Concorde Agreement Explained
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. On July 29, 2008, the ten participating teams created the Formula One Teams Association (FOTA) to negotiate the terms of the contract. After a dispute between FOTA and the FIA in the first half of 2009, Mosley and all the teams signed a new Concorde contract, although Sauber, who was the majority owner of BMW in transition, had announced shortly before his retirement from the sport at the end of the season, so was waiting for a control of the team to be returned to Peter Sauber before signing. The new agreement provides for the continuation of the terms of the 1998 agreement and will continue until 31 December 2012. At the same FIA World Motor Sport Council meeting, a resource limitation programme was also adopted, as well as a revised set of sports and technical rules for the 2010 season.  In 1995, the FIA decided to transfer the commercial rights of Formula 1 for 14 years from BAZL to the Formula 1 administration. 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). The challenges posed by the virus served as an additional reminder that something had to change, that is, as soon as the championship resumed, the trade agreement was also able to discuss. READ MORE: The cost cap for F1 2021 has said what has changed and why? A new trade agreement to reduce financial disparities between teams, to bridge competitive conditions and to close the performance gap is the next part of this process. The terms of the contract remain largely confidential, although the known provisions required the signatory teams to show up and show up at each race, guaranteeing their right to do so in order to assure the public of the newly acquired television of the sport that they would have a race to watch.