In response to an executive order signed by President Trump directing federal agencies to “alleviate unnecessary regulatory burdens placed on the American people, the Financial Crimes Enforcement Network (FinCEN) released an interim final rule that substantially narrows the scope of the Corporate Transparency Act (CTA) by requiring only entities previously defined as “foreign reporting companies” to file beneficial ownership information reports (BOIR).
The interim final rule, which became effective on March 26, 2025, exempts entities formed in the United States (known as “domestic reporting companies” under the prior rule) from any requirement to report beneficial ownership information. Under the interim final rule, such entities are no longer required to file initial reports, nor are they required to update reports that were previously filed.
The definition of “reporting company” has been revised to mean an entity formed under the law of a foreign country that has registered to do business in the United States. Foreign entities that meet the revised definition of reporting company are still required to file a BOIR. But if a foreign entity is only registered to do business in the U.S. through a subsidiary formed in the U.S., neither the parent nor the subsidiary would be required to file a BOIR.
Furthermore, foreign reporting companies are exempt from having to provide the BOI of any U.S. person that is a beneficial owner. And U.S. persons who are beneficial owners of foreign reporting companies are now exempt from having to provide BOI to those companies.
A foreign entity that became a reporting company prior to March 26, 2025, was required to file an initial BOIR no later than April 25, 2025. Any foreign entity that becomes a reporting company after March 26, 2025 is required to file an initial BOIR within 30 days of the earlier of the date on which it receives actual notice that it has been registered to do business in a U.S. jurisdiction or the date on which a secretary of state or similar office first provides public notice, such as through a publicly accessible registry, that the reporting company has been registered to do business.
The agency intends to issue a final rule by the end of 2025 … stay tuned.
The information presented is not intended to be, and does not constitute, “legal advice.” Because each situation varies, and only brief summary information is provided here, you should not use this information as a basis for action unless you have independently verified with your own counsel that it applies to your particular situation.
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