Margrethe Vestager, the European Commissioner for Competition, has informed British MEP Anneliese Dodds that the Commission will not be investigating the sale of Formula One, which was completed in January, any further. There have been concerted attempts, condemned by the FIA as being “inaccurately informed or made maliciously” to try to disrupt the process, which Vestager was obviously keen to put a stop to it.
The Commissioner has ruled out their ability to investigate/authorise the transfer of ownership, she has not ruled out an investigation into the sport. The complaints submitted by the two F1 teams are still in play.
“In a response to a letter from me, the European Commission have clarified their inability to rule on the takeover of Formula One by Liberty Media,” Dodds said. “Nonetheless, there are still serious questions to be answered about the unfair allocation of prize money in the sport. The current system severely disadvantages the smallest teams and gives a lion’s share of the money to the biggest teams regardless of where they finish on the grid. I will continue to raise my competition concerns with the European Commission and keep pushing for a full follow-up of the complaints submitted to the Commission by Sauber and Force India. We have seen three instances of teams in my constituency struggling due to what they see as unfair competition in the Sport, with Manor Racing the latest team to fold. If we do not act now, more may follow. This could have a very worrying impact on highly-skilled engineering jobs in my constituency and in the Midlands.”
This problem will likely be sorted out by Liberty Media, as it changes the way things are done in Formula 1.
Dodds says that the European Commission is investigating the tax ruling which appears to have been agreed between HM Revenue and Customs and Formula One’s former owners.
“Any sweetheart deal that reduces the tax burden of only one company is state aid and must be taken seriously,” she says. “If such a deal breaks competition rules, I expect any unpaid tax to be duly collected by the British Government.”
If this were to happen, the money owed would presumably be owed by the previous owners and not the new ones. It is also not perhaps the best thing to do for Britain because if there is no tax deal on offer, the Formula One group could easily relocate to offshore locations, which would cost Britain jobs.