(Bloomberg) -- Texas Governor Greg Abbott signed a bill into law that restricts transgender student athletes from playing on teams that don’t align with the gender of their birth certificate.

The law is set to take effect on Jan. 18, according to a notice posted on the Texas legislature’s website.

Critics called the new law a mean-spirited rule that would make life even more difficult for kids who often are already struggling. Proponents said it was needed to keep competition fair and protect girls from athletes who might be bigger and stronger.

Abbott has increasingly prioritized issues including abortion, gun rights and voting limits in recent months, ahead of a March primary vote in which he faces Republican challengers who accuse him of being insufficiently conservative. The moves have spurned a backlash among some major Texas employers, who say the political climate is making it harder for them to recruit job candidates to the state.

“We are heartbroken,” said Ricardo Martinez, the chief executive of Equality Texas, a nonprofit focused on discrimination targeting LGBTQ people. “Politicians willingly overlooked the evidence of harm that filing, hearing, and debating these bills has on transgender and LGB+ people in our community.”

Texas became the 10th state -- and the largest -- to enact a law limiting transgender participation in sports, according to the Human Rights Campaign, which advocates for LGBTQ rights. Nationwide this year, more than 280 bills that the HRC sees as anti-LGBTQ have been introduced across 33 states, including more than 130 specifically focused on transgender people.

In Texas, Abbott and the Republican-controlled legislature have pursued policies popular with the conservative base this year. This month, the governor issued an executive decree forbidding employers from requiring Covid-19 vaccines. In recent months, he’s also signed bills that allow people to carry handguns without permits, limit the teaching of so-called “critical race theory” and effectively ban abortions after about the sixth week of pregnancy. While Abbott’s overall popularity has trended lower over the past year, he retains 73% job approval among Republicans, according to an August poll by the Texas Politics Project.

But some business groups have been more critical. Texas Competes, an LGBTQ advocacy group, issued a letter from 1,400 companies and local business associations in Texas decrying the transgender rule as something that will make it harder for the state to compete for top business talent. Some executives, mainly from smaller firms, have also spoken publicly against the initiative and said it was threatening expansion plans. Another group, Don’t Ban Equality in Texas, issued a statement against the abortion restrictions signed by companies including Netflix Inc., Lyft Inc. and Trillium Asset Management.

The chief executive of San Antonio’s visitors bureau has said the city risks losing million of dollars in corporate conference revenue in a backlash against the bills perceived as targeting already oppressed communities. Marc Anderson said three groups that would have provided $1.4 million in hotel revenue have already said they won’t go to Texas because of the efforts.

“In addition, we are working on a large $35 million corporate group for 2023 and they have said if this bill becomes law, they will no longer consider San Antonio,” Anderson said by email.

Lawsuits challenging the ban are likely. When Idaho passed a similar law in 2020, the American Civil Liberties Union sued on behalf of a transgender student who wished to join Boise State University’s women’s cross country and track teams. A federal judge in August 2020 issued a temporary injunction that put the law on hold while the case proceeds.

And in June, the Human Rights Campaign sued Florida Governor Ron DeSantis after he signed a similar ban into law. The case, filed on behalf of a transgender middle school student who plays girls’ soccer, is likely to go to trial next year if the state’s pending motion to dismiss it is denied. The HRC committed to suing over similar laws in Mississippi, Tennessee and Arkansas.

Even without a ban in place, participation in sports by transgender athletes has triggered litigation. In Connecticut, three cisgender high school girls filed a lawsuit seeking to ban transgender athletes from competition. When their case was thrown out by a trial judge, they appealed to the federal appeals court in Manhattan, which is weighing the matter. Nearly two dozen state attorneys general and more than 150 athletes filed a brief urging the appeals court to uphold dismissal.

Martinez, the CEO of Equality Texas, said transgender kids are already being bullied in school as a result of the efforts to pass the bill

“We are worried about the potential harm that will continue to happen,” he said.

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