^{Legal Alerts | March 17, 2026 12:00 am} SEC Exempts Certain Foreign Private Issuers from New Section 16(a) Reporting Obligations

In Davis Graham’s January 2026 alert, we discussed the significant changes introduced by the Holding Foreign Insiders Accountable Act, which extended Section 16 reporting obligations to directors and certain officers of foreign private issuers. In a welcome development for many FPIs, the Securities and Exchange Commission has now exercised its exemptive authority to provide relief for issuers incorporated in certain qualifying jurisdictions.

Background

As detailed in Davis Graham’s prior alert, the Holding Foreign Insiders Accountable Act (“HFIAA”), signed into law on December 18, 2025 as part of the National Defense Authorization Act for Fiscal Year 2026, amended Section 16(a) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), to extend insider reporting obligations to directors and officers (as defined in Section 3(a)(7) of the Exchange Act and Rule 16a-1(f) of the Exchange Act, respectively) of foreign private issuers (“FPIs”). The HFIAA also authorized the Securities and Exchange Commission (“SEC”)to exempt any person, security, or transaction from Section 16(a) reporting requirements if the SEC determines that the laws of a foreign jurisdiction impose “substantially similar” requirements.

On March 5, 2026, just days before the March 18, 2026 compliance deadline, the SEC issued an exemptive order (Release No. 34-104931)^[1] providing conditional relief from Section 16(a) reporting obligations for directors and officers of certain FPIs.

Scope of Exemption

Under the SEC’s order, the exemption is available to directors and officers of any FPI that is both (1) incorporated or organized in a “qualifying jurisdiction” and (2) subject to a “qualifying regulation.”

Qualifying Jurisdictions

The SEC has identified six qualifying jurisdictions:

• Canada;
• Chile;
• the European Economic Area^[2];
• the Republic of Korea;
• Switzerland; and
• the United Kingdom.

Qualifying Regulations

The SEC determined that each of the following regulations imposes requirements “substantially similar” to Section 16(a) based on five key criteria: (i) persons covered, (ii) securities covered, (iii) transactions covered, (iv) the content and timeliness of required reports, and (v) public availability of reports in English.

Key Conditions for Reliance on the Exemption

The exemption is subject to two important conditions that FPIs and their insiders must satisfy:

1. Reporting Under the Qualifying Regulation. Each director or officer relying on the exemption must report their transactions in the issuer’s securities as required under the applicable qualifying regulation. Importantly, this condition applies on an individual basis. If a director or officer qualifies as such under SEC rules but falls outside the defined category of reporting persons under the qualifying regulation, that individual will still be required to file Section 16(a) reports with the SEC.
2. English-Language Availability. Any report filed under a qualifying regulation must be made available in English to the general public within two business days. If an English version cannot be filed through the regulator’s or listing venue’s database, it may be posted on the company’s website.

Both the incorporation/organization requirement and the qualifying regulation requirement must be satisfied, although they need not involve the same jurisdiction. For example, directors and officers of an FPI incorporated in Canada with securities listed in Germany (which is subject to Article 19 of EU MAR) would qualify for the exemption because (i) Canada is a qualifying jurisdiction and (ii) EU MAR is a qualifying regulation, even though these arise from different jurisdictions.

However, satisfying only one prong is insufficient. An FPI incorporated in a non-qualifying jurisdiction but listed on an exchange in a qualifying jurisdiction would not qualify, even if subject to a qualifying regulation, due to not meeting the incorporation/organization requirement. Directors and officers of such FPIs must still file Section 16(a) reports in addition to any foreign reporting obligations.

Practical Implications and Immediate Action Items

For FPIs in qualifying jurisdictions:

• Assess exemption eligibility immediately. Confirm whether the FPI is subject to a qualifying regulation and conduct an analysis to identify which directors and officers would be covered by the exemption.
• Identify potential gaps. Determine if any Section 16 directors or officers are not currently reporting under any qualifying regulation and evaluate whether to align home-country reporting obligations or prepare for parallel SEC filings.
• Establish English-language reporting processes. If reports under the qualifying regulation are not already filed in English, establish a process for preparing and publishing English versions within the two-business-day window, whether through the foreign regulator’s database or on the company’s website.

For FPIs NOT in qualifying jurisdictions:

Directors and officers of FPIs incorporated outside the qualifying jurisdictions or not subject to qualifying regulations remain subject to the Section 16(a) reporting framework. These FPIs should follow the action items outlined in Davis Graham’s January 2026 alert:

• Identify covered personnel. Identify covered personnel and ensure that they are enrolled in EDGAR Next and have obtained the necessary filing credentials before March 18, 2026.
• Prepare for initial EDGAR filings. Prepare for initial Form 3 filings, which must be submitted by 10:00 p.m., Eastern Time, on March 18, 2026.
• Update related policies and procedures. Review and update internal policies to address Section 16 reporting and workflows.
• Train and communicate. Educate directors and officers on Section 16 reporting obligations, beneficial ownership concepts, and filing procedures.

Next Steps

For questions about the SEC’s exemptive order, the scope of coverage, or how to structure Section 16 compliance, contact a member of our Public Companies & Capital Markets team to help you navigate these new requirements.

• ^[1] See https://www.sec.gov/rules-regulations/2026/03/34-104931 for the full text of the exemptive order.
• ^[2] As of the date of the exemptive order, the European Economic Area consists of the 27 member states of the European Union (Austria, Belgium, Bulgaria, Croatia, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, Netherlands, Poland, Portugal, Romania, Slovakia, Slovenia, Spain, and Sweden) as well as Iceland, Liechtenstein, and Norway. Any country that joins the EEA would also be required to adopt EU MAR (and therefore this exemptive relief would apply to directors and officers of its FPIs), while a country that leaves the EEA may no longer be subject to EU MAR (and directors and officers of its FPIs would no longer be eligible for this exemptive relief to the extent the country is no longer subject to the EU MAR).