Arsenal manager Wenger has rejected the idea that the England national team will be assisted by the new rules as planned while insisting they are "paralysing" the transfer market due to higher financial demands from players and their agents.
The boards of the 20 Premier League clubs last year unanimously agreed that squads should be limited to 25 players, eight of which must be 'home-grown' in order to promote English players. But Wenger is far from happy with the changes and believes they will jeopardise the Premier League's status as the world's best.
"Instead of asking 'we have the best league in the world, how can we make it greater?' they wonder 'how can we make it smaller?' The rules they decide are a disaster for this country. Ridiculous. They are all artificial and have nothing to do with top-level sport," he said.
The Frenchman reckons the home-grown rule gives too much power to players and their agents and will lead to an increase in financial demands which are already "paralysing the market''.
He said: "I read that (Stephen) Ireland wants to go only if Man City gives him £2million. That's because the new rules transform, even more, the agents into mercenaries. It is absolutely ridiculous and it is paralysing the market. Nobody buys. It is a joke. But they will create more rules like that, the home-grown rule, which is rubbish. It is not linked with quality. Do you really think it will remain the best league in the world? No chance. The Premier League have to decide: are they here to prepare the national team, so let's kick everybody out? Or are they here to be the best league in the world?''
Wenger said the limitations on foreign players would only harm England's national team by reducing the quality around them, blaming poor coaching, not imports, for England's failures.
He said: "You have as many foreign players in Spain as in England. You can sign players from all over the world in Spain. Why do they still produce players and we do not? It's down to the coaching. I've been educating players since I was 25 and I know one rule. The first thing you do to develop a player is to put him with another good player. If you are a great player, you want to play with great players.''
Premier League chief executive Richard Scudamore has sympathy for Wenger but believes the rules are designed for the correct reasons and will have a positive impact.
"In some ways I agree. For 12 years I argued for an open system," Scudamore told the BBC. "But there is a point at which you have to do something for the greater good.
"What we're trying to do is get young players through. It's not about the top superstars. They can have as many Under-21s as they like. It's not restricting the number of players - we're restricting the number of over-21s. What we're trying to do is make the marginal decisions go the other way.
"If you're about to decide whether to give a young player a contract or buy a foreign player then all of a sudden you think maybe we'll err on the side of the young player. I think Arsene, much as I respect him, has got a little bit emotive on this one.''