The U.S. Congress enacted the Corporate Transparency Act (CTA) in 2020. The CTA for the first time created a federal obligation to report beneficial ownership information for most U.S. entities (and foreign entities doing business in the United States), unless exempted. Pointing to the lack of transparency that may facilitate fraud, drug trafficking, corruption, tax evasion, organized crime or other illicit activity, the CTA mandated the Financial Crimes Enforcement Network (FinCEN), a component of the U.S. Department of the Treasury, with implementing the regulations governing the new disclosure regime. FinCEN finalized these regulations in September 2022, which are referred to collectively in this alert as the “Beneficial Ownership Information Reporting Rule” or “BOI Reporting Rule.”

The BOI Reporting Rule takes effect on January 1, 2024. All U.S. entities or non-U.S. entities that are registered to do business in the United States are potentially impacted by the BOI Reporting Rule and should review whether they are required to file a report with FinCEN under the BOI Reporting Rule.