London: Formula One`s governing body has formally approved a framework for a new commercial `Concorde Agreement` to take the sport through to 2020, it said on Friday.
"The agreement reached by the FIA and the Formula One Group in July 2013, setting out the framework for implementation of the Concorde Agreement for the period 2013-2020, has now come into force," the International Automobile Federation (FIA) said in a statement.
"Now that the agreement is operative, the parties will move towards the conclusion of a multi-party Concorde agreement," added the body, whose world motor sport council is meeting in Croatia.
The confidential Concorde Agreement, which expired at the end of last year, sets out the commercial side of the highly lucrative sport, including the distribution of revenues.
It must be agreed by the rights holder, governing body and teams - 11 at present. Once the document has been signed by all parties, it will come into force.
The FIA said the new agreement provided it with "significantly improved financial means" and would lay down solid foundations for the Formula One championship.
FIA president Jean Todt said the world body looked forward "to continuing to fulfill its historic role as the guarantor of both regulation and safety in F1 for many years to come."
Commercial supremo Bernie Ecclestone added: "I am very pleased that the agreement between the FIA and the Formula One Group has been concluded."