F1 | Sao Paulo GP suspended by judge after legal challenge
Despite having a 5-year deal for the Sao Paulo GP, a judge has intervened and temporarily suspended the contract for the race scheduled on November 7th.
Even before the 2021 F1 season has started, Formula One Management (FOM) already announced changes to the 23-race calendar on Tuesday. Now though, despite having a 5-year deal for the Brazilian Grand Prix to remain at its traditional Interlagos circuit in Sao Paulo, a judge has intervened and temporarily suspended the contract for the race scheduled on November 7th.
The Brazilian Grand Prix already featured heavily in the news last year following the announcement of plans to move to a new circuit in Rio de Janeiro. The proposal was met with concern from seven-time F1 champion Lewis Hamilton voicing environmental worries over the deforestation required for the venue. Therefore, when the 5-year deal was announced last December it looked as though Interlagos would remain as the venue for many years to come.
“It is a great joy to be able to announce that Interlagos will continue to host one of the most important events in world motorsports. We made a tremendous effort to keep the race in our city,” Sao Paulo mayor Bruno Covas said at the time.
This news, last year, came after the Brazilian Grand Prix had to find itself a new promoter. The previous deal, which had been agreed with F1 Supremo Bernie Ecclestone, required F1 to receive no fee from the organisers to hold the race. These terms and conditions ran out in 2020 and the organisers of the Brazilian GP are now required to pay a fee to F1 to host such a prestigious event. So, where would the money come from?
Brasil Motorsport, a company owned by investment entities controlled by Mubadala, which is a global investment company from Abu Dhabi, claimed the contract.
However, motorsport.com has reported that there has been a legal challenge over the way public funds were used to secure the Brazilian Grand Prix. Also, there is a question as to the level of transparency surrounding the deal between F1 and such a newly-formed company.
Brasil Motorsport is headed by former Olympic sailing competitor Alan Adler and has a record of advertising NBA pre-season games, PGA tournaments and music concerts. However, nothing on the company’s roster shows a pedigree of motorsport – which is just one of the reasons it is receiving a renewed focus.
The legal action has been supported by local councillor and lawyer Rubens Nunes, who wrote on Twitter: "F1 is important for Sao Paulo and for Brazil - I'm a fan - but that does not authorise the city to enter into contracts without a bid, under secrecy and with a company without 'expertise' in the area, created a few days ago for this."
The news announced on motorsport.com states:
The true nature of the Sao Paulo financial support has subsequently become clear in legal documents that reveal how much the city is paying, namely 20m Reals – the equivalent of US$3.65m – per year over the five years of the deal.
The organisers had probably hoped that by changing the name of the Grand Prix from ‘Brazilian Grand Prix’ to ‘Sao Paulo GP’ it would demonstrate the support from the city. However, the public believed that they were only contributing to renovating the Interlagos venue. Obviously, with the city in fact paying the equivalent of US$3.65m per year for the length of the new contract, questions have arisen.
When the 5-year contract was announced, Bruno Covas, the mayor of Sao Paulo said:
“We believe that hosting the Grand Prix, in addition to promoting our city to the world, will continue to bring important contributions such as job creation and income generation. We have seen studies that show that for every R$1 invested in the São Paulo GP, R$5.20 is generated for the local economy.”
However, following the revelation this week of the new financial information, irrespective of what the Grand Prix may bring to the city - a public petition has challenged the running of it. As such, the contract has been suspended by Judge Emilio Migliano Neto, pending further investigation.
"The facts reveal without a doubt, at least at this stage, that the principles of publicity and transparency are being violated in an explicit manner," the judge noted.
"For this reason also [absence of bidding], there is a need to suspend the execution of the contract, to assess whether there were effectively resources to cover the expenses detailed in the signed agreement."
The Sao Paulo authorities now have five days in which to submit relevant documents to enable the Sao Paulo Grand Prix contract to be back on track.
Meanwhile, the organisers who had hoped to move the race in Brazil from Sao Paulo to Rio de Janeiro in the future will now no doubt me met with renewed confidence.
The race which had been planned in Rio for 2021 already enjoyed support from Brazilian president Jair Bolsonaro but would have required the deforestation within the Camboata Forest at the Deodoro military base.
However, if Sao Paulo cannot fulfil the long term contract to run the Sao Paulo GP, as a result of the love the nation of Brazil has for Formula One - Rio de Janeiro may find itself in the conversation sooner than it had expected.
One thing is for sure, there are a big 5 days ahead for the Sao Paulo authorities and it looks like this story has only just begun.
Meanhwile, it is not just the Brazilian Grand Prix which has encountered issues:
