The implementation of the Corporate Transparency Act (CTA) has undergone substantial changes over the past year. The initial broad-based application of the rules received a significant push back from various constituencies and litigation ensued to minimize or eliminate CTA altogether. Although the Treasury Department and FinCEN initially resisted making any changes, they have finally agreed to do so.
On March 21, 2025, the Treasury Department issued interim final regulations (RIN 1506-AB49) with regards to what type of entities are subject to the beneficial ownership reporting (BOI) requirements. Previously, both domestic and foreign reporting entities were required to file the BOI reports and disclose their beneficial owners and individuals with substantial control. The Treasury Department has now limited the scope of the CTA to only foreign reporting entities. A “foreign reporting company” means any entity that meets all of the requirements below:
- A corporation, limited liability company or other entity
- Formed under the law of a foreign country
- Registered to do business in any State or tribal jurisdiction by the filing of a document with a secretary of state or any similar office under the law of a State or Indian tribe
Furthermore, under the new rules, foreign reporting companies with U.S. beneficial owners are not required to report those U.S. beneficial owners, and U.S. persons are not required to provide such information to any foreign reporting entity of which they are a beneficial owner.
The new deadline for existing foreign reporting companies is now set to at least 30 days from March 21, 2025.
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