FIA may face conflict of interest with F1 takeover

The FIA may have set itself up for potentially massive conflict of interest due to the fact that it is itself a shareholder of the entity being acquired by Liberty Media Group.

In an article published on Forbes website, business journalist Chris Sylt reminded pundits that the new owner of Formula 1 will have to negotiate a major roadblock in the coming months before it is permanently handed its latest acquisition.

The deal officially announced this past week will require the approval of the FIA as well as the European Commission.

The problem stems from the fact that F1's governing body is a 1% shareholder in Delta Topco, the unit which owns Formula 1 and which is being acquired by John Malone's Liberty Media.

The FIA's stake, which cost an estimated $458,000, is now worth over $91 million! One therefore wonders how the FIA could objectively not approve Liberty's takeover of F1 given the massive financial windfall which will benefit the sport's regulator.

If the EC is indifferent to the FIA's stake in Delta Topco but not to the huge profits which will come the institution's way in the event the deal is completed, a formal investigation could be launched into F1's affairs and its commercial contracts with the teams.

Ultimately, Liberty Media Group's deal could face the risk of being scrapped.

No doubt the coming months will provide ample opportunity for clarification, but potential litigation opportunities will also remain for any party willing to denounce the FIA's potential conflict of interest.

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Phillip van Osten

Motor racing was a backdrop from the outset in Phillip van Osten's life. Born in Southern California, Phillip grew up with the sights and sounds of fast cars thanks to his father, Dick van Osten, an editor and writer for Auto Speed and Sport and Motor Trend. Phillip's passion for racing grew even more when his family moved to Europe and he became acquainted with the extraordinary world of Grand Prix racing. He was an early contributor to the monthly French F1i Magazine, often providing a historic or business perspective on Formula 1's affairs. In 2012, he co-authored along with fellow journalist Pierre Van Vliet the English-language adaptation of a limited edition book devoted to the great Belgian driver Jacky Ickx. He also authored "The American Legacy in Formula 1", a book which recounts the trials and tribulations of American drivers in Grand Prix racing. Phillip is also a commentator for Belgian broadcaster Be.TV for the US Indycar series.