The ethics committee of world football's governing body has set a deadline of October 24 for delegates to hand back the watches
Officials from each of the 32 countries who took part at the FIFA World Cup have been urged to hand back watches, each worth more than £16,000, by FIFA's ethics investigators.
Additionally, a Parmigiani watch was also distributed in gift bags from the Brazilian football federation in June to the 28 members of FIFA's executive committee at this summer's tournament.
But now a statement from FIFA's ethics committee has declared that the gifts are a breach of the organisation's code of ethics and should not have been accepted, adding that they want all watches returned by October 24.
"The CBF should not have offered the watches, and those who received gift bags should have promptly checked whether the items inside were appropriate and, upon discovering the watch, either returned it or... reported the matter to the investigatory chamber.
"The FIFA code of ethics plainly prohibits such gifts. Football officials may not offer or accept gifts that have more than 'symbolic or trivial value'.
"If in doubt, gifts shall not be offered or accepted. Football officials are expected to be aware of the importance of their duties and concomitant obligations and responsibilities.
"In an effort to resolve this matter expeditiously, the investigatory chamber will not pursue further formal ethics proceedings in this matter against officials who submit the Parmigiani watch they received from CBF to the secretariat of the investigatory chamber by no later than October 24, 2014."
Congress: FIFA executive committee meets at the 64th FIFA congress
The ethics committee said the CBF distributed 65 gift bags, each containing a Parmigiani watch, to a group comprising the officials on the FIFA executive committee, a representative from each of the 32 national associations taking part in the World Cup and representatives from other South American national associations.
The statement declared that the matter came to light when several officials reported it to the ethics committee, handing back their watches.
"The FIFA code of ethics plainly prohibits such gifts," added the statement. "Football officials may not offer or accept gifts that have more than 'symbolic or trivial value'.
"If in doubt, gifts shall not be offered or accepted."
FIFA said it had declined to distribute watches distributed by Hublot, its official timekeeper, to executive committee members following advice from the ethics committee.
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