"I don't know whether or not he could get approved," Gary Bettman said today during a discussion with the commissioners of the four major, North American, pro sports leagues.
The NHL's board of govenors would have to make the vote to approve Balsillie's $212.5 million offer to buy the team.
Balsillie's offer is conditional that he could move the team to Southern Ontario.
"That's, as I said, something I don't get a vote on," said Bettman.
"If in fact it becomes an issue for board consideration, the board of governors of the league will make that decision."
The NHL has stripped current Coyotes owner Jerry Moyes of the authority to run the club after Moyes announced the team had filed for Chapter 11 bankruptcy protection on Tuesday.
Just last week , Coyotes executives stated that things were business as usual and that the NHL was not running the franchise.
The filing included the proposed sale of the franchise to PSE Sports & Entertainment, LP.
Bettman said the filing occurred "not because creditors were lurking and seeking redress for not being paid, but because there was an offer apparently from Mr. Balsillie to buy the franchise and move it," and that the issue will be the "subject of litigation."
"This is not about whether or not we want a franchise in southern Ontario. This is not about whether or not Mr. Balsillie would make a suitable owner that the owners would approve," he said.
"This is about the league's rules and the enforceability of our rules."
"Whether or not Mr. Moyes even had the authority to file the bankruptcy petition is something we're going to get into.
"This is more about the tactic and I think a challenge to league rules than it is about economic condition of the club, which we believe can with new ownership and with the accommodations the city of Glendale is prepared to make, we think can succeed."
Bettman had already been on his way to meet with Moyes to discuss purchasing offers made for the Coyotes, when he learned of the bankruptcy.
Bettman indicated that a move of any kind was no favourable.
"This is not about whether or not we want a franchise in southern Ontario. This is not about whether or not Mr. Balsillie would make a suitable owner that the owners would approve. This is about the league's rules and the enforceability of our rules," he said.
"Whether or not Mr. Moyes even had the authority to file the bankruptcy petition is something we're going to get into."
NHLPA boss Paul Kelly said the situation must be resolved quickly.
"You can't let the thing linger I would say much past the end of the month of June," Kelly told The Canadian Press today.
"I'm hopeful the sides can either come together or the court will make the time to resolve these issues."
Kelly added that the players' union would support a economically stable franchise in Phoenix, but has gone on record prior in favour of a Southern Ontario team.
"I've said it many times that I think the league should seriously look at putting another team in southern Ontario - either in Toronto or in the Hamilton/Kitchener area," he said.
"I think there's incredible enthusiasm for hockey in southern Ontario, certainly they could support a second team."
Kelly was not surprised that Balisille's offer wasn't being welcomed by Bettman with open arms.
"This is his third attempt at buying a franchise and moving them," said Kelly.
"I haven't been involved in any of his prior efforts but I'm certainly well aware that (the NHL) doesn't like to be strong-armed."
"The league believes that it has a number of legal and technical manoeuvres that it can take to block anybody that tries to forcibly enter the ownership group."
"We want what's best for hockey, we want what's best for the players and the game. If that turns out to be Phoenix, then great, we'll support it," he said.
If it turns out that bringing in a new owner and moving that franchise to southern Ontario, where it will be extremely well-received, if that's what ultimately evolves than that would be great for our players."
Both the Premier of Ontario, Dalton McGuinty and Canadian Prime Minister Stephen Harper showed their support today of a team in Southern Ontario.
Neither politician stated that it would need to be via the Coyotes moving or another team broughtin by Balsillie nor did they say they would commit tax-payers dollars to supporting a new franchise.
"I'd love another NHL team in Canada, particularly southern Ontario can support another team," Prime Minister Harper said Wednesday in Prague.
"I have even (mentioned) to a couple of NHL owners I think southern Ontario is ripe to support more than one NHL team," he added.