United States Corporate Transparency Act reporting obligations scaled back, but Canadians may still be impacted

The Corporate Transparency Act (CTA) is a United States law designed to enhance law enforcement’s ability to combat money laundering, terrorist financing and other illicit activities by increasing transparency with respect to owners of closely held business structures. The CTA mandates certain businesses to file information about their beneficial owners into a database established by the Financial Crimes Enforcement Network (FinCEN). See our previous coverage of the CTA and reporting requirements in the below links.

In our previous update on CTA we noted that the United States Treasury Department issued a press release on March 2, 2025, indicating that, among other things, a proposed rule would be issued to narrow the scope of beneficial ownership information (BOI) reporting under the CTA to certain foreign reporting companies.

In line with that announcement, on Friday, March 21, FinCEN issued an interim final rule that exempts United States entities and persons from reporting BOI. Under the interim final rule, the only entities that currently have BOI reporting obligations under the CTA are those that are not exempt and fall within the revised definition of “reporting company” in the implementing regulations, being a corporation, limited liability company or other entity formed under the law of a foreign country and registered to do business in any state or tribal jurisdiction by filing a document with a secretary of state or any similar office under the law of that state or Indian tribe.

As set out in the press release issued by FinCEN, foreign entities that fall within the definition of reporting company will not have to report any United States persons as beneficial owners, and United States persons will not have to report their BOI for any such entity.

Foreign entities that already qualify under the revised reporting company definition have 30 days from March 26, 2025, to file BOI reports if they were registered to do business in the US on or before March 26, 2025.  Otherwise, any reporting company going forward must file its BOI report within 30 calendar days after its initial registration to do business in the US is effective.

FinCEN is accepting comments on the interim rule and has indicated it intends to finalize the rule this year. For more information on the BOI reporting requirements see our prior updates below.

• The Corporate Transparency Act is here—are you ready?

• New year, new reporting requirements