Recent hopes that the financially-embattled Nürburgring could still be able to host next year’s German Grand Prix have taken a major dent, with circuit officials conceding that it wouldn’t be able to afford its turn to host the 2013 event, despite a another recent bailout from the local Rhineland-Palatinate state government.
The government’s budget committee approved a €254m rescue package last week, with the measures including a deferral of interest payments on the circuit’s already massive debts owed to its creditors.
The deal effectively means that the iconic circuit can still continue to operate while servicing these debts, but it will need to get around an investigation that the European Commission has announced it will conduct into the exact details of this arrangement.
There are strict laws under which governments in the European Union must operate when coming to the aid of financially-crippled organisations, and it’s the EC’s belief that this latest deal contravenes these regulations.
“At this stage, the Commission has doubts that the measures were granted on market terms and that the companies are viable without continued state support,” a statement from the EC reads.
“The extension of an in-depth investigation gives interested third parties an opportunity to comment on the additional measures under assessment; it does not prejudge the outcome of the investigation.
“The Commission is concerned that Nürburgring may already have been a company in difficulties in 2008, when it received the previous aid. Because of its highly distortive effects on competition, rescue or restructuring aid to a company in financial difficulties may be granted to a given company only once in a period of 10 years.
“The Commission will now investigate whether these repeated public interventions were in line with EU state aid rules.”
Even if this latest bailout gets the auditor’s green light from the EC, that doesn’t guarantee that the Nürburgring will be in a position to host next year’s German Grand Prix, which is stages every two years on an alternating basis with the Hockenheimring.
Officials from the circuit have conceded that, despite the bailout it has received, it won’t be able to host the event unless it can negotiate a substantially reduced sanctioning fee with F1 supremo Bernie Ecclestone.
“If Ecclestone accepts an offer without this typical fee, we can certainly keep F1,” the Nürburgring’s development chief, Thomas Schmidt, told the German-language DPA news agency.
“If not, we simply don’t have the money.”
Ecclestone has himself gone on the record and stated that the German Grand Prix must remain on the F1 calendar, but he hasn’t gone so far as offering what solutions he would be willing to explore.
One possible solution could be that the Hockenheimring stages next year’s race in place of the Nürburgring, but given the equally-perilous state of that circuit’s financial affairs, that hardly seems like a workable solution…
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