The NCAA Division I Council recently adopted new rules on disclosure requirements for third-party name, image and likeness (NIL) agreements and voluntary registration for NIL service providers (sports agents, financial advisers, athletic consultants, etc.). The adopted rules take effect Aug. 1, 2024, and are characterized as “student-athlete protections.”
Additional proposals regarding permissible institutional support and a clearer definition of an NIL entity were introduced but not yet adopted by the membership. The NCAA indicated that these proposals may be adopted as early as April 2024 after the NCAA receives feedback on the proposals.
New Framework Effective Aug. 1, 2024
- Voluntary Registration: The NCAA will establish a voluntary registration process for NIL service providers, including potential agents, financial advisers and consultants. This process aims to collect and publish information on service providers, making it available to student-athletes and schools in order to facilitate informed decision-making.
- Disclosure Requirements: Student-athletes will be required to disclose to their universities details and information on any NIL agreements greater than $600 in value no later than 30 days after entering into the NIL agreement. This includes disclosing contact information for all involved parties and NIL service providers; the terms of the agreement, including services rendered; term length of the agreement; amount compensated; and pay structure. Schools will then provide deidentified data to the NCAA biannually for a database accessible to student-athletes. Notably, many states already require disclosure of NIL deals; the NCAA’s new rule establishes a national requirement.
- Standardized Contract: The NCAA will develop a template contract and recommended contract terms, and collaborate with schools to educate student-athletes on contractual obligations.
- Comprehensive NIL Education: The NCAA plans to create comprehensive education for student-athletes and their support networks, covering policies, rules and best practices related to NIL.
The Division I Council proposed rules on school involvement and support for NIL activities. The intended purpose of the proposed rules is to support student-athlete decision-making and address challenges associated with NIL activities. As mentioned above, these proposals have not been adopted, but could be considered and adopted at the Division 1 Council’s April 2024 meeting.
- School Support of NIL Activities: The proposals remove some of the existing restrictions on schools’ involvement with enrolled students’ NIL activities. The proposed rules also subject third-party entities that are affiliated with an NCAA member institution to the same NIL standards and regulations imposed on schools. While direct compensation to student-athletes from schools is still prohibited, schools could facilitate NIL deals between students and third-party entities.
- Defining NIL Entities: The proposed rules define an NIL entity as “an individual, group of individuals, or any other entity (for example, a collective) organized to support the athletics interest of an NCAA school or group of schools by compensating student-athletes for NIL activities on behalf of itself or another third party.”
- Clarifying School Support of NIL Entities: The proposed rules also eliminate prohibitions on communications between schools and NIL entities. This would allow schools to reach out to entities (including collectives) concerning enrolled student-athletes for that school. Schools would still be prohibited from directly or indirectly providing any financial support to collectives or other NIL entities.
- Engagement With Prospective Student-Athletes: The proposed rules prohibit NIL entities from engaging with or providing any sort of benefits to a student-athlete until that athlete: (1) signs a letter of intent, (2) participates in summer activities, (3) practices with the team or (4) attends class at the school. This rule also would impact prospective transfer students who would be bound under the same prohibition from engagement with NIL entities.
If the proposed rules are adopted — particularly those on institutional involvement — it will significantly change the shape of NIL activities on college campuses.
Taken together, the adopted and proposed rules highlight the evolving landscape for collegiate athletics. Please contact the authors of this article if you have questions about best practices for NIL disclosure requirements and/or institutional tracking, or the potential impact of the proposed rules on your institution.