After a thrilling but chaotic end to the WDC saga in Japan this past Sunday, we have yet another controversy on our hands. Red Bull and Mercedes have been at loggerheads for a long time over the alleged cost cap breach. A decision is expected soon.

The paddocks had been brimming with furor ever since reports and rumors about a breach of F1’s cost cap regulations came to light. While no official statements had been made, there were rumors of 2 breaches.

One breach was a minor one, a less than 5% overspend of the total budget, and one was a major breach, i.e. more than 5%. Teams had begun making statements, however. Toto Wolff and Mattia Binotto were among the first to make statements against the breach.

Red Bull, the alleged wrongdoer, was quick to deny all allegations.

Prior to Singapore, Christian Horner told Sky Sports F1, “Certainly not aware [of any breaches]. The accounts were all submitted way back in March so it’s been a long process with the FIA. Next week is when they declare the certificates, certainly, our submission was below the cap. It’s down to the FIA to follow their process, which they’re currently doing.”

Proceedings have since gone ahead and a decision from FIA is expected soon.

As per, BBC Radio 4 Today, Horner again said, “We’re very confident we’re within the cap and within those financial regulations.”

“So we’ve been shocked at the speculation and accusations that have been made by other teams. We wait for the FIA to conclude their process and we wait to see what comes out. Anything other than compliance we’ll be extremely surprised at.”

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Any decision from the FIA would create a lot of ripples. If Red Bull is found to have breached, the amount of overspending would be crucial in deciding whether their 2021 title win would be adversely affected.

What could happen if Red Bull is in breach of the cost cap regulations?

Per the FIA’s regulations on a spending limit, in case of a minor breach, they could suffer a points deduction in both Championships, and a suspension from certain races. These penalties could affect the current season as there still are 4 races left in the season.

However, if there’s a material breach, a breach of greater than 5%, they could possibly lose their Championship from last season (since the breach concerned last year’s spending).

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Red Bull is very confident with their submissions. They have expressed their disappointment with other teams’ allegations repeatedly.

“The submission between the team and the FIA is one that is confidential. I have no idea what the outcome of our rival submissions are, or their accounting treatment, or so on. So I would be intrigued to know where their source of information for these fictitious claims have come from. And I mean, they’re hugely defamatory,” said Horner.

“How on earth do they have this information? Where do they have this knowledge? The FIA have even stated they haven’t even completed their process.“

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It is likely the FIA will release its decision and penalties, if any, today. A lot will be riding on the decision and all teams would be watching very closely.