Every team on the grid earns a share of F1's prize money based on constructors' championship position. Add an eleventh team and that same pool gets split eleven ways instead of ten — every existing team's cut shrinks, even if their on-track performance doesn't change at all.
The anti-dilution fee exists to compensate for exactly that. It's not a fine, not a licensing fee to the FIA, and it doesn't go to Formula One Management — it's paid directly to the ten existing teams, split according to a formula the Concorde Agreement defines.
The number itself is negotiated, not fixed by regulation. The 2021 Concorde Agreement set a $200 million floor. When Cadillac (backed by General Motors) pursued entry for 2026, the existing teams initially pushed for figures as high as $600 million before a $450 million figure was agreed ahead of the 2025 Australian Grand Prix — more than double the original floor, reflecting how much F1's commercial value has grown since 2021.
This is a different mechanism from the cost cap: the cost cap limits ongoing annual spending, while the anti-dilution fee is a one-time payment to enter at all.