What Is The Formula 1 Concorde Agreement

The agreement is, among other things, a trade document that defines how television revenues and Formula 1 prices will be distributed – and which are expected to expire at the end of the year. Yet Ferrari remains politically ahead. Although a cynic can say that Ferrari`s off-track victories these days are a shadow of what they were before, since other teams can legitimately claim to be the winners. Teams that once received additional payments will still receive them, but this proportion will be reduced and will go to the other teams – not that one of the parties will discuss the exact allocation; Some were not at all willing to talk about the agreement. Liberty Media expressed its desire for a more uniform distribution of funds from the moment they took over the sport, and they delivered on that front with the first Concorde they negotiated. “We are pleased to have reached an agreement between the 10 teams by August on plans for the long-term future of our sport,” said Chase Carey, F1 CEO. “All our fans want more races, bike action and every team has a chance to get stormed on the podium. On January 19, 2005, Ferrari announced that it had signed an extension of the previous contract, which expires on December 31, 2012. [4] On July 18, 2005, Red Bull also signed an extension[5] and Jordan/Midland two days later. [6] On December 7, 2005, Williams was the fourth team to sign a contract extension. [7] In 1995, the FIA decided to transfer the commercial rights from Formula 1 to the Formula 1 administration for 14 years.

In exchange, Ecclestone would make an annual payment. McLaren, Williams and Tyrrell protested by rejecting the proposed Concorde Agreement (negotiations for which it began in 1993). Ken Tyrrell, in particular, was outraged that Ecclestone, as president of OFZL, negotiated the transfer of the organization`s rights to his own company. Tyrrell also objected to the agreement`s endorsement being kept secret and argued that the secrecy of the agreement would only benefit Ecclestone (by weakening the bargaining power of the other parties). At the moment, you don`t make money with a Formula 1 team. And realistically, you`ll never do it. Teams usually spend what they earn because it should give them performance, and they are in the sport to deliver on the right track. Although there are obvious commercial considerations for owning an F1 team, these considerations are reinforced only by a more competitive car. The agreements promote professionalism and increase the commercial success of Formula 1. The most important factor in achieving this was the requirement for teams to participate in each race, making the sport more reliable for channels that should invest heavily in acquiring television broadcasting rights. In return, a percentage of the sport`s commercial revenues were guaranteed to the teams.

So when F1 sources confirmed that the first registration period of August 12 had been postponed by six days, there was a bit of doubt that was starting to sneak into what was going to happen.