Major League Baseball installed two competitive balance rounds under the league’s new Competitive Balance Agreement. This is to benefit small market teams like the Pittsburgh Pirates, who rely heavily on homegrown players. This allows for smaller market teams to gain an extra high draft pick to bring in another quality prospect.
The Competitive Balance rounds are slotted picks after the first round and the second round of the draft. These rounds are called Competitive Balance A and Competitive Balance B. The league picked the picks via a lottery in years past, but under the most recent CBA, the league takes the 10 smallest revenue teams and their win percentage to determine who gets what picks.