On March 5, 2026, the U.S. Securities and Exchange Commission (“SEC”) issued an order (the “Order”) granting directors and officers of certain foreign private issuers (“FPIs”) an exemption from the insider reporting requirements of Section 16(a) of the U.S. Securities Exchange Act of 1934 (“Exchange Act”). The Order provides relief to directors and officers of Canadian issuers who report their securities holdings on the System for Electronic Disclosure by Insiders (“SEDI”) pursuant to National Instrument 55-104 Insider Reporting Requirements and Exemptions (“NI 55-104”).
While FPIs had previously relied on a long-standing exemption from Section 16 insider reporting, the U.S. Holding Foreign Insiders Accountable Act (“HFIA Act”), enacted in December 2025, amended Section 16(a) of the Exchange Act to require directors and officers of FPIs with securities registered pursuant to the Exchange Act to begin filing Section 16 insider reports on March 18, 2026. The HFIA Act, however, authorizes the SEC to grant exemptions from the requirements of Section 16(a) if it determines that the laws of a foreign jurisdiction apply substantially similar insider reporting requirements.
Subject to a number of conditions, the Order exempts directors and officers of FPIs from Section 16(a) reporting if the FPI is: (i) incorporated or organized in a “qualifying jurisdiction” and subject to a “qualifying regulation” of the same jurisdiction; or (ii) incorporated or organized in a “qualifying jurisdiction” but subject to a “qualifying regulation” of a different jurisdiction.
The SEC has determined that Canada is a “qualifying jurisdiction” and that NI 55-104 (supported by National Instrument 55-102 System for Electronic Disclosure by Insiders (SEDI) and companion policies) is a “qualifying regulation”. Directors and officers (as defined in Section 3(a)(7) of the Exchange Act and Rule 16a-1(f) of the Exchange Act) of Canadian issuers seeking to rely on the exemption must file insider reports pursuant to NI 55-104.
Other “qualifying jurisdictions” include Chile, the European Economic Area, the Republic of Korea, Switzerland and the United Kingdom. Directors and officers of FPIs that are not incorporated or organized in a “qualifying jurisdiction”, but which are subject to a “qualifying regulation”, are not eligible for the Section 16 exemption.
The Order also provides that insider reports must be made available in English to the general public within two business days of public posting.
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