H.R. 4868: College Athlete Economic Freedom Act

This bill, titled the College Athlete Economic Freedom Act, aims to establish rules concerning the rights of college athletes about their name, image, and likeness (NIL). Below is a summary of the key provisions:

1. Athlete Rights

The bill grants college athletes the right to:

• Market their name, image, and likeness without restrictions from colleges or athletic associations.
• Form or join collectives to negotiate contracts related to their NIL rights.
• Receive compensation for the commercial use of their NIL.

2. Prohibition of Restrictions

Institutions of higher education cannot impose rules that:

• Prevent college athletes from marketing their names, images, or likenesses.
• Limit the amount of compensation athletes can receive, unless negotiated fairly with a collective representative.
• Interfere with the creation or recognition of a collective representative for athletes.

3. Group Licensing and Institutional Support

Colleges must:

• Obtain licenses from groups of athletes if they wish to use their collective NIL for promotions.
• Provide equitable support for all athletes, regardless of gender, race, or sport, concerning NIL marketing opportunities.

4. Representation

Athletes may retain agents or legal representation without fear of being prevented from participating in their sports. Institutions cannot regulate these representation agreements.

5. Funding for Market Analysis

The bill allows the Secretary of Commerce to award grants for conducting market analyses on the monetization of athletes’ NIL rights. This is aimed at gathering data on compensation and ensuring fair practices.

6. Provisions for International Athletes

International college athletes will have clarified eligibility under U.S. immigration law, ensuring they can engage in NIL activities without jeopardizing their visa status.

7. Enforcement and Compliance

The bill establishes enforcement provisions for unfair or deceptive practices, allowing violations to be addressed by the Federal Trade Commission (FTC). It also offers a private right of action for individuals claiming damages from violations of the bill.

8. State Preemption

States may not enforce laws regarding the NIL agreements of college athletes that conflict with this Act, ensuring a standardized approach at the national level.

9. Impact on Scholarships

The Act specifies that earning compensation from NIL rights will not adversely affect athletes’ eligibility for scholarships or grants-in-aid.

Relevant Companies

• NKE (Nike) - Nike may benefit from increased partnerships and endorsements with college athletes promoting its brand.
• ADBE (Adobe) - Adobe could leverage college athletes in their marketing strategies utilizing athlete content creation features.
• PEP (PepsiCo) - As a longstanding sponsor in college sports, PepsiCo could engage in new marketing strategies with athletes via their NIL rights.