Skadden, Arps, Slate, Meagher & Flom LLP and Affiliates

SEC Insider Reporting Requirements for Directors and Officers of Foreign Private Issuers Apply Starting March 18, 2026

Skadden Publication / SEC Reporting & Compliance Alert

Brian V. Breheny Raquel Fox Andrew J. Brady Caroline S. Kim Leo W. Chomiak Jeongu Gim Nicholas D. Lamparski Khadija L. Messina Joshua Shainess Sydney E. Smith Kyle Wiley

Executive Summary

  • What’s new: Effective March 18, 2026, directors and officers of foreign private issuers (FPIs) will be subject to insider reporting requirements under Securities Exchange Act Section 16(a). The SEC has now finalized rules implementing the change and issued some clarifications.
  • Why it matters: FPI directors and officers will be required to disclose their initial ownership of company equity securities and report any subsequent transactions in company equity securities generally within two business days — a significant change in compliance obligations for FPIs and their insiders, with implications for internal processes and disclosure practices.
  • What to do next: FPIs should review their internal procedures and prepare to assist their insiders with Section 16(a) reports beginning March 18, 2026.

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Beginning March 18, 2026, directors and officers (D&Os) of foreign private issuers (FPIs) will be subject to the insider reporting requirements under Section 16 of the Securities Exchange Act of 1934 (Exchange Act), following enactment of the Holding Foreign Insiders Accountable Act (HFIAA). See our December 23, 2025, alert, “Foreign Private Issuers’ D&Os Will No Longer Be Exempt From Section 16(a) Insider Reporting Obligations.”

On February 27, 2026, the SEC adopted final rules to conform certain rules and forms under Section 16 of the Exchange Act to the requirements of the HFIAA. While most of the final rules are conforming changes to reflect the requirements of the HFIAA, the SEC clarified a couple of key points and provided guidance on a few compliance questions, including:

  • FPI D&Os will be subject only to the reporting requirements under Section 16(a). They remain exempt from short-swing profit rules under Section 16(b) and short sale prohibitions under Section 16(c).
  • 10% beneficial owners of FPIs remain exempt from Section 16 in its entirety, including Section 16(a) reporting obligations.

Next Steps for FPIs

While individual D&Os are ultimately responsible for their own Section 16 reports, public companies generally assist with the preparation and filing of these reports for their D&Os, given the complexity of reporting rules and short deadlines. To that end, FPIs should assess their internal procedures and prepare to implement Section 16(a) reporting for D&Os by the March 18, 2026, effective date, including the following considerations:

  • Confirm which officers would be subject to the reporting requirements. For Section 16 purposes, Rule 16a-1(f) of the Exchange Act defines the term “officer” to mean certain senior officers of an issuer who perform a policy-making function, including president, principal financial officer, principal accounting officer (or, if there is no such accounting officer, the controller), any vice-president of the issuer in charge of a principal business unit, division or function (such as sales, administration or finance), any other officer who performs a policy-making function, or any other person who performs similar policy-making functions for the issuer. Note that FPIs should have already identified their Section 16 “officers,” because the definition of “executive officers” subject to the SEC’s Rule 10D-1 implementing the Dodd-Frank clawback rules (in effect since late 2023) is the same as the “officer” definition under Exchange Act Rule 16a-1(f). However, FPIs that applied the definition of “executive officer” expansively for purposes of the Dodd-Frank clawback rules might want to revisit that list when identifying their “officers” for purposes of the Section 16(a) reporting obligations.
  • Confirm which directors would be subject to the reporting requirements. Exchange Act Section 3(a)(7) defines the term “director” to mean any director of a corporation or any person performing similar functions with respect to any organization, whether incorporated or unincorporated. While applying the term “director” in certain non-U.S. jurisdictions may require careful analysis, FPIs are expected to use consistent criteria for their director rosters for both Section 16(a) and the FPI eligibility test under Exchange Act Rule 3b-4.
  • Collect and verify company security ownership information for all D&Os to prepare the initial Form 3 reports.
  • Confirm or obtain the necessary EDGAR filing credentials for all current and incoming D&Os. FPI D&Os who are also insiders of a domestic issuer or have filed at least one Schedule 13D or 13G or Form 144 should already have filing credentials, but those credentials may be outdated, or the account may not have been enrolled in EDGAR Next. Obtaining new filing credentials or renewing any legacy credentials (including EDGAR Next enrollment) would require the filing of a notarized Form ID with the SEC, a process that can take a few weeks.
  • Confirm internal or external capacity to make Section 16 filings on behalf of the D&Os, including through arrangements with outside counsel and/or a financial printer.
  • Confirm appropriate communication channels with D&Os’ securities brokers for timely reporting of D&Os’ transactions in company securities.
  • Revisit the company’s insider trading policy to reflect any necessary updates in light of the application of Section 16(a) reporting requirements to D&Os.
  • Consider the implications of having to disclose all D&Os’ ownership of company securities and the details of each equity-based compensation award to D&Os in real time, beyond the current limited disclosure requirements on insider compensation on Form 20-F or other applicable SEC filings.

SEC Authority for Potential Exemptions

The HFIAA provides that the SEC may exempt any persons, securities or transactions from the requirements of Section 16(a) if the SEC determines that the laws of a foreign jurisdiction apply “substantially similar requirements” to that person, security or transaction. In the adopting release, the SEC noted that such exemptions are outside the scope of this rulemaking and may be considered in a separate rulemaking or order.

As of the date of this publication, the SEC has not yet granted any Section 16(a) exemption. Senior members of the SEC staff have informally advised that, while the SEC is evaluating whether any such exemption would be warranted, FPI D&Os should prepare to comply with Section 16(a) on or before the March 18, 2026, deadline.

This memorandum is provided by Skadden, Arps, Slate, Meagher & Flom LLP and its affiliates for educational and informational purposes only and is not intended and should not be construed as legal advice. This memorandum is considered advertising under applicable state laws.

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