The Super League side announced the arrival of former Australia rugby union international Folau, 30, on Tuesday.
Folau settled a legal dispute with Rugby Australia in December after his contract had been terminated for a "high-level breach" after he posted hell awaits "drunks, homosexuals, adulterers, liars, fornicators, thieves, atheists and idolaters" on Instagram.
Catalans say "any transgression" from Folau will trigger the immediate termination of his deal.
But the Super League have made their displeasure at the signing clear, with chairman Robert Elstone saying he "deplores the homophobic comments Israel Folau has made in the past" and adding that the decision to sign him from Catalans "lets down many people connected to our sport".
Prior to the post that saw him sacked by Australia, the ex-Waratahs back, who was also suing NSW Rugby, had been previously warned over his online posts in 2018.
Folau, who won 73 international caps in rugby union, had claimed in his dispute with RA to have lost out on the chance to play at two World Cups and the opportunity to become Australia captain.
In a fresh controversy last November, Folau's comments linking the bushfires in Australia to gay marriage and abortion were slammed as "appallingly insensitive" by the nation's prime minister Scott Morrison.
Israel Folau est un Dragon
— Dragons Catalans (@DragonsOfficiel) January 28, 2020
After Catalans said they were "pleased" to sign him, Folau stressed it was not his intention to cause any upset with his religious beliefs.
"I acknowledge the views expressed by Super League and the Rugby Football League," said Folau.
"I'm a proud Christian, my beliefs are personal, my intention is not to hurt anyone and I will not be making further public comment about them.
"I look forward to my return to the great game of Rugby League with the Catalans Dragons."
Former NRL star Folau switched to union in 2013, having debuted in league back in 2007.
Catalans chairman Bernard Guasch insisted the club wanted to give Folau a chance to display his talents but that he was operating under strict instructions over the beliefs he is allowed to express publicly.
"We want to give Israel a new opportunity to shine on the pitch," said Guasch.
"We do not support or agree with Israel's previously expressed and controversial views which are based upon his sincerely held religious belief.
"We do not share or condone those views and we are totally committed to our club and our sport being open and welcoming to everyone. We do not believe that those views should be publicly expressed, especially by a high-profile sports person.
"We have a signed agreement with the RFL. Any transgression will trigger an immediate termination of Israel's contract and a substantial fine for the club."
The RFL has confirmed it will not prevent the registration of Folau with Catalans, but stressed it was "a difficult decision" and did not believe it could block the move "under our current regulatory framework".