Expanding The NRL: Corporate Structure And Profit Sharing (Part 2)

Despite negotiations slowing in the wake of a second wave of COVID-19 in Australia, the Australian Rugby League Commission (ARLC) remains committed to adding a new club to expand the national first grade competition, the National Rugby League (NRL)[1]. The benefits of expansion are obvious – it has the potential to:

• Foster increased fan engagement from new geographical areas;
• Increase the volume of professional matches to be televised; and
• Provide greater opportunity for corporate sponsorships and advertising.

However, expansion inevitably raises commercial and legal issues for both clubs and the governing body. In Part I of this two-part series (accessed here), the focus was on the challenges for an expansion club in its initial financing and what could occur if a new club goes into financial distress. Pivoting to the dynamics between clubs and the governing body, Part II focuses on the legal, regulatory and governance considerations of corporate structure, and the profit-sharing and contractual considerations with regards to broadcasting agreements.