Alert: Corporate Transparency Act Beneficial Ownership Reporting Obligations Reinstated

On February 18, 2025, the last remaining nationwide injunction blocking the Corporate Transparency Act (“CTA”) was stayed in Smith, et al. v. U.S. Department of the Treasury, et al., 6:24-cv-00336 (E.D. Tex.). As a result, the federal government may now proceed with enforcing the CTA. FinCEN, following guidance issued through an alert on February 19, 2025, officially stated that beneficial ownership information (“BOI”) reporting requirements are back in effect and provided a 30-day extension for most reporting companies to file an initial, updated, and/or corrected BOI reports. The official deadline to file a BOI report for most reporting companies is now March 21, 2025.

We note that FinCEN has indicated they will provide an update before that March deadline of any further modifications in terms of timing, as they have recognized that reporting companies may need additional time to file. We do not however recommend relying on any additional extensions, and advise that reporting companies file their respective BOI reports as soon as possible, and at least prior to March 21, 2025. We note that while there are several other litigations challenging the constitutionality of the CTA at this time, we expect BOI reporting requirements to remain in place through the March deadline.

How to Proceed

Reporting companies should gather the requisite materials to submit BOI report filings as soon as possible. We are available to assist with filing such a report, and further information to file a report, such as the official form and relevant exemptions, can be found on the FinCEN FAQ. For a more in depth overview of BOI reporting requirements, please refer to our previous post on January 10, 2024.

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We will continue to monitor developments in this area and encourage you to subscribe to be kept informed of latest developments. Please contact the authors or your usual Herbert Smith Freehills contacts for more information.