March 19, 2026
Effective March 30, 2026, the Financial Industry Regulatory Authority (“FINRA”) will implement significant amendments to FINRA Rule 3220 (Influencing or Rewarding Employees of Others), commonly known as the Gifts Rule. The changes — adopted under the FINRA Forward initiative — raise the annual gift limit for the first time in more than three decades, codify years of informal guidance into binding supplementary material, and introduce a new exemptive relief mechanism. Broker-dealers should review their written supervisory procedures and gift tracking systems now to ensure compliance before the effective date.
Background
The Gifts Rule prohibits any FINRA member or associated person from giving anything of value exceeding a specified annual dollar limit to any person where the payment is in relation to the business of the recipient’s employer. The rule is designed to prevent conflicts of interest that can arise when gifts are used to cultivate business relationships with employees of institutional customers, vendors, or counterparties. It does not apply to gifts given to a member’s own associated persons or to individual retail customers.
The $100 annual gift limit had been in place since 1992. FINRA solicited comment on potential amendments through Regulatory Notice 16-29 (August 2016) and again through Regulatory Notice 25-04 (March 2025). The SEC approved the final rule amendments on February 12, 2026 (Exchange Act Release No. 34-104830 (Feb. 12, 2026), 91 FR 7570 (Feb. 18, 2026) (Order Approving File No. SR-FINRA-2025-003)).
The Development
As set forth in FINRA Regulatory Notice 26-05 (Feb. 2026), the amendments make three principal changes to Rule 3220.
Increased Gift Limit. The annual gift limit rises from $100 to $300 per person per year. FINRA determined that $300 reflects the inflation-adjusted equivalent of the original limit and should remain adequate at current inflation levels for approximately ten years. FINRA intends to review the limit periodically to assess whether further adjustments are warranted.
New Supplementary Material. The amendments adopt a series of supplementary provisions — Rules 3220.01 through 3220.09 — that codify existing FINRA guidance and interpretations, superseding prior informal guidance including Notice to Members 06-69 (December 2006). Key provisions address the following:
Gifts given incidentally during a business entertainment event remain subject to the $300 limit unless the gift is a personal gift, of de minimis value, or a promotional or commemorative item. The cost of the business entertainment itself does not count toward the gift limit (Rule 3220.01). For valuation purposes, gifts other than event tickets are valued at cost, exclusive of tax and delivery charges; tickets to sporting or other events must be valued at the higher of cost or face value (Rule 3220.02). Members must aggregate all gifts given by the firm and each of its associated persons to a particular recipient across the year, using a calendar year, fiscal year, or rolling basis as stated in the member’s written procedures (Rule 3220.03).
Several categories of gifts fall entirely outside the Gifts Rule’s limit and recordkeeping requirements. Personal gifts marking infrequent life events — such as a wedding or the birth of a child — are excluded, provided the gifts are customary, reasonable, and not in relation to the recipient’s employer’s business; however, when the member pays for or reimburses the cost of such a gift, FINRA presumes the gift is business-related (Rule 3220.04). Customary and reasonable bereavement gifts are similarly excluded (Rule 3220.05). De minimis gifts — such as pens, notepads, or modest desk items — and promotional items displaying the member’s logo that are of nominal value are excluded, provided their value is substantially below $300 (Rule 3220.06(a)). Solely decorative items commemorating a business transaction are excluded without regard to cost (Rule 3220.06(b)). Donations to individuals for losses sustained in a federally declared major disaster are also excluded (Rule 3220.07).
On supervision and recordkeeping, Rule 3220.08 requires members to maintain systems and procedures reasonably designed to ensure that gifts in relation to the business of the recipient’s employer are reported to the firm, reviewed for compliance, and retained in the member’s records. Procedures must be structured so that the associated person giving a gift is not the one who determines whether it is business-related. Recordkeeping requirements do not apply to excluded gift categories, though members may elect to maintain records for excluded gifts as part of their supervisory program.
Exemptive Relief. The amendments authorize FINRA staff to grant exemptions from the Gifts Rule for good cause shown under new Rule 3220(d).
The amendments also include conforming changes that raise the $300 gift limit in FINRA Rule 2310 (Direct Participation Programs), Rule 2320 (Variable Contracts of an Insurance Company), Rule 2341 (Investment Company Securities), and Rule 5110 (Corporate Financing Rule – Underwriting Terms and Arrangements).
Key Takeaways
The tripling of the gift limit is the headline change, but for most broker-dealers the more consequential development is the codification of existing guidance into enforceable supplementary rules. Practices that were previously addressed through informal FINRA guidance are now embedded in the rule text itself, meaning examiners will evaluate compliance against these specific provisions directly.
Member firms should treat March 30 as a hard deadline for updating written supervisory procedures to reflect the new $300 limit and to address each of the supplementary rule categories. Gift tracking and aggregation systems should be reconfigured to apply the higher threshold, and procedures should clearly specify whether the firm uses a calendar year, fiscal year, or rolling basis for aggregation purposes — Rule 3220.03 makes that election a compliance requirement, not a discretionary choice.
Firms that rely heavily on business entertainment in their client development practices should pay particular attention to the interaction between Rule 3220.01 and the entertainment exception. A gift presented during a dinner or event is subject to the $300 cap even if the entertainment itself is not; the two categories must be tracked separately.
The new personal and bereavement gift provisions provide helpful clarity, but the presumption in Rule 3220.04 cuts firmly against the firm: if the member pays for or reimburses a gift, FINRA will presume it is business-related regardless of the occasion. Associated persons should understand this distinction, and supervisory procedures should address how personal gift claims are documented and reviewed.
Finally, firms facing unusual or recurring situations not squarely addressed by the rule now have a formal mechanism for seeking exemptive relief from FINRA staff under Rule 3220(d).
For More Information
If you have questions about FINRA Rule 3220 or how the amended Gifts Rule applies to your firm’s compliance program, please contact Evans Law, PC at bgelaw.com.