The Formula One Teams' Association (FOTA) will officially call off its plans for a rival championship tomorrow after reaching a breakthrough deal with the FIA.
Following last-ditch talks between FIA president Max Mosley, FOTA chairman Luca di Montezemolo and F1 supremo Bernie Ecclestone, an agreement was reached that commits the teams to the sport until 2012.
FOTA members had been set to press ahead with breakaway plans in the meeting in Bologna tomorrow, but following its victory in getting the FIA and Ecclestone to agree to terms that keeps its eight members in F1, it will now rubber stamp final cost-cutting regulations for 2010 and call off its breakaway instead.
The deal between the FIA and FOTA was confirmed on Wednesday afternoon, when the FIA announced that its planned budget cap for 2010 had been scrapped, and instead FOTA-proposed cost-cutting regulations will be introduced.
In a bid to help new teams, technical assistance will be offered to Campos Meta, Manor Grand Prix and Team US F1 by major outfits.
The FIA statement said: "As part of this agreement, the teams will, within two years, reduce the costs of competing in the championship to the level of the early 1990s.
"The manufacturer teams have agreed to assist the new entries for 2010 by providing technical assistance."
As part of the deal with FOTA, the teams' association has agreed to recognise the FIA's position as the sport's governing body, adding that a new Concorde Agreement has been agreed in principle to keep all of the teams in F1 to 2012 and, upon re-negotiation, it is hoped beyond.
"The manufacturer teams have further agreed to the permanent and continuing role of the FIA as the sport's governing body," added the statement. "They have also committed to the commercial arrangements for the FIA Formula 1 World Championship until 2012 and have agreed to renegotiate and extend this contract before the end of that period.
"All teams will adhere to an upgraded version of the governance provisions of the 1998 Concorde Agreement."
Furthermore, with it clear that FOTA is not trying to usurp the FIA's authority, FIA president Max Mosley has agreed to not stand for re-election in October.