Revised CSC Guidance Transforms NIL Payment Framework for Student-Athletes

Revised Guidance on NIL Payments from the College Sports Commission

On July 31, 2025, the College Sports Commission (CSC) released updated guidance crucial for the frameworks surrounding payments related to names, images, and likenesses (NIL) for student-athletes. This revision aims to clarify the definition and validity of business purposes underpinning NIL agreements, aligning with the recent class action settlement involving prominent colleges and athletic conferences such as the NCAA, Big Ten, SEC, Pac-12, Big 12, and ACC.

The changing landscape of college athletics has increasingly put the spotlight on NIL deals, which allow student-athletes to profit from their personal brand. However, these deals have raised complex questions regarding compliance and business legitimacy. The new guidance from the CSC is a significant step toward reforming the NIL payment structure while ensuring that these arrangements are not only permissible but beneficial for the athletes involved.

Key Changes in the Guidance

Under the updated rules, collectives—groups that help funnel NIL opportunities to student-athletes—are now allowed to enter into agreements directly with them. However, these agreements must adhere strictly to the stipulated terms set forth in the settlement. This development replaces a prior guidance memo from July 10 that lacked alignment with the settlement terms.

Previously, many NIL collectives operated under the assumption that their primary purpose was to financially incentivize student-athletes to choose or stay at specific institutions. However, the CSC guidance makes it clear that this does not meet the necessary criteria for a valid business purpose under the provisions of the settlement.

The revised guidance emphasizes that NIL payments must serve a legitimate business purpose and be directed at offering goods or services to the public for profit. Notably, this stipulation means that payments should align with fair market value compensation, as defined in the settlement.

A Shift in Focus: Substance Over Labels

One of the most groundbreaking elements of this guidance is its focus on the substance of NIL payments rather than merely their titles. The settlement is designed to scrutinize NIL agreements based on their actual business purpose and not just the labels or names applied to them by collectives or other associated entities.

In practice, each proposed payment will be assessed on a case-by-case basis by the College Sports Commission. Should there be a challenge to the commission's determination by a student-athlete, an independent arbitrator will then take the case under consideration.

It is important to note that NCAA regulations still prohibit payments that directly entice athletes based on their performance, distinguishing them from acceptable NIL payment agreements.

Empowering Student-Athletes for the Future

With this revised guidance, student-athletes are granted clearer pathways to utilize their NIL rights, while the framework surrounding these agreements becomes streamlined and more transparent. This is particularly empowering for athletes, allowing them to concentrate more on their sports, knowing that compliance with this new guidance can unlock lucrative opportunities through collectives. These NIL arrangements will not count against the previously established payment limits of $20.5 million imposed on schools, further easing concerns regarding financial restrictions.

In conclusion, the CSC’s revised guidance heralds a new era in the college sports landscape by clearly defining acceptable parameters for NIL payments. This not only helps in fostering fair opportunities for student-athletes but also enhances the integrity of college athletics as a whole. As these changes unfold, both schools and student-athletes stand to benefit from a more robust and transparent NIL framework, paving the way for future innovations in how student talent is recognized and remunerated.