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America's Cup: Malta Altus Challenge smiling after big win

by Richard Gladwell Sail-World NZ 6 Feb 2019 21:18 PST 7 February 2019
Royal Malta Yacht Club is represented by the Malta Altus Challenge in the 36th America's Cup © Rolex / Kurt Arrigo

The Arbitration Panel for the 36th America's Cup has just released their first Decision of the 36th America's Cup.

It is a big win for the Malta Altus Challenge, and indeed any team looking to bypass the "100% nationality" rule that applied for the 2021 America's Cup.

On December 6, 2018, less than a week after their Challenge was accepted by America's Cup Defender the Royal New Zealand Yacht Squadron, the Malta-based Challenger, lodged a request with the three-person Arbitration Panel seeking a definition of the term "nationality" as used in the Protocol for the 36th America's Cup.

This was the first decision for the Arbitration Panel, headed by Australian David Tillett, Graham McKenzie (NZL) and Prof Henry Peter (SUI).

Under the tight nationality rules for the 36th America's Cup, all sailing crew are required to be nationals of the country of the Club their Team represents.

The Protocol provides two ways that will satisfy this requirement.

Article 10.2(a) says it will be satisfied "if the person is a national of that country".

A second way is if the person lives in the country of the Club their Team represents for a total of 380 days from September 1, 2018, to August 31, 2020; or if they are Late Challengers, the 380 days runs from December 1, 2018, to November 30, 2020.

The term "national" in the context of Article 10.2(a) is not defined in the Protocol. And could be construed to mean that someone who was a passport holder of their Team's country would satisfy that national requirement.

Malta Altus Challenge engaged Dr Hamish Ross, a former legal and rules adviser to the Swiss Alinghi team, twice winners of the America's Cup. Ross is domiciled in New Zealand and is also serving as the team's Strategic Director - handling base and similar team issues required in Auckland. His PhD is in the America's Cup.

The Malta Altus Challenge used as a test case a "Sailor A", believed to be one of the professional sailors sought to be engaged by the team, but one who was not a Maltese citizen - and for various reasons would have struggled to reside for 380 days in the historic Mediterranean island state.

The term "national" was not defined in the Protocol, and the Protocol provides for the Arbitration Panel can to then apply a dictionary meaning of the term in making its Decision.

Two teams, the American Magic (New York Yacht Club) and Ineos Team UK (Royal Yacht Squadron) filed Responses to the Arbitration Panel. They are believed to have held different views but did not disagree with the interpretation conclusions of the Arbitration panel.

Two weeks later, in its Decision, the Arbitration Panel ruled that "If Sailor A becomes a citizen of Malta and receives a passport of that country at any time before the commencement of racing in the Challenger Selection Series, that will satisfy Article 10.2(a) of the Protocol."

That Decision clears the way for Malta Altus Challenge to engage a multi-national team, and bring those sailors into the team at any time before the start of the Prada Cup, the Challenger Selection Series for the 36th America's Cup, provided they have been issued with a Maltese passport. It means that Malta can cherry pick a multinational America's Cup crew from the best sailors available, including those who are committed to sailing in the SailGP series for countries like Australia, which do not have a Challenger in the 36th America's Cup.

They are believed to be in a position to engage several key sailors from Artemis Racing team (SWE), who came within an ace of winning the Challenger Selection Series in Bermuda - and statistically had more leg wins than Emirates Team New Zealand in the Louis Vuitton Trophy final. They also had two wins in the America's Cup Qualifier Series in their Match with Oracle Team USA.

While the principle of the Arbitration Panel's Decision is expected to apply to any team, they probably still have to make a specific application to the Arbitration Panel and state their case to be completely assured of the legality of their actions.

The other six teams are expected to continue to hire all-national sailing teams engaging people who are citizens of the country of the Team.

Malta Altus Challenge does have to pay the costs of the Decision, put at NZD$8,000 - however in the grand scheme of the 36th America's Cup that is a small investment for a very significant gain for the Maltese team.

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