The English and French elite clubs have said they will establish two 20-team competitions to replace the Heineken and Challenge Cup tournaments from 2014 after they were unsuccessful in reaching agreement with organisers on a new structure from next year.
"Despite numerous meetings between the stakeholders over the last year ... discussions have been unsuccessful and the clubs can only conclude that negotiations on any new European agreement have now ended," Premiership Rugby, which represents England's top flight clubs, said.
Premiership Rugby said they had full support of the French clubs, who would not compete in any European competition without their English counterparts.
"Given the importance and urgency of the current position ... the clubs have now asked Premiership Rugby to take immediate action to put in place a competition for 2014/15 to include the French and English clubs but which will also be open to teams from other countries," Premiership Rugby added.
Clubs from England and France have long been at loggerheads with European Rugby Cup, the organisers of the European competitions, though revenue sharing and television rights appear to be at the forefront of the dispute with a battle between British pay TV operators BSkyB and BT.
BSkyB has agreed a four-year deal with the ERC to screen European club competitions from 2014, but rival BT has a separate agreement to broadcast the English Premiership and matches involving English clubs competing in Europe.
The Guardian also reported in April that BT would broadcast French Top 14 games, while the clubs believed ERC did not have the right to negotiate the agreement with BSkyB as they had instigated a two-year notice period clause in their participation contract in 2012.
The newspaper added on Wednesday that revenue sharing agreements and greater control over the game by the clubs were also important issues in dispute.
The English and French teams also believe that clubs from Ireland, Scotland, Wales and Italy have an unfair advantage in the European competitions as they compete in a separate 'Pro-12' league with no relegation while English and French clubs face relegation from their own national competitions.
Because of the lack of relegation, local media have highlighted a two-tiered approach by several clubs to field vastly different teams for the lucrative European fixtures from those that play in their 'domestic league'.
ERC said all parties were due to meet in Dublin on Wednesday to discuss the tournaments' future structure.
"While there is a shared sense of frustration among ERC's stakeholders at the lack of progress towards a new accord, the meeting will provide an opportunity for the parties to review the consultation process to date," ERC said in a statement.
"The current accord, which was agreed by all stakeholders in 2007, includes a two-year notice period which began on 1 June 2012 to allow for negotiations towards the formulation of a new agreement.
"The structure and format of both the Heineken Cup and the Amlin Challenge Cup remain in place until the end of the 2013/14 season."