On February 27, 2026, the Securities and Exchange Commission (SEC) adopted final amendments to implement the Holding Foreign Insiders Accountable Act (HFIAA), which amended Section 16(a) of the Securities Exchange Act of 1934 (the “Exchange Act”) to require directors and officers of foreign private issuers (FPIs) to file beneficial ownership reports on Forms 3, 4, and 5 beginning March 18, 2026.[1]
Shortly after adopting the rules, on March 5, 2026, the SEC issued an order granting conditional exemptive relief from the new requirements for certain companies that are already subject to local reporting rules.[2]
Both of these developments are discussed below.
As discussed in our earlier client alert, HFIAA amended Section 16(a) of the Exchange Act to eliminate the longstanding exemption for directors and officers of FPIs from Section 16 reporting. Specifically, the SEC adopted amendments to Rule 3a12-3(b), Rule 16a-2, and Forms 3, 4, and 5 to conform these rules and forms to HFIAA. The final amendments reflect that directors and officers of FPIs must file:
Consistent with HFIAA, the SEC also clarified that 10% beneficial owners of FPIs (that are not officers or directors) will be exempt from Section 16 in its entirety, including Section 16(a) reporting obligations.
In addition, FPI insiders will be subject only to the reporting requirements under Section 16(a). The short-swing profit rules under Section 16(b) and short sale prohibitions under Section 16(c) will not apply to FPI insiders.
While FPI insiders generally are subject to the new Section 16(a)(5) of the Exchange Act, the SEC provided a limited exemption from Section 16 reporting where the laws of a foreign jurisdiction impose “substantially similar” requirements. The SEC’s order exempts directors and officers of an FPI that is incorporated or organized in a “qualifying jurisdiction” and where the FPI is either subject to a specified “qualifying regulation” of the same jurisdiction or of a different qualifying jurisdiction, provided the company makes the home country reports publicly available in English within two business days of public posting.
The SEC’s order deemed the following jurisdictions as qualifying jurisdictions:
The exemption is subject to two principal conditions:
Reports filed under the qualifying regulation must be made publicly available in English within no more than two business days of public posting.
The SEC noted that it may extend similar relief to additional jurisdictions in future exemptive orders if it determines that their laws impose substantially similar reporting requirements.
Beginning March 18, 2026, directors and officers of FPIs with a class of equity securities registered under Section 12 of the Exchange Act are required to file Forms 3, 4, and 5, unless an exemption applies.
For FPIs incorporated or organized in the qualifying jurisdictions and subject to the qualifying regulations, directors and officers will not be required to file Forms 3, 4, or 5 with the SEC, provided the conditions are satisfied.
FPIs incorporated outside these jurisdictions, or whose directors and officers are not subject to a qualifying regulation, remain subject to the new Section 16 reporting requirements, beginning March 18, 2026.
[1] Holding Foreign Insiders Accountable Act Disclosure (February 27, 2026).
[2] Order Granting Directors and Officers of Certain Foreign Private Issuers an Exemption from the Filing Requirements of Section 16(a) of the Exchange Act (March 5, 2026).