The rapid developments under the Corporate Transparency Act (CTA) continue, with the Treasury Department coming in over the top of FinCEN, proposing to greatly narrow the CTA so that filing obligations will only apply to foreign reporting companies. On Sunday, March 2, the Treasury Department announced that it will not be enforcing penalties or fines against U.S. citizens or domestic reporting companies or their beneficial owners after forthcoming changes take effect to the beneficial ownership information (BOI) reporting rules.  To implement this shift in the approach to enforcement, the Treasury Department stated that it will be issuing a proposed rulemaking to narrow the scope of the CTA to foreign reporting companies only. The full statement from the Treasury Department is as follows:

Treasury Department Announces Suspension of Enforcement of Corporate Transparency Act Against U.S. Citizens and Domestic Reporting Companies

The Treasury Department is announcing today that, with respect to the Corporate Transparency Act, not only will it not enforce any penalties or fines associated with the beneficial ownership information reporting rule under the existing regulatory deadlines, but it will further not enforce any penalties or fines against U.S. citizens or domestic reporting companies or their beneficial owners after the forthcoming rule changes take effect either. The Treasury Department will further be issuing a proposed rulemaking that will narrow the scope of the rule to foreign reporting companies only. Treasury takes this step in the interest of supporting hard-working American taxpayers and small businesses and ensuring that the rule is appropriately tailored to advance the public interest.

“This is a victory for common sense,” said U.S. Secretary of the Treasury Scott Bessent.  “Today’s action is part of President Trump’s bold agenda to unleash American prosperity by reining in burdensome regulations, in particular for small businesses that are the backbone of the American economy.”

We expect there will be further guidance on the legal effects of the Treasury Department’s statement from the Treasury Department and/or FinCEN in the near future. With the CTA now being directed at non-US companies, if you are a domestic reporting company, it may be reasonable to hold off on filing a BOI report until such further guidance is issued.

We will continue to follow developments related to the CTA, and plan to provide further updates. If you have any questions related to the CTA, please reach out to your SGR attorney or any of the individuals listed below.

• Tom Hong (Atlanta/Austin/Charlotte)
• Brett Lockwood (Atlanta/Austin/Charlotte)
• Eric Breitman (New York/Washington D.C.)
• Ken Crane (Chicago)
• Adam Buss (Jacksonville/Miami/Tampa)
• Peter Rho (Los Angeles)
• Ben Graham-Evans (London)
• Michael Kraus (Atlanta – German Practice)
• Stefan Buske (Munich)
• Nicola Fiordalisi (Milan – Italian Practice)

To read more about the most recent CTA announcement from FinCEN, CLICK HERE.

***Updated as of March 3, 2025