As Major Brands Like Adidas Launch Nationwide NIL Opportunities, Will International Student-Athletes be caught in Student Visa Limbo Again?
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As Major Brands Like Adidas Launch Nationwide NIL Opportunities, Will International Student-Athletes Be Caught in Student Visa Limbo Again?
Executive Summary
Major brands such as international apparel company Adidas are entering the NIL arena, inviting student-athletes across more than 20 sports to earn NIL income
Adidas’ multi-tiered NIL program launch includes creating opportunities for student-athletes to earn NIL income through social media influencing around Adidas products
International student-athletes have been hindered by their Visa status and associated policies that impact NIL income earning opportunities
There is no express indication that the Adidas campaign would not be open to international student-athletes
International student-athletes in F-1 international student visa status are not allowed to work for pay outside of certain approved types of employment, either on campus or for training in their field and authorized by their school’s Designated School Official (DSO)
DSOs continue fielding campus-level NIL questions as international student-athletes consider NIL income earning opportunities
NIL opportunities and permissive policies do not supersede federal immigration law
International student-athletes may earn NIL income if its considered “passive income” such as participating in a group-licensing opportunity like jersey sales
The Department of Homeland Security has authority to determine what constitutes “passive income”
Legal experts have noted that NIL activities may fall somewhere in between active income and passive income as it relates to student-visa laws
Last March, Adidas announced that it was forming an NIL network that will be accessible to its 109 NCAA Division I partner schools. Through the program, eligible students across 23 D-I sports will have the opportunity to become a paid affiliate brand ambassador with Adidas, a first for a major sports brand.
As Sports Illustrated reported, the initiative is the latest chapter of Adidas’s “Impossible Is Nothing” campaign, which promotes the brand’s goal of creating a more equitable and inclusive future in sports. To start, athletes will have the chance to profit through commission links, but Adidas plans to also offer elevated opportunities at a brand partnership and entrepreneurial level.
“We hope to uplift student-athletes by providing educational opportunities to learn more about the NIL and business landscape, which may include bringing them into brand moments and campaigns, partnerships with existing brand athlete partners and ambassadors,” Adidas NCAA program lead Jim Murphy said in a statement to Sports Illustrated. “But really we want to open the doors to a more equitable future outside of just unlocking monetary rewards. We want to help them grow as student-athletes and set them up for a future beyond college sports.”
The inspiration to allow a wide range of athletes from its member schools to profit off their name, image and likeness branched from Adidas’s goal of impacting as many people as possible while bringing a thoughtful approach to NIL.
The goal of positioning student-athletes across 23 Division I sports to be paid affiliate brand ambassadors for Adidas will amplify the focus on one specific subset of student-athletes—international student-athletes.
As JDSupra.com reported, most international student-athletes are in F-1 international student status, sponsored by their college or university. That means the school is responsible for the student-athlete’s immigration compliance and has discretion to cancel the international student’s F-1 visa status if the student-athlete does anything that violates F-1 rules. Working outside of permitted parameters is a status violation that requires the school’s Designated School Officials (DSOs) to terminate the student’s F-1 visa status. The school’s DSOs have significant discretion in determining whether a student in F-1 visa status violated status by working without proper authorization.
Some international students on campus are in other visa status categories, typically as dependents of parents or guardians living in the U.S. with work visas. Examples include children of diplomats, professionals, or business executives. Some international students are in the U.S. with their own work visas or as spouses of individuals with work visas.
As a general rule, according to JDsupra.com, international students in visa status categories other than F-1 have no work authorization at all, so they have to restrict any NIL activities to passive income that doesn’t qualify as work (the only exception is that some spouses may be eligible for work authorization, depending on their visa status category). Their college or university has no responsibility or role in their immigration compliance.
For individuals who are not in F-1 student status and don’t have work authorization as a spouse in their visa category, maintaining compliance by limiting activities to only passive income is a matter between the student, the company, and government (Internal Revenue Service and Social Security Administration) according to JDsupra.com. Accountants can help these international student-athletes maintain compliance. They may obtain an Individual Taxpayer Identification Number, form a corporation or limited liability corporation (LLC), file LLC or corporate tax returns, and benefit from passive income from NIL activities. Individuals with DACA protection have unrestricted work authorization while undocumented individuals have no work authorization.
According to Hirschfeld-Kramer, an employment law firm out of California, F-1 sponsoring schools are certified by the U.S. Department of Homeland Security (DHS) to issue F-1 student visa documentation and manage student visa records in the Student and Exchange Visitor Information System (SEVIS) database maintained by DHS to track student visa holders.
Certified F-1 sponsoring schools have an express duty to educate and inform their F-1 students about F-1 compliance rules, including the scope of permissible employment and the approvals needed to authorize permissible types of employment.
International student-athletes in F-1 international student visa status are not allowed to work for pay outside of certain approved types of employment, either on campus (for the school or a service provider for the campus community), or for training in their field of endeavor and authorized by their school’s Designated School Official (DSO) for their F-1 program.
Passive income is permitted for international students in F-1 status and does not violate their F-1 visa status. Applicable state laws are important indicators of the rules, but international student-athletes are subject to the umbrella of U.S. immigration law and interpretation of “work” versus “passive income” by the DHS, which won’t necessarily agree with state labor and employment regulators.
To avoid a status violation, F-1 international students need to understand what seems to be passive income and what seems to be work for pay. For example, appearing in a scripted advertisement probably is work for pay, whereas use of competition film or photos in subsequent advertising probably is passive income. So that means appearing in a scripted advertisement filmed on campus is not permissible “on campus employment” for F-1 international students unless the school is creating the advertisement on campus for its own promotional efforts.
Each school certified by DHS to sponsor F-1 international students must appoint one (or more) DSO on campus who has delegated authority from DHS to monitor the F-1 status of the international students on its campus. If a DSO becomes aware that an F-1 student worked for pay– or “volunteered” to work without pay– outside authorized parameters for F-1 status, the consequences can be drastic.
If an F-1 student violates status by engaging in any amount of unlawful employment, the DSO is required by law to terminate the student’s SEVIS record with the Student and Exchange Visitor Program, U.S. Immigration and Customs Enforcement (SEVP – ICE – DHS), which terminates the student’s F-1 visa status. The student then has to either apply to U.S. Citizenship and Immigration Services (USCIS – DHS) for reinstatement to F-1 status, or depart the U.S. and return based on a new F-1 SEVIS record from their school. If they depart the U.S., it’s likely they will need to obtain a new F-1 visa stamp at a U.S. consular post (the State Department), and then they will need to request return admission to the U.S. in F-1 status.
When a student arrives at a U.S. port of entry and requests admission in F-1 status, U.S. Customs and Border Protection (CBP – DHS) checks their SEVIS record to make sure they still are authorized for F-1 status by their school and SEVP (ICE – DHS). CBP will know from SEVIS if a student recently was terminated in SEVIS for a status violation such as unlawful employment and now is returning on a new SEVIS record, and CBP can question the student about the circumstances.
As we enter Year 2 of NIL, the consternation around NIL activities and F-1 student status may reach a fever pitch and prompt DHS to issue additional guidance on NIL activities and student-visa statuses for all stakeholders. The DHS providing more examples of permissible passive NIL income opportunities will be especially beneficial to international student athletes, NIL companies, and DSOs on campuses across the country.
Athletics Veritas is presented for information purposes only and should not be considered advice or counsel on NCAA compliance matters. For guidance on NCAA rules and processes, always consult your university’s athletics compliance office, conference office, and/or the NCAA.
