SEC Issues Exemptive Order And Technical Guidance On The Holding Foreign Insiders Accountable Act

In February 2026, the SEC issued an Exemptive Order and a comprehensive set of Frequently Asked Questions (FAQs) as part of its ongoing implementation of the Holding Foreign Insiders Accountable Act (“HFIAA”).  The HFIAA expands insider reporting obligations under Section 16(a) of the Securities Exchange Act to officers and directors of foreign private issuers (“FPIs”).  For a detailed description of the HFIAA and a useful checklist for its use, see HERE.

As allowed by the HFIAA the exemptive order exempts certain persons from the new requirements where they are subject to the laws of a foreign jurisdiction that apply substantially similar requirements to such person.  While the default requirement is that FPI insiders must file Forms 3, 4, and 5 via EDGAR beginning March 18, 2026, the new Exemptive Order provides a specific, conditional path for insiders in certain jurisdictions to avoid duplicative filings.

Background Section 16(a)

Section 16(a) of the Exchange Act is designed to provide timely public disclosure of ownership and transactions by corporate insiders to protect investors by increasing transparency. Under Section 16(a):

• Directors, officers, and beneficial owners of more than 10% of a class of a registered company’s equity securities must file Form 3 to disclose initial ownership upon becoming an insider.
• Subsequent changes in beneficial ownership must be reported on Form 4 within two business days of the transaction.
• Certain annual or deferred reports are filed on Form 5 within 45 days after fiscal year end.

Before the HFIAA, FPIs were exempt from these insider reporting requirements even if their securities traded in the United States.

Exemptive Order

The Exemptive Order is not a blanket waiver; it is a conditional, individual-based exemption granted under the authority of new Section 16(a)(5). To avail themselves of the relief and avoid filing U.S. Forms 3, 4, and 5, a filer must meet two primary technical tests: the Entity Test and the Individual Filing Condition.

1. The Entity Test: Qualifying Jurisdictions and Regulations

The FPI must be incorporated or organized in a qualifying jurisdiction and be subject to a qualifying regulation.

Each of the qualifying regulations provide in general, requirements that directors and officers of covered issuers promptly report their initial holdings and any changes in beneficial ownership of the issuer’s securities, including a description of the security, the nature of the transaction, and the price and volume of the transaction, and that such reports be made available to the general public

Note: The FPI can “mix and match.” For example, a company incorporated in Switzerland but listed in London (subject to UK MAR) would qualify.

2. The Individual Filing Condition: Actual Reporting & English Disclosure

Even if the company is in a qualifying jurisdiction, the exemption is individual-specific. To be exempt from SEC filings:

• Actual Reporting: The director or officer must actually be required to—and must actually—report their transactions under the home country’s Qualifying Regulation. If an individual is an “officer” under SEC definitions but is not a reporting person under local law, they must file U.S. Section 16 reports.
• English Availability: Any report filed under the foreign regulation must be made available in English within two business days of its public posting. If the foreign regulator’s database does not support English, the issuer must post an English version on its corporate website.

FAQ

The SEC has also published an FAQ page regarding the HFIAA’s requirements.

• Filing Deadlines: Directors and officers of FPIs that were reporting as of December 18, 2025, must file an initial Form 3 by March 18, 2026. However, if the person is no longer a director or officer as of March 18, 2026, then no Form 3 filing is required.  New insiders appointed after March 18, 2026 must file within 10 days of their appointment.
• Exclusion of 10% Holders: In a critical win for large shareholders, the SEC confirmed that the HFIAA Act applies only to directors and officers. Unlike domestic issuers, 10% beneficial owners of FPIs remain exempt from Section 16(a) reporting.
• Section 16(b) and 16(c) Relief: Rule 3a12-3(b) has been amended, not rescinded. While FPI insiders must now report under Section 16(a), they remain exempt from Section 16(b) short-swing profit disgorgement and Section 16(c) short-sale prohibitions.
• Calculation of Beneficial Ownership (FAQ 4): The Staff reiterated that FPI insiders must use the Rule 16a-1(a)(2) “pecuniary interest” standard for Form 4 and 5 reporting, while the 10% threshold calculation (relevant for domestic issuers) is not applicable here.
• EDGAR Next Readiness: The SEC emphasized that every reporting person must have their own unique CIK and be enrolled in EDGAR Next. This requires notarized Form ID applications, which can be a significant logistical hurdle in foreign jurisdictions. For more on EDGAR Next see HERE.

The Author

Laura Anthony, Esq.

Founding Partner

Anthony, Linder & Cacomanolis

A Corporate and Securities Law Firm

LAnthony@ALClaw.com

Securities attorney Laura Anthony and her experienced legal team provide ongoing corporate counsel to small and mid-size private companies, public companies as well as private companies going public on the Nasdaq, NYSE American or over-the-counter market, such as the OTCQB and OTCQX. For more than two decades Anthony, Linder & Cacomanolis, PLLC has served clients providing fast, personalized, cutting-edge legal service.  The firm’s reputation and relationships provide invaluable resources to clients including introductions to investment bankers, broker-dealers, institutional investors and other strategic alliances. The firm’s focus includes, but is not limited to, compliance with the Securities Act of 1933 offer sale and registration requirements, including private placement transactions under Regulation D and Regulation S and PIPE Transactions, securities token offerings and initial coin offerings, Regulation A/A+ offerings, as well as registration statements on Forms S-1, S-3, S-8 and merger registrations on Form S-4; compliance with the Securities Exchange Act of 1934, including registration on Form 10, reporting on Forms 10-Q, 10-K and 8-K, and 14C Information and 14A Proxy Statements; all forms of going public transactions; mergers and acquisitions including both reverse mergers and forward mergers; applications to and compliance with the corporate governance requirements of securities exchanges including Nasdaq and NYSE American; general corporate; and general contract and business transactions. Ms. Anthony and her firm represent both target and acquiring companies in merger and acquisition transactions, including the preparation of transaction documents such as merger agreements, share exchange agreements, stock purchase agreements, asset purchase agreements and reorganization agreements. The ALC legal team assists Pubcos in complying with the requirements of federal and state securities laws and SROs such as FINRA for 15c2-11 applications, corporate name changes, reverse and forward splits and changes of domicile. Ms. Anthony is also the author of SecuritiesLawBlog.com, the small-cap and middle market’s top source for industry news, and the producer and host of LawCast.com, Corporate Finance in Focus. In addition to many other major metropolitan areas, the firm currently represents clients in New York, Los Angeles, Miami, Boca Raton, West Palm Beach, Atlanta, Phoenix, Scottsdale, Charlotte, Cincinnati, Cleveland, Washington, D.C., Denver, Tampa, Detroit and Dallas.

Ms. Anthony is a member of various professional organizations including the Crowdfunding Professional Association (CfPA), Palm Beach County Bar Association, the Florida Bar Association, the American Bar Association and the ABA committees on Federal Securities Regulations and Private Equity and Venture Capital. She is a supporter of several community charities including the American Red Cross for Palm Beach and Martin Counties, Susan Komen Foundation, Opportunity, Inc., New Hope Charities, the Society of the Four Arts, the Norton Museum of Art, Palm Beach County Zoo Society, the Kravis Center for the Performing Arts and several others.

Ms. Anthony is an honors graduate from Florida State University College of Law and has been practicing law since 1993.

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