Football's world ruling body FIFA has threatened to ban the Swiss Football Association if it fails to impose a transfer ban on the club by January 13.
The Court of Arbitration for Sport (CAS) on Thursday upheld a decision by football's European ruling body UEFA to refuse FC Sion re-entry to the Europa League after the Swiss club breached player recruitment rules.
Sion had been put under a transfer embargo over the signing of Egyptian goalkeeper Essam El Hadary, but proceeded to sign six players in the summer.
Sion then fielded five of the six players during the Europa League play-off tie against Celtic earlier this year and were kicked out of the competition as a result, with UEFA's decision to expel them upheld by the CAS.
After being thrown out of the competition the determined Swiss club lodged several appeals with Swiss courts -- a move which appears to have angered FIFA's Executive Committee.
A statement released here Saturday by FIFA said if Sion were not punished by the Swiss FA, Swiss football would in turn be sanctioned.
"Following the latest developments in the FC Sion/Olympique des Alpes SA (OLA) case, and in particular the decision of the Court of Arbitration for Sport of 15 December 2011, the Executive decided to give a final deadline of 13 January 2012 to the Swiss FA to enforce the registration ban imposed on OLA by the FIFA Dispute Resolution Chamber and confirmed by the Swiss Federal Court and to sanction the attitude of the club repeatedly trying to circumvent this decision in a legally abusive manner.
"As a consequence, all matches in which the relevant players participated shall be declared forfeit or three points shall be deducted respectively.
"Should this deadline not be respected, the Swiss FA will be automatically suspended from 14 January 2012 onwards."
Top Swiss team FC Basel are currently through to the knockout phase of the Champions League and the national team is set to play Argentina in a friendly in February.