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Highlights
- The Financial Industry Regulatory Authority (FINRA) amended Rule 3220 to increase the annual gift limit to $300 per recipient, tripling the long-standing $100 limit.
- Rule 3220 formally integrates long-standing interpretive guidance, clarifying valuation methods and expressly excluding certain personal, bereavement and de minimis gifts from the $300 limit.
- Member firms must update their written supervisory procedures, expense tracking systems and employee training to ensure accurate aggregation and supervision under the new $300 threshold.
The U.S. Securities and Exchange Commission (SEC) on February 12, 2026, approved the Financial Industry Regulatory Authority's (FINRA) amendment to Rule 3220 (Influencing of Rewarding Employees or Others), commonly referred to as the "Gifts Rule."
Key Rule Changes
- Increased Gift Limit: The annual gift limit has been raised from $100 to $300 per individual per year. FINRA noted this increase accounts for inflation since the limit was last set in 1992, as well as approximately 10 years of projected future inflation. Conforming increases were also made to the gift limits in FINRA's non-cash compensation rules.1
- Codification of Interpretive Guidance: To
improve regulatory clarity, FINRA has integrated its historical
guidance directly into the rule's supplementary material:
- Valuation. Gifts must generally be valued at cost, exclusive of tax and delivery charges. However, tickets to sporting or entertainment events must be valued at the higher of their cost or face value.
- Express Exclusions. The rule explicitly excludes certain categories of gifts from the $300 limit and associated recordkeeping requirements. These include "personal gifts" for infrequent life events (such as weddings or the birth of a child), bereavement gifts, de minimis gifts, promotional items of nominal value and donations related to federally declared major disasters. Crucially, for the personal gift exclusion to apply, the member firm cannot bear the cost of the gift directly or via reimbursement.
- Business Entertainment. Gifts given during the course of business entertainment are explicitly subject to the new $300 limit unless they qualify for a specific exclusion (e.g., a de minimis promotional item).
- Exemptive Relief: Under the newly proposed Rule 3220(d), FINRA staff has authority to grant conditional or unconditional exemptions from the Gifts Rule for "good cause shown," taking into account the varying sizes, structures and business models of member firms.
- Supervision and Aggregation: Member firms must maintain procedures detailing how they aggregate all gifts given by the firm and its associated persons to a single recipient over the course of the year to ensure compliance with the $300 limit.
Next Steps for Member Firms
Firms should promptly review and update their written supervisory procedures (WSPs), compliance manuals and expense reimbursement systems to align with the new $300 threshold and codified valuation methodologies. Training programs for associated persons will need to be refreshed to clarify the distinct rules governing business entertainment, personal gifts and gifts capped by the higher threshold.
Footnote
1 FINRA's Non-Cash Compensation Rules: FINRA Rules 2310 (Direct Participation Programs), 2320 (Variable Contracts of an Insurance Company), 2341 (Investment Company Securities) and 5110 (Corporate Financing Rule – Underwriting Terms and Arrangements).
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