NRL teams are poised to be denied access to the first advance of more than $1 million each from the game's $1.8 billion broadcast windfall amid renewed hostility with the ARL Commission, which has declared it will withhold the funding until clubs give the green light to new perpetual licence agreements.
Clubs are due to provide a response to draft agreements proposed by the NRL by Friday, the same day that the first advanced instalment from the code's new five-year television deal is expected to land in League Central's account. A $1.125 million sum was then scheduled, under the terms of a memorandum of understanding last December between the NRL and clubs, to be forwarded to each club on Friday week.
However, that payment will almost certainly be delayed after the clubs baulked at the fine print of the draft licensing agreements, which they argue give the governing body far more wide-reaching powers and moves the goalposts significantly from what had been agreed upon late last year.
An NRL spokesman said on Monday that the money would not be delivered until the perpetual licences to play in the premiership were agreed upon. "The additional funding to the clubs will occur once the licence agreement is signed," the spokesman said. The impasse threatens to cause cash-flow headaches for a number of clubs that had budgeted for the arrival of the first payment on or about July 8.
However, stronger clubs are urging the more financially vulnerable that are hanging out for the payment to hold firm because of the need to get the licences right.
Some clubs have sought their own legal advice and corporate lawyer Glen Selikowitz at Baker McKenzie has been brought on to provide a response on behalf of all 16 clubs to the draft licence.
Intense negotiations between the parties are likely to follow in coming weeks. The clubs say the
NRL has adopted an aggressive timeframe on getting the agreements over the line but there is no certainty about when a resolution will emerge. Club bosses are determined not to be cornered into agreeing to a document that will have long-lasting implications for the game despite recognising the urgency of the situation.
There was scheduled to be a meeting at NRL headquarters on Monday but that was cancelled.
The payments due next month were to be the first of two bonuses totalling $1.5 million a year in 2016 and 2017 and pledged to clubs after the striking of a record broadcast deal last November. Half of the money, however, will be loans so teams can reduce their losses.
The sticking point in the bonus cash being passed on is common ground being reached on the perpetual licences – which will guarantee teams a place in the NRL as long as they are financially viable – and that appears some way off.
Clubs are contesting the contents of the licences on a range of fronts including pushing back at the idea of a sinking fund into which they would pour money that could be drawn upon by a team that strikes financial trouble.
They are of the belief it is up to the commission to ensure the viability of its teams, and also strongly oppose a proposal that would allow the NRL to take ownership of assets and infrastructure in the event a licence was terminated.
ARLC chairman John Grant said last week the clubs would be funded to become "long-term sustainable" under the in-principle agreement and League Central could as a result not be expected to dip into its pockets to prop up a financially distressed team.
Clubs lost a combined $38.4m last season but stand to have their annual grant rise to $13m from 2018 if, as has been foreshadowed, the salary cap is lifted to $10m that year.
