The fight for F1's governance

Sunday's Japanese Grand Prix was extremely significant, not so much for Fernando Alonso's self-inflicted retirement or Sebastian Vettel's domination - nor even that the reigning champion eased to the first back-to-back victory of the season, or the unusually sunny Suzuka weather.

What made the day remarkable occurred precisely six hours before the start of the race - to wit at 0900 in the Lotus hospitality building, which hosted a FOTA-convened meeting in full view of the paddock.

Usually such gatherings are clandestine affairs, more often than not held at secret venues. On this occasion, though, no attempt was made to hide what was going on.

Equally significant was the fact that 10 team bosses were present, with Ferrari's Stefano Domenicali sitting to the immediate right of FOTA chairman Martin Whitmarsh, despite:

a) FOTA currently having just seven paid-up members, and;

b) Ferrari being one of three non-member teams (the others are Sauber and HRT). Thus, the only two squads not present at the hour-long summit - nor indeed invited - were the Red Bullers, namely Red Bull Racing and Toro Rosso.

As disclosed here, RBR team boss Christian Horner shrugged off not being invited, telling Grapevine: "You've got FOTA that doesn't consist of some teams but does consist of others. I have no idea what the topic of discussion was; they obviously feel that it doesn't apply to Red Bull," when questioned about his team's absence.

Team principals leave the Suzuka meeting © LAT

However, the ex-F3000 racer thereafter expanded on his team's position in an exclusive interview, providing ample food for thought for next week's column.

Although the meeting's (lengthy) agenda was compiled by FOTA's secretary-general Oliver Weingarten, the group was keen to stress that the gathering was not a FOTA session, but rather a meeting of teams with common concerns.

However, such was the focus on the main points, namely governance of the sport, that those present failed to progress beyond this single item.

Thus the 2014 engine situation, concerns over Austin's facilities ahead of the US Grand Prix, the Resource Restriction Agreement, massive increases in proposed entry fees and inclusion of 'listed' parts in the regulations - the last-named holding major implications for customer cars - were not addressed due to time constraints.

"But, we didn't need to [discuss those points]: in a nutshell the main issue is [change of] governance - fix that, and we fix everything else, whether the structure of the F1 Commission, the Working Groups, entry fees, RRA, listed parts or whatever," said one source.

Another concurred, then added: "It was about governance, governance, governance; of maintaining the integrity of the Concorde Agreement..."

Although the governance issues were previously analysed in detail here, said team bosses believe the FIA's World Motorsport Council meeting on September 28 in Paris failed to address their concerns; that, if anything, too many matters remain unresolved for too long.

Confusion still exists over the entry window, entry fees, (re)structure of the Formula 1 Commission, purpose of the proposed (and much amended) 18-head 'Steering Committee' and the future (if any) of the two sub-committees, namely the Technical and Sporting Working Groups. And, that's just for starters...

Plus, pointed out our sources, the current Concorde Agreement - the document that outlines the tripartite obligations of governing body, commercial rights holder and teams individually and collectively - has just 10 weeks to run before expiry. And while commercial terms have been agreed by the CRH with 10 of the dozen teams, two, namely Marussia and HRT, remain out in the cold despite the former currently lying 10th in the constructors' championship, ahead of Caterham, which was made (and accepted) an offer.

There also exists much concern about the recent posting of financial results by Red Bull Racing (and Red Bull Technology, effectively an in-house supplier to the main team, plus Toro Rosso where permitted).

Christian Horner © XPB

While Horner, a self-confessed opponent of the current cost structure of the sport, remains adamant that his operation complies fully with the terms and conditions of the so-called 'Singapore' Resource Restriction Agreement, team bosses point to the fact that Red Bull Racing's 2011 turnover rose 10 per cent over the previous year (£176 million versus £159m) - despite an agreed expenditure glide path being in place...

This is not their only concern about RBR, which entered the sport in 2005 and has contested 141 races, scoring two constructors' championships. The team agreed preferential commercial terms with Bernie Ecclestone (and a seat on the board should the planned flotation come to fruition) despite its brief existence, so a certain amount of bitterness exists in the paddock.

By way of comparison, Ferrari (est 1950/846 races/16 constructors' titles) draws on more than 60 years of continued presence in the sport, yet the hallowed Italian team has effectively been treated as RBR's equal - while the likes of McLaren (1966/718/8) and Williams (1978/587/9) have been downgraded to tertiary status. Lotus, which has no continuous history to speak of, is in the semi-desert...

