Leader and AL of a clan can initiate clan battle with the leader/al of another clan. First format is arranged 3v3,4v4, etc etc. then whoever that initiated the battle gets to choose the members who are online from their clan list. the members that gets chosen get a confirmation that asks whether you would like to participate. click ok and then you get tped to an exclusive arena zone.
right now, arranging clan battles in arena are a pain and too many outsiders messing up the fights....reward/penalty for winning/losing...guess that can also be arranged at the time format is decided...eg. no reward, item put up upfront, noa upfront, etc.