Sir Russell Coutts has no doubt that Emirates Team New Zealand will follow through with plans to compete at the 35th America’s Cup in Bermuda in 2017.

Team New Zealand’s involvement in the next edition of the “Auld Mug” remains in doubt after organisers controversially withdrew Auckland as the initial host venue for the America’s Cup Qualifier and with it the likelihood of the team receiving government funding.

Team New Zealand, who have also been rocked by the fallout from the sacking of skipper Dean Barker, filed an application to the America’s Cup arbitration panel to reinstate Auckland as the venue for the qualifying regatta.

They have challenged the revision, favoured by the majority of America’s Cup teams, based on a signed and accepted bid they claim was announced to the teams in accordance with the original Protocol governing rules for the event.

The outcome of the arbitration could make or break New Zealand’s campaign to regain the title with John Key, the country’s Prime Minister, suggesting that the Government will not fund the team now that it appears there will be no regatta in Auckland.

“I think we’re at the end of the road really,” Mr Key said. “With the event being held 100 per cent in Bermuda, that becomes a really challenging issue to go beyond the $5?million we’ve already put in.”

The original decision to hold a pre-regatta in Auckland was strongly opposed by the European challengers, who indicated a preference that all of the racing in 2017 be conducted at a single venue, Bermuda.

Cup organisers announced last week that Bermuda will host all America’s Cup racing in 2017.

Coutts, who led Team New Zealand to its first America’s Cup victory in 1995, said it was unlikely Team New Zealand would withdraw.

“They have a great sailing team, and this rule favours a great sailing team,” the Oracle Team USA chief executive said.

In the unlikely event that Team New Zealand pulled out, Coutts said another New Zealand syndicate would fill the void.

“Others would put a New Zealand team together because frankly they have the components of a very competitive team,” he said.

Teams voted in favour of changes to the 35th America’s Cup Protocol, which included a reduction in boat size and as a consequence the withdrawal of Auckland as America’s Cup Qualifier host city, at a Competitor Forum last month.

Team New Zealand and Luna Rossa both protested the format change, with the Italian syndicate withdrawing from the 2017 event, calling the decisions unprecedented and illegitimate.

“We are quite frankly in disbelief that the continued actions of the America’s Cup Event Authority have lead to the withdrawal of our great friends Luna Rossa,” Grant Dalton, Team New Zealand’s chief executive, said.

“It sends a clear and unmistakable message that the self-serving manoeuvring of rules within sports oldest trophy has consequences for not only the America’s Cup but also all of sailing.”