The validity of the Club Nautico Espanol de Vela as Challenger of Record was submitted to the new Arbitration Panel.

Under 24.2 of the new Protocol, the yet to be publicly announced entity has been reconstituted for the 33rd America’s Cup, but membership is reduced to three.

The Swiss Professor Henry Peter was appointed as Chairman. One of the other Panel members is believed to be Graham McKenzie (New Zealand) and a member from the Host country, Spain. A three member Sailing Jury has also been appointed.

A letter has been posted on the Golden Gate Yacht Club website responding to an unsigned note from Professor Henry Peter (SUI)received by the Yacht Club, advising of the intentions of both the Defender and Challenger. The intention was also referred to by Alinghi officials at the America’s Cup press conference in Valencia earlier this week.

"The format and process set up for this arbitration in The Protocol Governing the Thirty Third America’s Cup ('Protocol') violate the most basic principles of justice and independence common to all legitimate adjudicatory bodies and are an affront to the most basic sensibilities common to all law abiding people", said GGYC letter. "A dispute resolution proceeding in which the parties to the proceeding are in agreement (in this case CNEV and SNG), and in which the judges may be removed, and the rules of procedure may be changed, at any time and for any reason by the parties to the arbitration, will be viewed by the public and the sailing community as nothing more than a kangaroo court".

"In fact, (...) the New York courts have the authority to interpret the trust instrument, the Deed of Gift, and determine whether a successor trustee, in this case SNG, has complied with its terms", wrote James V Keraney, Counsel to Golden Gate Yacht Club.

Nevertheless, several outcomes are possible from the Hearing, one of which may be to refer the matter for determination by the Courts, as Societe Nautique de Geneve SNG is entitled to do so, as Defender under Clause 35 of the Protocol.

The initiation of proceedings to the Arbitration Panel could also be the opening gambit in a move to exclude Golden Gate YC from the 33rd America's Cup, as if the panel elect not to send the matter onto the New York Supreme Court but make a determination in the matter themselves, then SNG could invoke Sections 35 and 2.7(d) of the Protocol which prohibit any Challenger from resorting to any other court or tribunal. And, the latter Clause gives SNG the contentious right to disqualify and Challenger if they dispute the binding effect or the Protocol.

Another outcome could be that the Arbitration Panel decides that CNEV are not qualified to be the Challenger of Record. In this case Clause 3.3 of the Protocol would come into effect, where CNEV would either withdraw or be disqualified as COR and then either a new or existing Challenger can be selected by SNG. Or, the next Challenger to submit a Notice of Entry would be selected.

However the Challenge from Golden Gate YC was the second lodged after the Club Nautico Espanol de Vela.