EU threat to F1 flotation

Commission voices concern over broadcasting contracts that exclude screening other car races

Racing supremo Bernie Ecclestone's bid to gain European Commission support for his planned flotation of Formula One Holdings seems set to backfire, amid concern that his Grand Prix contracts with broadcasters break EU competition rules.

Senior Commission officials said this week there were serious doubts over the legality of the web of agreements that FOH has with 60 television companies worldwide to broadcast Grand Prix racing - a key source of revenue for FOH. "The European Commission has a series of real questions and real worries," warned one.

The Commission has powers to force Mr Ecclestone to disband the agreements, some of which are for 10 years, if it believes they go contrary to article 85 of the EU's Treaty of Rome, which forbids anti-competitive contracts.

If the Commission did that, it would be a slap in the face for Mr Ecclestone, who voluntarily submitted the contracts to it last July for review to remove any doubts that could endanger the flotation. Any legal doubts surrounding the business of Formula One would deter investors from buying shares and diminish the value of the company.

The Commission is worried in particular about broadcasting agreements that give certain television companies a 33 per cent discount from the fees each pays if the broadcaster does not show any other car races. This, officials say, could discriminate unfairly against competitors.

Mr Ecclestone meanwhile remained confident that the Commission would give the FOH float a green light. "A lot of people don't want to ask (the Commission) because they think what they are doing might be illegal. We are quite sure we aren't breaking the law," Mr Ecclestone said. He added his lawyers were "in hourly contact" with Brussels and that he was reassured by what the Commission was telling him.

"They have been so good and so helpful I can't believe it. They have been really super. They know we want to get a flotation."

With regard to the Commission's concerns over discounts for broadcasters who give no coverage to competing motor races, Mr Ecclestone commented: "If you are a broadcaster and you broadcast Baywatch, you are not going to show a similar programme."

Mr Ecclestone said the flotation would go ahead once the Commission had reached a verdict. "The day the Commission says to us what you are doing is fantastic, we will immediately go to the market," he said.

The Commission has no time limits imposed on its investigation. It is currently waiting for interested third parties to submit their comments on the case.

Should the Commission and Mr Ecclestone clash, the motor racing supremo is unlikely to get help from the Government following the recent revelation that the Labour Party was seeking a second pounds 1m donation from him.

Start your day with The Independent, sign up for daily news emails
News
ebooksAn unforgettable anthology of contemporary reportage
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Recruitment Genius: Digital Optimisation Executive - Marketing

£30000 - £35000 per annum: Recruitment Genius: The UK's fastest growing, multi...

Recruitment Genius: Financial Reporting Manager

£70000 - £90000 per annum: Recruitment Genius: A Financial Reporting Manager i...

Recruitment Genius: Payments Operations Assistant

£23000 - £25000 per annum: Recruitment Genius: They win lots of awards for the...

Recruitment Genius: Telephone Debt Negotiator

£13500 - £20000 per annum: Recruitment Genius: This nationwide enforcement com...

Day In a Page

Syria civil war: Meet the military commander who says his soldiers will not rest until every inch of their war torn country is free of Islamist 'terrorists'

‘We won’t stop until Syria is back to normal’

Near the front lines with Islamist-controlled towns where Assad’s troops were besieged just last month, Robert Fisk meets a commander confidently preparing his soldiers for battle
Fifa corruption: Strip Qatar of the World Cup? Not likely

Strip Qatar of the World Cup? Not likely

But if a real smoking gun is found, that might change things, says Tom Peck
Twenty two years later Jurassic Park series faces questions over accuracy of the fictional dinosaurs in it

Tyrannosaurus wrecked?

Twenty two years on, Jurassic Park faces questions over accuracy
The inside story of how Bill Clinton built a $2bn global foundation may undermine Hillary's chances

The inside story of how Bill Clinton built a $2bn global foundation...

... and how it may undermine Hillary's chances in 2016
Genes greatly influence when and how many babies a woman will have, study finds

Mother’s genes play key role in decision to start a family

Study's findings suggest that human fertility is still evolving
12 best olive oils

Extra-virgin, cold-press, early-harvest, ultra-premium: 12 best olive oils

Choosing an olive oil is a surprising minefield. Save yourself the hassle with our handy guide
Rafa Benitez Real Madrid unveiling: New manager full of emotion at Bernabeu homecoming

Benitez full of emotion at Bernabeu homecoming

There were tears in the former Liverpool manager’s eyes as he was unveiled as Real Madrid coach. But the Spaniard knows he must make tough decisions if he is to succeed
England can win the Ashes – and Elvis Presley will present the urn

England can win the Ashes – and Elvis will present the urn

In their last five Test, they have lost two and drawn two and defeated an India side last summer who thought that turning up was competing, says Stephen Brenkley
Sepp Blatter resignation: The beginning of Fifa's long road to reform?

Does Blatter's departure mean Fifa will automatically clean up its act?

Don't bet on it, says Tom Peck
Charles Kennedy: The baby of the House who grew into a Lib Dem giant

The baby of the House who grew into a Lib Dem giant

Charles Kennedy was consistently a man of the centre-left, dedicated to social justice, but was also a champion of liberty and an opponent of the nanny-state, says Baroness Williams
Syria civil war: The harrowing testament of a five-year-old victim of this endless conflict

The harrowing testament of a five-year-old victim of Syria's endless civil war

Sahar Qanbar lost her mother and brother as civilians and government soldiers fought side by side after being surrounded by brutal Islamist fighters. Robert Fisk visited her
The future of songwriting: How streaming is changing everything we know about making music

The future of songwriting

How streaming is changing everything we know about making music
William Shemin and Henry Johnson: Jewish and black soldiers receive World War I Medal of Honor amid claims of discrimination

Recognition at long last

Jewish and black soldiers who fought in WWI finally receive medals after claims of discrimination
Beating obesity: The new pacemaker which helps over-eaters

Beating obesity

The new pacemaker which helps over-eaters
9 best women's festival waterproofs

Ready for rain: 9 best women's festival waterproofs

These are the macs to keep your denim dry and your hair frizz-free(ish)