Once upon a time, the world of Match of the Millennium was a vastly more complex place, with a history worn smooth by the rivers of time. At one point, a group sought to change that. Because of that group's act, the timeline became twisted and fractured, erasing many of the events of the past, and returning the world to its infancy. The world is a newer place, where a man can do almost anything he dreams of, if only he has the power or will.
The world of MotM is in a "Year One" status, which means that many of the common events that may have defined an entire person's goal in life might not have happened yet. Most of the series events which MotM has drawn its inspiration from have simply not happened yet, and the choice is simply left to the player as to what point they wish to take their character in, unless directly contradicted by a theme file or character profile. This tends to err towards the side of allowing a player to decide where their own character goes in life, as opposed to having everything decided for them before they even put in their application.
Many of the antagonists of their respective series' have been reset to the point at which they were at their greatest. Sagat is lost in his own rage after killing Go Hibiki and losing his title to Ryu and Adon, while Hyo Imawano begins to take over Justice High in his bid to bring the world to order. Geese Howard has killed Jeff Bogard, and is at the height of his career as the boss of the Southtown Syndicate, while Mad Gear attempts to control Metro City underneath the command of the wily Belger. This allows the clash between protagonist and antagonist to continue, with the stakes heightened for all.
A new player has a lot to get acquainted with over the course of their play here, and the infinite granularity to which a player can be exposed to the individual events of MotM has been softened somewhat. Generally speaking, beyond what's listed in the infofiles directly, most of what occurs to or is relevant to an individual character is up for negotiation: HAS Ryo found out King is a woman yet? Well, that's up to those players. As characters change hands, smaller details may be changed or rewritten as appropriate.
Largely, as it pertains to continuity: Whatever will involve the most battle, goes.