Defiant Mosley drops hints to membership

Max Mosley

To all FIA Club Presidents
16 May 2008
Dear President,

Having asked the Senate to call an Extraordinary General Assembly on 3 June, I feel I owe you a letter of explanation.

Firstly, I should like to say that I am very sorry that publication of details of my private life, which I have always intended should remain entirely private, has caused so much trouble and embarrassment. Despite a press campaign against me, I gave only one interview myself. This was to the UK Sunday Telegraph four weeks ago. We could send you a copy with translations if you wish.

The question of resignation

Following recent press publicity, I received spontaneous and entirely unsolicited letters from FIA member clubs representing a total of 85 of our votes. Of these, representatives of 13 votes suggested I should consider resigning. However, representatives of the remaining 62 all urged me to stay. A number of informal communications from clubs which had not written indicated a still greater majority in support. Given this majority, it would clearly have been wrong to ignore the views expressed and step down with no further discussion. At the very least, I felt bound to ask the membership of the FIA as a whole to express a view. This is why I asked the Senate to call an Extraordinary General Assembly.

Furthermore, were I to resign before my mandate ends in 2009, an election for a new president would have to be held within two to four months (FIA Statutes Art 12.1). Candidates for the job would stand on their own.

Literally anyone could stand and there would be no list to stabilize the process and ensure that each candidate had the support of a real cross-section of FIA member clubs.

During the two to four month election period, the complex negotiations which are mentioned below would necessarily slow or even cease. A new president would then take over with no knowledge of the background and, worse, might perhaps have been elected with the support of the very people with whom we are negotiating.

The negotiations

In addition to the obvious need to seek the views of those who elected me, I believe that unless invited to do so by the clear majority of FIA member clubs, it would be irresponsible, even a breach of duty, to walk away from a number of negotiations currently under way, all of which are of fundamental importance to the FIA.

We are in the middle of a renegotiation of the 100 year commercial agreement between the FIA and the Formula One Commercial Rights Holder. In effect, this agreement governs Formula One. The CRH originally asked us to accept changes to the agreement in order to reduce the CRH's liability to tax. These we can probably concede. But the CRH has also now asked for control over the Formula One regulations and the right to sell the business to anyone – in effect to take over Formula One completely. I do not believe the FIA should agree to this.

To do so would be the abandon core elements of the FIA's patrimony including, for example, our ability to protect the traditional Grands Prix.

We would also be weaker financially but, even more importantly, we could put at risk the viability of the FIA as the regulatory authority of international motor sport and lose a valuable communication for the wider interests of the organization.

(We could perhaps grant the CRH greater freedom to sell the business but only if, in return, the FIA takes control of all sporting aspects of a Formula One Grand Prix including, for example, the allocation of passes to all working areas. However, there is so far no sign of agreement on this).

The CRH also wants a new Concorde Agreement. So do the Formula One teams. A new Concorde Agreement would give the Formula One teams a greater say in the rule-making process, including various rights of veto. Because of its influence over the teams (which comes mainly from its ability to offer favors in and around the paddock), the CRH sees a Concorde Agreement as another way to exercise control over the sport. Again, however, I do not believe we should concede. The sport and the commercial interests should be kept separate. The teams and the CRH should be consulted and listened to at all stages, but it must be the FIA, not the CRH or the teams, which decides the regulations. My refusal to concede on this has led to a difficult situation and compounds the problems with the CRH over the 100 year agreement.

In my view, we should only sign a new Concorde Agreement if it reinforces the authority of the FIA and deals properly with the major financial crisis which appears imminent in Formula One. Costs have gone out of control, income is insufficient and major manufacturers are in difficulty with their core businesses. Only with fair and realistic financial arrangements will we avoid losing more teams.

In addition to all this, we are negotiating a long term commercial agreement covering the World Rally Championship. This is of great importance to the financial well-being of the FIA and those of its member clubs which organize international rallies. We must also not forget that the new arrangements are likely to have major implications for the FIA's regional rally championships.

These negotiations are critical to the future of the FIA and will require another year or so before they are complete and ready for submission to the WMSC and the General Assembly.

I think it is also important to recognize that there has been struggle for control of Formula One that goes back to the original Concorde Agreement in 1981. More recently it involved the major car manufacturers threatening to launch a break-away series. During my period as FIA President the economics of Formula One have changed beyond all recognition. We are now dealing with a sport involving billions of dollars and interests that would like nothing better than to remove the FIA from the Championship entirely. I have been determined to fight for the rights and role of the FIA in Formula One and it is possibly for this reason that the media have been encouraged by those who have an interest in undermining my Presidency. I believe, therefore, that whatever the Extraordinary General Assembly decides, it should not reward those who have deliberately set out to destabilize the FIA at such a crucial time in its history.

