Beneficial Ownership Information Reporting Requirement Revision and Deadline Extension

<RULE> DEPARTMENT OF THE TREASURY <SUBAGY>Financial Crimes Enforcement Network</SUBAGY> <CFR>31 CFR Part 1010</CFR> <RIN>RIN 1506-AB49</RIN> <SUBJECT>Beneficial Ownership Information Reporting Requirement Revision and Deadline Extension</SUBJECT> <HD SOURCE="HED">AGENCY:</HD> Financial Crimes Enforcement Network (FinCEN), Treasury. <HD SOURCE="HED">ACTION:</HD> Interim final rule; request for comments. <SUM> <HD SOURCE="HED">SUMMARY:</HD> FinCEN is adopting this interim final rule to narrow the existing beneficial ownership information (BOI) reporting requirements under the Corporate Transparency Act (CTA) to require only entities previously defined as “foreign reporting companies” to report BOI. Under this interim final rule, entities previously defined as “domestic reporting companies” are exempted from the reporting requirements and do not have to report BOI to FinCEN, or update or correct BOI previously reported to FinCEN. With limited exceptions, the interim final rule does not change the existing requirement for foreign reporting companies to file BOI reports, but it extends the deadline to file initial BOI reports, and to update or correct previously filed BOI reports, to 30 days from the date of this publication to give foreign reporting companies additional time to comply. However, the interim final rule exempts foreign reporting companies from having to report the BOI of any U.S. persons who are beneficial owners of the foreign reporting company and exempts U.S. persons from having to provide such information to any foreign reporting company for which they are a beneficial owner. FinCEN is accepting comments on this interim final rule. FinCEN will assess the exemptions, as appropriate, in light of those comments and intends to issue a final rule this year. </SUM> <EFFDATE> <HD SOURCE="HED">DATES:</HD> This rule is effective March 26, 2025. Written comments must be received on or before May 27, 2025. </EFFDATE> <HD SOURCE="HED">ADDRESSES:</HD> Comments may be submitted by any of the following methods: • <E T="03">Federal E-Rulemaking Portal: https://www.regulations.gov.</E> Follow the instructions for submitting comments. Refer to Docket Number FINCEN-2025-0001, the Office of Management and Budget (OMB) control number 1506-0076, and Regulatory Identification Number (RIN) 1506-AB49. • <E T="03">Mail:</E> Policy Division, Financial Crimes Enforcement Network, P.O. Box 39, Vienna, VA 22183. Refer to Docket Number FINCEN-2025-0001, OMB control number 1506-0076 and RIN 1506-AB49. <FURINF> <HD SOURCE="HED">FOR FURTHER INFORMATION CONTACT:</HD> FinCEN's Regulatory Support Section by submitting an inquiry at <E T="03">www.fincen.gov/contact.</E> </FURINF> <SUPLINF> <HD SOURCE="HED">SUPPLEMENTARY INFORMATION:</HD> <HD SOURCE="HD1">I. Background</HD> On January 1, 2021, Congress enacted into law the CTA as part of the broader Anti-Money Laundering Act of 2020. <SU>1</SU> <FTREF/> Section 6403 of the CTA, among other things, amends the Bank Secrecy Act (BSA) by adding a new section 5336, Beneficial Ownership Information Reporting Requirements, to subchapter II of chapter 53 of title 31, United States Code. This section established new BOI reporting requirements for many corporations, limited liability companies, and other similar entities operating in the United States. The CTA excludes from that general definition, however, specified categories of businesses. The CTA also authorizes the Secretary of the Treasury (Secretary) to exempt any other “entity or class of entities” for which the Secretary, with the written concurrence of the Attorney General and the Secretary of Homeland Security, has, by regulation, determined that “requiring beneficial ownership information from the entity or class of entities . . . would not serve the public interest” and “would not be highly useful in national security, intelligence, and law enforcement agency efforts to detect, prevent, or prosecute money laundering, the financing of terrorism, proliferation finance, serious tax fraud, or other crimes.”  <SU>2</SU> <FTREF/> In addition, section 5318(a)(7) of the BSA provides that the Secretary may make appropriate exemptions from a requirement in the BSA or regulations prescribed under the BSA. <SU>3</SU> <FTREF/> Taken together, these provisions authorize the issuance of regulations that may provide additional exemptions from the requirements of the CTA. <FTNT> <SU>1</SU>  The CTA is Title LXIV of the William M. (Mac) Thornberry National Defense Authorization Act for Fiscal Year 2021, Public Law 116-283 (2021) (NDAA). The Anti-Money Laundering Act of 2020—which includes the CTA—is Division F, sections 6001-6511, of the NDAA. </FTNT> <FTNT> <SU>2</SU>  31 U.S.C. 5336(a)(11)(B)(xxiv). </FTNT> <FTNT> <SU>3</SU>  31 U.S.C. 5318(a)(7). </FTNT> The CTA requires the Secretary to prescribe regulations to implement the CTA's reporting requirements. For most reporting companies, the CTA