Over the past two months F1 has raced into a storm over grants paid by its governing body, the FIA, to motor sport organisations in oppressive countries such as Syria, Sudan and Zimbabwe. The payments were recently reported to the Treasury department and, according to a report in the Express by Christian Sylt, it is "engaging with relevant government agencies" to see if they breached financial sanctions.
As Pitpass has reported, over the past three years the FIA has given grants to the Syrian Automobile Club which arranges races that are sponsored by president Assad's government and are used as propaganda by his tourism minister who is subject to European Union sanctions.
It has come to the attention of the British government as the FIA established the grant programme with funds from a contract it signed with F1's UK-registered operating company. This fuelled calls from human rights group Waging Peace for a government investigation and it wrote to Damian Collins, chairman of the Culture, Media & Sport select committee. He recently referred the matter to the Treasury as it investigates suspected breaches through its Office for Financial Sanctions Implementation (OFSI).
As the following shows, last week Lord Bates, the UK's international development minister, confirmed that "information relating to this matter has been received by HM Treasury via its Office of Financial Sanctions Implementation (OFSI). OFSI are engaging with relevant government agencies as appropriate to ensure the information is properly considered."
There is no evidence the organisations which receive the grants are owned by the governments. Likewise, the legitimacy of the projects or the application process has not been called into question. F1, the teams and drivers play no part in awarding the grants and FIA documents detail the requirements that applicants have to meet.
However, the letter from Waging Peace pointed out that oppressive regimes can use the racing, which is funded by the grants. for promotion as the "government will have a huge stake in the success of motor sport there as a way of signalling it is ‘open for business'". The example of Syria alone proves this point and it has continued to receive grants despite it being public knowledge that the racing they fund is being used as propaganda by the Assad regime.
An FIA spokesperson said: "We are entirely confident that any investigation would find that the FIA has acted appropriately at all times, and we stand ready and willing to cooperate with any enquiries from the appropriate authorities, although no such requests have been received."
Interestingly, the consultancy firm Deloitte found room for improvement in this area after the FIA called it in last year. Deloitte filed a report which made a number of recommendations including "strengthening of the monitoring of the use of grants awarded by the FIA." This is revealed in documents from the FIA though it refuses to release the report itself. The FIA spokesperson says that actually Deloitte "fully endorsed the functioning of the existing grants programme, while recommending minor process improvements."
A spokesperson for F1 added "It is not within our remit to influence or determine how the FIA promotes, develops and regulates motor sport, nor how its funds are applied. We are satisfied that we are in full compliance with applicable sanctions."
Time will tell what the Treasury thinks.