On August 11, FinCEN announced that it had issued a final rule permanently exempting domestic reporting companies and U.S. persons from beneficial ownership information (BOI) reporting requirements under the Corporate Transparency Act, while retaining limited reporting obligations for certain foreign entities registered to do business in the United States. The final rule, issued following a reassessment prompted by Executive Order 14192 (previously covered by InfoBytes here), which directed agencies to “alleviate unnecessary regulatory burdens,” adopts and expands the March 2025 interim final rule (covered by this Orrick Insight here) by: (i) permanently exempting all domestic entities from the definition of “reporting company”; (ii) exempting reporting companies from reporting the BOI of any U.S. person who is a beneficial owner or company applicant; (iii) exempting U.S. persons from providing BOI to any reporting company for which they are a beneficial owner or company applicant; and (iv) eliminating the requirement for U.S. person holders of a FinCEN identifier to update or correct previously submitted information. The rule is effective immediately upon publication in the Federal Register.

Foreign entities that qualify as reporting companies remain subject to BOI reporting requirements, including reporting the identities of their non-U.S. person beneficial owners, but are not required to report information about U.S. person beneficial owners or U.S. person company applicants. The rule also retains the interim rule’s revised special rule for foreign pooled investment vehicles, exempting them from reporting BOI of any U.S. person who exercises substantial control over the entity. FinCEN estimated the exemptions first adopted in the interim have relieved approximately 27.5 million domestic reporting companies of filing obligations and reduced reporting costs by $9 billion per year relative to the original reporting rule. Treasury stated that the rule focuses BOI collection where the “greatest risk mitigation-to-burden ratio lies,” targeting foreign legal entities that present heightened national security and illicit finance risks. FinCEN also announced it anticipates working with the National Archives and Records Administration to delete previously reported BOI of U.S. persons and domestic companies from its database, and it does not intend to require individuals to request deletion or to provide confirmation of deletion.