East West Diversified Ventures
Partner With Us
Back to Insights

East West Diversified Ventures

The Foreign Private Issuer Framework: What Southeast Asian Companies Should Know Before Entering the U.S. Markets

The U.S. system provides meaningful accommodations for qualifying foreign issuers - but it is not a shortcut, and the framework is under active regulatory review.

A Southeast Asian company considering a U.S. listing does not necessarily enter the same reporting framework as a U.S.-incorporated public company. U.S. securities law recognizes a category known as the foreign private issuer, or FPI, and provides qualifying companies with a reporting and governance framework designed to accommodate cross-border issuers.

That framework can be strategically important. It can allow a company to access U.S. investors while continuing to operate from its home jurisdiction and, in important respects, using international reporting practices. But the FPI regime should not be described as a regulatory shortcut. It still requires substantial SEC disclosure, audited financial statements, exchange compliance and public-company discipline.

Who qualifies as a foreign private issuer?

The FPI definition is technical and should be analyzed with U.S. securities counsel. In broad terms, a foreign issuer can lose FPI status if more than 50% of its outstanding voting securities are held of record by U.S. residents and the company also has specified U.S. business contacts - for example, a majority of executive officers or directors who are U.S. citizens or residents, more than 50% of assets located in the United States, or business principally administered in the United States.1

The test is important because FPI status affects the forms a company files and a number of continuing disclosure and governance requirements. It also must be reassessed periodically under the applicable SEC rules.

IFRS can remain available

One of the most significant accommodations for many Southeast Asian issuers is accounting. The SEC permits an FPI to file financial statements prepared in accordance with IFRS as issued by the International Accounting Standards Board without reconciling those statements to U.S. GAAP.2

That can materially simplify the long-term reporting model for companies already moving toward full IASB IFRS. It does not mean that every local accounting framework is automatically acceptable. The SEC accommodation applies to IFRS as issued by the IASB; issuers using another home-country framework may face reconciliation or conversion requirements.

Annual reporting generally occurs on Form 20-F

Foreign private issuers generally use Form 20-F for annual reporting rather than Form 10-K. SEC staff guidance states that the Form 20-F annual report is due four months after the end of the issuer's fiscal year.3

Form 20-F remains a substantial disclosure document. It includes business information, risk factors, operating and financial review, governance and ownership information, audited financial statements and other material disclosures. Management should not view the longer annual-reporting timetable as permission to operate with weak financial processes.

Current information is commonly furnished on Form 6-K

FPIs generally use Form 6-K to furnish specified material information that is made public in the home jurisdiction, filed with a foreign exchange or distributed to security holders, as well as other information the issuer chooses to furnish. This differs from the domestic Form 8-K framework and gives FPIs a reporting architecture that better accommodates home-country disclosure systems.

Some home-country governance practices may continue

Nasdaq allows a foreign private issuer, subject to important exceptions, to follow certain home-country practices in lieu of portions of the Nasdaq corporate-governance rules. The issuer must disclose the Nasdaq requirement it does not follow and describe the home-country practice used instead; Nasdaq also requires specified audit-committee protections.4

This can be helpful for companies whose board structures, shareholder-meeting practices or committee arrangements differ from U.S. norms. It should not be used as a reason to minimize governance. Institutional investors may expect practices that exceed the minimum legal accommodation, particularly where controlling shareholders or related-party transactions are significant.

The FPI framework still demands institutional readiness

Qualifying as an FPI does not remove the need for a PCAOB-registered auditor, accurate SEC disclosure, exchange listing standards, internal controls, governance processes and management accountability. Nor does it eliminate U.S. securities-law liability for materially misleading disclosure.

Companies should therefore think of FPI status as a framework for international issuers, not a lighter version of being public. The accommodations are designed to recognize that a foreign company remains embedded in another legal and corporate system while participating in the U.S. capital markets.

The regulatory framework is under review

Companies planning a transaction should also be aware that the SEC is actively reconsidering the FPI eligibility framework. In June 2025 the SEC issued a concept release asking whether the definition should be revised in light of changes in the FPI population and home-country regulatory environments.5 In February 2026, the Division of Corporation Finance stated that it was still processing comments on that concept release and considering potential recommendations.6

As of September 2026, the concept release itself is not a final rule changing the existing FPI definition. Nevertheless, companies with multi-year U.S. capital-markets plans should monitor the rulemaking process because future changes could affect eligibility or the accommodations associated with FPI status.

What management should do before relying on FPI status

  1. Confirm the status analysis with U.S. securities counsel, including U.S. shareholder ownership and the location of management, assets and administration.

  2. Choose the accounting framework deliberately. If the company intends to use IASB IFRS, identify conversion and first-time adoption issues early.

  3. Map home-country governance practices against the relevant U.S. exchange requirements and decide which accommodations, if any, the company actually wants to use.

  4. Build disclosure controls and a Form 6-K process that integrates home-country announcements with U.S. reporting obligations.

  5. Reassess FPI status when required and monitor SEC rulemaking rather than assuming the current framework will remain unchanged indefinitely.

The conclusion: an international framework, not an exemption from discipline

For many Southeast Asian companies, the FPI regime makes a U.S. listing more practical because it recognizes international accounting, reporting and governance realities. That is a meaningful advantage. It can allow a company to enter the U.S. market without unnecessarily recreating every element of a domestic U.S. issuer structure.

The companies that benefit most will be those that use the flexibility responsibly: maintaining high-quality reporting, strong governance and clear investor communications even where the rules allow a different home-country practice. The objective should not be to minimize obligations. It should be to build a reporting model that is credible in both the home market and the United States.

Footnotes

  1. U.S. Securities and Exchange Commission, Concept Release on Foreign Private Issuer Eligibility, Release Nos. 33-11376 and 34-103176 (June 4, 2025), describing the current FPI eligibility test and the SEC's review of that definition. https://www.sec.gov/rules-regulations/2025/06/s7-2025-01

  2. U.S. Securities and Exchange Commission, Financial Reporting Manual Topic 6, section 6310.1; see also SEC Release No. 33-8879. An FPI using IFRS as issued by the IASB is not required to reconcile to U.S. GAAP. https://www.sec.gov/about/divisions-offices/division-corporation-finance/financial-reporting-manual/frm-topic-6

  3. U.S. Securities and Exchange Commission, Exchange Act Forms Compliance and Disclosure Interpretations, Question 110.05, stating that Form 20-F is due four months after the end of an issuer's fiscal year. https://www.sec.gov/rules-regulations/staff-guidance/corporation-finance-interpretations/exchange-act-forms

  4. Nasdaq Rule 5615(a)(3), foreign private issuer provisions regarding home-country practices, disclosure and audit-committee exceptions. https://listingcenter.nasdaq.com/rulebook/Nasdaq/rules/Nasdaq-5600-Series/5605/EQUALS/

  5. U.S. Securities and Exchange Commission, Concept Release on Foreign Private Issuer Eligibility, June 4, 2025. The release solicited comment on whether the FPI definition should be revised. https://www.sec.gov/rules-regulations/2025/06/s7-2025-01

  6. U.S. Securities and Exchange Commission, Division of Corporation Finance, "Coming Attractions From the Division of Corporation Finance," February 13, 2026, stating that the Division was processing comments on the June 2025 FPI concept release. https://www.sec.gov/newsroom/speeches-statements/moloney-statement-coming-attractions-021326-coming-attractions-division-corporation-finance