By: Matt Calabro
In a significant and long-awaited update, on February 27, 2026, FINRA adopted amendments to Rule 3220 (the “Rule”), modernizing the framework that governs gifts and gratuities in the financial services industry. Most notably, the annual gift limit has increased from $100 to $300 per person, per year—the first adjustment since 1992. Further, in connection with the Rule change, the rules surrounding non-cash compensation (specifically, Rules 2310, 2320, 2341 and 5110) have been amended to conform to the $300 limit.
The revised rule will be effective March 30, 2026.
With the Rule amendments, FINRA adopted supplementary material to codify extensive prior guidance and interpretations. The result is a clearer, more prescriptive compliance framework—particularly around valuation, aggregation, supervisory review, and excluded categories of gifts. Specifically:
- The Rule clarifies that the Rule does not apply to gifts from a firm to its own associated persons or gifts to individual retail customers.
- Gifts are to be valued at cost, excluding tax and delivery, although tickets to sporting and other events are valued at the greater cost or face value.
- The gift limit applies to the aggregate value of gifts to a particular recipient. Aggregation can be done on a calendar year, fiscal year, or rolling 12-month basis, and the time period must be reflected in a firm’s WSPs.
- Items of de minimis value and promotional items are excluded so long as their value is substantially below $300. Further customary, reasonable, and solely decorative commemorative items (e.g., tombstones or plaques) are not subject to the Rule.
- Gifts given incidental to business entertainment are subject to the Rule.
- Personal gifts for infrequent life events (e.g., wedding, birth of a child) are excluded from the Rule if they are customary and reasonable, personal in nature, and not related to the recipient’s employer’s business. However, if the broker-dealer pays for the gift, it is subject to the Rule.
- Customary and reasonable bereavement gifts are not subject to the Rule.
- Donations in response to assist individuals impacted by a Presidentially declared major disaster are excluded from the Rule.
- A firm must maintain supervisory systems reasonably designed to capture reportable gifts, monitor them for compliance (including aggregation), and maintain required records. These procedures must be designed such that the giver is not responsible for determining whether a gift is business-related.
Takeaways
In addition to a long-desired dollar limit increase, the amended Rule provides additional clarity around how it is applied. In our experience, many broker-dealers’ gift policies historically have not addressed the scenarios outlined in the new supplementary materials.
We recommend that firms revisit their gift policy, particularly with respect to:
- Treatment of retail customers
- Valuation and aggregation methodologies
- Gift logs and tracking mechanisms
- Clarifying treatment of personal vs. reimbursed gifts
- Training supervisors on the revised standards
- Aligning non-cash compensation policies with the $300 limit
In short, FINRA has preserved the core purpose of the Rule, preventing improper influence, while modernizing the compliance architecture around it. For firms that treat this as a simple inflation adjustment, the real opportunity may be missed. This is a chance to recalibrate and strengthen supervisory controls around one of the industry’s most examined risk areas.
The Gift Rule Highlights
| New gift limit | $300 per recipient per year |
| Who it applies to | Individuals where the gift is in relation to the business of that individual’s employer |
| Who is not subject to the Rule | – Retail customers of the broker-dealer – Employees of the broker-dealer |
| Business entertainment | Not subject to the Rule, although gifts given in connection with entertainment are subject to the Rule |
| How to value gifts | At cost, exclusive of tax and delivery, except event tickets which are valued at higher of cost or face value |
| Logo/promotional items | Not subject to the Rule, so long as value of gift is significantly below $300 |
| Personal gifts (e.g., wedding, birth) | Not subject to the Rule, unless firm pays for the gift |
| Recordkeeping | Required, using calendar year, fiscal year or rolling 12 months, as documented in firm WSPs |