In the previous year, the FIA implemented a cost-cap rule that applies to all team accounts. This was in response to Red Bull's violation of spending over $1.8 million, which resulted in an F1 cost-cap penalty. Additionally, Aston Martin was fined £388,000 for a procedural breach.
During last year's auditing, Aston Martin was also fined a total of $450,000 for breaching the procedure related to the adjustment of expenses for acquiring its new Silverstone base.
A Material Overspend Breach is considered the most severe breach under the regulations. It occurs when there is an overspend of more than 5 percent of the cost cap value. In such cases, the FIA may deduct championship points and impose financial or sporting penalties, depending on the severity of the breach. With more teams looking to join the F1, it's essential that the FIA ensures strict compliance with known policies.
Last year, Red Bull was reported to have overspent $1.8m, resulting in a dispute. As a penalty, the team received a $7m cost cap penalty and a 10% decrease in its stipulated stream testing. Additionally, they faced an Overspend Breach of up to 5% of the total cost cap value.
The administration body commenced the cost cap regulation in full force in January 2022 up till December 2022 to reduce excessive spending. After rigorous supervision, the administration announced that 10 teams could abide by the rules and would be awarded a certificate.
After the investigations, the FIA shared that both F1 activities and non-F1 activities within each of the teams were critically surveyed, together with several on-site visitations, but none of the teams were found guilty of having breached the cap cost regulations, silencing the earlier dispute that some teams were making use of engineering off-shoots to boost their F1 projects. It is now believed that this loophole has been blocked.
It was earlier reported during the season that other teams had breached cost cap regulations either by an incorrect recording of costs or incorrect entry of the required paperwork, which made the administration postpone the awarding program.
The assessment has been a rigorous and meticulous process, opening with a comprehensive analysis of every document that was submitted by the teams and a detailed auditing process to confirm the financial cost regulations.
The administrative body confirmed that "The FIA Cost Cap Administration has awarded a certificate of diligent compliance to each of the ten teams after passing all the tests, stating that each of the Competitors acted in cooperation and good spirit throughout the assessment process.