Ecclestone setback in battle for Formula One

Click to follow
The Independent Online

The reign of Bernie Ecclestone as the most powerful man in Formula One could be coming to an end after he lost the first skirmish in the battle with the banks who own 75 per cent of the company that owns the commercial rights to motor racing's elite event.

The reign of Bernie Ecclestone as the most powerful man in Formula One could be coming to an end after he lost the first skirmish in the battle with the banks who own 75 per cent of the company that owns the commercial rights to motor racing's elite event.

An appeal court judge in London yesterday dismissed an appeal on behalf of Ecclestone's Formula One Holdings Ltd and Bambino Holdings Ltd for a dispute with the banks to be heard under Swiss law rather than British.

Leave to appeal was refused, and the main case is now scheduled to be heard in London later this month.

Lord Justice Carnwath upheld a decision that the case should be heard in Britain and stated that the alternative, to wait for a ruling in a Geneva court, would serve "no purpose but to increase delay and expense".

Although the judgment concerned the narrow issue of jurisdiction, the underlying dispute has major implications for the sport. "The overall dispute concerns the control and future of Formula One racing," the judge declared.

Ultimate victory for the banks would weaken Ecclestone's decades-long grip on the sport which has made him fabulously wealthy. The case is being closely watched by major carmakers who have threatened to set up their own rival series from 2008.

The banks - Bayerische Landesbank, JP Morgan and Lehman Brothers - control 75 percent of the SLEC holding company that owns the commercial rights to Formula One. The other 25 per cent is owned by Bambino Holdings, an Ecclestone family trust.

SLEC also owns FOH, but the banks are contesting the appointment of that company's directors, arguing that although they own the majority of the shares they do not have control because of the board's composition. The banks acquired their stake in Formula One after Germany's Kirch media empire collapsed, owing them $1.6bn (£864m).

Jordan, who are fighting for survival after engine supplier Ford pulled out, will enter next season's Formula One championship. "We haven't submitted it [the entry] yet, but we will definitely do so before Monday's deadline," said a team spokeswoman.

Jordan are close to finalising an engine deal with Toyota and have also been talking to a potential Chinese backer.

Struggling Minardi have already submitted their entry and Jordan's confirmation would leave just Ford-owned Jaguar in doubt. That team has been up for sale since September, with Austria's Red Bull energy drink magnate, Dietrich Mateschitz, in negotiations .

If only nine teams sign up on Monday then some will be obliged to run three cars in grandes prix to make up the numbers.

Comments