Player eligibility

In the december window of 09/10, I've signed a player who's played for UEFA cup; I'm in the CL. I thought that he'd be eligible (being in the other Euro-competition) but apparently that's not how FM thinks the rules work.

Is my assumption correct that playing in any form of continental footie makes the player ineligible for other continental competitions? So playing for the lowly Intertoto would disqualify them for a CL-spot that season?

Thanks in advance!