The new oversight body tasked with regulating name, image and likeness (NIL) agreements in college athletics has begun rejecting a number of deals submitted by athletes and third-party sponsors, signalling a tougher approach to policing the rapidly expanding NIL marketplace.

The College Sports Commission (CSC) — created following the landmark House settlement that reshaped the economics of college sports — now reviews NIL agreements through a central clearing house system. Under the framework, any third-party deal worth more than $600 must be submitted for approval to ensure it represents a legitimate commercial agreement rather than a disguised recruiting inducement.

According to officials overseeing the process, the commission has already rejected hundreds of proposed agreements that failed to meet those standards, with the CSC warning athletic departments that it has ‘serious concerns about some of the deal terms being contemplated and the consequences of those deals for the parties involved’, emphasising the need for strict compliance with the new rules.

The commission’s primary task is to determine whether NIL contracts reflect genuine marketing arrangements. Deals must demonstrate what regulators describe as a ‘valid business purpose’ rather than functioning as payments designed to influence recruiting or reward on-field performance. Guidance issued by the commission makes that standard explicit.

“An entity with a business purpose of providing payments or benefits to student-athletes or institutions, rather than providing goods or services to the general public for profit, does not satisfy the valid business purpose requirement,” the commission said when outlining its review criteria.

The oversight mechanism was introduced as part of sweeping reforms stemming from the House vs NCAA settlement, which allows schools to share revenue directly with athletes while also preserving the NIL market for outside endorsement opportunities. The commission and its NIL Go platform were created to enforce those rules and ensure that outside payments are not used to circumvent the new financial limits placed on athletic departments.

“There’s no question that during the portal, agents were demanding guaranteed NIL for student athletes and schools felt pressure to guarantee those things, even though such guarantees are not within the rules,” the commission’s Bryan Seeley told reporters. “I think any athletic director would tell you that.

“The massive increase in associated deal volume of this kind of manufactured NIL is leading to some increased review times in NIL Go — I don’t think the system was designed with this amount of associated deals in mind! What I’ve been told is that there was a belief among many that perhaps up to 90 percent of deals flowing through the system would do so automatically, that would not need any kind of human review. So the bottom line is, there are changes we need to make in the system that we are working on making that I think will improve things.”

While administrators broadly support greater transparency in the NIL system, the stricter approval process has already created tension among schools, collectives and athletes navigating the evolving marketplace.

With millions of dollars in NIL agreements now flowing through the system and hundreds of deals already rejected, the CSC’s early decisions could play a major role in defining how athlete compensation operates in the next phase of college sports.