Proton has just announced that it has revoked the Lotus brand licensing from the 1 Malaysia Racing Team led by Tony Fernandes. The team will continue to be called Lotus Racing till the end of this season but that will not be case in 2011. This also applies for the Team Lotus name that was recently announced for 2011.

The press release’s exact words were “with Proton’s agreement, Group Lotus has now terminated its licence to 1 Malaysia Racing Team to use the “Lotus Racing” brand in the 2011 and future Formula 1 seasons as a result of the flagrant and persistent breaches of the licence by 1 Malaysia Racing Team, which were damaging to the Lotus brand”. This is definitely not good news for the team.

It went on to add that it believes “neither 1 Malaysia Racing Team, nor any other company associated with Mr. Fernandes such as Tune Group Sdn Bhd or Team Lotus Ventures Limited, has the authority of Group Lotus to use any Lotus brand in the 2011 Formula 1 season”.

It was also revealed that the Tune Group’s recent rights acquisition of the Team Lotus name from a business formerly owned by David Hunt called Team Lotus Ventures Limited will not enable the Formula 1 team to use the classic name. Group Lotus said that it believes the so called rights have “no proper legal foundation”, as Hunt’s attempt to acquire the name in 1994 was ineffective. It was also said that Tony Fernandes knew this for a fact.

Proton also confirmed that it will take “all necessary steps” to protect the rights in the Lotus name, “including resisting any attempts by Mr. Fernandes or his companies, or any other unauthorized person, to use the Lotus name in the 2011 Formula 1 season”.

Chairman of both Proton Holdings Bhd and Group Lotus, Dato’ Sri Nadzmi Mohd. Salleh said, “We believe the Lotus brand to be one of the most valuable brands in Formula 1 today. We are the owners of this brand, and will take all necessary steps to protect it. Tony Fernandes has no rights to use the Lotus brand in the 2011 Formula 1 season, and we will strongly resist any attempts by him to use our brand without our permission and will withdraw our sponsorship of the Lotus Racing team.”

“To put it simply, Group Lotus is everything Lotus. The fact that 1 Malaysia Racing Team entered into an agreement with Group Lotus to use the brand means that both Mr. Fernandes and 1 Malaysia Racing Team recognises and acknowledges Group Lotus’ rights,” he added.

The press release also stated that Proton will withdraw its sponsorship of the Lotus Racing team for the 2011 season. If this revocation continues to be implemented, Fernandes will have no choice but to rename the team, but there could be other underlying issues. So what will happen to the Lotus Racing team? Only time will tell.