Nasdaq PHLX adopts $300 gift limit rule for member firms
Member firms, principals and officers must cap gifts to non-employees at $300 per year, effective immediately after the Sep 8, 2026 filing.
On September 8, 2026, Nasdaq PHLX LLC filed a proposed rule change, designated Release No. 34-106406 and File No. SR-Phlx-2026-56, to adopt Options 10, Section 27, "Influencing or Rewarding Employees of Others." The rule became effective immediately upon filing and establishes a $300 per individual per year limit on any item of value, including gratuities, given by a member organization, Options Principal, Representative, officer, partner or branch office manager to an employee, agent or representative of another person when the payment relates to the recipient's employer business.
The provision applies to all PHLX member organizations, regardless of FINRA membership, and defines a gift of any kind as a gratuity. It does not apply to employment contracts that were in existence prior to the employment relationship and are supported by a written agreement that includes compensation details and the employer's written consent.
Member organizations must retain a separate record of all payments, gratuities, employment agreements and related compensation for the period required by Rule 17a-4 of the Exchange Act. The Exchange also reserves the authority to grant unconditional or conditional exemptions from any provision of the rule in exceptional circumstances, provided the exemption aligns with the rule's purpose, investor protection and the public interest.
Supplementary materials accompanying the rule prescribe valuation at cost (excluding tax and delivery) for most gifts, with tickets valued at the higher of cost or face value, and require aggregation of all gifts given by the organization and its associated persons to each recipient on a calendar, fiscal or rolling year basis. Personal gifts for life events, customary bereavement gifts, and de minimis or promotional items are excluded from the $300 limit and associated recordkeeping requirements. Gifts given during business entertainment are subject to the rule unless they fall under the de minimis or personal-gift exclusions.
The new rule mirrors FINRA Rule 3220 to promote consistency across markets, reduce regulatory fragmentation and enforce a uniform standard of business conduct regarding gifts and gratuities on the PHLX platform.
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