Hopes that the Canadian Grand Prix's place on the Formula One schedule would be confirmed by a rescue plan put forward by national brewing giant Molson appear to have foundered.

Although included on the latest draft calendar, Montreal's place remains provisional pending a satisfactory outcome to the ongoing debate over compensation for teams running tobacco sponsorship. With new anti-tobacco laws set to come into force at the end of the current season, the inclusion of a race in Canada would push the number of race where tobacco liveries would be banned above the limit agreed by teams, sponsors and the FOM. Unless another such race drops off the schedule - which, despite the contractual wrangling going on between Bernie Ecclestone and Magny-Cours, is unlikely - Canadian GP bosses would have to come up with a financial package to ensure the race goes ahead.

Molson and Montreal Canadiens ice hockey team owner George Gillett were reported to be in negotiation with race promoter Norman Legault to fund the race, but sources now report that talks have broken down without agreement.

Montreal newspaper La Presse claims that the negotiations foundered when it became apparent that Ecclestone was seeking compensation for each year that the race would run under the anti-tobacco ruling, and that the annual figure being demanded was already too high.

At the end of September, during the USGP at Indianapolis, Ecclestone apparently told the Canadian organisers that the financial compensation package would amount to at least US$30 million per annum - and that was only a fraction of the cost of staging the race.

"For as long the anti-tobacco law is in force, this compensation problem will reappear," he told La Presse, "Therefore, the bill for US$30 million could increase to US$100 million, maybe even to US$150 million, and this is just for the compensation package. On top of that, it will be necessary to add CAN$200 million to obtain the rights of the race."



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