The Australian Rugby Union (ARU) will make a decision this week whether to axe the Western Force or Melbourne Rebels from the new Super Rugby competition.
Governing body SANZAAR confirmed on Sunday that three teams - two from South Africa and a third from Australia - would be removed from the tournament to bring it back down to 15 from 2018.
The decision over which teams would be axed has been left with the ARU and its South African counterpart, with the Force having always been rumoured to be one of the teams under threat.
That was confirmed on Monday when ARU chairman Cameron Clyne said they were one of only two teams being considered along with the Rebels, who came into the league five years later in 2011.
Clyne said the ACT Brumbies had also been on their shortlist for removal but after an "exhaustive analysis" they would remain in the streamlined tournament.
"At the request of the board, ARU management completed an exhaustive analysis on the Brumbies, Western Force and Melbourne Rebels," he said.
"The purpose of the analysis was to assess each of those teams on their financial sustainability, high performance and commercial factors...with a view to identifying which of those three teams to remove from the competition.
"We don't anticipate this financial consultation period being a drawn-out process and expect to be able to deliver an outcome in the very near future.
The decision to cut a team from Australia has been criticised by the country's players' union, with 20 per cent of their members set to be affected by the decision.
Last month, the Rugby Union Players Association hinted at strike action, and a spokesman described the decision as "short-sighted and ill-conceived", but Clyne said the landscape had changed since expansion of the league, which started out with 12 teams in 1996.
Clyne added: "Since the ARU expanded to five Super Rugby teams in 2010, the economy we operate in globally has changed dramatically.
"With the incentives on offer in Europe, the player exodus has been significant in Australia and indeed across our SANZAAR partners.
"Based on recent performance trends it is evident that we do not currently have the playing depth in Australia to service five teams in Super Rugby."
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