G14 dissolved after Fifa agrees to pay for players

The threat of a breakaway European super league to rival the Champions League became a thing of the past last night with the announcement that G14, the influential cartel of 18 clubs, is to be disbanded after almost a decade of club-v-country feuding.

At a meeting Fifa and Uefa, football's world and European governing bodies, signed a potentially far-reaching agreement with the clubs – including Manchester United, Liverpool and Arsenal – to dissolve G14 and replace it with a more representative body, the European Club Association, which comprises over 100 clubs and is recognised by all parties.

In a significant return move, Uefa and Fifa agreed to the clubs' demands that they pay or make a significant financial contribution to compensate clubs when players are released for World Cup and European Championship fixtures.

This has been the basis of a battle among the various bodies over who has responsibility for a player's upkeep while he is on international duty, especially when they get injured.

The meeting in Zurich, which transformed the relationship between the clubs and governing bodies, was kept under wraps by all parties included David Gill, Peter Kenyon and Martin Bain, the chief executives of Manchester United, Chelsea and Rangers respectively.

Although no specific sum was made public in terms of how much the governing bodies would pay clubs who release players, yesterday's letter of intent – signed by all parties – was hailed as "historic" by Fifa president Sepp Blatter.

"Something very special has happened today," said Blatter, who has long campaigned for greater recognition of national teams. "The clubs, which are the basic cells of our game and fundamental to its thriving, are at last to become a part of the pyramidal football organisation."

He was supported byUefa president Michel Platini whose promise of greater co-operation among football's various stakeholders was one of the key messages when he took over the presidency from Lennart Johansson.

"The demands of the clubs to be heard and to be associated are well-founded," said Platini. "The letter of intent signed today is not a political step, but a logical one."

A statement added: "As part of the planned moves, Uefa and Fifa will enter into a series of commitments including financial contributions for player participation in European Championships and World Cups, subject to the approval of their respective bodies."

Since G14 was founded in September 2000 in the wake of previous attempts to establish a super league, Fifa have been increasingly alarmed by a number of expensive court cases brought against them, mainly over players getting injured while playing for their countries. These will now be withdrawn.