authorized the Secretary to allow up to two years from the regulation's effective date for reporting companies to file their initial BOI reports. The Secretary has delegated these and other CTA-implementing responsibilities to FinCEN, a bureau of the Department of the Treasury (Treasury). <SU>4</SU> <FTREF/> <FTNT> <SU>4</SU>  The Secretary delegated the authority to implement, administer, and enforce the BSA and its implementing regulations to the Director of FinCEN. <E T="03">See</E> Treasury Order 180-01, paragraph 3(a) (Jan. 14, 2020), <E T="03">available at https://home.treasury.gov/about/general-information/orders-and-directives/treasury-order-180-01; see also</E> 31 U.S.C. 310(b)(2)(I) (providing that FinCEN Director “[a]dminister the requirements of subchapter II of chapter 53 of this title, chapter 2 of title I of Public Law 91-508, and section 21 of the Federal Deposit Insurance Act, to the extent delegated such authority by the Secretary”). </FTNT> On September 30, 2022, FinCEN published the Beneficial Ownership Information Reporting Requirements final rule (Reporting Rule), implementing the CTA's reporting requirements (31 U.S.C. 5336(b)). The Reporting Rule became effective on January 1, 2024, and is codified in FinCEN's regulations at 31 CFR 1010.380. <SU>5</SU> <FTREF/> Section 1010.380 requires certain corporations, limited liability companies, and other similar entities (reporting companies)  <SU>6</SU> <FTREF/> to report certain identifying information about the reporting companies themselves, the beneficial owners who own or control them, and, for companies created on or after January 1, 2024, the company applicants who form or register them. <E T="03">Beneficial Ownership Information Reporting Requirements,</E> 87 FR 59498 (Sept. 30, 2022). On November 30, 2023, FinCEN also issued a final rule amending the Reporting Rule to extend the filing deadline for reporting companies created or registered in 2024. FinCEN, <E T="03">Beneficial Ownership Information Reporting Deadline Extension for Reporting Companies Created or Registered in 2024,</E> 88 FR 83499 (Nov. 30, 2023). </FTNT> <FTNT> <SU>6</SU>   <E T="03">See</E> 31 U.S.C. 5336(a)(11). </FTNT> <FTNT> <SU>7</SU>   <E T="03">See</E> FinCEN, <E T="03">Beneficial Ownership Information Reporting Requirements,</E> 87 FR 59498 (Sept. 30, 2022), at 59498-99; 31 CFR 1010.380(b)(2)(iv). </FTNT> Section 1010.380 previously required domestic reporting companies and foreign reporting companies  <SU>8</SU> <FTREF/> created or registered to do business in the United States before the rule's effective date of January 1, 2024, to file initial BOI reports with FinCEN by January 1, 2025, one year after the effective date of the regulations. <SU>9</SU> <FTREF/> Domestic reporting companies created in 2024 and those foreign reporting companies registered to do business in the United States in 2024 had 90 days to file their initial BOI reports with FinCEN. <SU>10</SU> <FTREF/> Starting on January 1, 2025, section 1010.380 provided all reporting companies created or registered on or after that date with 30 days to file their initial reports. <FTNT> <SU>8</SU>  A domestic reporting company was previously defined at 31 CFR 1010.380(c)(1)(i) as “a corporation; a limited liability company; or other entity that is created by the filing of a document with a secretary of state or any similar office under the law of a state or Indian tribe.” A foreign reporting company was defined at 31 CFR 1010.380(c)(1)(ii) as “a corporation, limited liability company, or other entity that is formed under the law of a foreign country and that is registered to do business in the United States by the filing of a document with a secretary of state or equivalent office under the law of a state or Indian tribe.” </FTNT> <FTNT> <SU>9</SU>  31 CFR 1010.380(a)(1)(iii). </FTNT> <FTNT> <SU>10</SU>  FinCEN, <E T="03">Beneficial Ownership Information Reporting Deadline Extension for Reporting Companies Created or Registered in</E> 2024, 88 FR 83499 (Nov. 30, 2023), at 83504. </FTNT> The January 1, 2025, deadline previously established in FinCEN's regulations has changed in light of litigation challenging the CTA. In two cases, district courts issued universal orders that preliminarily enjoined FinCEN from implementing and enforcing the CTA and the Reporting Rule or stayed the effective date of section 1010.380 on a nationwide basis. <SU>11</SU> <FTREF/> First, on December 3, 2024, in <E T="03">Texas Top Cop Shop, Inc.</E> v. <E T="03">Bondi,</E> the U.S. District Court for the Eastern District of Texas, Sherman Division, issued an order that preliminarily enjoined the government from enforcing the CTA and stayed its implementing regulation's reporting deadlines. <SU>12</SU> <FTREF/> The government appealed and separ ━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━ Preview showing 10k of 73k characters. Full document text is stored and available for version comparison. ━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━