Bates, who is now the chairman of Leeds United, singled out the Double winners as he expressed support for Football League's decision to formally adopt new rules on quotas of home-grown players.
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'This is an idea both the Premier League and the Football League are trying to implement to encourage the growth of youngsters and give them a better chance.
'For example, it is significant that since 2003 Chelsea have not brought one single English player into their first-team squads and similar situations apply to other clubs.'
England defender John Terry remains the most high-profile graduate of the Chelsea youth system but now Premier League had paved the way for the changes which will come into play next season for top-flight clubs and their Football League peers.
Bates insisted Leeds' record stood up to scrutiny after the Football League AGM in Malta voted in favour of new rules restricting clubs' first team squads to 25 players over the age of 21, of which ten must be 'home grown'.
'It's going to put a limit on the unlimited imports of foreign players,' he added: 'We're quite happy with it. We have the likes of Jonny Howson, Ben Parker and Aidy White for starters and I think it's good.
'It will take time to work, but it is a long-term thing not short-term. It also means the managers and coaching staff can concentrate on the players they have chosen.'
Bates, who took over Leeds five years ago, is also confident that 'sanity' will return to the transfer market as clubs trim their wage bills.
'Most clubs are seeking to reduce their wages budget drastically,' Bates said. 'The problem is that means they will have to get rid of players but the ones they want to get rid of are the ones that are overpaid which means the other clubs can't afford to take them. 'At the same time the agents still think there is a pot of gold at football clubs and so they are asking for silly wages.
'There is a semi stand-off and I think that now what is going to happen is that we will have the World Cup so negotiations will, if not dry up, will go on hold and in the meantime players will realise their players, their clients haven't got a job and therefore their demands will come more realistic and less stupid as time goes by.
'It means that clubs that want to get rid of players will have to be realistic. A little bit of sanity is now starting to come back to the wages market but again it will take time.'