

Formatian At the close of the 1991-92 season, a proposal was made to form a new league that will result in more money into the game overall. Treaty founding members who signed on July 17, 1991 by 5 top ranked clubs, sets out basic principles to regulate the FA Premier League.
The formation of the new top division will have its own commercial authority apart from the English Football Association (FA) and the Football League (The Football League), as well as giving the FA Premier League license to negotiate its own broadcast rights issue and the sponsorship deal. The argument given at the time was that the extra income would allow English clubs to compete with teams across Europe.
In 1992 the First Division clubs resigned from the Football League en masse and on 27 May 1992 the FA Premier League was formed as a limited company, working outside the headquarters of the English Football Association and its own offices in Lancaster Gate. This becomes the dividing of the 104-year history of league football since it was formed in 1888, which has been operating until later into four divisions.
Furthermore, the Premier League would operate as a single division and the Football League operates with three divisions. There was no change in competition format, the same number of teams competing at the top level, promotion and relegation between the Premier League and the new First Division remained the same as the old First and Second Division with three teams relegated from the league and three promoted.
With the establishment of the Premier League, the Football League First Division became the league 2nd level, and the league's Second Division became the 3rd level in the league system of English football.