Concern was also expressed that Red Bull had cut a preferential Formula 1 deal with Ecclestone, while a related company, Red Bull Media House, was in advanced negotiations to acquire the commercial rights to the World Rally Championship - as announced by the FIA immediately after the late-September WMSC meeting.

"They now have a foot in each of the FIA's two biggest championships" said a team boss in Japan, "so I shudder to think what will happen when Dietrich [Mateschitz, Red Bull founder] tires of motorsport and pulls the plug."

Where once Ferrari was, fairly or not, the paddock whipping boy, Red Bull has displaced the red team...

As first disclosed here, Ecclestone and Jean Todt intended scrapping the F1 Commission plus TWG and SWG (certainly in their present forms), and replacing the three bodies with an 18-man Commission made up of three groups of a half-dozen members each, representing governing body, CRH and six chosen teams, the so-called CCB outfits: Red Bull Racing, Ferrari, McLaren, Mercedes, Williams and a rotating seat, thought to be allocated to Lotus. See also here.

Whereas the teams, when taken together with sponsor, technical partner and their nominated circuit votes, effectively have a 70 per cent shout under the current structure, their voice could be as low as 33.3 per cent under the 18-man proposal - while such as Sauber, Force India and Toro Rosso are effectively sidelined. Although, of course, the last-named could benefit from the protection afforded by RBR.

Any wonder there exists massive dissent in the ranks, and not only among three of said four?

Jean Todt © LAT

"When they [FIA/FOM] realised there was strong pushback against the new [governance] structure, they proposed keeping the Formula 1 Commission and Working Groups to save an element of face, but slotting the 18-man group in as a sort of 'Steering Committee' between them to mandate the Working Groups to examine issues and pass them upwards to the F1 Commission," advised our source in Korea.

"[But] the problem is that the F1 Commission can only approve or reject, it can't amend, so the entire process just gets longer and more convoluted. Yes, the F1 Commission as it stands is unwieldy and does not always address all issues, but [the proposal] is not the solution to the problem..."

The entry fee issue has further fuelled discontent, for although the teams realise the FIA requires funding of up to £30m a year, they stand to be hit by entry fee increases of up to 1000 per cent, while drivers also face massive hikes in Superlicence fees.

There are those who suggest that entry fees should be viewed as nothing other than tax on performance - much as governments tax profits - imposed by the governing body. But that conveniently overlooks the fact that governments that hike taxes by 1000 per cent overnight while their cohorts revel in untold riches face revolt...

Then there's the Schedule 3 issue, namely the effective incorporation of 'listed parts' - those which define a constructor, thus making teams eligible for their shares of F1's multi-billion-dollar revenues - in the 2013 Technical Regulations, with Art 2.2 having been amended as follows:

Changes to these regulations may only be made in accordance with the provisions of the Code The 2009 Concorde Agreement.

Code? What Code?

Where previously regulations could only be amended in terms of Concorde - which specifies that Working Groups approve any changes by 70 per cent majority team vote (100 per cent after June 30 for the following season), then be approved by the F1 Commission by an equal percentage before being escalated to the WMSC for ratification - that single underscored word replacing four struck-out terms holds the potential to totally change the face of F1, with the teams conceivably being powerless to prevent, for example, customer cars being introduced via the backdoor! The 'Code'...

Thus discontent within the paddock runs deep. True, the depth doesn't plumb the lows which prevailed in 2009, the previous Concorde Agreement having expired almost two years before its successor was agreed - and only after then-FIA president Max Mosley agreed to not stand for another term in office - but at that point the teams fought long and hard for a change in governance which provided them with a strong voice.

However, should the change in governance come to pass, they stand to lose their collective power.

Martin Whitmarsh © LAT

Todt has called a meeting of Ecclestone and all team bosses for October 23 in Paris in an attempt to defuse the discontent and find a speedy resolution ahead of signing the (much revised) 2013-2020 Concorde Agreement, as mandated last month by the WMSC.

But the teams are concerned the sheer number of issues - plus, of course, their complexity - will overwhelm the meeting on the day, and thus FOTA chairman Whitmarsh and Ferrari boss Domenicali were charged to meet with Todt ahead of October 23 with a view to tabling their concerns about the direction the sport is taking, and outline possible compromises.

Their hope is that Todt will heed what is the strongest opposition to the proposals yet, with more than 80 per cent of teams being dead-set against the new structure.

Does it mean FOTA as a universal voice for the teams is back? Most certainly not. By the same token, though, a 10-team FOTA is not beyond the bounds of possibility - now that most have cut their own commercial deals with Ecclestone...