The Board of the Football League has ruled that the businessman is ineligible to takeover the Championship ship after being found guilty of a tax offence in Italy
The Board of the Football League convened on Sunday to discuss the potential takeover and have ruled the Italian businessman is not eligible to takeover the Championship club.
"The Board considered detailed legal advice with regard to the application of its regulations within the context of a decision made under Italian law," a statement on the Football League's website read.
"Mr. Cellino was recently found guilty beyond reasonable doubt by a Court in Sardinia of an offence under Italian tax legislation relating to the non-payment of import duties on a boat. This resulted in a fine of €600,000, an order for the payment of trial costs and the confiscation of the boat in question.
"Having fully considered the matter, the Board agreed unanimously that the decision of the Italian Court does constitute a disqualifying condition under its Owners' and Directors' Test.
"The relevant disqualifying condition being that Massimo Cellino has been convicted of an offence involving acts that would reasonably be considered to be dishonest."
The Italian businessman has 14 days to appeal the decision.