New U.S. Reporting Requirements for Insiders of Foreign Private Issuers

Introduction A significant change in U.S. securities law is approaching that will fundamentally impact the reporting obligations of directors and officers of Foreign Private Issuers (FPIs). Going forward, directors and officers will be required to report within 48 hours to the SEC transactions in the issuer’s securities. Previously, insiders of FPIs were exempt from this filing requirement, but they will soon be required to file such ownership reports with the SEC. Who Is Affected? The new legislation targets the following individuals at SEC-registered FPIs:

• Directors and Officers: Individuals serving in these roles must now report their holdings and transactions.
• The 10% Owner Exception: Notably, unlike the rules for U.S. domestic companies, this law does not apply to persons who beneficially own more than 10% of a class of registered equity securities, unless they also serve as a director or officer.
• Identifying “Officers”: FPIs will need to determine which senior management members qualify as “officers” under SEC rules, a definition expected to be consistent with Nasdaq clawback rules.

  Mandatory Reporting Requirements Insiders must provide granular data regarding their holdings and grants that was not previously public. This includes:

• Form 3 (Initial Statement): Required to report initial holdings upon the law’s effective date or upon an individual becoming an insider.
• Form 4 (Changes in Ownership): Must be filed to report virtually any change in beneficial ownership—including buys, sells, grants, vests, or exercises—regardless of how small the transaction. This includes transactions on stock exchanges outside the U.S.
• Form 5 (Annual Statement): Used for year-end reporting of certain exempt transactions or to catch up on missed filings.
• Strict Two-Day Deadline: Changes in ownership (Form 4) must be reported within two business days of the transaction.

  Compliance Timeline

• Effective Date: The new requirement was signed into law on December 19, 2025 and will become effective 90 days later on March 18, 2026.

  Next Steps

• Obtain EDGAR Codes: Directors and officers must have EDGAR Next filing codes to make these submissions.
• Inform your directors and officers of the new reporting requirements.
• Contact Herzog to design a process for reporting and compliance.