University Southern California Trojans
NIL BOOSTER RULES EDUCATION
What is an NIL Deal
An NIL deal is any agreement where a student-athlete receives anything of value, (e.g., money, products, services) in exchange for the use of their name, image or likeness (NIL). NIL can include social media promotions, brand partnerships, personal appearances, autograph sessions or other similar activities.
Institutional NIL refers to compensation that comes directly from the school or from someone using school-provided funds. These payments count toward the school’s annual NIL revenue-sharing cap and are managed by the institution.
Third-party NIL refers to all compensation that does not come from the school. These are agreements between student-athletes and outside businesses, brands or individuals. These agreements do not count against the school’s cap, but they must meet the standards set by the College Sports Commission (CSC), which oversees compliance in this area.
Since third-party NIL is separate and apart from the university’s distribution of revenue sharing, the CSC requires disclosure and review. Any third-party NIL deal worth $600 or more must be disclosed by the student-athlete, where the CSC reviews the compensation, the purpose of the agreement and the relationship between the student-athlete and the payor.
Reporting Requirements
- Any third-party NIL deal worth $600 or more must be reported by the student-athlete using the CSC’s disclosure system, NIL Go. This includes a single deal ≥ $600, or multiple smaller deals with the same payor that cumulatively exceeds $600.
- Student-athletes are required to disclose the third-party NIL deal within 5 business days of execution/signing. Deals not reported will impact the student-athlete’s eligibility.
How Disclosed Deals Get Evaluated
When reviewing NIL deals, CSC focuses on three components:
- Associated Status – The relationship between the Deal Sponsor and/or Deal Facilitator and a given institution. Deals with associated entities and associated individuals are reviewed with greater scrutiny. More information about the threshold for associated status can be on the NIL Go website;
- Valid Business Purpose (VBP) – Whether a deal is being made with the purpose of using a student-athlete’s NIL for a valid business purpose related to the promotion or endorsement of goods or services provided to the general public for profit; and
- Range of Compensation (RoC) – Whether the compensation paid to the student-athlete is commensurate with compensation paid to similarly situated individuals.
If the CSC determines a deal fails to meet any of its standards (i.e., no valid business purpose, or outside a reasonable range of compensation), the deal may be rejected. In those cases, the student-athlete has the opportunity to revise the deal or appeal the decision. If the student-athlete continues with the deal as submitted, they may face enforcement consequences, which could include loss of eligibility.
What this Means for Boosters
Boosters may enter into NIL agreements with student-athletes, with the understanding that these third-party arrangements must be disclosed by the student-athlete and evaluated by the CSC. Consequently, the student-athlete should always wait for CSC approval before providing any payment. Further, boosters should be aware if they trigger “associated” status as such deals will be subject to greater scrutiny.
Boosters are encouraged to notify USC if they plan to pursue an NIL agreement so the university can help support the process and ensure the student-athlete completes all required disclosures.
Resources
- College Sports Commission FAQ
- College Sports Commission Fact Sheets and Rules
- USC NIL Contact: Sam Adams (samantca@usc.edu)
