Lyon have been banned from making any transfers in the January transfer window and provisionally relegated from Ligue 1 at the end of the season because of financial mismanagement

The National Directorate of Management Control (DNCG) handed down the punishment to the team owned by American businessman John Textor after a hearing on Friday.

If Lyon are to avoid being relegated to France's second tier by the DNCG at the end of the season, they will need to demonstrate a much healthier economic outlook.

As part of the punishment, the club is forced to announce a limit on the budget forecast for player salaries, as overseen by the DNCG.

"The meeting went well. We have no problems with the continuity of the model or with financial viability," Textor said after the hearing.

He also announced a public presentation for Saturday where he will show the documents he presented to the DNCG.

The DNCG maintains strict control and regulation on professional football club accounts so as to avoid overspending and clubs going into administration.

The French giants won seven league titles in a row from 2002 to 2008 and reached the UEFA Champions League semifinals twice during that period.

Textor, who also owns shares in Crystal Palace in the Premier League and Brazilian top league leader Botafogo, has had a difficult two years in France owing to the lack of financial stability at the club since his arrival. Lyon have recently reported financial debt of up to 505.1 million.

Lyon currently sit fifth in Ligue 1 on 18 points having recently won the derby against bitter rivals Saint-Etienne.

Information from The Associated Press contributed to this report.