Key Points:

Team New Zealand CEO Grant Dalton says it would be a "public relations disaster" if Alinghi now referred his team to arbitration after the two syndicates performed mutual hatchet-burying manoeuvres last week.

Emirates Team New Zealand dropped its US$65 million legal action against Alinghi in return for being admitted to the new America's Cup

regatta to be sailed in 2010 _ as long as Alinghi wins the court case against BMW Oracle early next year. Alinghi, meanwhile, signed up to attend Team NZ's Louis Vuitton Pacific Series to be sailed by many America's Cup teams using Team NZ and Oracle Cup yachts in Auckland in January-February.

But Alinghi skipper Brad Butterworth, interviewed on radio last week, muddied the waters with an aside suggesting Team NZ would still have to go to arbitration.

That is a reference to the America's Cup protocol which allows Alinghi to exclude a syndicate from the regatta if they have taken court action against them. Butterworth's aside seemed to raise the issue of Team NZ still having to go through the process of arbitration _ and thus may be barred.

However, Team NZ were represented at the Geneva meeting of 11 Cup challengers. They signed a statement calling on Oracle to drop their legal action in US courts and join the other challengers in agreeing on several new conditions which Alinghi brought to the table to provide the fairness sought by Oracle's court case.

Asked if Team NZ would now officially enter the next Cup regatta by Alinghi's December 15 deadline and whether he was worried about arbitration, Dalton said: "It's redundant."

He quoted a letter from Alinghi, the key sentence saying: "Your participation in the 33rd America's Cup

regatta is welcomed, providing all legal proceedings have been discontinued."

Dalton said: "It has been discontinued so we are in. I am not sure what Brad was saying about the arbitration panel but I believe it was no more than a throwaway line.

"It would be a public relations disaster if we were referred to the arbitration panel," he said, agreeing such a move would only signal Alinghi's reputation for self-advantage and over-controlling the regatta had returned.

"We are inside the tent now and we are now at position A. Arbitration would see things go back to position Z all over again and there is no point in them doing that. If they did, Jim

Farmer [Team New Zealand's QC] would wage war but it would be nonsensical for them to do that."

All of this, however, is predicated upon who wins the court case between Alinghi and Oracle, with judgment expected on an Oracle appeal by March. If Alinghi win, their scenario will prevail and they will control the Cup protocol and rules.

If Oracle win, they will be able to force an Alinghi-Oracle head-to-head, winner-takes-all, one-off challenge in 90ft trimarans for the Cup _ although the American syndicate has said it would not do that and would want to agree rules for a multi-challenger regatta using more conventional Cup yachts.

Dalton said: "Frankly, we don't disagree with what Oracle has done. We are just hoping now that our decision to bring everyone onto the water [in the Louis Vuitton Pacific Series in January-February] makes everyone lay down their weapons.

"What is needed now is another face to face meeting although it does seem that won't happen [after an

exchange of letters between warring

bosses Ernesto Bertarelli of Alinghi and Larry Ellison of Oracle]," said Dalton.

"Oracle are simply looking for more fairness although I don't know whether what Alinghi are proposing now [a new, cheaper yacht and other concessions] is enough fairness to persuade Oracle to give up their legal action."