Rugby Western Australia (Rugby WA) has gone into voluntary administration over "financial constraints" after attempting to save the Western Force from being axed from Super Rugby.
The Force were officially cut from Super Rugby in August as one of the chosen francihses to reduce the southern hemisphere competition from 18 to 15 teams.
Rugby WA sued the Australian Rugby Union (ARU) in April, but a Sydney court dismissed the case.
An advisory and investment firm claim they were appointed as voluntary administrator by Rugby WA "because of concerns of the future solvency of the business".
"This concern was due to the financial constraints on Rugby WA from the Western Force's elimination from Super Rugby Competition and Australian Rugby Union pursuing RugbyWA for its legal costs," said Scott Langdon of the advisory and investment firm via a press statement.
Langdon also claimed that Rugby WA will continue managing competitions in Western Australia and aim to handle the sport's development in the state.
A creditors' meeting has been planned for next week and another about a month after.
A parliamentary inquiry has recently revealed that the ARU made the decision to axe the Force instead of the Melbourne Rebels a few months before a review process was completed.
The Force should be playing in a six-team Indo Pacific Rugby Championship funded by billionaire Force supporter Andrew Forrest at some point next year.