The English Football League today confirmed they are in talks about Celtic and Rangers competing in next season's Worthington Cup.
Discussions remain at an early stage and the Scottish clubs have not yet been approached, but the idea is being actively considered.
League spokesman John Nagle said: "It is an idea that has been discussed in outline by the League and we continue to explore its possibilities.
"It is at a stage where people are discussing what it would mean and how it would work."
One potential problem is whether the Old Firm clubs would qualify for Europe if they won the trophy, or if they did not whether the runner-up would then qualify.
Nagle added: "We need to work out all the ramifications of what it would mean."
The League are keen to revitalise the Cup, with the top British clubs now playing reserve sides in order to keep senior players fresh for Premiership and European competitions.
PA