Volume: 5 Issue: 3
Major League Soccer (MLS), which was formed in 1996, is the Division 1 professional soccer league in the United States. The league today has 13 teams (including one in Toronto, Canada). Unlike other sports leagues, in which independent team owners compete with one another on and off the field, MLS is structured as a single limited liability company. The league office, rather than any individual team, contracts with, employs and pays all players. Player compensation, bonuses and specific employment terms are determined by the league, not the clubs. In addition, the way in which players are allocated among the teams is set by the league office (e.g., player drafts, waiver drafts), and the teams operate within this regulatory framework to select and acquire the players they want. The teams, therefore, select their rosters rather than the league. These regulations, together with a league and individual team salary budget, are designed to provide equal competitive opportunity among the teams. Put simply, the league office creates an environment where teams have the ability to create their rosters and compete equally irrespective of an individual club's revenue or market size.