America’s Cup: Team New Zealand face power struggle over new protocol – Paul Lewis

THREE KEY FACTS

• Team New Zealand’s draft protocol proposes a new power-sharing structure for the America’s Cup.
• Challengers are pushing for more influence and are threatening not to attend without improved transparency.
• The changes aim to reduce costs and increase participation, but require extensive negotiations.

You don’t have to look very far to see the motivation behind the America’s Cup challengers having a crack at Emirates Team New Zealand: power.

Now Team New Zealand have published the draft final protocol, which went to the Challenger of Record, Sir Ben Ainslie’s Athena Racing, nearly two weeks ago with nil response, we can see that the bleating from the Brits and American Magic about “transparency” was really a bit of a power grab.

Their press releases were high on corporate-sounding phraseology but a bit skinny on detail. However, once you understand the significant changes proposed by Team NZ in the protocol, you can see why the challengers are lining up to have a go – tacitly threatening not to attend the next Cup if Team NZ’s “transparency” and “co-operation” are not improved.

Hello? How is it that the draft protocol has been floating round for two months now without being signed off – and how did a version of it find its way into the hands of an American journalist? Not much transparency there. Forgive the cynicism but this is the America’s Cup; self-interest always rules.

The challengers have clearly banded together to “co-operate” on the significant new proposal by Team NZ to alter the very shape of the America’s Cup; a formula that attempts to put the Cup on a whole new organisational footing where challenging teams have far more say in running the event.

The details are yet to be finalised but it seems, from the outside, to be a kind of sailing body corporate. Called the America’s Cup Partnership or ACP, it shares responsibility for matters like the format of the 38th Cup “and future cycles”, its timing, commercial rights, media rights and fundraising to meet the costs of the event – and to attract new teams.

It’s a huge step. It takes the Cup away from sole control by the defenders and places it in the hands of a, well, committee involving the defenders and challengers.

It’s designed to help safeguard the future of the Cup within a new structure, supported by other measures like teams spending no more than €60 million ($115m) to encourage more entries and broaden the appeal.

It’s generally accepted that it costs about $200m to design, build and race a competitive AC75 foiling monohull like those in the last two Cups (though Team NZ spent only about $120m).

Other measures in the draft protocol – not yet agreed by anybody, mind – include stored or battery power instead of cyclors, the crew of six to include one woman and one youth sailor, relaxation of the nationality rule (two non-nationals permitted on board instead of the current one) and the constructed-in-country controls.

Here’s what we don’t know, particularly about the ACP: what is the structure within this new organisation? Where does the money come from?

Who has the final say or power of veto? What powers will the defenders have?

We also do not yet know the exact specifications of the yachts to be raced in the 38th America’s Cup (the class rule). They will be confirmed by June 30.

You can see now why the challenger teams have gone public. It’s a ploy to twist Team NZ’s arm to give them more say; more power.

One yachting source close to the team said: “I think they [the challengers] don’t think they can beat Team NZ on the water, so they will try to beat them this way”.

Whatever the accuracy of this, there is no question this protocol, if agreed upon, is one of the most notable in the history of the Cup.

A Deed of Participation is also to be signed, in which teams agree they will continue with the AC75 yachts in the 39th America’s Cup or face a fine of US$20m ($34m).

That could be a sticky and sticking point. It effectively removes the right of the defenders (if the challengers should win) to choose their own yacht, race format and draft their own protocol – as Team NZ did when they won the Cup from Oracle Team USA in Bermuda in 2017.

That potentially violates the Deed of Gift, the America’s Cup founding document and scripture, if you like. The lawyers will be sharpening their pencils.

Those are quite some changes. You can see what’s in it for Team NZ – continuity, longevity, the potential to rely less on billionaires, and shared responsibility so the Cup becomes a global travelling circus, a bit like Formula One.

You can also see what’s in it for the challengers – a more level playing field (in theory, anyway) and a better chance to topple the Kiwis on the water if they have more say on how to get there and what happens when they are.

They have a small point about normal America’s Cup practice being to have the protocol decided first, before the venue announcement (as the latter often contains financial and other obligations for teams) but, really, isn’t the new power-sharing arrangement better for them?

However, this level of change will need a shedload of negotiations – and it’s not hard to guess that the 38th Cup may be a bit delayed while this little lot is sorted out. Not to mention the chances of a legal challenge – though it may be, after the challengers’ reactions, that the ACP will not happen.

An America’s Cup in 2027 is still perfectly possible, of course, but it seems there’s an awful lot of talking that needs to take place first.

Paul Lewis writes about rugby, cricket, league, football, yachting, golf, the Olympics and Commonwealth Games.