On March 21, 2025, the U.S. Department of the Treasury’s Financial Crimes Enforcement Network (FinCEN) issued an interim final rule that significantly narrows the scope of the Corporate Transparency Act (CTA), exempting U.S. companies and individuals from beneficial ownership information (BOI) reporting requirements.
Under the interim final rule, foreign reporting companies registered to do business in the United States are required to report BOI. Additionally, the rule exempts foreign reporting companies from the requirement to report BOI of any U.S. individuals who are beneficial owners of the foreign reporting company, as well as the U.S. individuals themselves from needing to provide the same kind of information to any foreign reporting company for which they are also a beneficial owner.
Background to BOI Reporting Prior to Interim Final Rule
The move marks a substantial shift in the implementation of the CTA, which was originally enacted in 2021 to combat illicit finance through enhanced corporate transparency, requiring affected companies to report BOI by Jan. 1, 2025. However, the requirement has faced a saga of postponements and challenges in court, which resulted in the deadline to report BOI being pushed back to March 21. Leading up to the new deadline, Treasury announced on March 2 that it would not enforce any penalties or fines against individuals or companies that would be required to report under the CTA, relieving millions of U.S. businesses from BOI reporting obligations.
Redefining “Reporting Company”
The interim final rule redefines “reporting company” to include only entities formed under foreign laws that have registered to do business in the United States. As a result, domestic entities—those formed under U.S. laws—are no longer required to report BOI to FinCEN. Additionally, foreign reporting companies are exempt from reporting BOI of any U.S. persons who are beneficial owners, and U.S. persons are not required to provide such information to foreign reporting companies.
What’s Next for BOI Reporting and the Interim Final Rule?
The interim final rule delays the filing deadline for foreign entities registered to do business in the U.S. by the later of (1) 30 days from when the rule was published with the Federal Register on March 26 or (2) 30 days after receiving public notice that their registration to do business in the United States has become effective. Treasury has opened a public comment period on the interim final rule, inviting feedback until May 27, 2025.
For questions or more information about how the interim rule impacts you and your company, contact your Windham Brannon advisor today, or reach out to Gary Gruner and Brandi Samuel.
