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Haas F1 Team

Haas issue firm response to former title sponsor claims

The Haas legal battle with Uralkali has taken another twist.

Gene Haas
Article
To news overview © XPBimages

Haas has issued a firm rebuttal to claims made by former title sponsor Uralkali in the wake of an arbitration ruling in Switzerland this week.

Haas entered into a title partner agreement with Uralkali before the start of the 2021 F1 season. A year later, the team terminated the contract following Russia's invasion of Ukraine, as well as ending its deal with then-driver Nikita Mazepin.

The company, one of the world's leading potash producers, was previously run by Dmitry Mazepin, a Russian oligarch with close ties to President Vladimir Putin.

Uralkali demanded Haas return the $13 million sponsorship money paid in advance. In response, Haas demanded $8.6 million in compensation, citing reputational damage.

Following a lengthy legal battle, the Swiss Arbitration Centre delivered its verdict this week, with Uralkali citing victory, claiming via a statement that "the tribunal found that Haas was in violation of the contract".

It further stated that Haas was "obliged"..."to pay compensation to Uralkali". It added that "the tribunal also rejected all of the team’s counterclaims toward the company", with Uralkali now anticipating "Haas will fulfil its obligations under the ruling without undue delay".

After weighing up its response, Haas has stated categorically that the SAC did not find the team was in violation of its contract, nor has it been ordered to pay compensation.

Instead, the SAC only ordered Haas to refund the portion of the sponsor fee attributable to the time after the contract was lawfully terminated.

A Haas statement, sent to RacingNews365, read: "The arbitration panel ruled that Haas had “just cause” to terminate its sponsorship contract with Uralkali, and denied Uralkali’s claims for breach of contract.

"Haas terminated its agreement with Uralkali on March 4, 2022, shortly after Russian military forces invaded Ukraine. The arbitration panel ruled that, in light of all the facts relating to the parties’ relationship, including Uralkali’s association with Russia, Haas “could not be expected to continue the Sponsorship Agreement under such circumstances,” and concluded that “the Arbitral Tribunal finds that Haas had a just cause to terminate the Sponsorship Agreement.”

"The panel emphasised that multiple other sports organisations severed their ties with Russian companies immediately after the invasion of Ukraine, and thus there was a risk “that Haas could rapidly be the last non-Russian sport team continuing with a Russian name sponsor.”

"Accordingly, the panel ruled that the sponsorship was effectively terminated on the date of Haas’s notice of termination, and ordered that Haas retain the portion of the sponsorship fee for the period before the termination, and refund any balance to Uralkali."

RacingNews365 understands that a refund, in itself, poses difficulties. As an American company, financial transactions with Russian-based organisations are not permitted.

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