A decades-old exemption just ended. Here is what every foreign private issuer listed on a U.S. exchange needs to do right now.

A decades-old exemption just ended. Here is what every foreign private issuer listed on a U.S. exchange needs to do right now.

On December 18, 2025, the Holding Foreign Insiders Accountable Act (HFIAA) was signed into law as part of the National Defense Authorization Act. Effective March 18, 2026, directors and officers of foreign private issuers — companies that have long operated outside the scope of U.S. insider reporting rules — are now subject to the same Section 16(a) disclosure framework that applies to every domestic public company.

This is not a gradual phase-in. It is an immediate, structural change to how insider ownership and transactions must be disclosed. For the FPIs we work with at Finiti, this shift carries real operational weight — and it arrives fast.

What changed, and why it matters

For more than five decades, foreign private issuers were exempt from Section 16 of the Securities Exchange Act. Under Rule 3a12-3(b), FPI insiders reported only to their home-country regulators, with aggregate ownership appearing once a year in a Form 20-F. Individual trades were invisible to the U.S. market in real time.

The HFIAA ends that. Directors and officers of FPIs whose equity securities are registered under Section 12 of the Exchange Act must now file Forms 3, 4, and 5 on EDGAR — the same forms used by insiders of every U.S. domestic issuer. Those filings must be in English, submitted electronically, and visible to the public the moment they hit the system.

The scope matters: this covers ordinary shares, American Depositary Receipts, restricted stock units, option grants, vesting events, tax-withholding transactions, and all other equity-linked instruments. If an insider holds equity or trades in equity — directly or indirectly through a spouse, trust, or controlled entity — it gets reported.

One important carve-out: the HFIAA does not extend Section 16(b) short-swing profit disgorgement rules or Section 16(c) short-sale restrictions to FPI insiders. And the obligation applies only to directors and officers, not to 10% beneficial owners who are not insiders. But those are the limits of the relief. On reporting, the obligation is full and immediate.

The filing timeline — and why it is already urgent

Any director or officer serving at an FPI as of December 18, 2025 must file an initial Form 3 by March 18, 2026. After that date, newly appointed directors and officers have ten calendar days from the date they assume the role. Going forward, any change in beneficial ownership — a trade, an equity grant, a vesting event — triggers a Form 4 due within two business days.

That two-business-day window is one of the sharpest operational changes for FPI teams accustomed to annual reporting. A grant awarded Monday morning needs to be on EDGAR by Wednesday night. For companies with leadership teams spread across multiple time zones, this requires airtight internal workflows, not ad-hoc processes.

The EDGAR access problem — and how it played out in practice

To file anything on EDGAR, every director and officer needs individual EDGAR Next credentials. That requires submitting a notarized Form ID and waiting for SEC review, which under normal conditions takes eight to ten business days. When the HFIAA deadline approached, the SEC estimated that up to 21,000 new Form IDs would need to be processed — a volume it had never seen at this scale or speed.

The backlog was real. On March 12, 2026, the SEC's Division of Corporation Finance issued FAQ guidance providing conditional no-action relief: insiders who had submitted a completed Form ID before March 18, 2026 but did not receive EDGAR access in time were given until April 1, 2026 to file their Form 3. The relief was narrow — the Form ID had to be submitted on time, and the filing had to come immediately upon receiving access.

That grace period is now behind us. Any FPI that has not yet resolved its insiders' EDGAR access and filed initial Form 3s is in a position it needs to address immediately.

What the ongoing compliance picture looks like

Beyond the initial Form 3, the permanent compliance structure for FPI insiders involves three distinct forms, each with its own trigger and timing:

Form 3 establishes initial ownership at the time someone becomes a director or officer, or when an issuer first registers equity under Section 12. It is a one-time snapshot.

Form 4 is the real-time disclosure engine. Any trade, grant, vesting event, or other change in beneficial ownership generates a Form 4 obligation. Two business days. No exceptions built into the rule.

Form 5 is an annual catch-up mechanism filed within 45 days of fiscal year-end. It captures certain small transactions eligible for deferred reporting and corrects any previously missed filings.

There is one more layer worth noting. Even though Section 16(b) short-swing profit disgorgement does not apply to FPI insiders, the visibility created by Form 4 filings is new. Plaintiffs' attorneys systematically monitor EDGAR for insider transaction patterns. The same disclosures that inform investors also inform litigators. FPIs should consider including a standard note in the Remarks section of each filing making clear that the issuer is a foreign private issuer and not subject to Section 16(b). This is a simple step that provides a meaningful layer of clarity.

How Finiti supports FPIs navigating this change

We work closely with foreign private issuers on their SEC compliance infrastructure — from the structure of their 20-F disclosures to the systems that keep their ongoing filings accurate, timely, and audit-ready.

The HFIAA introduces a class of filing obligation — Form 3, 4, and 5 — that many FPI teams have never managed before. The forms themselves are not complicated. What is complicated is building a process that catches every reportable event in time: tracking insider equity positions across jurisdictions, coordinating pre-clearance with trading windows, notifying the right people fast enough to meet a two-business-day deadline.

That is exactly the kind of compliance infrastructure we help build and run. If your company is an FPI adjusting to Section 16 for the first time, or if you are already in the process and want a second set of eyes on your workflow, we are ready to help.

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