Leon's James Rodriguez strikes the ball challenged by America's Israel Reyes during a Mexican soccer league match in Mexico City. AP
Leon and fellow Mexican club Pachuca both qualified for this summer's Club World Cup in the United States but have the same owner, Grupo Pachuca.
“After having evaluated all evidence on file, the chairman of the FIFA appeal committee has decided that CF Pachuca and Club León failed to meet the criteria on multi-club ownership,” FIFA said in a statement.
FIFA added Leon’s replacement will be announced at a later date.
Before the decision was announced, Grupo Pachuca argued that the clubs operated independently. It also promised to sell Leon but has not done so.
The group said in a statement on Friday that they will appeal to the Court of Arbitration for Sport.
“We are dissatisfied with this decision and will appeal it to the fullest extent possible since all the evidence that proves our administrative independence was presented in a timely and transparent manner,” the group said.
“We will defend what was won on the field.”
Leon recently signed Colombian midfielder James Rodriguez in an attempt to be more competitive in Group D of the Club World Cup alongside Brazil's Flamengo, Tunisia's Espérance Sportive Tunis and England's Chelsea.
The participation of two clubs that belong to the same owner was questioned by Costa Rican club Alajuelense, which asked FIFA to enforce the rule that forbids clubs from the same ownership to participate in the tournament.
CONCACAF qualified four teams in the Club World Cup: Seattle Sounders, Monterrey, Leon and Pachuca. Lionel Messi’s Inter Miami was invited by FIFA.
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