The club will be allowed only to sell players, while both Mateo Kovacic and Gonzalo Higuain could be signed on a permanent move before the end of June, when their season-long loan expires.
Also USA international star Pulisic will join the Blues at the end of current season. However, Chelsea will be prevented from signing any new player until January 2020.
An official statement from the club reads: “Chelsea FC has today received the decision of the FIFA Appeal Committee.
‘The Club notes that the FIFA Appeal Committee has decided to partially uphold the appeal lodged by Chelsea FC against the decision of the FIFA Disciplinary Committee. However, the Club is very disappointed that the transfer ban of two consecutive registration periods was not overturned.
“Chelsea FC categorically refutes the findings of the FIFA Appeal Committee. It acted in accordance with the relevant regulations and will appeal the decision to the Court of Arbitration for Sport (CAS)”.