America's Cup juggernaut revs up - Entries open on Sunday.
by Richard Gladwell/Sail-World NZ 26 May 15:47 PDT
A walk in the Park? Italian Prime Minister Andrea Abodi, Minister for Sport & Youth, Giorgia Meloni, Italian Prime Minister and Grant Dalton, CEO Emirates Team New Zealand - May 26, 2025 © Ian Roman / America's Cup
The first official event of the 38th America's Cup got underway on Monday, set against the symbolic backdrop of St. Peter's Basilica in the Vatican.
Except for the Defender, Royal New Zealand Yacht Squadron, none of the competitors, including the Challenger of Record, the Royal Yacht Squadron, were present.
It is expected that they will be invited to the next event of the Italian welcoming tour in Naples on Wednesday, May 28, at Castel dell'Ovo, where an official presentation of the event will be held.
The two events are proof positive that the 38th America's Cup is underway, breaking free from the salvos of media releases calling for more transparency launched by two concerned teams late last week. As part of their response, the America's Cup defender included a document labelled "Final Draft" of the Protocol, or rules that will govern the upcoming Cup.
The Challengers were also offered a viewing of the Venue Hosting Agreement. Curiously, two weeks later, one of the malcontents, Athena Racing, representing the Challenger of Record, had not returned the prerequisite Non-Disclosure Agreement (NDA) before being sent the confidential Host Venue Agreement, which would reveal the amount of the Hosting Fee.
In Naples, the atmosphere is expected to be more sombre than the smiles and bonhomie of Monday's session in Rome's Casino del Bel Respiro, with the Prime Minister and other Italian luminaries in attendance. With The Vatican just over the way, the opportunity seems to have been missed to have the newly minted, American-born Pope Leo bless the America's Cup.
Entries open on Sunday
Late last week, there were agitated calls for more transparency from the two Challenger teams: American Magic, the team of the venerable New York Yacht Club, and Athena Racing, to which Emirates Team NZ, the team of the Royal Yacht Squadron, Challenger of Record, responded.
Whether the 2024 Swiss Challenger Alinghi Red Bull Racing will be present in Naples' Castel dell'Ovo on Wednesday will be a key point of interest.
The Swiss are said to have added fuel to the embers of discontent within the challenger ranks, with a letter claimed to be en route from a former America's Cup Trustee, La Société Nautique de Genève, to the current Trustee, the Royal New Zealand Yacht Squadron. The note is understood to be less than complimentary about the current state of the America's Cup and the Draft Protocol in particular.
One can assume from the missives of Thursday and Friday that the "Final Draft" of the Protocol governing the conduct of the 38th America's Cup has not been countersigned by the Challenger of Record.
That being the case, it will be interesting to see what happens this Sunday, when, according to the Final Draft, entries open for the Cup and remain for three months before closing on August 31, 2025.
Technically, the RNZYS has to receive all Notice of Challenges and then put them through a vetting process to ensure the challenging clubs comply with the Deed of Gift, the 19th-century document that governs the overall framework for the America's Cup, and also the provisions for a bona fide club, which are laid out, under the as yet unsigned Protocol.
Surprisingly, unlike the Protocol for the 2024 America's Cup, the Final Draft Protocol doesn't specify a date for payment of the €5 million (NZ$9million) entry fee, which has been previously due within seven days of the Entry being accepted by the Royal New Zealand Yacht Squadron.
Last January, the Royal Yacht Squadron's team, INEOS Britannia, was disbanded when its financial backer, INEOS Sport, withdrew its support. No interim financial backer has been announced for the British entry since then. The now €5 million entry fee is a significant increase from the € 2 million entry fee for the 2024 America's Cup and will be a challenge for any team that doesn't have financial backing in place.
Seed Capital
In a change from the 2024 situation, the Entry Fee doesn't go to the Defender, who is responsible for organising the America's Cup events. In this Final Draft Protocol, a new organisation was created to run the America's Cup events, and the entry fees, doubling as "Seed Capital", are used to fund the new Cup organisation, the America's Cup Partnership (ACP).
That organisation takes over on June 30, 2025, and is stated by the Protocol to be funded by "Seed Capital" - without which it can't operate.
All Challengers Entry fees contribute to the "Seed Money". However, the Defender is exempt from that requirement; in other words, RNZYS and ETNZ pay nothing, and they won't be providing the financial props for the fledgling ACP in the interim.
The Defender doesn't quite get away scot-free, as since winning the Cup, ETNZ has carried the costs of getting the Host Venue, Naples and the principal sponsor of the America's Cup Events, Louis Vuitton, on board. To date, it has also coordinated much of the heavy lifting on the new Protocol and the AC75 Class Rule.
There is no mention in the Final Draft Protocol regarding whether the Event Hosting Fee or any Sponsorship monies are to be deposited into the ACP bucket. One assumes there will be some payment, as neither the venue nor the presenting sponsor would sign a deal that did not have deliverables, which are the primary responsibility of the Defender.
Dalts hands over to ACP.
In forming ACP, Emirates Team New Zealand CEO Grant Dalton appears to have dodged a bullet.
In the last two Cups, Dalton was often accused of wearing two hats - that of the CEO of the racing team ETNZ and that of the CEO of America's Cup Events Ltd, the event organisation arm of Emirates Team NZ.
Now that the responsibility for the Event organisation has been handed over to an independent group managed by the ACP Board and formed from the Founder Cup teams, the Defender has escaped involvement in the organisational minutiae of what is primarily a Challenger Selection Series.
The lunatics aren't quite taking over the asylum; the Challenger of Record and Defender (COR/D) do have the right of approval over the direction of travel without doing the heavy lifting in the Cup organisation.
After the conclusion of the 2021 America's Cup, Emirates Team New Zealand sat down and conducted a review of their performance in the regatta, not on the basis of winning, but on the basis of losing. It was the only way they could objectively assess their performance, identify areas where they could have improved, and pinpoint the root causes of the errors in the 7-3 Cup win.
It's a fair bet that a similar process was undertaken this time around.
That probably explains the hard line taken by the team with skipper Peter Burling and his required absence to compete in 14-18 SailGP regattas each year in the run-up to the Cup, given the sailing time limits imposed by the new Protocol.
It is also a fair bet that, given his objective of winning the America's Cup, Dalton and others in the management team didn't feel that running around and organising a Challenger Selection Series was conducive to winning the America's Cup. Like the expectation put on of his former skipper, Dalton is putting his total focus on winning the America's Cup.
A stellar Challenger Selection Series doesn't make the ETNZ's boat go any faster, and passing the responsibility to an independent, largely Challenger funded independent organisation is a smart, maybe Cup winning, move.
Show me the Money
If Athena Racing cannot demonstrate to the Royal Yacht Squadron that it has the financial backing to support a competitive team, then it is likely that RYS will withdraw as Challenger of Record. Part of meeting that COR commitment, as the first club entered, is paying the €5million Entry Fee/Seed Capital.
In that eventuality, it will be interesting to see what happens and whether the provisions of the Deed of Gift take precedence over the provisions of a yet-to-be countersigned Protocol. In the past, the Challenger of Record has continued without a team in the event; however, in the current circumstance, it is hard to see how the COR can continue without paying the not insubstantial €5 million Entry Fee.
Whichever way that scenario plays out, it is a fair bet that other teams will be emailing RNZYS at the stroke of midnight on Saturday night to submit their entry and secure first place in the queue to replace the Challenger, should the British team withdraw.
After months of quiet, the America's Cup juggernaut is finally firing up.