The Securities and Exchange Commission (SEC) adopted a final rule to increase transparency into the holdings and transactions of directors and officers of foreign private issuers (FPIs).
With the enactment of this final rule, directors and officers of FPIs with a class of equity securities registered under Section 12 of the Securities Exchange Act of 1934 must begin disclosing their holdings and transactions in the FPI’s equity securities effective March 18.
The SEC’s final rule amendments revise the following rules and forms to reflect the changes made by the HFIA Act:
- Rule 3a12-3(b) to remove the current exemption from Section 16 in its entirety and replace it with exemptions from the Section 16(b) short-swing profit rules and Section 16(c) short selling prohibition only.
- Rule 16a-2, which identifies persons and transactions subject to Section 16, to exclude 10 percent holders of FPIs’ equity securities from the requirements of Section 16(a) and related rules.
The rule and its amendments reflect the requirements of the recently enacted Holding Foreign Insiders Accountable Act (HFIA).
The HFIA Act, enacted on Dec. 18, 2025, amended Section 16(a) of the Exchange Act to require every person who is a director or an officer of an Exchange Act reporting FPI to file Section 16 reports electronically and in English. This does not include “10 percent holders,” those who beneficially own more than 10 percent of any class of equity securities of such FPIs. The HFIA Act mandates that the Commission issue final regulations to carry out the amendments made by the HFIA Act no later than 90 days after the date of enactment.
The adopting release will be published on the SEC website and in the Federal Register.