News & Views

Sport Governing Bodies need Different Legal Structures for their Commercial Ventures

As the fall-out from the FIFA Forward Enterprise proposal rumbles on, where and how national governing bodies and international federations sit in a world of sport which is continually being shaped by commercial pressures, capital requirements, and increasing competition is an intriguing question.

Traditionally, governing bodies and federations develop their sport globally, represent members and participants, maintain competition structures, manage elite athlete participation and development and, in many cases, distribute public or centrally generated funding back into their sport. They are increasingly performing these functions in a commercial market in which privately financed businesses can raise capital, pursue audiences, athletes, and revenues without carrying the same responsibilities. They are also often constrained by legacy decision-making structures and administration which can create bureaucracy and a lack of reactivity to market forces.

For most governing bodies outside the largest commercial sports, capital is also significantly constrained. Income remains concentrated around government and lottery funding cycles which is at risk of political changes, economic climate, membership, broadcast revenues which are under attack, sponsorship, and a limited portfolio of events. There is rarely substantial discretionary capital available to develop a new competition, build a digital platform or invest in another commercial opportunity.

The resulting challenge for governing bodies and federations is increasingly one of maintaining their commercial relevance and the revenues required to support the wider sport. However, the right corporate restructuring, contractual structure, and commercial thinking can allow these challenges to be overcome if their own balance sheet is constrained.

When investment moves outside the governing structure

Triathlon provides a useful example. The Professional Triathletes Organisation (PTO) developed outside the governing body, World Triathlon, and raised private capital to build a professional proposition around elite long-distance athletes.  The T100 series created a new event inventory, athlete remuneration, and a media product without requiring the international federation to finance its development.

Over time, the relationship between the two organisations has developed substantially. World Triathlon and PTO agreed a 12-year strategic partnership covering the long-distance World Championship Tour, anti-doping, safeguarding, sponsorship and broadcast collaboration, and PTO-promoted events have increasingly incorporated World Triathlon competition.

This experience demonstrates the commercial risk for governing bodies where external capital identifies value around a sport before its established institutions have the means to develop it themselves. World Triathlon has ultimately found a way to participate in the commercial platform built by PTO, combining its regulatory authority, competition portfolio, and athlete ecosystem with the capital and commercial capability of an external operator.

British Cycling offers a particularly relevant UK example. In December 2025, it established British Cycling Ventures (BCV) as a dedicated commercial entity designed to develop new revenues and attract strategic investment. The BCV structure provides a vehicle through which private capital can participate in selected commercial activities which include the development of new events and formats without investing directly into the governing body.

From a legal perspective, the devil will be in the detail on what assets and rights are made available to BCV, what level of economic interest will be retained by British Cycling, and the level of governance afforded to investors who will need to ultimately support the wider sport. The governing body also needs to understand the investor's objectives and exit requirements.

Four legal structures worth considering

The appropriate structure will largely depend upon the commercial opportunity, the capital required, and the rights available to support it. For governing bodies operating with limited balance-sheet capacity, four approaches are particularly relevant:

• A dedicated commercial vehicle with external equity allows selected commercial assets or opportunities to sit within a separately managed company into which private capital can be raised. This can provide capital and specialist management while allowing the governing body to retain a significant economic interest. Care is required in defining which rights are transferred, which are licensed, the treatment of existing sponsorship and media agreements, investor governance rights, and the mechanisms through which value returns to the sport.

• A corporate joint venture can suit a governing body or federation with valuable rights but insufficient capital or specialist capability to exploit them. The governing body might contribute IP, sanctioning, event rights, calendar access, or athlete relationships, while its partner provides capital, technology, distribution, and / or operating expertise. Governance becomes particularly important in these arrangements, including board representation, reserved matters requiring the consent of a % of shareholders, further funding obligations, exclusivity, ownership of newly created rights, deadlock, and termination rights.

• A strategic commercial partnership without equity may be more appropriate where an opportunity is not sufficiently developed to support an external valuation. Revenue-sharing arrangements around events, technology, media, licensing or participation products can give a commercial partner sufficient incentive to invest its resources while leaving ownership with the governing body. The duration and scope of exclusivity require particular attention; rights granted too broadly or for too long can restrict subsequent commercial development.

• A spin-out or partial sale becomes possible where an existing commercial activity has sufficiently independent revenues, management and growth prospects to operate as a business in its own right. The transaction can release capital and give the business greater freedom to grow, although the board must assess the value received against the future income and strategic control being surrendered. That calculation is particularly important where commercial revenues ultimately fund distributions and development across the sport.

Commercial development as part of stewardship

For governing bodies operating with constrained resources, commercial development is increasingly relevant to their ability to fund participation, performance, and the long-term development of their sport. Accessing private capital and specialist capability can form part of that strategy, provided the commercial and legal structure preserves an appropriate balance between investment, control, and the interests of members.

Whilst the FIFA saga grabbed headlines for all the wrong reasons, it should not deter the questions that other governing bodies should rightly be considering about their own assets and the markets developing around them in order to safeguard and grow their particular sport.

At O'Connors, we advise governing bodies, rights holders, investors and commercial partners on establishing and funding new sports ventures, including investment vehicles, joint ventures, strategic partnerships and spin-outs. Early consideration of rights ownership, governance, funding and stakeholder approvals can materially improve both the investability of a proposition and the governing body's position when external capital is introduced. If you have any queries or need more information please contact Phil Bowers, Head of Sports and Commercial.