FIFA has broadly rejected Chelsea's appeal against its two-window transfer ban for signing underage players, world football's governing body has announced.
The Premier League club were given the sanction, which runs until July 2020, in February and were also fined £460,000 for 29 breaches of the rules on the international transfer of minors.
Denying any wrongdoing, Chelsea immediately lodged an appeal, with the case heard by FIFA's appeal committee last month.
In a statement, FIFA said it has "partially upheld" the appeal but only in the sense that Chelsea will now be allowed to sign players aged under 16, providing they come from within the European Economic Area.
The ban on signing over-16s remains in place, as does the fine, although it does not apply to the futsal or women's teams.
"With respect to all men's teams, the ban on registering new players, both nationally and internationally for two registration periods, has been confirmed by the FIFA Appeal Committee," it said.
Cross-border transfers of players aged under 18 are banned unless there are specific, non-football reasons for the player moving to the relevant country.
FIFA initially investigated more than 100 cases involving Chelsea, going back several years, but only charged the Blues with 92 breaches of article 19 – the rule prohibiting the registration of minors – and other charges related to the club having third-party influence over other club's players.
Chelsea successfully defended themselves in 63 of these cases at a FIFA disciplinary committee but were found guilty of 29 illegal transfers.
The Stamford Bridge outfit were given 90 days to "regularise the situation of the minor players concerned", while the Football Association was also fined £390,000 for letting Chelsea register these players.
Spanish trio Atletico Madrid, Barcelona and Real Madrid have all been sanctioned for similar offences in the past.
Manchester City are understood to be the next leading club in FIFA's cross hairs for a ban related to underage transfers.
Chelsea are yet to comment on the verdict, which they received today, or say if they will take their legal fight to the Court of Arbitration for Sport.
