The international signing period begins July 2nd. On that date teams will be allowed to sign players who fit certain criteria for up to an allotted value. Players that have spent 3 or more years playing on a professional team from their country or who are 23 or older are unrestricted free agents and spending caps don't apply to them. Much like with the first year player draft, this limit is a soft cap. Teams may go over, but are penalized according to how much they go over.
This article is a little outdated now, but it does a good job of outlining penalties:
- 0-5% = 75% tax on overage
- 5-10% = 75% tax on overage, limit of $500,000 per signing in next signing period
- 10-15% = 100% tax on overage, limit of $500,000 per signing in next signing period
- 15+% = 100% tax on overage, limit of $250,000 per signing in next TWO signing periods