"We have been forced to let go of players for next season we would have certainly kept if we knew there were some sort of exceptions or appeal process involved and I know other clubs are in the same position.
"This type of massaging of the cap has the potential to create precedent and it opens up a Pandora's box.
"I would be very disappointed and surprised if the Commission allowed it."
"If it is allowed the salary cap could become a farce."
The ARLC would only say that negotiations between the game's governing body, the Eels and Folau and his management were ongoing.
"We are continuing to work with Parramatta and to work within the salary cap," a spokesman said.
"The integrity of the salary cap if of paramount importance."
Parramatta boss Ken Edwards said the Eels were forced to make the radical request.
"It is an extremely complicated situation," Edwards said.
"Both the ARLC, the NRL and Parramatta have all worked very hard to come to a resolution on the matter.
"(But) it is becoming frustrating. We need to know as a club where we are so we can move forward and so does Israel Folau."
Edwards met with ARLC chairman John Grant on Friday to discuss the proposal which would average the club's expenditure on players over the 2013 and 2014 seasons.
Folau quit his lucrative AFL contract with Greater Western Sydney on November 1 and since then the ARLC and the Eels have been at loggerheads over the former international.
The Eels wanted to register Folau on a contract worth $150,000 a season - a move rejected by salary cap auditor Ian Schubert.
"We have been open and transparent from the start," Edwards said.
"We haven't tried to keep anything (hidden)."
The news came on a day Parramatta announced a new five-year deal with Venues NSW over the use of Parramatta Stadium as the club moved to allay fears from fans they could abandon their home since 1986 - the year of their most recent premiership win.
- AAP
