Now Forge and Paper is running side by side again! Forge still have no support for Java 16 but by changing

java -Xmx12288M -Xms12288M -jar forge-1.16.5-36.2.0.jar nogui

to

/usr/lib/jvm/java-8-openjdk-amd64/jre/bin/java -Xmx12288M -Xms12288M -jar forge-1.16.5-36.2.0.jar nogui

Paper is running the default Java (16) and Forge is running Java 8.