Summary
With the Protect College Sports Act of 2026 (the Act) now awaiting a House vote, universities and other stakeholders have a window to get ahead of potentially sweeping bipartisan legislation, which would create national rules governing student-athlete name, image, and likeness (NIL) compensation, eligibility, and transfers.
The proposed federal rules would replace the patchwork of state NIL laws with a single national standard, reshaping how institutions recruit and compensate student-athletes and affecting conferences, collectives, and other NIL stakeholders, as well.
Stakeholders that begin planning now will be best positioned should the bipartisan bill pass the House, following the Senate’s 77–22 approval last month.
The Upshot
- The Act would codify a five-year player eligibility window for Division I and II athletes and a “one free transfer” rule, with a subsequent transfer triggering a one-year loss of eligibility. These transfer rules include exceptions such as for unauthorized use of institutional marks or code-of-conduct violations.
- The Act ties institutional compensation of student-athletes to the revenue share cap from the House v. NCAA settlement (In re College Athlete NIL Litigation), permits a retention fund of up to $22.5 million per year above the cap for nine years, and requires that NIL deals with third-party organizations, commonly known as “boosters” or “collectives,” serve a valid business purpose at market rates.
- Associations, conferences, and institutions would be shielded from antitrust liability for enforcing the Act’s compensation, eligibility, transfer, recruiting, and agent rules.
- The Act would preempt state laws regulating NIL compensation, transfers, and eligibility.
- The Act adds new obligations and protections, including NIL disclosure and reporting requirements, a limited private right of action, and roster-spot and scholarship maintenance requirements for women’s and Olympic sports.
The Bottom Line
In anticipation of passage in the House, higher education institutions, conferences, collectives, and other NIL participants should begin evaluating whether their compensation, disclosure, compliance, and roster practices comply with the Act’s requirements.
On September 28, 2026, the Senate voted 77–22 to pass the Protect College Sports Act of 2026 (the Act), legislation that would impose comprehensive federal rules on intercollegiate athletics. Championed by Senate Commerce Committee Chair Ted Cruz (R-Texas) and Ranking Member Maria Cantwell (D-Wash.), the Act addresses student-athlete eligibility, transfer rights, and NIL compensation, and grants the National Collegiate Athletic Association (NCAA) and its member schools a limited antitrust exemption.
NIL Compensation and Disclosure
The Act would bar institutions, conferences, and associations from restricting athletes’ ability to earn NIL compensation or conditioning eligibility or scholarships on NIL activity (or lack thereof), subject to limited exceptions, which include sport discontinuation, head coach departure, sexual assault or harassment, and graduate study. Institutional compensation could not exceed the revenue share cap set forth by the settlement in In re College Athlete NIL Litigation, No. 20-cv-03919 (N.D. Cal.), which is currently $21.58 million per year and is set to increase by roughly 4% annually over the 10-year settlement term. However, compensation could exceed this cap through a retention fund permitting up to $22.5 million per academic year above the cap for athletes who have completed at least one season, available for nine years after enactment and conditioned on academic benchmarks. An additional $5 million could be used for “non-revenue sports,” including women’s and Olympic sports.
NIL agreements with boosters, collectives, and other “associated entities” would have to serve a valid business purpose and be commensurate with compensation paid to comparable nonathlete individuals with a similar profile, reputation, or notability, and institutions could not compensate prospective athletes before enrollment. Division I athletes would have to report NIL agreements exceeding $600 within five days of executing an agreement, and institutions and associations would face annual disclosure obligations, including a public, searchable database to help athletes estimate the fair market value of NIL deals. The Act also amends the Sports Agent Responsibility and Trust Act to impose new agent registration and endorsement-contract requirements, including a 5% cap on agent fees for endorsement contracts.
Antitrust Protection and Preemption
The Act provides that it is not unlawful under federal or state antitrust laws for an association, conference, or institution to enforce or comply with the Act’s compensation, revenue share, eligibility, transfer, recruiting, agent, and coaching-transition provisions, or to impose fines, participation restrictions, and eligibility sanctions for violations. The exemption is available only to associations that adopt implementing rules. The Act also preempts state laws that conflict with it or regulate NIL compensation, transfers, or eligibility, while preserving state civil rights, tort, contract, consumer protection, and certain other laws.
The Act also extends the Sports Broadcasting Act’s antitrust exemption to intercollegiate athletics. This exemption has historically permitted professional sports leagues to collectively sell broadcasting rights irrespective of restrictive antitrust law. This exemption would now permit jointly formed entities that pool and sell college media rights to act in line with professional sports leagues. However, this exemption is subject to membership, revenue distribution, local broadcast access, and rivalry-preservation requirements, and would restrict certain conference mergers and acquisitions by conferences reporting more than $700 million in revenue.
Athlete Protections and Enforcement
The Act would, among other things, prohibit institutions from revoking or reducing scholarships based on athletic performance, injury or illness, or roster management and require medical coverage for sports-related injuries, including for five years after an athlete’s final competition. The Act also includes a Title IX savings clause and requires larger Division I institutions to maintain at least as many scholarships and roster spots for “non-revenue sports,” including women’s and Olympic sports, as they offered in 2024-25.
Athletes could bring civil actions for violations of specified provisions, subject to a 30-day pre-suit notice and cure requirement (except for claims involving physical injury, death, or sexual abuse), and associations, conferences, and institutions could not include predispute arbitration agreements in athlete agreements under the Act.
Next Steps
The Act now moves to the House of Representatives. If enacted, it would substantially reshape the compliance landscape for colleges and universities, conferences, collectives, sponsors, and athlete agents. Stakeholders should begin reviewing NIL and revenue-sharing arrangements, booster and collective relationships, disclosure and reporting processes, scholarship and roster policies, and athlete agreements (including arbitration provisions) against the Act’s requirements.
Ballard Spahr lawyers in our Education, Sports and Entertainment, and Antitrust and Competition Groups are available to assist clients in evaluating the Act and its implications for their athletics programs and NIL arrangements.
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