European Union may investigate Formula 1 business methods

European union flag

It has emerged that the European Union is monitoring the controversial new system of decision-making and business methods within Formula 1.

Earlier this month, we reported that Formula 1’s four smallest teams – Marussia, Caterham, Force India and Sauber – had written a letter complaining about the new and rule-influential Strategy Group.

The Group is made up of the grid’s powerful ‘big four’ teams. Williams, for historic reasons is the fifth member. It recently vetoed FIA president Jean Todt’s plans for a 2015 budget cap.

Force India deputy Bob Fernley told the Guardian that the big teams also receive the lion’s share of the commercial revenue distributed by Bernie Ecclestone.

“We have a situation where we have enriched and empowered five teams and disenfranchised six,” he said.

Germany’s Sport Bild suggested that the letter, described as “explosive” by one team insider, made clear the small teams’ belief that the Strategy Group could be contrary to European competition law.

Now,  London newspaper The Times claims that European Union officials, specifically the competition authority, are “monitoring” the situation.

“A full [EU] investigation would throw Formula 1 into turmoil, potentially wrecking agreements and finishing any prospect that the sport could be floated on the Singapore Stock Exchange”, correspondent Kevin Eason said.

Eason revealed that “two people close to the sport” have already been interviewed by European officials, who are “said to be showing concern”.

They are reportedly also concerned about the FIA’s current role, after a previous EU investigation ruled that the governing body not be involved in Formula 1’s commercial matters.

The Paris-based federation is yet to comment.

“We simply cannot run a sport like this,” said Fernley, who will be at a crucial meeting involving Todt and Ecclestone in London on Thursday. (GMM)

Subbed by AJN.