Why did the Malaysian government cite the F1 hosting fee as a reason to end the contract in 2017?

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The Malaysian government cited the substantial annual license fee paid to Formula One Management (FOM) as a primary reason for terminating the hosting contract in 2017.

The decision to cease hosting Formula One races was significantly influenced by the considerable financial commitment required for the annual license fee. This fee, paid to Formula One Management (FOM), amounted to hundreds of millions of ringgits, representing a substantial expenditure for the nation.
Significant Financial Burden of FOM License Fees

Malaysia's involvement in hosting Formula One between 1999 and 2017 was marked by the recurring issue of the annual license fee payable to FOM. These fees represented a major financial obligation, reaching hundreds of millions of ringgits over the years. For comparison, the FOM fees for Bahrain in 2026 are between US$70 million (approximately RM298 million) and US$80 million.
Fluctuating Attendance and Broadcast Rights

Beyond the direct license fee, other financial considerations contributed to the government's decision. Fluctuations in race attendance figures and the perceived value of broadcast rights were also cited as reasons for ending the contract. These factors, combined with the high licensing costs, made the continuation of hosting the Grand Prix a contentious issue.
Economic Impact vs. Cost Considerations

While the potential economic benefits from tourism and global exposure were acknowledged, the sheer cost of the FOM license fee ultimately tipped the balance. This multi-hundred-million-ringgit fee was a significant hurdle, making the event a difficult proposition to justify to taxpayers and leading to its discontinuation in 2017.

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Why did the Malaysian government cite the F1 hosting fee as a reason to end the contract in 2017?

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