Formula 1: Sauber in trouble with Swiss authorities over stake sponsorship

Controversies have accompanied Formula 1 for decades: "Too loud, too dangerous, too damaging to the environment" are absolute classics. There have also been repeated debates about advertising, particularly in relation to alcohol and cigarettes. Recently, gambling in the form of Sauber sponsor Stake took centre stage. The Swiss Gaming Commission accused the racing team of advertising illegal offers in the country.

Formula 1 has always been much more than the pinnacle of motorsport. Away from the glitzy surface of the races, the series has always had a controversial side, characterised by some of the biggest scandals in the sport's history. These incidents, often as dramatic as the races themselves, have shaken confidence in the sport and pilloried its players. One of the most notorious scandals was the so-called "Crashgate" in Singapore in 2008, in which Nelson Piquet Jr. deliberately caused an accident to enable his team-mate Fernando Alonso to win. The "Spygate" between McLaren and Ferrari in 2007, which is regarded as one of the biggest cases of industrial espionage in sport and led to a record fine of 100 million dollars for McLaren, is also unforgotten.

In addition to sporting or technical misdemeanours, there are various ethical offences with a lasting impact that cast Formula 1 in a questionable light. The long-standing advertising contracts with tobacco and alcohol companies are particularly sensitive. Although tobacco advertising has been largely banned from Formula 1 since the early 2000s, there are regular attempts to circumvent these restrictions. Subtle layouts and designs on the cars are a constant reminder of the glorious but equally controversial times when tobacco giants such as Marlboro and John Player Special adorned the racing cars. Similarly, partnerships with alcohol brands such as Johnny Walker and Heineken have sparked debate as they are at odds with global efforts to promote responsible consumption and position motorsport as family-friendly entertainment.

Gambling undoubtedly also provides a lot of fuel in this context. Sponsorship of big players in the industry has long been established. Niki Lauda, for example, was present for many years as a brand ambassador with the Novomatic cap, PokerStars sponsors Red Bull Racing and even entire Grands Prix are supported by brands such as Aristocrat Gaming (Las Vegas) or 188Bet (F1 Asia).

Stake already has several brands on its list of sponsors. Last year, we already asked ourselves whether the Swiss racing team Sauber would actually race in all countries under the then name "Alfa Romeo Racing" with the logos of Stake.com. In the 2024 season, Sauber will even compete under the name "Stake F1 Team". It was this change of brand that drew the attention of the Swiss Federal Gaming Board (SFGB). Could it be that Sauber is violating the gambling laws of its home country?

Proceedings initiated against Sauber for advertising illegal gambling

Sauber has had considerable legal trouble in its home country in recent weeks. The reason for this was the new main sponsor Stake. In the 2024 and 2025 racing seasons, the gambling provider will give the team its name. It was renamed the "Stake F1 Team". This has even led to legal proceedings being initiated against the team.

The reason: Stake is an online gambling operator that does not have a licence in Switzerland. The company originates from Australia and operates under a licence in Curaçao. The Swiss Gambling Act (GSG) stipulates that such providers must have a licence from the Swiss Federal Gaming Board (SFGB) to operate legally within the country's borders. Only land-based casinos that already have a licence for terrestrial gambling can apply for an additional licence for online gambling. Internationally licensed services are illegal in Switzerland. This also means that such platforms may not be advertised in the country.

The crux of the matter is that Stake's logo can be found primarily on the team's racing cars and also on its website, within social media channels and in other places that are freely visible to Swiss citizens. This sponsorship is certainly defined as a form of advertising. Sauber's actions could therefore theoretically fall under the offence of advertising for illegal gambling, which could result in a fine of up to 500,000 Swiss francs (around 534,000 euros).

However, following an in-depth investigation by the ESBK, the accusation was dropped more quickly than initially suspected.

What made the authorities change their minds?

The ESBK undertook a thorough examination of the case in order to clarify whether or not Stake's sponsorship was illegal advertising within the meaning of the law. Several criteria were taken into account. The lawyers ultimately let Sauber off the hook for the following reasons in particular:

1. They took particular note of the fact that the racing team mainly operates internationally, with no events featuring Stake's logo taking place in Switzerland.
2. Furthermore, Sauber and Stake do not engage in any advertising activities explicitly aimed at the Swiss.
3. The racing team's website and other digital channels are also not specifically tailored to Switzerland, but focus on an international audience.
4. Ultimately, the SFGB recognised that Stake's gambling offer is already made inaccessible within the country by the operator - it cannot be used via a VPN (Virtual Private Network) or in any other way from Switzerland.

It is therefore clear to the authorities that the racing team did not violate the Gambling Act as part of its partnership with Stake. Consequently, the proceedings were discontinued.

For Alessandro Alunni Bravi, team representative of Sauber, the decision is only logical - he told the press: "We always comply with all applicable laws, including in Switzerland. And of course we have taken all measures to comply with them."

However, there were also more critical opinions, such as from legal expert Patrick Krauskopf: "Sponsorship would be permitted. In this case, however, the Stake and Sauber brands are so closely linked, and the term Stake is so strongly imprinted in the minds of viewers, that we have probably crossed the red line into unauthorised advertising."

Conclusion

Image source: Screenshot von https://www.sauber-group.com/car?d=Racing