Canadian athletes might be dishing dimes but they’re on the bench with respect to new NIL laws

Jeffrey Steinberg, Adam Scherer, David Silber, Teresa Litrico
Article
| 4/1/2022

It's been less than a year since the NCAA said college athletes could profit from their name, image, and likeness (“NIL”) and college basketball stars are wasting no time as NIL deals take over March Madness with big brands partnering in some very lucrative deals.

From the men’s program, examples include Gonzaga forward, Drew Timme and his head-turning handlebar mustache, inking a deal with the Dollar Shave Club to serve as the company's first "chin-fluencer." Then there‘s University of Michigan guard Adrien Nuñez signing deals with Amazon, Coach, and Spotify with the help of his more than 3 million TikTok followers.

But with the 2021 women's NCAA title game between Stanford and Arizona drawing 4.1 million viewers – it makes sense that women's basketball players have earned the second-highest level of NIL deal compensation (19 per cent), falling only behind college football players (51 per cent).

Fan favourite, Paige Bueckers, point guard for UConn, signed endorsement deals with footwear and apparel marketplace platform StockX, Gatorade, CashApp, and Chegg.org. She also filed a trademark for "PAIGE BUCKETS" last year through Wasserman, the agency that represents her. While South Carolina All-American, Aliyah Boston, confirmed endorsement deals with Bojangles, Crocs, and Bose.

This week, on the Canadian side of the border, basketball fans were excited to hear that Canada would be represented in each of the final four teams - Aaliyah Edwards (UConn), Merissah Russell (Louisville), Laeticia Amihere (South Carolina), and Alyssa Jerome (Stanford). Why then are the social feeds of these elite college athletes strangely void of sponsored content or NIL agreements?

Meanwhile in Canada

It was on June 30, 2021, that the Division 1 Board of Directors approved an interim NIL policy. This new policy allows all NCAA D1, D2 and D3 student-athletes to be compensated for their NIL as of July 1, 2021, regardless of whether their state has a NIL law in place or not.

So when the NIL rules went into effect at midnight, on July 1 of last year, it was in fact, a Toronto-based digital marketing agency, The Influence Agency and Six Star Pro Nutrition, that became the first businesses to sign paid endorsements with U.S. college athletes.

But before Canadian NCAA athletes can start doing the happy dance, there are two major caveats that they must be aware of – the first is that the NCAA NIL rules do not override state, college/university, or conference-specific NIL rules. This means student-athletes need to review the NIL rules in the state where their school is located and check with their athletic department for any school and conference-specific rules to understand what limitations they will have on their NIL.

The second, and more problematic, has to do with their student visa status. Aaliyah Edwards and Merissah Russell are among the more than 12 per cent of college athletes in the U.S. from a foreign country and vast majority of those, according to the NCAA, are in the country on F-1 student visas. Those visas prohibit students from working off campus except in rare, authorized exceptions, such as participating in an internship or work in their field of study. In these cases, for international student-athletes, the school is legally obligated to terminate their visa should they have been making money off their name, image, or likeness.

Loopholes?

Not exactly a loophole, but one option is for athletes to stay in Canada. Simon Fraser University is Canada’s only post-secondary institution and the only non-American university that competes in the NCAA (Division II).

Students already at, or committed to, U.S. schools should obtain legal advice prior to signing any NIL agreements. There might be opportunities for “passive” NIL agreements if they are signed while the athlete is physically in Canada – but each agreement should be reviewed with your lawyer. There are also reports of several athletes from Canada who travel back home to make social media postings, so they aren’t in violation of the U.S. visa laws.

Better to be safe, than sorry

Navigating schoolwork, high-performance athletics, and your social media presence – is a lot! As an international student, when your education and athletics career could be at risk, leave the NIL management to the experts. A skilled team of experienced professionals can relieve you of these immediate concerns, while you focus on your education, your sport and creating engaging content for your audience.

This article has been prepared for the general information of our clients. Specific professional advice should be obtained prior to the implementation of any suggestion contained in this article. Please note that this publication should not be considered a substitute for personalized advice related to your particular situation.

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Jeffrey Steinberg
Jeffrey Steinberg
Partner, Business Management & Transactional Services
Jeffrey Steinberg CPA Professional Corporation
Adam-Scherer-Crowe-Soberman-Toronto
Adam Scherer
Managing Partner
Adam Scherer Professional Corporation
Teresa Litrico
Teresa Litrico
Director, Digital Strategy

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