Iraq faces a year in the soccer wilderness after FIFA suspended it from all international competitions on Monday and issued an ultimatum to Baghdad.
The executive board of world soccer's governing body announced it had imposed the ban after the Iraq government dissolved its National Olympic Committee and national sport federations in breach of FIFA and Olympic regulations.
The board will recommend that the FIFA Congress, which meets in Sydney on Friday, suspends Iraq from all tournaments for 12 months, but left the door open for a reprieve if Baghdad reversed its decision by 1400 GMT on Thursday.
A suspension would destroy Iraq's dream of competing at the 2010 World Cup finals in South Africa.
Iraq were due to play Australia in a qualifier in Brisbane on Sunday then again in Dubai next week and if they miss those matches, Australia would be given the points.
"The FIFA Executive Committee decided to suspend the Iraqi Football Association (IFA) as of today ... following the governmental decree passed on May 20 which dissolved the Iraqi National Olympic Committee and all national sport federations, including the IFA," FIFA said in a statement.
"The FIFA Executive Committee also decided ... the case of the Iraqi Football Association would be presented to the FIFA Congress on May 30 for suspension until the FIFA Congress in 2009, namely one year.
"However, the suspension decided upon today may be lifted if FIFA receives by May 29, midnight (Sydney time), written confirmation from the Iraqi government that the decree has been annulled."
In a bid to reverse FIFA's decision, the Iraqi government notified the IFA on Monday that it was not affected by last week's decree, although Baghdad stood by its decision to disband the administrative arm of the Iraqi Olympic Committee.
BAGHDAD CLARIFIES DECREE
"We received a letter from the secretary-general of the cabinet which clarifies that the decision does not include the sports federations, including the soccer federation," IFA head Hussein Saeed told Reuters.
"We sent a copy of the letter to FIFA. We don't know whether they will change their mind or not," he said.
Saeed, speaking from Dubai, said he would meet FIFA president Sepp Blatter on Tuesday in Sydney to discuss FIFA's decision.
Sports Ministeer Jasem Mohammed Jaafar told Reuters the government had sent clarification to the football federation because the old decision was vague and misinterpreted.
"We have done what we could. If FIFA doesn't reverse its decision and Iraq doesn't play in the World Cup, we won't be responsible," he said.
The Iraq team were in Thailand preparing to leave for Australia when FIFA announced its decision. Iraq coach Adnan Hamad told Reuters in Bangkok that the players were in a state of depression after learning of the ban.
"The decision is a big shock for the players," he said.
"Now we are awaiting for direction from the Iraqi Football Federation to know what to do. We are supposed to leave for Australia on May 27 but we will postpone that."
Australian officials said they were also hoping for a resolution so that Sunday's World Cup match would proceed.
Any cancellation would increase Australia's chances of making it through to the next stage of qualifying but the Football Federation of Australia (FFA) would lose about A$3 million ($2.88 million) in ticket sales and sponsorship.
"Our strong hope is the matter is resolved as quickly as possible and the two teams can meet on the field," the FFA's head of corporate and public affairs Bonita Mersiades Mersiades said. "In the meantime the Socceroos are continuing as if it's business as usual."
The Iraqi team provided their war-torn homeland with a rare moment of celebration in 2007 when they won the Asian Cup in one of sport's great modern fairytales.
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