H.R. 3847 — Student-athlete Protections and Opportunities through Rights, Transparency, and Safety Act

This section designates the Act as the “Student-athlete Protections and Opportunities through Rights, Transparency, and Safety Act” or the “SPORTS Act” and includes a table of contents.

This section defines 16 terms for purposes of the Act, including (1) compensation (i.e., any form of payment or remuneration, including for name, image, and likeness rights, excluding grants-in-aid, certain health insurance, disability insurance, career services, wages for actual work, and employment facilitation programs); (2) institution (i.e., institution of higher education as defined in section 101 of the Higher Education Act of 1965, 20 U.S.C. 1001); (3) student athlete (i.e., an individual enrolled at an institution who participates in a varsity sports team of the institution); (4) third party (i.e., any individual or entity licensing name, image, and likeness rights from current or prospective student athletes, excluding institutions, conferences, and interstate intercollegiate athletic associations); and (5) name, image, and likeness rights (i.e., rights under federal or state law to control and profit from the commercial use of an individual's name, image, or likeness, including publicity rights).

This section prohibits an institution of higher education, athletic conference, or interstate intercollegiate athletic association from restricting a student athlete's ability to enter into a name, image, and likeness (NIL) agreement, except if the agreement (1) violates the institution's code of student conduct, (2) negatively impacts the institution's reputation or public image, or (3) conflicts with the institution's existing contracts. This section further (1) requires student athletes to disclose NIL agreement terms to their institution within 60 days, with the institution prohibited from releasing such information without the student athlete's or NIL representative's written consent (except as provided in section 6); (2) prohibits such entities from barring student athletes from intercollegiate athletic competitions or related events due to NIL representation; and (3) voids NIL agreements that are not in writing or that omit required elements, including a services description, parties' names, term, compensation amount, and termination provisions for non-performance.

This section amends the Sports Agent Responsibility and Trust Act by (1) striking a required warning in agent contracts notifying student-athletes that agreeing to agent representation may cause loss of athletic eligibility; and (2) establishing disclosure and consent requirements for athlete agents assisting student-athletes with endorsement contracts (i.e., name, image, and likeness agreements), including disclosure of the agent's registration status with an interstate intercollegiate athletic association (and, if registered, whether the student-athlete's institution is a member) and, if unregistered, written consent from the student-athlete (or parent or guardian if under 18 years of age).

This section requires interstate intercollegiate athletic associations to (1) establish a registration process for individuals or entities seeking to represent student athletes in name, image, and likeness (NIL) agreements and (2) maintain a publicly accessible, searchable database to help student athletes and NIL representatives estimate fair market value for such agreements based on information under section 6. The section further authorizes conferences and interstate intercollegiate athletic associations to (1) establish rules on athlete recruitment timing and transfers (including limits on inducement payments), (2) provide NIL educational materials to student athletes and their parents or guardians, (3) organize championships, and (4) enforce membership bylaws allowing removal of institutions, restrictions on competition participation, or limits on athlete eligibility (if compliant with the Act).

This section requires each institution, not later than July 1 of the first year after enactment and annually thereafter, to provide anonymized data on name, image, and likeness (NIL) agreements disclosed to it under section 3(a)(3) during the preceding year to any interstate intercollegiate athletic association of which it is a member. Such data includes (1) a description of services rendered by the student athlete and (2) the amount of compensation provided to the student athlete, with protections to prevent transmission of personally identifiable information. The association must use the data to establish and maintain a publicly accessible, searchable database enabling student athletes and NIL representatives to estimate fair market value for NIL agreements, while taking reasonable measures to prevent identification of any student athlete.

This section establishes eligibility requirements for institutions to receive any Federal funding from the Department of Education by conditioning such eligibility on compliance with specified protections for student athletes receiving grants-in-aid for varsity sports team participation. Specifically, an institution must (1) provide such student athletes with education and training on career preparation, financial literacy, mental health, name-image-and-likeness opportunities, nutrition, sexual violence prevention, strength and conditioning, and the process for transferring to another institution; (2) pay all medical costs for injuries sustained during such participation for the 4-year period after the student athlete graduates or separates from the institution; and (3) neither reduce nor cancel such grants-in-aid due to athletic ability or performance, team success contribution, injury, physical or mental illness, or roster management, and make the grants available for degree completion for 10 years from initial agreement regardless of continued sports participation. The Secretary of Education may promulgate implementing regulations under the Administrative Procedure Act (5 U.S.C. 553). The requirements apply to funding made available 1 year after enactment.

This section establishes a limitation on liability for institutions, conferences, and interstate intercollegiate athletic associations that comply with this Act and its amendments. Such entities may not be treated as violating any law or regulation, or be subject to liability thereunder, based on (1) the adoption of, agreement to, enforcement of, or compliance with any rule or bylaw limiting or prohibiting student athlete compensation from such entities; (2) a restriction on the intercollegiate athletic eligibility of a student athlete who violates such a rule reasonably contemplated under this Act; or (3) compliance with any agreement, understanding, rule, or bylaw reasonably contemplated under this Act.

This section preempts any state or local law, regulation, rule, requirement, or standard that conflicts with this Act or that governs or regulates—with respect to intercollegiate athletic competitions or varsity sports teams—the compensation, employment status, eligibility, or commercial use of the name, image, or likeness of student athletes. The section further provides that student athletes are not employees of their institutions, conferences, or interstate intercollegiate athletic associations solely by virtue of participating on varsity sports teams.