Max Mosely will step aside as president of the FIA in October
It has been a turbulent year for Formula One with leading teams such as Honda withdrawing due to financial difficulties.
It has also been touch and go over the past few months as to whether the Formula One World Championship would continue as we know it.
The Formula One Team Owners Association (FOTA), consisting of teams such as Ferrari, McLaren, Red Bull, Toro Rosso, Toyota, Renault, Brawn and BMW Sauber, had been campaigning for changes to the way Formula One is run.
However, FOTA’s threats to boycott the 2010 racing season and to form their own breakaway series are now a thing of the past.
After months of strained negotiations with Formula One’s governing body, the Fédération Internationale de l'Automobile (FIA), an agreement has been reached.
All of FOTA’s members will now participate in the 2010 Formula One World Championship.
Max Mosely, the president of the FIA outlined the new agreement in which they have agreed to drop plans to limit teams’ spending.
They intend to get spending levels back to that of the early 1990s. He also announced that he will step aside as president of the FIA in October.
FOTA chairman, Luca di Montezemolo said that the FOTA teams had "asked for things which were fair and realistic" and welcomed the breakthrough.
Formula One supremo Bernie Ecclestone also showed relief that an agreement had been reached and said that he was "very happy common sense had prevailed".