USL Adopts Promotion-Relegation Plan: MLS May Have Competition
- Calvin Holle
- Mar 31
- 7 min read
On March 19, 2025, The United Soccer League (USL) club owners voted to implement a promotion and relegation system (pro/rel), marking the first time this European-style system will be implemented in the United States. Representing a seismic shift in American soccer, the USL confirmed plans to launch a Division One men’s professional league in 2027 to rival Major League Soccer (MLS) within the sanctioning standards of the U.S. Soccer Federation (USSF). Like all other professional leagues in the United States, MLS operates as a closed-league model. The move by USL aligns with global soccer norms by introducing a three-tiered structure culminating in a Division 1 league but raises complex antitrust questions and market uncertainties. The legal ramifications of this system – particularly considering the recent North American Soccer League, LLC v. United States Soccer Federation, Inc. (NASL v. USSF) anti-trust verdict – and its potential to reshape soccer’s competitive and viewership landscape demand rigorous scrutiny.
In February 2025, a federal jury ruled in favor of the USSF and MLS in a seven-year antitrust lawsuit by the defunct North American Soccer League (NASL). The NASL alleged that USSF and MLS conspired to manipulate the Professional League Standards (PLS) – including stadium requirements, owner wealth thresholds, and market size criteria – to suppress competition. The jury rejected these claims, citing the NASL’s mismanagement and failure to retain clubs as primary sources of its collapse. From a legal standpoint, the case sets an important precedent as the USL charts its course. It demonstrated how difficult it is for a rival league to win an antitrust suit in sports. “Antitrust claims are notoriously hard to prove, particularly in the sports context,” observes sports attorney Chris Deubert. Such cases require complex economic evidence and a clear showing that the alleged monopolists unreasonably restrained trade. NASL could not meet that burden. USSF argued NASL simply did not meet the PLS benchmarks and even pointed to NASL’s internal troubles (one NASL investor had been implemented in a FIFA corruption probe) as reasons for its demise.
While the USL’s system promotes meritocratic competition, it faces antitrust scrutiny under the Sherman Act’s Section 1 (collusive restraint) and Section 2 (monopolization). Key concerns include barriers to entry & vertical integration, market definition & monopoly power, and collusion & conflicts of interest. The USSF’s PLS for Division 1 could create exclusionary hurdles. The league is to be composed of a minimum of 12 clubs at launch, expanding to 14 by the third year of operation. Stadiums must be enclosed and have a minimum seating capacity of 15,000. At the time of writing, only four USL Championship clubs (Birmingham Legion FC, Oakland Roots SC, Louisville City FC, Miami FC) meet the stadium standards. USSF also states that 75% of clubs must be in metropolitan areas with a population exceeding 1 million. A club’s principal owner must have at least a 35% stake in his/her respective club, while his/her net worth must be at least $70 million. Smaller markets like Northwest Arkansas (Future Ozark United FC) or New Mexico may struggle to finance upgrades, risking allegations that the PLS disproportionately favor wealthy owners, echoing NASL’s claims. In addition, if the USL’s Division 1 gains sanctioning, it would compete with MLS for players, sponsors, and broadcasters. Courts often narrowly define “relevant markets” in sports antitrust cases. In the NASL case, the jury rejected the league’s argument that Division 1 and 2 leagues constitute distinct markets. The USL must demonstrate its system enhances consumer choice without coercively displacing MLS, which may prove difficult given MLS’s entrenched position. Furthermore, the USSF’s dual role as regulator and commercial partner to MLS remains contentious. While the NASL case cleared USSF of conspiring with MLS, the USL’s rise could reignite scrutiny. If USSF grants the USL Division 1 while maintaining MLS’s privileges, rival leagues might allege biased governance. There is no explicit rule forbidding multiple Division 1 leagues, but it is unprecedented.
One legal question is whether USSF will apply the standards uniformly, as any whiff of favoritism could revive antitrust concerns. Questions would arise if USSF were to raise the requirements suddenly to handicap the USL, as NASL alleged happened to them. In a post-verdict statement, USSF said the decision of NASL “validates U.S. Soccer’s commitment to fostering a broad and healthy ecosystem of professional soccer leagues across all divisions.” For the federation, allowing an ambitious USL pyramid to coexist with MLS would be the ultimate proof of that “broad ecosystem” commitment – and a shield against future lawsuits.
Not long ago, the USL and MLS were partners rather than rivals. In 2013, MLS and what was then called USL Pro announced an affiliation agreement to collaborate on player development. For much of the 2010s, the USL effectively served as MLS’s minor league. The alliance started to fray as MLS grew and sought more control over its developmental pipeline. By 2022, MLS launched MLS Next Pro as a separate third-division league. MLS pulled virtually all its affiliated clubs out of the USL to play in MLS Next Pro. By the start of 2023, the USL was fully independent from MLS’s influence. The split freed USL to pursue “disruption and innovation” – such as an open league structure – because it no longer had to align with MLS’s closed model. USL has been standing on its own impressively – expanding to new markets, attracting investment, and solidifying multiple leagues at a time when NASL collapsed. That said, USL is not positioning itself as an immediate MLS substitute. Its leadership acknowledges that MLS is wealthier and more established. While USL alone “doesn’t have the clout” to truly rival MLS financially, it can “differentiate their product” and seize the mantle of innovation.
