- with readers working within the Banking & Credit industries
On May 20, 2026, the Securities and Exchange Commission issued an exemptive order (Release No. 34-105517) expanding the exemptive relief from the beneficial ownership reporting requirements of Section 16(a) of the Securities Exchange Act of 1934 for officers and directors of foreign private issuers (FPIs) to include three additional “qualifying jurisdictions”: Australia, India, and Singapore. The SEC determined that each of the exempted jurisdictions has “qualifying regulations” that impose insider reporting obligations “substantially similar” to those of Section 16(a), making duplicative compliance unnecessary. The SEC’s initial exemptive order issued on March 5, 2026 covering Canada, Chile, the United Kingdom, the European Economic Area, South Korea, and Switzerland is discussed in our March blog post.
The qualifying regulations in the three additional jurisdictions are as follows:
Australia
Section 205G of the Corporations Act of Australia and the Australian Securities Exchange Listing Rule 3.19, which require directors of covered issuers to promptly report their initial holdings and any changes in beneficial ownership of the issuer’s securities.
India
Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 2015, which requires directors and officers of covered issuers to promptly report their initial holdings and any changes in beneficial ownership of the issuer’s securities.
Singapore
Part 7 of Singapore’s Securities and Futures Act 2001, which requires directors and chief executive officers of covered issuers to promptly report initial holdings and any changes in beneficial ownership of the issuer’s securities.
The exemptions granted by the SEC’s May 20, 2026, order are subject to a director or officer of an FPI from an exempted jurisdiction satisfying each of the following conditions:
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Each director or officer is required to report their transactions in the issuer’s securities as required under the applicable qualifying regulation to which they are subject. The SEC notes that this condition is intended to ensure that any director or officer who does not fall within the defined category of reporting persons under the applicable qualifying regulation will still be required to file Section 16(a) reports.
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Any report filed pursuant to a qualifying regulation must be made available in English to the general public within no more than two business days of its public posting. If an English version of the report cannot be filed through the relevant regulator’s or listing venue’s online database, it may be made publicly available on the company’s website.
It is important to note that the first condition—that the director or officer is required to report their transactions in the issuer’s securities as set forth under the qualifying regulation to which they are subject—is particularly relevant to officers of an Australian FPI (who are not subject to the Australian qualifying regulation) or officers, other than a chief executive officer, of a Singaporean FPI (who are not subject to the Singaporean qualifying regulation). Those officers would not qualify for the exemption and will still be required to file Section 16(a) reports, even if the directors and any covered officers of the same FPI qualify for the exemption.
Key Takeaways
FPIs incorporated or organized in a qualifying jurisdiction and subject to a qualifying regulation should evaluate whether their directors and officers can rely on this exemption from Section 16(a) compliance, particularly the first condition. It is important, however, to ensure ongoing compliance with the exemption conditions, as failure to satisfy them would result in a loss of the exemption. We expect the SEC may continue to evaluate additional jurisdictions for potential inclusion in future rounds of exemptive relief.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
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