Explained: The $20 billion F1 vs FIA bust-up
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A report by Bloomberg emerged last week revealing that Liberty Media, the owners of F1, rejected a bid worth $20bn (£16bn) to take over the sport.The news was met by a series of tweets from FIA president Mohammed Ben Sulayem, who expressed his concerns about the hefty price tag on F1.Michael Schumacher vs Lewis Hamilton: The never-ending debate?Video of Michael Schumacher vs Lewis Hamilton: The never-ending debate?On Tuesday afternoon, a number of publications reported that F1 has sent a “legal warning” to the FIA body for Ben Sulayem’s comments over the potential sale of F1.The perceived conflict between F1 and the FIA is nothing new.Earlier this month, FIA appeared to welcome Andretti’s potential entry with Cadillac, however, F1 gave a very lukewarm response.FIA hit back at “adverse reaction” to Andretti’s F1 entryWhat is the FIA?The FIA or Fédération Internationale de l’Automobile, is the world’s governing body for motorsport, like FIFA with football.The FIA oversees all aspects of motorsport from regulating it, issuing licences and permits to drivers and teams; structuring safety regulations, and promoting awareness and education about the sport.In terms of F1, the FIA ensures all teams are adhering to the technical and sporting regulations while regulating safety standards.Related “A crisis” – Veteran F1 steward criticises FIA for alternating race directors “People have cried” – Hamilton recalls “hardest year” for Mercedes What do Liberty Media own?The FIA is one party, but the other is FOM – Formula One Management, which is part of the Formula One Group.FOM is owned by Liberty Media, who completed their takeover of the sport in 2017.It was previously run by Bernie Ecclestone for 40 years before Liberty Media’s acquisition. While the FIA are F1’s governing body, FOM own the commercial rights to F1. The two parties are required to work hand in hand to make decisions about the sport.The Saudi bidWith F1 enjoying a remarkable bloom in recent years, the sport is going to be increasingly attractive to wealthy parties.The Middle East has had a growing influence in F1 and sport in general – the new Saudi and Qatar F1 grands prix or Qatar World Cup. A Saudi Arabian football club has recently signed Cristiano Ronaldo – one of the greatest football players of all time – on ridiculous money, while the Kingdom hopes to host the FIFA World Cup in the next decade.So it’s probably no surprise to see reports that Saudi Arabia were interested in F1.Liberty Media bought F1’s commercial rights for $4.4bn so they’d be set to make a very tidy profit should they wish to sell.Why is the FIA angry?Ben Sulayem has made a habit of taking to Twitter to voice his opinion in recent weeks, catching the attention of fans and various media outlets.He will have the FIA’s interests at heart – whether that’s ensuring the governing body is involved and has a say in F1’s next buyer or ensuring that it benefits financially, even though Ben Sulayem was quick to point out that it is a “non-profit organisation”.History of conflictPrior to the signing of the 2009 Concorde Agreement – a contract between the FIA, teams and FOM – there were a series of political clashes over the proposed changes for the 2010 campaign.It started when former FIA president Max Mosley pushed for a $30 million budget cap for 2010 in response to the global recession.Seven of the 10 teams objected to the plans through FOTA – the Formula One Teams’ Association – and even threatened to make a breakaway series.”4After months of meetings and negotiations, a new agreement was finally reached led by Ecclestone which ensured F1’s future was preserved.While there’s no hint of anything similar happening in the future, the continual conflict between the FIA and F1/the teams should keep everyone on their toes.
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