In December 2025, the Holding Foreign Insiders Accountable Act (HFIAA) was signed into law, subjecting directors and officers of foreign private issuers (FPIs) to the insider reporting requirements under Section 16(a) of the US Securities Exchange Act of 1934 (Exchange Act). For years, directors and officers of FPIs with US-registered equity securities were exempt from Section 16(a) insider reporting requirements. That will no longer be the case.
As described in greater detail in this Cooley alert, the HFIAA obligates directors and executive officers of FPIs to begin filing reports under Section 16(a) 90 days following the date of its enactment. As a result, effective March 18, 2026, such directors and officers will be required to file a Form 3 with the US Securities and Exchange Commission (SEC) reporting their ownership of the issuer’s equity securities. Thereafter, these individuals will be required to file Form 4s within two business days to report changes in their ownership. Additionally, these filing obligations will equally apply to funds and other institutional investors that consider themselves to be “directors by deputization” for Section 16 purposes.
The HFIAA’s expansion of the Section 16 reporting requirements does not extend to 10% stockholders of FPIs, unlike US domestic companies. However, investment funds whose investment professionals serve as directors of FPIs should be aware that the fund’s holdings and transactions may be required to be reported on the director’s Section 16 filings if the director is considered to “beneficially own” the fund’s securities. Additionally, the HFIAA directs the SEC to undertake rulemaking to amend existing Section 16 rules to conform to HFIAA requirements. In the course of that rulemaking, it is possible the SEC could further extend the reach of Section 16 reporting to also include 10% stockholders of FPIs.
Importantly, by its terms, the HFIAA does not extend the short-swing profit liability provisions of Section 16(b) of the Exchange Act or the short-sale limitations of Section 16(c) of the Exchange Act to FPIs. However, it is possible that these provisions could be extended to FPIs through the SEC rulemaking required by the HFIAA.
Steps that funds and other institutional investors should take now
With the March 18, 2026, effective date roughly two months away, funds and other institutional investors whose investment professionals serve as directors of FPIs should begin to take proactive steps to comply with these requirements, including:
- Identifying any investment professionals serving as directors of FPIs in their portfolios.
- Confirming these individuals’ SEC filing credentials or applying for credentials on their behalf (note that this process can take up to two weeks or more).
- Ensuring that they understand Section 16 filing triggers and reporting obligations.
- Reviewing their compliance systems to confirm that they have appropriate controls to comply with these requirements.
- Conferring with their advisors to prepare and submit any required filings in a timely manner.
The authors
