FIFA will allow Premier League players from Brazil, Chile, Mexico and Paraguay to compete this weekend after those countries agreed to waive a five-day travel restriction period.
Liverpool, Manchester United, Chelsea and Manchester City were among clubs that did not release Brazilian players for the current international break due to them having to travel to COVID-19 "red list" countries.
Sources this week say Premier League clubs could face sanctions from FIFA if they played South American players, who were not released for international duty, in this weekend's games.
But after extensive talks over the past 24 hours between FIFA and the relevant associations, a deal was reached that cleared the way for the players to compete without the risk of the clubs being sanctioned, the source told Reuters.
FIFA, the English FA and Premier League are working closely together to find a solution with the UK government over red-list quarantine restrictions in the October international window, the source added.
FIFA had waived its normal regulations on international call-ups during the COVID-19 pandemic but did not extend that waiver to cover the current games.