Effective March 18, 2026, the Holding Foreign Insiders Accountable Act (the “HFIA Act”) ends the long-standing exemption from beneficial ownership reporting requirements for officers and directors1 of Foreign Private Issuers (“FPIs”) under Section 16(a) of the Securities Exchange Act of 1934 (the “Exchange Act”). On February 27, 2026, the US Securities and Exchange Commission (the “SEC”) adopted amendments to Exchange Act Rules 3a12-3(b) and 16a-2, and Forms 3, 4 and 5 to implement the new requirements of the HFIA Act.2
The HFIA Act included exemptive authority in Section 16(a)(5) of the Exchange Act, however, which provides that the SEC may exempt any class of persons, securities or transactions from the new reporting requirements if it determines that the laws of a foreign jurisdiction apply substantially similar reporting requirements to those under the HFIA Act to such person, security or transaction. In reliance on this exemptive authority, the SEC has identified foreign jurisdictions and laws that it determined impose sufficiently similar requirements on FPI insiders such that insiders of companies incorporated or organized in those jurisdictions and subject to those laws are eligible for exemption from the Exchange Act Section 16(a) insider reporting requirements imposed under the HFIA Act.3
The SEC has clarified that this exemption will be available to directors and officers of FPIs that are incorporated or organized in a “qualifying jurisdiction,” and subject to a “qualifying regulation,” including an FPI incorporated or organized in a qualifying jurisdiction but subject to a qualifying regulation of a different jurisdiction. The qualifying jurisdictions are:
- Canada,
- Chile,
- the European Economic Area,4
- the Republic of Korea,
- Switzerland and
- the United Kingdom.
The corresponding qualifying regulations are:
- Canada’s National Instrument 55-104 – Insider Reporting Requirements and Exemptions,
- Articles 12, 17 and 20 of the Chilean Securities Market Law,
- Article 19 of the European Union Market Abuse Regulation,
- Article 173 of the Republic of Korea Financial Investment Services and Capital Markets Act and Article 200 of the Enforcement Decree of the Financial Investment Services and Capital Markets Act,
- Article 56 of the Listing Rules and implementing directives of SIX Swiss Exchange as approved by the Swiss Financial Market Supervisory Authority and
- Article 19 of the United Kingdom Market Abuse Regulation.
The exemption will be granted subject to two additional conditions: (1) any director or officer seeking to rely on this exemption must report their transactions in the issuer’s securities as set forth under the qualifying regulation, and (2) any report filed pursuant to the qualifying regulation must be made available in English to the general public (such as on the company’s website) within two business days of its public posting if not already publicly available in English on the regulator’s online database.
The SEC based its assessment of substantially similar requirements on the persons covered, securities covered, transactions covered, reports and their public availability. The SEC has determined that insiders of companies in each of the above jurisdictions subject to the corresponding regulations meet the above criteria and accordingly are exempted from the HFIA Act reporting requirements.
For further information or assistance in interpreting the exemption or in complying with the new requirements, please contact Keith Billotti at (212) 574-1274 or billotti@sewkis.com, Edward Horton at (212) 574-1265 or horton@sewkis.com, Walter Van Dorn at (212) 574-1590 or vandorn@sewkis.com, or your primary attorney at Seward & Kissel LLP.