European Club Association (ECA) chairman Andrea Agnelli told his members at a meeting in Split that the new event would bring the "overall number of clubs" involved in UEFA club competition to 96.
Under the new format, the Europa League's group stage will be reduced from 48 teams to 32, with the new competition and the Champions League all having the same number.
In his opening address at the ECA's biannual general meeting on Tuesday, Agnelli said: "Pending approval of the UEFA executive committee, the green light has been given to introduce a third competition, bringing the overall number of clubs to 96, as of the 2021/22 season."
Agnelli, who is also president of Juventus, occupies one of two seats allocated to club representatives on the UEFA executive committee, which will next meet on September 27 in Nyon, Switzerland.
Europe used to have a third competition for winners of domestic cup competitions, known as the Cup Winners' Cup, but it was abolished in 1999. Domestic cup winners now enter the Europa League.
The ECA has previously called for more clubs to be involved in European competitions and a "greater certainty of matches" for participating clubs.
UEFA has made little secret of the fact it has been looking at ways to raise the Europa League's profile while also giving more clubs a shot at European competition, and therefore its growing financial benefits.
Two weeks ago in Monaco, UEFA said it is "constantly reviewing" its competitions and has been "discussing various ideas within its Club Competitions Committee before any decision on potential changes would be made".
Back then, UEFA president Aleksander Ceferin said proposals were "just discussions".
Agnelli also repeated his call from last year for a drastic overhaul of the international match calendar, which is drawn up by global soccer body FIFA and allocates dates for national team games.
"A detailed assessment of the existing international match calendar is required prior to presenting a new model post-2024. The current model needs modernising," added Agnelli, who is also president of Juventus.
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