Key Points:

Reporting companies under the Corporate Transparency Act (the “CTA”) are now defined only as entities that are created under the law of a foreign country and that have registered to do business in the United States. Companies formed in the United States no longer have to report their beneficial owners.

In addition, reporting companies only have to report foreign beneficial owners. Reporting companies do not have to report American beneficial owners.

Beneficial ownership reporting requirements for these foreign reporting companies will take effect as of April 25, 2025.

For this interim reporting requirement, the federal government places the obligation on the reporting company itself. Because of that, and because of the need to collect and compile personal information, as above, we are not able to undertake this reporting on behalf of our clients unless specifically requested and agreed to in writing.

This update describes the current status of CTA implementation efforts and provides links to in-depth summaries and other resources.

On March 26, 2025, the Department of the Treasury issued an interim final rule which removes the requirement for U.S. companies and U.S. persons to report beneficial ownership information to the U.S. Department of the Treasury’s Financial Crimes Enforcement Network (“FinCEN”) under the CTA. The interim final rule revises the definition of “reporting company” in its implementing regulations to mean only those entities that are formed under the law of a foreign country and that have registered to do business in any U.S. State or Tribal jurisdiction by the filing of a document with a secretary of state or similar office.

The interim final rule has a deadline of April 25, 2025 for existing reporting companies to file their initial report. For reporting companies which register to do business in the United States in the future, they have thirty (30) days from the date of confirmation of registration to do business in the United States to file their initial report with FinCEN. Aforementioned, these reporting entities only need to report foreign beneficial owners, not American owners. Readers are encouraged to visit the FinCEN website, where numerous guidance documents – including the Interim Final Rule – can be found.

This interim final rule is a significant revision from the original FinCEN rule you may have heard about in the past couple years. Previously , the FinCEN beneficial ownership information reporting rule, codified at 31 U.S.C. § 5336, required entities it defined as reporting companies to report identifying information to FinCEN concerning two categories of individuals: (i) those who directly or indirectly own or control the reporting company (known as “beneficial owners”); and (ii) those who directly file or are primarily responsible for filing documents that create or register the reporting company (known as “company applicants”). This applied to U.S. and foreign companies alike.

The deadline to file an initial report for reporting companies was set originally for January 1, 2025. Beginning on December 3, 2024, this deadline changed numerous times in light of litigation challenging the CTA. In response to this nationwide litigation, the Department of the Treasury issued the interim final rule that is now in effect.

Please be advised that a willful failure to file a report, or a willful provision or attempt at provision of false or fraudulent beneficial ownership information (“BOI”), may result in civil and criminal penalties.

Access to the information that is reported is strictly constrained by the Corporate Transparency Act, and FinCEN is primarily authorized to disclose BOI in limited circumstances relating to national security, intelligence, or law enforcement. Importantly, the proposed rule does not include a mechanism for compelling disclosure of BOI in connection with private litigation.

In closing, we encourage you to review the linked resources published by FinCEN. As you review, and if you should have any questions or concerns regarding this regulation and its effect on you or your company, please contact any of our Business Services attorneys. While we share FinCEN’s expectation that the reporting company will be able to compile this information and file the necessary reports without legal or other expertise, we expect you may have questions regarding this new filing requirement or in developing your company’s BOI report.