A financial problem or a political one?

MARCH 24, 1997

A financial problem or a political one?

THE tiresome squabbling over the 1997-2001 Concorde Agreement continues to grind on with Williams and McLaren now threatening legal action unless the teams which are signatories to the agreement allow them to sign up on equal terms.

At the moment Arrows, Benetton, Ferrari, Jordan, Minardi, Prost and Sauber are the only teams which are signatories to the agreement - which is a three-way contract between the teams, the FIA and Bernie Ecclestone (the FIA "Commercial Rights Holder").

Stewart and Lola were not around when the agreement was drawn up, while Williams, McLaren and Tyrrell declined to sign, reckoning that the they should be given more money.

The three rebel teams quickly realized that they had made a bad tactical error when the other teams, Ecclestone and the FIA pushed ahead without them, leaving them outside the Agreement. The three teams receive the same prize money as the signatories plus allowances for their previous results in F1.

They do not, however, get a slice of the TV income, which is estimated to be worth as much as $15m a year to the signatory teams. The would seem to value the TV income at around $105m a year, although the rebels reckon that the actual income is much higher and that Ecclestone and the FIA are keeping more than they should.

Realizing that they were in an impossible position Williams and Dennis tried to negotiate a way back into the Agreement but the signatory teams - which will each lose money if they allow others to join the agreement - refused to offer a deal with equal shares. Williams and Dennis have, therefore, decided to threaten the teams with legal action, giving them a deadline of Wednesday (March 26).

Ecclestone and Mosley have let it be known that they want the problem to be solved as quickly and quietly as possible but it seems that two or more signatory teams do not want to let the rebels sign up.

While the teams will lose money if the TV income has to be divided between 10 teams rather than the current seven teams, it may not be purely a question of money. Allowing the three rebel teams to join the agreement would - in theory - change the membership of the FIA F1 Commission (the body which makes all the important decisions about Grand Prix racing).

According to the 1997-2001 Concorde Agreement six teams are represented on this body: the top five signatory teams in the previous Constructors' World Championship, plus the team which has competed in the most F1 World Championships (Ferrari). At the moment Ferrari, Benetton, Jordan, Prost, Sauber and Arrows are represented on the Commission, if Williams, McLaren and Tyrrell are allowed to sign up Sauber and Arrows will lose their political voice.

This they do not want to happen and there may be other teams which are not keen for Williams and McLaren to get back their seats on the Commission because in the past McLaren's Ron Dennis has proved to be something of an obstacle in pushing through change.

Under the new rules of the 1997-2001 Concorde Agreement unanimous agreement for change is no longer essential, 80% agreement now being sufficient. If there are 10 signatory teams, it will take three of them to disagree with a change to stop it happening.

For now, however, there are only seven signatories which means that six of them must agree if a change is to be made - this includes allowing new teams to sign the Agreement. With more than one team opposed to allowing the three rebel teams to join, the negotiations are blocked.

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