Australia's state teams could be without leading players for the new T20 Champions League as they battle with their IPL rivals for players.

The competition, announced this weekend, will see two teams from each domestic competition in Australia, England, South Africa and the IPL compete for a US$5million prize in late September.

Western Australia and Victoria, the finalists from the KFC Big Bash competition, will represent Australia.

However, Warriors star Hussey would be eligible for Chennai or his home state in what may lead to a tense tug-of-war for the hard-hitting left-hander.

Cricket Australia chief executive James Sutherland, who supported the latest addition to a rapidly expanding cricket calendar, said IPL franchises may get priority over states if a player was eligible for two sides in the Champions League.

"There's a couple of steps there in terms of the regulations that need to be determined," Sutherland said. "I know the IPL teams are very keen to have their players playing in the event."

The issue could be avoided with Sutherland revealing that a host of Australia's Test stars would be unlikely starters in the event which is tipped to be staged in India or the Middle East.

"The other is the actual availability of Australian players," he added.

"I think leading into the Test series against India, which starts in the first week of October, it's probably unlikely that too many of our Test players will be available to play."

He said the availability issues would be addressed in the coming months but the high-paying Indian teams would likely get their way.

"It's something we need to work out as we determine the regulations but there is probably a high likelihood that where an IPL team wants those players they will be cleared to play for those IPL teams," Sutherland said.

"We need to work out what the terms or conditions are on that release."

Fifteen matches over a 10-day period will take place immediately after the end of the Champions Trophy in Pakistan, which concludes on September 28.

Shane Warne's IPL champions Rajasthan Royals and runners-up Chennai Super Kings will be joined by Victoria, Western Australia, the Titans of Pretoria, and KwaZulu-Natal Dolphins.

England's representatives will be drawn from the finalists in the Twenty20 Cup.

Sutherland, back from India where he watched the IPL final, said he hoped the fixture would become a permanent one.

"It's certainly good prize money," he said.

"We are very pleased that there is a lot at stake and I'm sure our players from Victoria and Western Australia will be very excited at the prospect of playing on the international stage."