St Patrick's Athletic have formally begun the process of objecting to Waterford's participation in this year's UEFA Europa League.
They have written to the FAI to notify them of their plans and do not want Abbotstown to put Waterford forward - although the final decision will stand with UEFA.
The Dublin club would be next in line for a lucrative spot if Alan Reynolds' charges were refused.
Waterford require a dispensation to compete because the current trading company is fewer than three years in existence.
New owner Lee Power took control of the Blues at the end of 2016 and a name change from Waterford United to Waterford FC was part of the process.
The Saints sought legal advice - and also received guidance from the European Clubs Association - before drafting a letter which referred to Article 12.2 of UEFA's club licensing and financial fair play regulations; the clause which deals with the three-year rule.
It's believed they have also made plans to tick the relevant licensing boxes for a UEFA spot if Waterford were knocked back.
A new Derry City trading company was denied a European spot in 2012 under the three-year rule.
The main stumbling block was creditors that existed from the old company.
Power needed to deal with creditors before receiving a Premier Division licence from the FAI.
But the Saints have sought clarity on whether all debts have been wiped, making reference to recent media reports on the subject.
St Pat's officials, including owner Garrett Kelleher, made contact with the FAI as far back as December to notify them that they were monitoring the position.
Kelleher subsequently spoke with ex-CEO John Delaney before his switch to executive vice-president and fresh correspondence involved interim CEO Rea Walshe.
Waterford were one of the two League of Ireland clubs - with Limerick the other - who released statements in support of Delaney during the recent crisis.
League of Ireland
ST PATRICK'S Athletic Football Club have released a statement revealing their frustration at Dublin City Council's decision to ignore their plan for the St Michael's Estate area of Inchicore, a site in which the League of Ireland club have offered to build a new stadium, town centre, housing and retail facilities.