On March 21^st, Financial Crimes Enforcement Network (FinCEN) issued an interim final rule (Interim Rule) that removes the requirement for U.S. companies and U.S. persons to report beneficial ownership information (BOI) to FinCEN under the Corporate Transparency Act (CTA). The Interim Rule is effective immediately on the date of publication in the Federal Register, which is scheduled for March 26, 2025.

Specifically, in the Interim Rule:

• The definition of “reporting company” (companies that may have to report if an exemption does not apply) was narrowed 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 (formerly known as “foreign reporting companies”).
• Entities previously known as “domestic reporting companies” and their beneficial owners (regardless of whether they are U.S. persons) are now exempted from BOI reporting requirements under the CTA, and such entities are not required to update or correct BOI previously reported to FinCEN.
• U.S. persons will not be required to report BOI with respect to any reporting company for which they are a beneficial owner.
• Foreign entities that meet the definition of “reporting company” and do not qualify for an exemption must comply with the BOI reporting requirements under the CTA (except with respect to any U.S. persons that are its beneficial owners consistent with the above).
• In its March 21^st announcement, FinCEN also stated it will not enforce any beneficial ownership reporting penalties or fines against U.S. citizens or domestic reporting companies or their beneficial owners.

In addition, FinCEN extended deadlines for foreign entities that are non-exempt reporting companies under the Interim Rule as follows:

• Reporting companies registered to do business in the United States before the date of publication of the Interim Rule must file BOI reports no later than 30 days from that date.
• Reporting companies registered to do business in the United States on or after the date of publication of the Interim Rule will have 30 calendar days to file an initial BOI report after receiving notice that their registration is effective.

These changes are consistent with FinCEN’s March 2^nd announcement and dramatically reduce the scope of BOI reporting requirements for a large number of companies and their beneficial owners. 

FinCEN will be accepting comments on the Interim Rule until 60 days after the date of publication, and expects to issue a final rule later this year. In addition, there remain several legal challenges to the BOI reporting requirements under the CTA that have yet to be finally resolved, and legislation has been introduced in Congress to repeal the CTA. 

As such, although the Interim Rule provides some clarity for the time being, clients should continue to closely monitor ongoing developments and the FinCEN website in view of the potential for changes to the CTA and the rules and regulations implementing its requirements.

Dentons is here to help clients navigate the CTA. If you have any questions about the CTA or this Client Alert, please contact your Dentons attorney or any member of the CTA Team listed below.

For more information contact:

• Todd Carlisle
• Adam H. Dunst
• Michael Gilmer
• Tyler K. Keenan
• Stephen S. Kudenholdt
• Christopher J. Kula
• Jeffrey S. Marcus
• Jeffrey A. McKenzie
• Felix Mehler
• Robert B. Olin
• Lauris G.L. Rall
• Russell K. Smith
• Toni Weinstein