The BBC are reporting that the future of this year's Wales GB Rally is in doubt after the Welsh Assembly Government withdrew an estimated £2.2m a year in funding.
Organisers say they are "shocked and disappointed" at the move, despite a contract to back the event until 2011.
International Motor Sports Ltd (IMS) plans to sue for breach of contract.
The assembly government said the 2010 rally without world rally championship qualifying status was "not the type of event" it had agreed to sponsor.
In a statement, IMS said the 2009 rally was now "under threat".
It said: "This unprecedented action towards WRGB by the Welsh Assembly Government has been instigated without any prior notice or consultation.
"It is in breach of the existing contract between IMS and the Welsh Assembly Government that was signed on 30th March 2006 for the period up to and including the 2011 Rally.
IMS chief executive Andrew Coe said: "Our preparations for October's Wales Rally GB are progressing well, with the event scheduled to be launched to the media and public by the end of April.
"Therefore we are shocked and disappointed that the Welsh Assembly Government has taken this position, without even any prior notice or discussions between us, particularly as there is a firm and binding contract in place until 2011.â€
Source: bbb.co.uk
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