Soccer: Football clubs, their officials, players and employees are to be banned from holding any interest in licensed player agencies under new English FA rules intended to tighten up potential abuses of the transfer market.

The measure, one of a raft of new proposals approved in principle by the FA board last week, is intended to remove the potential for conflicts of interest posed by managers, club officials or players holding financial stakes in agencies with whom they are dealing in the transfer market.

Proactive Sports Management, renamed the Formation Group, is one of the companies that has attracted adverse publicity because of the number of players and managers at one time on its shareholders' register.

Managers such as Peter Reid, Kevin Keegan and Graeme Souness were all shareholders while also negotiating transfer deals for Proactive players, and the company had an office based at Newcastle's St James' Park, where several shareholders have held the manager's post.

The measure is one of several intended to restore some credibility to the FA's regulation of the transfer market. The proposals include agents having to submit to examination of their financial backgrounds and to register the identity of all third parties they may be working with on deals.

Agents will also be banned from representing players younger than 16. The wrangling over young players such as Jon Obi Mikel, the 15-year-old whose signature has been disputed by Chelsea and Manchester United and who has been involved in a tug-of-war between competing agents, is one of the more disturbing developments in the global transfer market, and the FA hopes its clampdown will prevent similar incidents in future.

The FA will also seek to tighten up the rules governing how agents approach clients. This new regulation arrives as the FA faces a high court challenge to its rules from Paul Stretford, formerly a director of Proactive, who has been charged by the FA with making an illegal approach to Wayne Rooney.

The FA has been criticised for excising a clause from the new regulations that outlawed the contentious issue of "dual representation", the practice of agents representing more than one party in a transfer deal. It maintains that, even without a ban on dual representation, these measures are a vast improvement on the current situation whereby the world governing body, Fifa, publishes regulations for agents but fails to enforce them.

The case of Bernie Mandic, Harry Kewell's agent, who admitted in the high court working for both Leeds United and Kewell during the Australian forward's €7.5-million (£5 million) transfer to Liverpool in 2003, was referred to Fifa by the FA only to be returned with no action taken after 13 months. The FA is confident that by acting now some credibility can be restored to its administration of the domestic transfer market.

The Premier League supports dual representation but the FA's failure to address the issue has dismayed the Football League, whose club chairmen at a board meeting tomorrow will discuss a range of measures including introducing their own regulations barring dual representation. Guardian Service