Though its formation had been rumored to be in the works for years, Sunday’s announcement that some of European soccer’s top clubs would break away from the continent’s established competitive structure to start the Super League nonetheless sent shock waves through the sport. The move by the clubs would severely damage the UEFA Champions League, Europe’s long-established top club competition and one of the world’s most followed sporting events.

Here’s what you need to know about the new breakaway league.

How would the Super League work?

On Sunday, 12 wealthy and prominent teams from leagues in England, Italy and Spain announced they would be forming the Super League, a new annual competition to determine Europe’s top club team and a potentially existential threat to the Champions League. Those teams are AC Milan, Arsenal, Atlético Madrid, Barcelona, Chelsea, Inter Milan, Juventus, Liverpool, Manchester City, Manchester United, Real Madrid and Tottenham Hotspur. Those 12, plus three more to be announced, would be the league’s permanent members, with five more teams qualifying annually based on achievements from the previous season.

The new league, to begin in August, would feature two groups of 10 teams, with clubs from each group playing one another home and away. The top three teams in each group would qualify for the quarterfinals, with the fourth- and fifth-place teams in each group taking part in a two-legged playoff for the remaining two quarterfinal positions. The remaining teams would take part in a two-leg knockout format to reach the neutral-site final in May.

How is the Super League different from the Champions League?

In a nutshell, participation in the Champions League is not guaranteed. Clubs from domestic leagues across Europe must finish high up in their league’s standings — fourth place or better, depending on the league — to qualify for the next season’s Champions League, whose main event consists of a 32-team group stage and then a 16-team knockout phase.

The Super League, on the other hand, would be a mostly closed league with 15 of the 20 members being the same every year, a setup more akin to major U.S. pro sports than the model for European soccer leagues. For club owners, the lure of the Super League is simple: A guaranteed spot would mean a guaranteed revenue stream, not subject to an annual qualification process.

This season’s Premier League standings can be used to show just how enticing a guaranteed spot would be. Of the six Premier League clubs to sign on (Arsenal, Chelsea, Liverpool, Manchester City, Manchester United and Tottenham Hotspur), only first-place Manchester City and second-place Manchester United would qualify for next season’s Champions League if the season ended Sunday.

UEFA, the governing body of European soccer which runs the Champions League, has taken its own, less dramatic step to increase revenue: On Monday, its executive committee unanimously voted an expected expansion of the Champions League’s group stage to 36 teams, with each club now guaranteed 10 games instead of six.

How much revenue are we talking about?

The Super League’s financial projections are staggering and are at the heart of the breakaway league. With reported backing from U.S.-based investment bank JPMorgan Chase, among others, each founding club would be guaranteed 3.5 billion euros, or approximately $4.2 billion, with projected paydays growing to at least 10 billion euros ($12 billion) for each team over the course of the league’s first commitment period, which would last at least 23 seasons.

Those numbers dwarf the financial rewards offered by the Champions League, which pays out clubs based on how far they advance in the tournament while also enriching teams from large television markets. This can create some interesting windfalls. For the 2014-15 Champions League, Italian club Juventus took home 89.1 million euros even though it lost in the final to Spanish side Barcelona, which earned 61 million euros. Juventus’s “market pool” payday, determined by the size of its television market, was 58.2 million euros; Barcelona received only 24.6 million euros for its market pool.

In essence, the Super League would mean a guaranteed, enormous revenue stream for its 15 permanent members. Those teams will receive 350 million euros simply for signing up; by comparison, German club Bayern Munich received only 130 million euros for winning last year’s Champions League (4 million euros less than Paris Saint-Germain, the French team it beat in the final).

Why does it seem like most people hate the Super League idea?

Because it would be closed to nearly all of European club soccer and would siphon away the most popular teams from the Champions League, which has been the continent’s top club competition since 1955. More importantly to fans, it also abandons soccer’s long-standing idea that a club must qualify for a competition through on-field performance. Now, 15 teams would qualify for the Super League automatically, no matter how poor their form was the previous season.

On Monday, UEFA President Aleksander Ceferin called the 12 breakaway teams “snakes” and said they were spitting “in the face of football lovers.”

“I cannot stress more strongly at the moment that UEFA and the football world stand together alongside this disgraceful, self-serving project from a select few clubs in Europe fueled by greed above all else,” Ceferin said, promising that any player who takes part in the Super League would be banned from participating in future international tournaments, including the World Cup.

UEFA, European soccer’s governing body, also has pledged that the 12 breakaway teams would be banned from next season’s Champions League, even if the Super League is not yet operational.

Have we seen this story before?

It’s not the first time change has been forced upon soccer by its most powerful clubs. In a way, the Champions League’s current structure was created in response to similar breakaway threats.

For the first few decades of its existence, the competition was known as the European Cup and was open only to the champions of each domestic league as a pure knockout tournament. But after lobbying from powerhouse teams in Spain and Italy, UEFA expanded the tournament in the 1990s to include non-champion clubs from the continent’s top leagues, thus ensuring the rich got richer and reducing the chance for a smaller club to win the tournament.

Since the 1991-92 tournament, the first to feature a group stage, teams from outside Europe’s top leagues — England, Germany, Spain and Italy — have won only three titles, and none since Porto of Portugal hoisted the trophy in 2003-04. In the 24 years before the 1991-92 event, such teams won eight European championships.

Similarly, the top clubs in England’s system formed the Premier League in the 1990s after demanding a larger share of soccer revenue in that country. Previously, those clubs had to share revenue with lower-division teams, but the formation of the Premier League allowed the top teams to create their own television and sponsorship deals and keep the financial windfall mostly for themselves. This led to understandable grumbling from the have-nots of English football, but now the Premier League is the most-watched collection of soccer teams in the world.

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