Canada will lose its Formula One Grand Prix next year because tough legislation banning tobacco advertising, including logos on cars, will come into full effect on October 1, the race's chief executive said on Thursday.

Formula One supremo Bernie Ecclestone's management company sent a letter on Wednesday to chief executive Normand Legault saying Montreal's picturesque race circuit on an island in the St Lawrence River would not be part of the 2004 calendar.

"This letter says that Canada's Grand Prix won't show up on the Formula One world championship 2004 calendar," Legault told a hastily called press conference in Montreal.

"This decision seems to be the consequence of the tobacco laws coming into full effect".

Canada has held a Formula One Grand Prix since 1967 and Montreal has hosted the race since 1978 on an circuit named after the late Ferrari great Gilles Villeneuve, father of 1997 world champion and hometown favourite Jacques Villeneuve.

Asked what it would take for Formula One to return in 2005, Legault said: "Tobacco-sponsored teams could accept to run without logos. But at the moment there's no plan".

The race, one of the city's biggest tourist attractions with an estimated windfall of more than C$50 million ($36 million), packs over 100.000 fans around the circuit and is one of the few races to draw sell-out crowds.

But television ratings and fan support aside, Legault knew that eventually his race would have a problem with the tobacco legislation.

Three of Formula One's top teams -- Ferrari, McLaren and Renault -- are sponsored by tobacco companies whose logos can clearly be seen on their cars.

"The letter wasn't a surprise," said Legault, who spoke about the issue with Ecclestone at the German Grand Prix in Hockenheim last weekend.

"He (Ecclestone) is invoking a contractual matter which he has the right to raise. I don't view it as a threat but as a final decision on his part," he added.

NOT THE FIRST

The move comes after the Belgian Grand Prix at Spa, widely viewed as the world's ultimate racing venue for its countryside surroundings and technical difficulty, was cancelled this season because of similar legislation banning tobacco ads.

A leading Belgian politician in Wallonia said this week the race would be on again next year after a ban on tobacco advertising was postponed, but Legault was not so sure about the same thing happening in Montreal.

"The Canadian Grand Prix has not and will not take action with the federal and provincial governments in order to obtain amendments to the anti-tobacco laws," Legault said.

The office of Canadian Health Minister Anne McLellan was not immediately available to comment.

Legault said it might be a better idea to try to work with the car makers, such as Mercedes and BMW, who are major financial partners in the McLaren and Williams teams.

The A1 Ring in Austria also bade farewell to Formula One this year as Ecclestone last month terminated his contract for next season due to the country's backing of EU legislation against tobacco advertising, which takes effect in 2005.

Though he called Ecclestone's letter a "final decision", Legault said the official calendar for 2004 would only be released in October.