Shareholder John Textor also owns fellow qualifiers Olympique Lyon, which led to the decision.
Seven Liberal Democrat MPs have asked the culture secretary to intervene in the matter.
The club's chairman, Steve Parish, has confirmed that they will appeal the decision to the Court of Arbitration for Sport (Cas).
Parish expressed confidence in their legal arguments and stated that they do not think the decision is fair.
He emphasized that John Textor did not have a decisive influence over the club's decisions.
The club is hopeful that their appeal will be successful.
