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Red Bull contends it has gained “zero benefit” from a development or operational perspective from its alleged Formula 1 budget cap breach in 2021.
The FIA recently completed its analysis into every team’s budget cap submission and determined that Red Bull was the only one to overspend.
Red Bull has been accused of what is called a ‘minor’ breach, although the exact amount is unspecified.
Though the threshold for a minor breach means it could be up to around $7million, the alleged breach is believed to be much lower – less than $2m.
Red Bull team principal Christian Horner has even argued that due to differences in interpretations about what should have been in the submission, the amount in contention is as low as $200,000.
Horner maintains that Red Bull’s submission accurately and faithfully followed F1’s financial regulations, so the team presently refutes the overspend the FIA believes has occurred.
Rivals have stated that not only could Red Bull have spent more on development or staff last year but this would have carried over into 2022. Horner claimed that Red Bull has “absolutely not” gained an advantage.
“What you’ve got to look at is the relevant costs and what are the relevant costs within and outside of the cap,” said Horner.
“And that’s where the interpretation comes from. Our view is that our relevant costs are within the cap.
“Obviously we’re in discussion with the FIA about what those costs are and what are mitigating potential circumstances.
“We had zero benefit from a development perspective or an operational perspective, either for 2021 or 2022 from the way we operated within the cap.
“Our submission was significantly below the cap, we expected certain things to be potentially challenged or clarified as is the process in a brand new set of regulations.
“But based on external, professional accounting from third parties, the interpretation of those rules, the 52-page document to police this, was very clear from our side.
“We absolutely and categorically don’t feel like we’ve had any advantage either in 2021 or 2022 or 2023 or 2024, or some teams talking about 2026.
“It’s totally fictitious.”
One of Horner’s frustrations with the FIA is that the team has received no prior warning about its interpretations of the rules despite there being opportunities for the FIA to intervene.
He said that an interim submission was made in 2021 with “no feedback or suggestions we were doing anything contrary to any regulations”.
“Then of course, the submission made in March, we didn’t hear anything from that submission in March until the latter part of September,” he said.
“It’s a significant period of time. There’s also a duty within the regulations for the FIA to guide and have effective compliance.”
Horner has, however, said that other clarifications by the FIA have impacted Red Bull’s submission.
He cited one in June relating to unused inventory as having a “seven-digit effect” on its budget and claimed Red Bull was not allowed to change its submission retrospectively.
“An enormous amount of data has to be inputted for these submissions,” said Horner.
“I think it’s only natural that in the first year of a set of very complicated regulations, to be able to get arms around everything is almost impossible.
“Interpretations have been made, maybe by other teams slightly differently.
“A change like that has a huge swing in your application of how you’ve completed your form, which had we been able to resubmit at that time, we would have treated very differently.”
The FIA has proposed an Accepted Breach Agreement to Red Bull but to enter that, Red Bull needs to accept it committed a breach and whatever penalty the FIA has suggested.
The Race understands this was originally proposed as a fine and a reduction in aerodynamic testing time.
Horner has pledged “complete transparency” once this matter is resolved and that he is willing to disclose Red Bull’s reasoning for its submission and why it disputes the FIA’s interpretations of certain aspects.
He effectively drew a distinction between this situation and the Ferrari/FIA engine negotiations in the winter of 2019/2020 that led to a secret settlement, because this follows a process outlined explicitly in the financial regulations.
“It should be transparent, the whole thing should be transparent,” said Horner.
“There will be no private, secret deal, all above board.
“This is very different to previous situations.”
Horner has had discussions with FIA president Mohammed Ben Sulayem in Austin and still hopes a conclusion can be reached this weekend.
“I hoped it would be resolved before this weekend,” said Horner. “I’m hopeful it can be resolved during this weekend.
“Should that not happen, the next process is that it goes to the cost cap administration panel and then beyond that, there’s the international court of appeal.
“It could draw it out for another six to nine months which is not our intention. We want closure on 2021.
“We’ve had some healthy and productive discussions with the FIA and I’m hopeful of being able to reach a conclusion in the near future.”
