UCSD policy

It is UCSD's policy to negotiate either quantity or trade discounts in lieu of accepting incentives or entering into rebate agreements with suppliers for all methods of purchase.

Department buyers and others are not to accept either incentives or offers for rebates from a supplier without the explicit advance approval of the purchasing director.

If a supplier proposes incentives or rebate agreements, refer the supplier to the purchasing director who will review the conditions of the offer to determine if:

• It is reasonable
• More favorable prices are available from other suppliers
• Either the rebate or incentive value can be applied toward the purchase price

Incentives

Incentives are deliberate enticements offered by a supplier to encourage a purchase. Incentives are tangible non-monetary benefits to the recipient and include any value-added goods and services offered at no charge to either the buyer or UCSD. Examples include:
• Extra goods or services
• Gifts
• Tickets to an event
• Free merchandise

Incentives are generally not accepted because it is inappropriate for a public institution to accept either property or a service that is difficult to identify as tangible and administer to the benefit to UCSD.

Rebates

Rebates are offers from the supplier either to return part of the cost of the order to the buyer or to provide additional consideration or compensation to encourage the purchase of goods and/or services. Examples are:

• Cash or credit based on total purchases
• Value-added goods or services offered at a substantially reduced price
• Checks to either the buyer or the university

If a manufacturer rebate is offered on a purchase you make, policy requires that the rebate check is made payable to the Regents of the University of California, and that the credit of the funds is returned to the same fund source as the expenditure.

Rebates offered either in the form of credits against future purchases or for goods or services at a substantially reduced cost are generally not accepted because of the administrative difficulty of tracking these credits and determining the sales and use tax associated with the resulting transactions.

Questions? Please contact Linda Collins, Director, Procurement and Contracts, (858) 534-3082.