0925 GMT February 17, 2020
Hammond accepted the watch from Sheikh Marei Mubarak Mahfouz bin Mahfouz, one of the richest men in Saudi Arabia.
Hammond received the gift during an event held for unveiling a statue of the queen over the summer.
The UK ministerial rules ban ministers from receiving gifts worth more than £140.
Hammond argues that he attended the event as a local MP rather than foreign secretary .
However, he has already admitted that he took part in the unveiling ceremony both as foreign secretary and MP.
“I am immensely proud to be taking part in these celebrations, both as foreign secretary and MP,” Hammond wrote in a press release issued the day after the event.
The revelation comes against the backdrop of growing criticism of the Tory government over close ties with Saudi Arabia despite the oil rich monarchy’s poor rights record.
Former Liberal Democrat leader Paddy Ashdown has already accused the Conservative government of bowing to oil rich Arab States.
He believes “closeness” between rich Arab donors and Tory ministers can be behind London’s failure to crack down on the flow of funds to Daesh terrorists from countries such as Saudi Arabia and Qatar.