Sponsorship and media partners might see USL’s growth potential. If USL’s Division 1 launches successfully and pro/rel is in effect by 2028, the league’s broadcast deals (which expire around 2026-27) could be renegotiated at higher values with the promise of a “major league” product. In contrast, MLS’s locked-in Apple TV deal, which began in 2023, runs through 2032, potentially giving USL a window to gain ground in TV exposure. While the $2.5 billion deal injected cash into MLS, it also moved most matches behind a paywall. The USL, on the other hand, has been pursuing a more traditional and accessible media strategy, which could pay dividends as it introduces pro/rel. In 2024, USL struck a deal with CBS Sports to broadcast a select number of matches on national television, while continuing to stream others on ESPN + and YouTube internationally. Crucially, the USL also encouraged all its clubs to sign local free-to-air TV deals. In fact, this season “for the first time, all USL Championship clubs secured local television deals” to air matches in their markets over local stations. The focus is on maximizing accessibility – making it easy for casual fans to stumble upon a USL match without an extra subscription. The results have been promising: USL reports that these local and national broadcasts contributed to a 20% rise in average match audiences in 2024, with total viewership climbing 18% over the previous year. Many clubs saw significant upticks in their home market TV viewership (25% increase) thanks to going on local channels.
The 2024 USL Championship Final (Colorado Springs Switchbacks vs. Rhode Island FC), which was aired on the main CBS network on a Saturday afternoon, drew 431,000 live viewers. Conversely, the 2024 MLS Cup Final (LA Galaxy vs. NY Red Bulls), which did air on Fox, drew only 468,000 viewers (English and Spanish combined), down nearly 50% from 890,000 on those channels the year prior. On the streaming side, one reporter used Nielson data to estimate that merely around 65,000 viewers watched the match via Apple’s MLS Season Pass in real time. Even if that estimate is low (Apple’s total global viewership might be a bit higher), the fact remains the league’s premiere event likely had around 500-533K total viewers. For context, as recently as 2022 (pre-Apple deal), the MLS Cup Final on network TV drew over 2.1 million viewers.
This all serves as a reminder that fans will watch soccer when it is easy to find – and that compelling stories (like promotion fights or underdog runs) can capture eyeballs. Competition for viewers in soccer may intensify with USL’s rise. MLS, for its part, is confident in its long-term plan and global stars, but it may need to ensure it does not lose the narrative. MLS commissioner, Don Garber, recently hinted that the league might seek more linear TV exposure even during the Apple deal, a sign that they recognize the need for visibility. If so, one could argue that USL’s presence is already pushing MLS to adjust its approach.
Right now, MLS remains the market leader in U.S. soccer by far – it has more resources, marquee players, and established fanbases in large markets. The USL will not outdraw MLS overall in the near term. However, USL’s open system could carve out a niche of authenticity and higher stakes that appeal to hardcore soccer purists and new fans in underserved markets. It may also attract international interest; global fans used to the pro/rel system could find the experiment intriguing, whereas MLS’s closed model has sometimes been a turn-off for that segment. While MLS’s national TV reach may be limited by streaming, it continues to pack large stadiums and generate local buzz (especially with the Messi effect at Inter Miami CF). USL will aim to grow its attendance too, but one advantage of pro/rel is that it gives every club something to fight for, possibly boosting attendance even for mid-table clubs (since avoiding relegation or chasing promotion keeps fans invested). USL’s community-based approach – with many clubs having deep local roots and now local broadcasts – might foster strong regional followings. This grass-roots growth is something MLS had to forego when it centralized media rights. Time will tell if USL can translate that into significant national viewership, but early returns suggest a growing appetite for what USL is serving.
The USL’s implementation of pro/rel is a watershed moment in American sports, one with significant legal and market implications. It tests the premise that an open system can thrive in a country that is so accustomed to closed leagues. In terms of market impact, the USL’s gamble could inject fresh energy into U.S. club soccer. Fans will soon have a choice between MLS’s franchise model – still expanding, star-driven, but somewhat predictable – and USL’s merit-based hierarchy, where every season could see new clubs rising and others falling. MLS’s dominant position is not under threat yet, but it may no longer be able to ignore the clamor for some of the excitement that an open system brings. As the 2026 World Cup approaches and soccer gains unprecedented attention in the United States, the timing of USL’s move could not be more intriguing. Though MLS remains king for now, there may be a battle on the horizon for American soccer supremacy.
Calvin Holle is a 2L at the University of Missouri-Kansas City School of Law. He can be found on LinkedIn.
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