The New Zealand Rugby Union will not allow the Highlanders to hang on to their draft players, nor will it allow players to be drafted for two years.
At an NZRU board meeting in Auckland yesterday, the board decided it could not support a proposal from the Highlanders to keep hold of its 2008 draft players.
The Highlanders drafted eight players this year and wanted them to come back next year for the continuity of the team.
It also wanted to have players drafted for two years for the same reason.
NZRU chief executive Steve Tew said the selection protocols which had been in place for the past three years would remain, as the protocol of the draft could not be changed retrospectively.
A changing of the draft protocol also needed assistance from the New Zealand Rugby Players Association, which had not yet been approached.
Coaches of each Super 14 team selected their top 24 players in their region, and players could be drafted after that, Tew said.
He said the union and coaches tried to work through issues to get the best players on the paddock, and he hoped coaches would voluntarily make players available from their region should they have better prospects playing somewhere else.
But he said the rules meant coaches could hang on to their top 24 players.
Tew said there was merit in the Highlanders' argument that they had developed players from outside their province, but it could be said the home provinces such as Manawatu and Hawkes Bay did just as much to develop the players.
Tew said the union was mindful of the issues facing the Highlanders and the franchise's small player base and low population, and everyone wanted the franchise to remain in the competition.
Otago Rugby Football Union chief executive Richard Reid said the announcement was disappointing but understandable, considering the Highlanders were asking for a lot.
"What we have done is get the subject matter with the board and received passive support from them," he said.
Reid said the board and NZRU management agreed the top players should play every week.
He said the issue would not go away, and it was hard to argue against the NZRU's stance.