Nicholas Latifi, Williams, Circuit de Barcelona-Catalunya, 2022

Williams fined for late submission of budget cap documents

2022 F1 season

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Williams has become the first Formula 1 team to run afoul of the sport’s Financial Regulations, known as the budget cap.

The team notified the FIA it would not meet a deadline to submit required paperwork by March 31st of this year. This was confirmed by the FIA in April, and subsequently accepted by Williams.

The FIA’s Cost Cap Administration issued an Accepted Breach Agreement between it and Williams detailing the breach and how it had been handled.

Williams undertook to supply the overdue submission, its first Complete Full Year Reporting Documentation for the period ending on December 31st last year, by 7pm CET on May 31st 2022. It also agreed to pay the Cost Cap Administration’s costs for the production of the ABA plus a financial penalty of $25,000 (£19,960).

The Cost Cap Administration confirmed Williams complied with the agreement within the deadlines specified. “Williams has been fully cooperative in seeking to remedy the breach,” it noted.

F1’s budget cap was introduced during the 2021 season, during which teams were limited to a maximum expenditure of $145 million, with some exceptions. The budget cap for 2022 is set at £140m, however several teams have warned sharp increases in inflation since the start of the year will make it difficult to stay within that limit.

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FIA statement on Williams Financial Regulations breach

An Accepted Breach Agreement (“ABA”) dated 19 May 2022 has been entered into by and between the FIA and Williams Grand Prix Engineering Limited (“Williams”) pursuant to Article 6.28 of the FIA Formula 1 Financial Regulations (“Financial Regulations”). The Financial Regulations are issued by the FIA and form part of the terms and conditions of participation in the FIA Formula One World Championship. Williams is an F1 Team competing in the 2022 FIA Formula One World Championship.

The ABA concerns a Procedural Breach of the Financial Regulations pursuant to Article 8.2(e) committed by Williams on account of its failure to submit (in respect of the Full Year Reporting Period ending on 31 December 2021) the complete Full Year Reporting Documentation by the Full Year Reporting Deadline of 31 March 2022, as required by Article 5.1 of the Financial Regulations.

On 12 April 2022, the Cost Cap Administration notified Williams that it had committed a Procedural Breach. On 15 April 2022, Williams responded to the notification accepting that it had committed a Procedural Breach and explaining the steps that it had taken to seek to avert that breach. Having considered Williams’ explanation and given in particular that the Procedural Breach was voluntarily disclosed by Williams in advance of the Full Year Reporting Deadline of 31 March 2022 and Williams has been fully cooperative in seeking to remedy the breach, the Cost Cap Administration deemed it appropriate to offer Williams an ABA resolving the breach on the terms set out below. That offer was accepted by Williams.

Summary of ABA terms and sanctions

Williams admits that it has breached Article 5.1(b) of the Financial Regulations due to its failure to submit, as part of its Full Year Reporting Documentation (in respect of the Full Year Reporting Period ending on 31 December 2021), the complete Full Year Financial Reporting Documentation by the Full Year Reporting Deadline of 31 March 2022, and so has committed a Procedural Breach under Article 8.2(e) of the Financial Regulations. On this basis, it was agreed that:

  • Williams had to remediate the Procedural Breach by no later than 19:00 CET on 31 May 2022.
  • Williams had to pay a Financial Penalty of USD 25,000 to the FIA within 30 days of the date of the ABA.
  • Williams had to bear the costs incurred by the Cost Cap Administration in connection with the preparation of the ABA.

The decision of the Cost Cap Administration to enter into the abovementioned ABA constitutes its final decision resolving the matter and is not subject to appeal. Non-compliance by Williams with any terms of the ABA will result in a further Procedural Breach under Articles 6.30 and 8.2(f) of the Financial Regulations and automatic referral to the Cost Cap Adjudication Panel The Cost Cap Administration confirms that, as of the date hereof, Williams has within the specified deadline remediated the Procedural Breach, paid the Financial Penalty, and bore the costs incurred by the Cost Cap Administration in connection with the preparation of the ABA.

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Keith Collantine
Lifelong motor sport fan Keith set up RaceFans in 2005 - when it was originally called F1 Fanatic. Having previously worked as a motoring...

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17 comments on “Williams fined for late submission of budget cap documents”

  1. I’m really happy to hear they are struggling, wish them to see at the bottom. This is not Williams team of Frank anymore.

    1. Weird take, one because you’re taking happiness at suffering, and two, Frank and Claire drove the team to the point where they needed to find a new buyer.

    2. Classy

    3. @hamiledon Having a normal one I see…

    4. Always rely on you for the view from under the bridge

    5. As someone who has supported the team since the first F1 race I watched, I couldn’t disagree with you more @hamiledon.

  2. Not just slow on track, it seems…

    This points to things being very disjointed at Grove.

  3. Absolutely ridiculous

    20k because your accounts are late while running a race team?

    Yet the likes of BP, many others and even Joe Blogs Ltd can be 2 years late without issue.

    The whole EU has never issues a set of accounts since it was formed!

    Admin gone completely crazy!

    For what?

    So we can rejoice in screw ups like last year?

    1. For what?

      Breaking the rules they willingly signed up for.

      Mr Island Man should be good for the money, right?

    2. DrG, the FIA budget cap authorities are separate from HM Revenues and Customs (let alone whoever the EU’s supposed to issue accounts to – even that’s been debated) and this has a separate penalty scale, agreed voluntarily by teams when they signed the newest round of agreements with Liberty and the FIA.

  4. I guess they’re not as efficient at cooking the books as the big teams. Rich get richer. Same as it ever was.

  5. ThreePurpleSectors (@)
    7th June 2022, 21:50

    My understanding is fine is for not submitting papers in time not an actual spending breach.

  6. One of the teams the budget cap was allegedly helping gets fined for not sticking to one of its more simple rules.

    Sad, really – but I guess not unexpected with the way Williams was run in the past – I had hoped their financial management would get better.

  7. Sell the team to VW and call it a day. They are beyond saving. Thankfully as with most private equity investments this is more than likely the plan. Frank and Claire ran it into the ground and the disaster continues under new leadership.

  8. Is the fine counted towards the budget cap ?

    1. @palindnilap: So they need to edit and resubmit them. You’d think there is a fine for being late at resubmitting? :-)

    2. @palindnilap Yes. This year’s (since the fine was levied this year).

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