The situation is further complicated by the fact that Liverpool were only planning a season-long loan deal for the 21-year-old, with a view to a deal with his Spanish club Albacete next summer.

Gonzalez, who was actually born in South Africa, is currently recovering from a cruciate knee injury and would not have expected to be fit until October.

The permit was refused primarily because Chile are not in the top 70 of the FIFA rankings, and it is believed Liverpool also fell foul of regulations that say the player had to be among their highest wage-earners.

Liverpool officials attended a hearing in London on Thursday to argue their case but were shocked when a panel of judges refused them.

The ruling clearly upset Benitez, who argued that Gonzalez is not only the best player in Chile but was also one of the most exciting players in Spain last season.

Benitez told www.liverpoolfc.tv: “He’s a player we have scouted for over six months. I can tell the Liverpool fans who don’t know too much about him that he’s a player with lots and lots of ability.

“He is very fast, good in the air, good at crosses and he can score goals. In fact, he is the best player in Chile. We have had reports on the player from our own scouts, professional players, former players and other managers and they all say the same – that he is a very good player for now and even better for the future.

“We haven’t been awarded a work permit though and I was very surprised to say the least.”

Government regulations also require that when signing a young player from outside the EU, a club must convince officials that there is no comparable player in their own country first.

Liverpool would have a better chance if Chile were in the world top 70. They are currently 72nd and their next match is against Brazil.

Benitez added: “We must now wait because one of the problems is that his national team are not ranked in FIFA’s top 70. If they win a couple of games, maybe they will move up the FIFA rankings and things may change.

“Gonzalez is already a player who will shine in the Premiership but very soon he could be one of the most exciting players in England.

“Liverpool supporters love to see players who can lift them out of their seats and Gonzalez is exactly that sort of player. You saw the reaction when Djibril Cisse came on against Kaunas on Wednesday.

“The fans were jumping up and cheering when Cisse raced down the wing. With Gonzalez, the fans would be out of their seats the whole time because he can play like Cisse but on the wing.”

Liverpool may well now review the situation, and could wait until the January transfer window to make a second application, hoping that the player will then meet more of the UK criteria as well as being fit to play.