Other issues – the major clubs

It will not have escaped your notice that certain major clubs on the mobility side have been very active in calling for me to step down and in seeking support for various hostile initiatives. Since the merger with the AIT in 2005, some of the major mobility clubs (AAA (USA), ADAC, etc) have expressed concern that the FIA was not serving their interests. The responses to the recent Communications Department Survey reveal a strongly negative attitude towards the FIA on the part of certain major clubs and some have already decided to be semi-detached from our organization. For example, for several years now the AAA (USA) has not sent its staff to the various FIA working groups.

In parallel to their FIA membership, a number of major clubs have developed commercial structures such as ARC in Europe and Global Response at a world level. These organizations, whose membership is exclusive and self-selected, exist independently from the FIA although they sometimes meet alongside out meetings as ARC did at the recent FIA Region 1 meeting in Antwerp. These attitudes and developments have raised concerns about a possible de-merger or breakaway group of larger clubs.

So it is perhaps time for an honest and objective debate about the role of the major mobility clubs within the FIA. There is no doubt that, unlike the majority of smaller clubs, they do not need the FIA to support their core mobility business and they have little or no interest in motor sport.

They already use their commercial structures (ARC and Global Response) to promote international co-operation between themselves and are reluctant to support an increased role for the FAI in promoting reciprocity (mutual recognition of members) among clubs or in developing new member services.

With Region 1, for example, there is reluctance on the part of ARC members to enhance the member services role of the FIA, as they do not wish us to develop products that might benefit fellow FIA clubs which are not members of ARC but offer competing services.

As a result it is only in the area of public policy that many of the major clubs seem willing to envisage a role for the FIA. However, even in this area some have apparently established their own public policy group, ignoring the structures agreed in the FIA Mobility Plan. This lack of transparency is a matter of concern, as the FIA has no way of knowing if commercial partnerships such as ARC and Global Response are influencing certain clubs' approach to the FIA's public policy agenda on issues like motor vehicle safety or environmental standards.

In fact over the last decade it is the sport that has contributed by far the largest amount of financial support for the FIA's efforts to promote road safety and the environment. The FIA now has a powerful reputation as an independent organization willing to challenge the automotive industry on issues of great importance to the ordinary motorist such as crash test standards, electronic stability control, emissions and fuel economy.

Furthermore, the sport enabled us to set up the FIA Foundation, which offers free membership to all clubs and has been particularly effective in working with smaller clubs and with FIA members from the developing countries.

Rather than threaten to break away of question the relevance of the FIA, I believe that the major mobility clubs should do more to ensure the success of the merger that they themselves originally supported.

The negotiations with the AIT were long and difficult and many of us worked very hard to achieve the merger. We are now beginning to see the benefits with the implementation of a Mobility Plan developed by the clubs and a highly professional new management team. So despite the current difficulties, I would urge the larger mobility clubs not to threaten breakaway groups but rather work harder to make a success of the merger for the benefit of the member clubs and the motoring public.

Of course, agreeing on the governance structure that meets the need of both mobility and sport has not been easy. As an organization resembling a trade association exclusively concerned with motoring tourism, the AIT tradition was highly consensual. By contrast the FIA has a very different and much more robust governance structure. As one of the top international regulatory bodies for sport, the FIA has to take difficult decisions that involve the safety of both competitors and the public, the fair enforcement of rules, and the organization of major championships across the world in many different disciplines. Given these very different characteristics, it is not surprising that there has been discussion over the composition of the voting list system. Happily the Working Group agreed at last year's General Assembly will propose a compromise on the this matter to the General Assembly in November which, if accepted, will enable the Presidential elections due next year to be held under a system that meets the needs of both the mobility and sporting sides of the FIA. This is an important step in resolving differences arising from the merger process that I wholeheartedly welcome.

The future

It has been a great privilege and indeed an honor to serve in a voluntary capacity as president of the sport since 1991 and the entire FIA since 1993. This has enabled me to achieve a number of goals which give me great personal satisfaction.

However, it was always my intention to stop in 2009. Nowadays, the presidency is a very difficult job, requiring complete dedication on a full-time basis. At 68, I want to work less hard and would also like to be free to devote more time to general road safety and environmental questions.

However, I think it essential that there should be a smooth transition. If we are to have a smooth transition we need to wait until 2009, when there will be a general election with new presidential candidates, each putting forward a list built on consensus for the approval of the FIA membership as a whole.

For these reasons I do not propose to resign unless a majority of the FIA membership wish me to do so. If the General Assembly agrees, I will continue until October 2009 leaving almost of public representation of the FIA to the two Deputy Presidents. This will give me the time I need to progress the current negotiations to the point where proposals safeguarding the fundamental interests of the FIA can be submitted to the WMSC and the General Assembly. It will also give me time to pursue the legal proceedings I have started against those who have caused so much unnecessary trouble and embarrassment. Above all, it will allow a smooth and orderly transition to a new presidency satisfactory to the membership as a whole.

Yours sincerely,
Max Mosley