HB126

HB126 loosens several Texas restrictions on compensation for college athletes’ name, image and likeness, often called NIL: payment for using an athlete’s identity commercially. It applies to the public general academic teaching institutions and private or independent higher-education institutions covered by Education Code section 51.9246, not every school athletic program. The law took effect June 5, 2025, and governs compensation paid on or after that date; earlier payments remain governed by prior law. Final law; official history.

The law removes the section’s blanket prohibitions on institutions providing or soliciting prospective athletes’ NIL compensation, on NIL payments coming from the institution, on payment for accepting an admission offer, and on payment for an act during an official team activity. It also repeals the broad ban on NIL arrangements before college enrollment and on using future NIL compensation to recruit. These changes remove state-law barriers; they do not promise any athlete a payment, set a payment amount, or cancel all other eligibility and contract rules.

An important age limit remains: unless a prospective athlete younger than 17 is already enrolled at a higher-education institution, no individual, company or other organization—including a covered institution—may enter an NIL arrangement with that athlete or someone related to the athlete by blood or marriage. Reaching 17 removes this particular restriction, not all applicable requirements.

Where this state-law section conflicts with requirements of an athletic association or conference, or a court order applicable to it, a new provision allows institutions, athletes and others to take actions authorized or required by the governing organization or a final applicable court order. Those who use that permission remain subject to the organization’s applicable rules and enforcement, and the under-17 restriction still controls. This is a conditional way to accommodate governing rules and court orders, not a blanket exemption from them.

Other protections and restrictions remain in the section, subject to that conflict provision: proposed NIL contracts must be disclosed to the institution before signing; contracts cannot conflict with specified team, institutional, athletic-department or honor-code requirements; athletic-performance compensation and specified endorsements remain restricted; contracts cannot run beyond athletic participation; and institutional logos, facilities and similar property require permission. The prohibited endorsements include alcohol, tobacco and nicotine devices, anabolic steroids, sports betting, casino gambling, firearms the athlete cannot legally buy, and sexually oriented businesses. Participation alone still does not make the athlete an institutional employee under this section. The repeal also removes an exception defining certain institutional assistance and donor recognition as not being institutional compensation—a distinction made unnecessary by removing that particular compensation prohibition.