Spain's football federation will take its case to the Court of Arbitration for Sport after FIFA rejected its appeal against sanctions imposed over Islamophobic chants by supporters during a match against Egypt in March.
FIFA fined the federation (RFEF) $20,000 and ordered it to close at least 15% of the available seats for Spain's next home friendly.
The sanctions relate to incidents at the RCDE Stadium near Barcelona, home of LaLiga club Espanyol, where some Spain fans chanted, "If you don't jump, you're a Muslim" during a World Cup warm-up match which ended in a 0-0 draw.
After the second occurrence of the chant, the stadium announcer issued a warning and the scoreboard displayed a message against discriminatory behaviour.
Spain winger Lamine Yamal, who is Muslim, condemned the chants at the time, describing them as disrespectful and intolerable and calling those responsible "ignorant and racist".
Spanish police launched an investigation the following day while world governing body FIFA later started disciplinary proceedings against the RFEF.
The RFEF argued that the word 'Muslim' was "neither insulting nor pejorative", adding the fans' conduct should be assessed under FIFA's Article 17, which covers political, ideological, religious or offensive messages, rather than Article 15, which deals with discrimination and racist abuse.
However, FIFA's disciplinary committee rejected that argument, saying Article 15 does not require the explicit use of a slur and that a term can be discriminatory when used in context as "an insult, taunt, or marker of inferiority".
The RFEF appealed the sanction, but a FIFA spokesperson told Reuters that it was dismissed last week, prompting the Spanish federation to take the case to CAS, the highest authority in sports disputes.
"Throughout the proceedings, the RFEF has maintained that it acted immediately, diligently and effectively from the moment it became aware of the incidents," a high-ranking official in the RFEF told Reuters.
"Furthermore, the measures taken ensured that the chants were not repeated and that the spectators present in the stadium themselves expressed their disapproval of such behaviour."
The official said the federation considered the sanctions particularly severe, arguing that comparable capacity restrictions had not been imposed automatically in more serious cases or those involving previous disciplinary offences.
Reuters has contacted FIFA for comment.
The chants were detected by the RFEF’s monitoring systems and immediately reported to the match officials, the official said, adding that security was reinforced in the affected section of the stadium.
"The Federation cooperated fully with the relevant authorities to identify those responsible."