New Zealsnd are considering challenging the authority of the sport's organisers, the International Rugby Board, after being yesterday stripped of the right to co-host next year's World Cup with Australia.

While it was the Australia Rugby Union which withdrew the invitation to its New Zealand counterpart to stage 23 of the 48 matches, officials in Wellington blamed the IRB for the move and as well as threatening legal action on the grounds that the sanction was unconstitutional, they vowed to raise the issue of the running of the game at next month's full council meeting of the board in Dublin.

The New Zealand RFU maintains that only the full council has the right to strip a country of its status as World Cup hosts, but the IRB argues that the hosts for next year are the ARU and that it is a matter for Australia who it sub-contracts matters to.

The NZRFU was asked yesterday to sign an agreement that it would provide "clean" stadiums for the tournament's organisers, Rugby World Cup Ltd, but having already sold a number of stand tickets for the World Cup matches as well as hospitality boxes, it was unable to do so and the ARU has been given three weeks to draw up plans to stage the 48-match event on its own.

"The board wanted us to do the dirty on our stakeholders," said one New Zealand official last night. "It would have been economic suicide to have signed what was put in front of us. We were asked not to play our provincial championship during the tournament, which would net us £6 million in gate receipts, while we could expect only one quarter of that from the World Cup games.

"It raises the issue of who is running the game. The IRB has been without a chief executive for more than a year and it has consistently failed to see this from our point of view, hardly surprising given that it has a northern-hemisphere bias."

The IRB maintains that the NZRFU was threatening the profitability of the World Cup by compromising RWC's sponsors who had baulked at the idea of World Cup matches being staged at grounds which carried advertisements for rival companies.

"The interests of our commercial partners was of paramount importance," said an IRB spokesman last night. "New Zealand knew back in 1998 when they agreed to be sub-hosts what the terms and conditions were. Nothing has changed since then."

The chairman of the NZRFU Murray McCaw said: "We were not prepared to mortgage New Zealand's rugby future to the whim of the RWC board. We were being asked to sell our soul."

The saga has brought into question again the wisdom of having more than one country staging the event. Only once, in South Africa in 1995, has a single country hosted the World Cup and later this year RWC will consider bids for the 2007 event. France, England and South Africa are the front runners.

New Zealand were irked that the two biggest draw cards outside the host nations, England and South Africa, would be based in Australia for the group stage.

Australia is confident it will be able to stage the event by itself, using its major cities of Perth, Sydney, Brisbane, Melbourne and Canberra as its main bases. But the ARU, which does not have a countrywide base, will also have to devise ways of attracting spectators to games between minor nations.

Guardian Service