NIL

Current Law

California's Fair Pay to Play Act (SB 206, as amended by SB 26) prohibits schools from preventing athletes from earning NIL compensation or hiring representation, so long as those arrangements do not conflict with existing team or institutional contracts. The law covers both college and high school athletes. Effective since September 1, 2021, it was among the first state laws to force the NCAA's hand on NIL.

The House settlement adds substantive requirements: deals must reflect a genuine business purpose, pay fair market value, and promote goods or services available to the general public. Collectively-arranged or booster-funded agreements that do not meet this standard face heightened scrutiny. Any NIL deal valued at $600 or more must be disclosed to the College Sports Commission via the NILGo platform prior to execution.

Key Compliance Obligation: Ensure your department has a clear pre-execution review process for all NIL contracts meeting or approaching the $600 reporting threshold. The obligation to report runs to the athlete, but compliance staff should have visibility.

Red Flag: Deals labeled "NIL" that are funded by boosters or collectives and tied to enrollment at your institution — rather than to commercial deliverables — are functioning as rev-share, regardless of what the contract says. The label does not control the legal effect.

Rev-Share

Current Law

The House settlement authorizes schools to share revenue directly with athletes as compensation for their athletic participation. For the 2025-2026 academic year, schools may budget approximately $20.5 million annually for direct athlete payments. Athletic directors and general managers have discretion over how those funds are distributed across sports and athletes.

Unlike NIL, rev-share is salary-like compensation — it is tied to being on the roster at a specific school and providing athletic value to the program, not to completing commercial deliverables. This distinction matters for how agreements should be structured, reviewed, and priced by agents.

Key Compliance Obligation: Rev-share agreements must be documented and structured separately from NIL contracts. Your compliance office should have a classification standard that determines whether a payment is triggered by deliverables (NIL) or by roster status and athletic participation (rev-share).

Red Flag: Agents are increasingly charging a single flat commission rate across both NIL and rev-share compensation. For salary-like rev-share money, the professional analogy is a player contract — where fees are typically in the 3-5% range, not marketing-level commissions. Athletes signing representation agreements without understanding this distinction may be significantly overpaying.

Agents

Current Law

Agents representing college athletes in California are governed primarily by the Miller-Ayala Athlete Agents Act (California Business and Professions Code section 18895 et seq.). Key requirements include:

• Registration: Agents must register with the California Secretary of State before representing any athlete, professional or amateur.

• Bonding: Agents must maintain either a $100,000 surety bond or a $100,000 errors and omissions insurance policy.

• Written contracts: Every representation agreement must be in writing and include a description of services and a schedule of fees.

• Athlete cancellation right: Athletes have a 90-day right to cancel any representation agreement without penalty.

• Disclosure: Agents must file current public disclosure information with the California Secretary of State.

  
  

Federal law — the Sports Agent Responsibility and Trust Act (SPARTA) — also applies. SPARTA requires written disclosure contracts, prohibits misleading conduct, and imposes civil liability for violations. California has also adopted the Uniform Athlete Agents Act (UAAA) framework. California does not currently cap agent fees by statute for NIL or rev-share representation — a known gap.

Key Compliance Obligation: Verify that any agent or representative interacting with your athletes has complied with California's registration and bonding requirements before an athlete signs a representation agreement. A simple registration check with the California Secretary of State is a baseline step.

Red Flag: Agents who are not registered in California but are actively recruiting or working with your athletes are in violation of the Miller-Ayala Act. Additionally, athletes have a 90-day cancellation window — make sure they know it exists before they sign anything.