Corporate Transparency Act Rules Rollback Issued by Treasury (1)

The Treasury Department issued interim final regulations that limit the companies that must report information about their ownership to foreign reporting companies only.

The regulations (RIN 1506-AB49), released late Friday, scale back the companies responsible for reporting their beneficial ownership information under the Corporate Transparency Act and set new deadlines for reporting.

Treasury’s Financial Crimes Enforcement Network announced in early March that it planned to limit the scope of the beneficial-ownership requirements to foreign companies, and that it wouldn’t enforce any penalties or fines for not reporting the information against US citizens or domestic reporting companies.

Under FinCEN’s original disclosure requirements, which took effect in 2024, tens of millions of companies were required to disclose their owners’ names, addresses, and other information. The requirements were aimed at preventing companies from hiding behind anonymity to conceal money laundering that helps fund terrorism, drug trafficking, and other global criminal activity.

But the requirements have come under multiple legal challenges. Treasury said in its early March announcement that its change would protect the interests of small businesses.

Under the new rules, foreign entities that meet the new definition of a reporting company won’t have to report any US persons as beneficial owners, and US persons won’t have to “provide such information to any foreign reporting company for which they are a beneficial owner.”

Reporting companies registered to do business in the US before the date of the rules’ publication in the Federal Register will be required to file reports no later than 30 days from that date. Reporting companies registered on or after that date will have 30 calendar days to file an initial BOI report after receiving notice that their registration is effective.

FinCEN is accepting comments on the interim final rule but didn’t give a closing date for them, and said it intends to finalize the rule this year.