DOHA - Qatari broadcaster beIN Sports on Tuesday threatened legal action against the Asian Football Confederation, alleging the governing body had "surrendered" to Saudi Arabia in a new row over Gulf broadcasting rights.
Earlier on Tuesday the AFC announced it would live-stream free matches featuring Saudi clubs in the region's premier club competition, the Champions League.
BeIN hold the rights to air competition matches.
The latest flashpoint comes amid a long-running row between the two countries over sports broadcasting, which has seen Qatar accuse Saudi of facilitating "industrial-scale" piracy of its programmes through a channel called "beoutQ", a claim Riyadh denies.
It also comes amid an ongoing bitter diplomatic Gulf crisis which has seen Qatar boycotted for the past 21 months by neighbouring former allies including Saudi Arabia.
"In response to the extraordinary announcement by the AFC... beIN is set to launch a major international legal dispute against the Confederation for material breach of its multi-million dollar broadcast agreement."
BeIN added the move was "clearly political".
The Doha-based sports broadcasting giant has held a contract with the AFC since 2013 to cover Champions League games as well as the Asian Cup tournament.
A beIN spokesman said the company spends around $38 million (33 million euros) a year on the contract, which is up for renewal in 2020.
A statement from the Saudi Press Agency said the AFC, in a letter to the Saudi Arabian Football Federation, was cancelling "the monopoly of beIN sports channels".
The news agency said the decision was based on "serious legal and systematic violations" committed by beIN.
This will not be the first legal action threatened by beIN.
Last October it launched a $1-billion compensation claim against Saudi broadcasters over the issue of piracy.
The latest row comes just weeks before the AFC elects its new president.
One of the three candidates is Qatar's Saoud al-Mohannadi.