Australian-born Nathan Fien was at the centre of the controversy, selected on the basis of his Kiwi great-grandmother when eligibility covers only parents and grandparents.
In addition to the deduction, Fien has been banned from playing for the remainder of the tournament, although it is doubtful he would have made it into the Kangaroos’ squad anyway.
After the hearing, the New Zealand Rugby League said that it accepted the decision and would not be making any appeals or taking any further action.
"The NZRL accepts it made an error and will not challenge the decision," said a statement released by NZRL general manager Peter Cordtz.
The decision was made by a panel of four, consisting of NZRL’s Selwyn Bennet, RFL executive chairman Richard Lewis, NRL chief executive David Gallop and chairman Colin Love.
The 27-year-old has represented Queensland in the past, but is now playing for NZ Warriors, and in two months will qualify to represent the Kiwi national team through residency.
The Kiwis now have only one game left to try and reach the final, with Great Britain having three chances to get the points they need.