Suppose you make a definition for France. The corresponding country file should be named country_france.xml.
If there are 4 leagues, say, the definition files should be called league_france1.xml to league_france4.xml.
If there is a national cup called, for instance, Coupe de France, the corresponding definition file is cup_france_coupe_de_france.xml (the important part is cup_france, you can choose the rest; you could also call it cup_france_coupe.xml if you like).
If there is a supercup called Supercoupe de France, the file would be something like cup_supercup_france.xml or so (it starts with cup_ because supercups are just a special type of cup).
All these structures -- country, league, cup -- have to have a unique string identifier (abbreviated sid; see the xml file examples below). The sid and the part between country_ and .xml (or cup_ and .xml for cups) have to be the same. The sid of the first league in France would be france1. The sid of the cup would be france_coupe_de_france. Now this is not only a convention, it``s a must if you want your definitions to work.
To refer within definition files to other definition files, you use the sid. E.g. to specify that 3 teams from the first league in France get relegated to the second league, you have to use the sid france2 in the prom_rel element (see below).
All these files should be moved to a separate subdirectory of $HOME/.bygfoot/definitions, in this case perhaps $HOME/.bygfoot/definitions/france. The game should be able to find them there and you can select country_france.xml from the popdown menu in the startup window (if no users are selected yet).