England's clubs want a shareholding in the Heineken Cup

Premier Rugby Limited said teams were pulling out over an alleged change of heart by the Rugby Football Union over giving clubs a stake in the tournament.

The Rugby Football Union replied by saying the clubs were in clear breach of their outstanding legal obligations.

"We will consider carefully what action we should take in the best interests of the game," said an RFU statement.

French clubs had voted 14-3 in favour of pulling out earlier on Thursday.

"We are not competing in the European Cups organised by European Rugby Cup. It is non-reversible," said French National League (LNR) president Serge Blanco.

An agreement for the European Rugby Cup, which has been in place for eight years and does not cover clubs having a stake in the running of the tournament, ends this season.

The problem is the RFU refuses to let go of their percentage to the clubs Serge Blanco

A statement issued by PRL said its members felt it was "appropriate" that clubs should have some say, and that this had been a "fundamental principle" of negotiations for a new agreement which had been going on for over 12 months.

"LNR and PRL both believe a position was clearly reached last year which confirmed that clubs would have a much greater say in any minimum seven-year agreement, and that they would both hold shares in the new ERC," the statement continuted.

"The clubs remain by this position reached in October 2006 as the basis for any future agreement.

"Regrettably, while the Federation Francaise de Rugby (FFR) and the Federazione Italiana Rugby (FIR) have confirmed this position, the Rugby Football Union (RFU) appears no longer to accept this.

"As a result, LNR and PRL clubs are not willing to participate in the absence of a new agreement based on last year's position and which is inclusive of all parties."

Blanco says the French do not desire an alternative tournament

The French clubs are also thought to be unhappy at their domestic championship being disrupted by the World Cup, but Blanco said the shareholding issue was the main reason for the decision.

"In 2005, we wrote to the European Rugby Cup president demanding a meeting to speak about the future of the Cup, particularly the shareholding," said Blanco.

"The problem is the RFU refuses to let go of their percentage to the clubs.

"Our only desire was to find a common ground which would allow the clubs to exist together for a longer time. We are sad we haven't found this.

"French clubs have invested a lot in this competition, but we cannot continue to be walked all over. Either respect us, or don't respect us. The only way to respect us is to give us our shareholding."

Blanco added that there was no desire among the French clubs to establish any alternative tournaments next term.

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Before the English clubs' pullout was confirmed, they had already spoken of their willingness to organise their own alternative European matches next year, a prospect described by RFU chairman Martyn Thomas as "suicidal."

The tournament has been won by English or French clubs nine times in its 11-year history, so with them missing, the level of competition would be much weaker, with a knock-on effect for the other countries taking part.

"It will cost £500,000 pounds for each Welsh region," said Llanelli Scarlets chief executive Stuart Gallacher.

"It is a fifth of our budget. It will be a huge blow to the Welsh sides just as it will be for the Irish and the Scots."