On March 5, 2026, the Securities and Exchange Commission (SEC) issued an order granting conditional relief from Section 16(a) reporting requirements for directors and specified officers (Section 16 Officers) of certain foreign private issuers (FPIs) incorporated or organized in Canada and other qualifying jurisdictions.
Without this relief, beginning March 18, 2026, directors and Section 16 Officers of FPIs with a class of equity securities registered under Section 12 of the Securities Exchange Act of 1934 would be required to file beneficial ownership reports on Forms 3, 4, and 5 with the SEC, including FPIs incorporated or organized in a qualifying jurisdiction.
The order is intended to prevent duplicative reporting where directors and Section 16 Officers are already subject to comparable disclosure requirements in their home jurisdiction.
Background
Historically, directors and Section 16 Officers of FPIs have been exempt from Section 16(a). Recent statutory amendments eliminated that exemption, making Section 16(a) reporting applicable to directors and Section 16 Officers of FPIs with a class of equity securities registered under Section 12, as of March 18, 2026. However, directors and Section 16 Officers of FPIs organized and headquartered in Israel and other regions directly affected by the Iran War have until April 20, 2026 to comply with the new Section 16(a) insider reporting requirements.
Conditions
Under the SEC's order, conditional relief from Section 16(a) is available to directors and Section 16 Officers of an FPI if the FPI is incorporated or organized in a qualifying jurisdiction and is subject to a qualifying regulation (which may be the regulation of the same or another qualifying jurisdiction).
Eligibility is determined on an individual basis, so some directors and Section 16 Officers may be able to rely on the exemption while others may not. To rely on the exemption, each director or Section 16 Officer must be required to report transactions under the applicable qualifying regulation, and any required reports must be publicly available to the general public in English within no more than two business days of their public posting.
Looking Ahead
FPIs should promptly identify all individuals who may be considered "officers" for Section 16 purposes, recognizing that the U.S. definition may be broader than comparable local reporting categories. FPIs should then assess eligibility for the exemption on an individual basis by determining which directors and Section 16 Officers are subject to a qualifying jurisdiction's insider reporting regime. FPIs should also confirm that applicable insider filings are publicly available in English and satisfy the SEC's timing requirements. For any director or Section 16 Officer who cannot rely on the exemption, FPIs should promptly submit Form ID applications to obtain EDGAR access and prepare the required initial Section 16 filings. SEC staff has stated that it will not recommend enforcement action for a late Section 16 filing caused solely by delayed EDGAR access if the filer submitted the completed Form ID application before March 18, 2026 and files the report as soon as practicable after access is granted, and in any event no later than April 1, 2026.
Any director or Section 16 Officer who does not qualify will be subject to Section 16(a) reporting beginning March 18, 2026 (or, if eligible for certain FPIs organized and headquartered in Israel or other directly affected jurisdictions, by April 20, 2026).
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If you have any questions regarding this alert, please contact the authors, and we would be happy to discuss it with you.