Arsenal manager Arsene Wenger has warned against a quota-based system being used in the Premier League believing it will dilute the quality of the division.
Football Association chairman Greg Dyke would like to see the number of home-grown players in top-flight squads increased from eight to 12, a move he feels will benefit the national team.
Premier League chief executive Richard Scudamore claims clubs were told by Dyke at a meeting on Thursday that the FA could not impose the change.
And Wenger believes those changes will not benefit the league or the national team.
In an interview with beIN Sports, Wenger said: "I believe that we are in the world of competition. Competition means who of you or me is the best one. We have to accept that.
"That means as well that the rules of the game must be structured to favour the best. Or we are not in a competition anymore.
"So we can say one of two things - we protect the mediocre or we produce the best players."
Wenger warned that similar schemes in other countries had led to young players becoming 'professional subs', not enhancing their development but downgrading the league standard.
"I give you two examples," he said. "In Yugoslavia in the past they decided you had to play three players on the team sheet who were under 21. What happened? They became professional subs. It happened in France, too.
"Then they decided you had to play three players (aged) under 21 from the start. You know what happened? They subbed all three after five minutes."
Dyke's proposal to toughen up home-grown player rules has the backing of UEFA president Michel Platini, who hinted that he intends to follow suit.
Should UEFA implement the regulations, then the Premier League would likely have to back down.