Formula One’s ‘Unequal’ Revenue Split Needs EU Probe, Parr Says

The European Commission should examine terms Formula One has promised top-ranked teams Ferrari and Red Bull to see if the payments are anti-competitive, the former Williams team chairman Adam Parr said.

Parr quit Williams in March, a week after Sky News reported that Ferrari and Red Bull would get as much as $45 million each and a seat on the board to renew terms with the auto racing series through 2020. Parr had been responsible for negotiating terms for eighth-ranked Williams.

“There’s a strong case that an unequal division of power and money to a subset of teams is unlawful,” Parr said by telephone. He’s not convinced Formula One “is organized with the right principles of fair competition,” he added.

Parr, a former lawyer, first made such comments in a comic book called “The Art of War,” which was published Nov. 29 and is about his five years in Formula One.

He said he quit Williams because “rightly or wrongly” he felt that series Chief Executive Officer Bernie Ecclestone was withholding an offer of new terms to the nine-time champion while he was managing its affairs.

Most teams, including Williams and Mercedes, have since renewed agreements with managing shareholder CVC Capital Partners Ltd. Neither CVC nor Ecclestone has disclosed details of the terms since the Sky News report. CVC spokesman James Olley said in an e-mail today the private equity firm had no immediate response to Parr’s comments.

Competition Probe

Teams are unwilling to complain to the 27-nation European Union’s executive arm about preferential treatment because they are “highly dependent on goodwill” from the commercial rights holder, Parr said.

Parr declined to say if he discussed making a complaint with team founder Frank Williams, who has a controlling stake in the Grove, England-based unit. The Daily Telegraph reported on March 25 that Daimler AG’s Mercedes team was considering a complaint to the EU about unequal terms.

The European Commission closed a two-year investigation into Formula One in 2001 after the sport agreed to end anti-competitive practices such as restrictions on circuits hosting other series.

Seven of London-based Formula One’s 20 races this year were in the European Union. European Commission spokesman Antoine Colombani said he wasn’t aware of any existing complaint or investigation involving Formula One.

Red Bull’s Sebastian Vettel won the 2012 drivers’ championship in the Nov. 25 season-ending race in Sao Paulo, beating Fernando Alonso of Ferrari by three points. Red Bull won the constructors’ event, 60 points ahead of Ferrari.

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