FIFA has announced both Real Madrid and Atletico Madrid will not be allowed to sign new players for the next two full transfer windows.
FIFA's official website revealed the news in a statement on Jan. 14. The sanctions are in relation to rule breaches in respect of signing players under the age of 18. Atletico confirmed via their official website they would appeal the decision, and Real did the same on their website.
Atletico formally filed the appeal on Monday, the club confirmed:
Club Atlético de Madrid has presented this Monday the appeal to the decision of the FIFA Disciplinary Committee which sanctions us with the ban to register national or foreign players during the next two whole recruiting periods and with a fine of 900,000 Swiss francs (approximately 820,000 euros).
The appeal is addressed to the Appeal Committee of the maximum global governing body of football and it reflects that our club does not agree with the sanctioning resolution and, at the same time, we consider that we have acted within the law in all cases. In addition, it requests the probationary suspension of the sanction pending the outcome of the appeal.
The clubs' punishments, which also include fines of CHF 900,000 (£622,600) and CHF 360,000 (£249,000) for Atletico and Real, respectively, will come into effect in the summer, meaning both clubs will be able to purchase new players during the remainder of the January window.
"The two clubs were found to have violated several provisions concerning the international transfer and first registration of minor players as well as other relevant provisions with regard to the registration and participation of certain players in competitions," the original FIFA statement read.
Real described the sanctions as "absolutely untrue" and added: "As a result, Real Madrid C. F. will appeal this decision of FIFA in all the sporting incidents, considering them absolutely inappropriate."
Los Rojiblancos said in their initial response to news of the ban: "Our club does not agree with the imposed sanctioning ruling and will examine all the documentation received to lodge an appeal against the sanction."
According to Onda Cero radio (h/t Sport), the signing of the son of Los Blancos boss Zinedine Zidane, Luca, is one of the cases FIFA is punishing Real for:
SPORT English @Sport_EN
Zidane's own son, Luca, was one of the cases which Real Madrid are being punished for (per Onda Cero radio) https://t.co/6D787axvO82016-1-14 12:45:57
The ban will have massive implications for both sides and the rest of European football, too.
Real, in particular, are renowned for their lavish spending, and as Sky Sports Spanish football expert Guillem Balague noted, any plans for major changes are likely to be put on hold for the time being.
He also outlined more details of the ban:
Guillem Balague @GuillemBalague
Real planning a recycling of the squad (would accept the right offers for Cristiano and Benzema) but a summer FIFA ban would stop all that2016-1-14 11:46:47
Guillem Balague @GuillemBalague
FIFA have announced it now partly so the ban applies for this summer without delays as clubs have got time to react, appeal, etc.2016-1-14 12:34:49
La Liga rivals Barcelona have just recently finished a similar embargo themselves, during which time they were able to win a whopping five trophies, including a memorable treble in the 2014-15 season.
They were also able to sign players during their ban but not register them to play in the first team, as was the case with the acquisitions of Arda Turan and Aleix Vidal last summer. Both players have only recently made their debuts, months on from becoming Barcelona players.
Bleacher Report's Karl Matchett thinks that of the two sides, it's actually Atletico who are better prepared for the ban:
Karl Matchett @karlmatchett
Atletico are better prepared than Real for this. Correa, Kranevitter, Vietto, Carrasco all signed recently, all young and excellent.2016-1-14 12:25:31
The bans are likely to put a halt to some transfer speculation, particularly when it comes to Real, who are often linked with major signings.
If the sanction is in place over summer, any deal for Manchester United's David De Gea would be off, despite reports in December suggesting Los Blancos would be making a major bid for his services, per Steve Millar of the Daily Star. Additionally, it makes it unlikely that Gareth Bale will be sold this summer, despite stories suggesting he could be on his way, per Rory Smith of the Times.
What it is also likely to mean is both sides will be busy in the final weeks of the January transfer window, in which they are still permitted to buy and register new players. For managers Zidane and Diego Simeone, it's a far-from-ideal scenario, but you suspect the clubs would have had some inkling these punishments were going to be handed out.
As Barcelona's recent success emphatically illustrated, a team can still thrive even without new faces coming in for two transfer windows in succession. Nevertheless, it's problematic for the Madrid clubs, especially given the Blaugrana will soon have no competition in the transfer market from their Primera Division title rivals.