CLG Section 16 Memo | January 2026

Foreign Private Issuers will be required to make Section 16(a) reports on share ownership and insider transactions

Beginning in March 2026, directors and officers of “Foreign Private Issuers” (FPIs) will be required to make public EDGAR filings pursuant to Section 16(a) of the Securities Exchange Act of 1934 (the “Exchange Act”) of Forms 3, 4 and 5.  These forms cover beneficial ownership of, and transactions in, SEC-registered equity securities.  Previously, directors and officers of FPIs were exempt from these filing requirements.  The change comes pursuant to The Holding Foreign Insiders Accountable Act that was passed into law in December 2025.

What is going to be required for FPIs?

Section 16(a) requires directors and officers of companies with SEC‑registered equity securities to disclose the following maters on Forms 3, 4 or 5, as applicable:

• Initial ownership (Form 3)

Form 3 is required when an individual becomes a “corporate insider,” which in practical terms means been appointed as an officer or director.  Form 3 requires identification of the insider, issuer information (name/ticker symbol), type of security, number of shares owned, and whether ownership is direct or indirect.

• Change in ownership (Form 4)

Form 4 is required when an insider’s beneficial ownership changes.  This would include sales, purchases or equity grants.

• Annual filing to cover transactions not reported (Form 5)

Form 5 is generally due no later than 45 days after the issuer’s fiscal year ends and is only required from an insider when at least one transaction, because of an exemption or failure to earlier report, was not reported during the year.

When will these filings be required?

Directors and officers of FPIs will be required to follow the same timing requirements for filing Forms 3, 4 and 5 as directors and officers of U.S. domestic issuers:

• at the time any such security is registered on a national securities exchange or by the effective date of a registration statement filed pursuant to Section12(g) of the Exchange Act;
• subsequently, within 10 days after any other individual becomes director or officer of the issuer; and
• for a change in ownership, before the end of the second business day following the day of execution of the relevant transaction.

What differences will remain for FPIs as compared to U.S. domestic issuers?

There are three key differences to note:

1. 1. Beneficial owners of more than 10% of an FPI’s registered voting equity securities will not be required to file Section 16 reports, unlike domestic issuers
   2. Directors and officers of FPIs remain exempt from the requirements contained in Section16(b) of the Exchange Act covering “short swing” liability
   3. The SEC will have the discretion to exempt FPIs from the Section 16(a) requirements if the SEC determines that the laws of a foreign jurisdiction apply “substantially similar requirements” to those provided pursuant to the 1934 Act. However, “substantially similar” is not defined or explained in the Act, and it remains to be seen what approach the SEC will take to this and which jurisdictions may qualify.

If you have any questions, please contact Anand Saha (asaha@cronelawgroup.com), Liang Shih (lshih@cronelawgroup.com) or your usual Crone Law Group contact.