HONG KONG (Reuters) - Chinese football authorities have announced major curbs on spending by clubs ahead of the 2020 season that include a cap on foreign and domestic players' salaries as they seek to stave off financial ruin.
Overseas recruits to the Chinese Super League in the upcoming winter transfer window will be limited to earning 3 million euro (S$4.5 million) after tax, the first time a salary cap has been implemented in the Chinese Super League in more than a decade.
Additionally, a ceiling of 10 million yuan (S$1.9 million) has been placed on Chinese players' salaries.
Clubs will also not be permitted to spend more than 1.1 billion yuan on their operations throughout the upcoming campaign, with salaries not to exceed 60 per cent of that amount.
"Our clubs had too much money burned and our professional football has not been run in a sustainable way," Chinese Football Association chairman Chen Xuyuan said, according to state news agency Xinhua.
"If we don't take timely action, I fear it will collapse."
The new rules were confirmed after a meeting of the Chinese Football Association on Wednesday and do not extend to bonuses that can be paid, which could give clubs some flexibility to pursue star signings.
Clubs will also be permitted to sign a fifth player from overseas, up from the current quota of four, but will only be allowed to field four foreigners on the pitch at any one time.
Officials have routinely sought to curb excessive spending in the Chinese Super League after a major outlay on foreign stars ahead of the 2017 season saw the arrival of players such as Brazilian star Oscar and Carlos Tevez from Argentina on huge salaries.
Later that year, a 100 per cent levy was placed on transfers valued at over 45 million yuan involving foreign players while the same condition was imposed on domestic moves worth more than 20 million yuan.
Money has poured into Chinese football from the country's private sector since Xi Jinping, a football fan who has declared his desire to improve the nation's standing within the game, became president in 2013.
Wales international Gareth Bale was the latest global superstar to be linked with a move to China following his falling out with Real Madrid coach Zinedine Zidane. That transfer to Jiangsu Suning fell through before the closure of the transfer window last summer.
However, the influx of foreign talent, expected to lift standards at a club level, has done little to reverse the national team's dismal fortunes, with China failing to qualify for the finals of the World Cup since their debut appearance in 2002.
The national team is currently struggling to qualify for the next tournament in Qatar in 2022, with Italian Marcello Lippi quitting as head coach in November and a replacement yet to be appointed.