World governing body FIFA said in a statement a lengthy investigation had found the Premier League side in breach of its article 19 regulation in the case of 29 minor players.
The club was also fined 600,000 Swiss Francs (460,843.53 pounds).
"Chelsea FC categorically refutes the findings of the FIFA Disciplinary Committee and will therefore be appealing the decision," a club statement said.
"The club wishes to emphasise that it respects the important work undertaken by FIFA in relation to the protection of minors and has fully cooperated with FIFA throughout its investigation."
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(Reporting by Martyn Herman; Editing by Christian Radnedge)
