On March 26, 2025, an interim final rule was introduced amending the CTA and removing the requirement for U.S. companies to report beneficial ownership information (BOI) under the Corporate Transparency Act (CTA). As of now, reporting requirements apply exclusively to entities that are formed under the law of a foreign country (i.e. not U.S.) and that have registered to do business in any U.S. State or Tribal jurisdiction by the filing a document with a secretary of state or a similar office. Additionally, reporting companies are not required to report any U.S. persons as beneficial owners, and U.S. persons are not required to report Beneficial Ownership Information regarding any entity for which they are a beneficial owner.
Background
Following extensive legal proceedings challenging the legality of the CTA and in light of the new administration’s attempts to reduce regulatory burdens on U.S. businesses, on February 27, 2025, the regulator announced that it was freezing enforcement of the CTA until revisions to the regulation were to be published.
On March 26, 2025, the regulation was amended. As of today, U.S. entities — previously known as “domestic reporting companies” — and their beneficial owners are no longer required to submit initial reports or update any previously filed reports.
The regulation was narrowed so that “Reporting Companies” are only entities formed under the law of a foreign country and that have registered to do business in any U.S. State or Tribal jurisdiction by the filing a document with a secretary of state or a similar office.
Additionally, all Reporting Companies are exempt from reporting requirements concerning beneficial owners who are U.S. persons. Similarly, U.S. persons are exempt from reporting obligations related to any such entity for which they qualify as a beneficial owner.
Foreign entities that meet this definition of Reporting Companies and do not qualify for an exemption from the reporting requirements are subject to initial BOI reporting deadlines as follows:
- Existing Reporting Companies, must file their initial report by April 25, 2025.
- Entities that became a Reporting Company on or afterMarch 26, 2025, have 30 calendar days to file an initial BOI report after receiving notice that their registration is effective.
- Updates and Corrections: After filing an initial BOI report, Reporting companies are obligated to submit updateswithin 30 days of changes to the information previously filed, or corrections within 30 days of becoming aware or having reason to know of an inaccuracy.
This memorandum contains general information only and does not constitute legal advice or a substitute for legal counsel. This memorandum is provided as a service to our clients, with the clarification that in any specific case, a separate discussion must be held regarding the matter at hand.
For any questions or clarifications, please contact our team responsible for this matter at the email address: CTA@shibolet.com.
