The decision is seen as fallout of the meeting between the two before England's first Test match against Pakistan at Trent Bridge.
In May, Giles Clarke, chairman of the ECB, circulated an email warning officials of Pietersen's current county side Hampshire against meeting Modi until the latter was cleared of corruption charges, The Telegraph reported Wednesday.
The ECB board officials further spoke to Pietersen on the issue after he scored a fifty in the second Test against Pakistan at Edgbaston, the report said.
When asked about his relationship with the former IPL commissioner, Pietersen told ECB that he had only met an old friend for a beer.
The England batsman was recently dropped from his county side Hampshire's squad for T20 finals against Essex on Saturday. Pietersen had expressed a desire to move to some other county as his home in Chelsea is far away from the Hampshire's Rose Bowl ground.
"I think the ECB policy will be that all of our international players must be contracted to a county, but I wouldn’t be overly concerned if Kevin hasn’t sorted out his county situation by the time we get under way in Australia," said Andy Flower, England team director.
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