Team New Zealand is in line to receive a seven figure pay-out from the America's Cup organising body after winning a bitter dispute over a breach of contract.

The dispute dates back to April last year, when the America's Cup Events Authority reneged on an agreement awarding Auckland hosting rights of the America's Cup qualifiers, originally scheduled for February 2017.

After delays of more than a year, an arbitration panel finally assembled in July to hear the case. It is understood the panel, the make-up of which is unknown, ruled in Team NZ's favour but with blanket confidentiality clauses in place around arbitration, the decision was not publicly released.

Given the time that has passed since the dispute was lodged, and the teams have been working to a new timetable which prevents them from launching their America's Cup race boats until after Christmas this year, it is impossible to reinstate the regatta in Auckland.


The Herald has learned that Team NZ and the America's Cup Events Authority (ACEA), which is headed by Russell Coutts, are now discussing the issue of compensation, with a conference call held last week between the two parties in an effort to reach a settlement.

Both the ACEA and Team NZ were given the opportunity to respond to the decision. Both cited the confidentiality rules which preclude them from commenting.

"The competitors have voted that all and any detail surrounding any arbitration remain confidential so this naturally applies to us as well," an America's Cup spokesman said.

Team NZ remain unwilling to even acknowledge the existence of the dispute.

"Following a June 2016 Protocol Amendment to the confidentiality provisions, instigated by ACEA/Golden Yacht Club and a majority of Challengers (excluding Emirates Team New Zealand), the team cannot comment upon or confirm the existence of a dispute submitted to the Arbitration Panel," the Kiwi syndicate said in a written statement to the Herald.

Estimates of a possible compensation deal have been put as high as $5 million, but even then the victory will remain a hollow one for Team NZ.

The relocation of the entire 2017 racing programme, which was just one of series of controversial changes implemented in April 2015 under the premise of "cost-cutting measures", effectively nobbled the Kiwi syndicate, who lost public and private money as a result.

But Team NZ cannot be compensated for the loss of the most valuable commodity in the America's Cup game: Time.


The invalidation of the government sponsorship agreement - the money for which was to kickstart the build of Team NZ's test boat - proved a massive setback to the team's programme.

Team NZ launched their first test boat only in June this year, by which stage defenders Oracle Team USA and British challenger Ben Ainslie Racing had already launched three of the super charged AC45 surrogates, while Artemis had launched two.

That gap is only going to get bigger in the coming months as Oracle and Bermuda-based challengers Artemis and Dean Barker's Team Japan, who are collaborating on design and performance development, come up to full speed.