Full speed ahead for Formula One anti-trust probe

Date: 12/03/1998

By Peter Chapman

THE European Commission's anti-trust probe into Formula One motor racing is expected to move into top gear now that the industry has replied to competition chief Karel van Miert's December request for information.

EU sources said this week that the Commission was likely to launch a full investigation very quickly unless the racing industry offered significant concessions to meet its concerns.

The targets of the Commission's probe are Formula One's Paris-based ruling body, the International Automobile Federation (FIA) and Bernie Ecclestone's Formula One Administration (FOA), whose deal with the FIA gives it exclusive commercial and television rights to events for 14 years.

A spokesman for Van Miert said that the Commission was still waiting for one last reply from Ecclestone's International Sportsworld Communicators, which handles his non-Formula One interests, before deciding what action to take.

But Ecclestone told European Voice this week that the company had replied to the Commission, filling in the missing link in the anti-trust probe.

All sides involved in the investigation remain tight-lipped over the contents of the communications, but sources suggest that the next step is likely to be a formal Commission 'statement of objections' giving details of its concerns over the deal between Ecclestone and the Formula One race organisers.

“Sending a statement of objections to the parties could happen very quickly, possibly within a month of receiving the replies,” said one competition source.

The FIA and Ecclestone - who cannot press ahead with plans to float the FOA on the stock market until the issue is resolved - would then have the opportunity to appeal both in writing and in person against any preliminary ruling.

“Of course the parties could modify their agreement, but assuming they do not it is difficult to see a formal decision before six months from now,” added the source.

Ecclestone described his firm's responses as “confidential”, refusing to say whether they would make concessions to the Commission. However, the signs are that Formula One will have a tough task persuading Van Miert that its house is in order.

When he announced the probe, the Commissioner described the organisation of the sport as “layer upon layer of exclusive deals amounting to cartel behaviour, added to abuse of a dominant position for the benefit of one company”.

These alleged abuses include a ban on owners of racetracks organising events not sanctioned by the FIA and obliging television companies who want to broadcast the US-based IndyCar races to pay more for televising Formula One.