David Richards, who runs the BAR racing team, has warned that he could move his operation abroad unless the Government act to end an anomaly in the anti-tobacco laws which penalises British-based Formula One teams.
Richards fears his team could lose millions of pounds in sponsorship, which could result in job cuts, under plans to ban cigarette advertising in Formula One from 31 July next year.
BAR, along with McLaren and Jordan, would be prevented from advertising tobacco at any race under the British legislation but foreign-based rivals, like Renault and Ferrari, could still carry cigarette sponsorship.
"Ferrari are the best-financed team in F1, they are based in Italy and have an American cigarette sponsor [Marlboro] and so they will be able to advertise in places like China," Richards said. "But because we are a British team we will be covered by the British legislation and so we would not be able to run tobacco advertising in China. It's a ludicrous situation.
"The UK government should not countenance it and it's down to them to do something about it. But I really do not know how this is going to work out. It could have serious consequences because it will effect our planned income stream for 2005. We would have to consider cutbacks in the team or look at other alternatives like moving the team abroad. You couldn't move the actual structure but you could move parts of the team abroad.
"The legislation was intended to protect British nationals against the excesses of tobacco advertising. It was not intended to have an impact of British F1 teams taking part in a race in China. I have spoken to the Department of Trade & Industry and they say this was not the intention when the legislation was drafted. It is the way it has been written which is so restrictive."
British American Tobacco have pumped at least £300m into BAR since the team was set up in 1998 and losing that sponsorship would be a considerable blow.
But teams would only move from Britain as a last alternative and it is unlikely to be a consideration for McLaren, whose new £250m headquarters at Woking is still being completed.
Teams had accepted that all tobacco advertising would be removed from F1 from the end of the 2006 season and negotiated contracts with their sponsors on that basis. But that agreement was undermined last year when the EU decided to bring in the ban in from 31 July next year.
Max Mosley, the president of the sport's world governing body, FIA, warned that decision could see teams decide to continue with tobacco sponsorship in a move which would threaten European races.
Undaunted by such background problems, Jenson Button fired up his 2004 BAR car in Barcelona yesterday and set his sights on a first appearance on a podium in the season's opening race in Australia.
The 24-year-old Briton is still searching for a top-three finish after 65 races but is confident that could happen in Melbourne on 7 March. "You always need a bit of luck to get the first podium but if we carry on working like we have been doing I think we could do it in the first race," said Button, who has finished fourth four times so far. "That would be fantastic, but if it doesn't happen so be it. There will be still be a long way to go this season."
Button has been handed the role of team leader in his second season at BAR after seeing off the former world champion Jacques Villenueve.
It was the Frome-born driver who unveiled the BAR-Honda 006 by guiding it out of the garage at the Circuit de Catalunya before completing a handful of demonstration laps. "I'm still not sure about the car, because I've only done a few laps in it. But it's very stable, which is the most important thing," Button added.
Richards is confident Button and his team-mate Takuma Sato, who competed in the final race of last season after Villeneuve withdrew, are the duo to continue the team's progress. "It is one of the youngest driver line-ups but an ambitious one, and I am sure their exuberance is going to move us forward," he said.