The Rugby Football Union (RFU) has been at constant loggerheads with the clubs since the game turned professional in 1995. But the two sides have put aside their differences to form a new group called England Rugby.
The new body will look after the financial and playing welfare at club and international level.
From the beginning of the next rugby season each Zurich Premiership club will receive £1.6million ($2.27m/B2.6m) annually from the RFU plus an initial £4m ($5.67m/B6.49m) bridging loan to be paid back within two years. For the next seven years after next season each club will receive a guaranteed £4m ($7m/B6.5m) a year and an extra £1m ($1.4m/B1.62m) in a season when a Rugby World Cup is held.
The current salary cap of £1.8m ($2.55m/B2.92m) remains the same. In addition to the financial windfalls, all Premiership clubs' debts will be written off.
England's top rugby union players, clubs and the Rugby Football Union (RFU) "are all going to live and die together", the RFU's chief executive Francis Baron said.
"It is now time to stop sweeping things under the carpet and dealing with the problems rugby players are facing... it's now time to put rhetoric into practice," Baron told delegates at a news conference.
England's top rugby union players will play no more than 32 matches each year under the terms of the deal. Several players called on the game's authorities to act to prevent burnout among internationals. Zurich Premiership clubs currently have a minimum of 29 matches a season, excluding friendlies, and a maximum of 39.
Baron and Tom Walkinshaw, the chairman of Premier Rugby, also stated that all the members of English Rugby would work together to make it easier for players to move from Rugby League to Union. The news comes on the same day that Gloucester is poised to announce that New Zealand rugby league international Henry Paul has switched codes and signed for them. Other players such as Welsh international Iestyn Harris, is also expected to take advantage of English rugby's support of code switching.
English rugby finally seems to have ended the war between the governing body and the clubs after agreeing an eight-year-plan in London on Tuesday.
