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What Do You Need To Know Today?

What the Act Requires. The Act requires certain U.S. companies, called ‘reporting companies,’ to submit a report to FinCEN identifying their ‘beneficial owners’ and the persons who organized such companies, called ‘applicants.’

There is No Filing Requirement Today. You do not need to do anything today. Rather, the filing requirement will commence upon the effective date of the implementing regulations developed by the secretary of the treasury. Such regulations will be adopted on or before Jan. 1, 2022.

We Don’t Know What We Don’t Know. Prior to the adoption of the implementing regulations, there are many questions we cannot address. For example, we do not know where and how the filing will be made. The filing could be made electronically directly to FinCEN or FinCEN may partner with the states to permit filings in connection with organizational filings. We simply do not know.

Who Must Report? The definition of reporting company is very broad and includes corporations, limited liability companies, or similar entities formed by filing a document with a secretary of state’s office — or equivalent — or a foreign entity that is registered to do business in the U.S.

Who Is Exempt? There are many exceptions to the definition of ‘reporting company’ that exclude certain businesses from the Act’s reporting requirements. Two types of companies are most likely to be excluded: (a) companies that are U.S.-owned with a real, physical operating presence, including more than 20 employees, in the U.S.; and (b) companies in heavily-regulated industries (e.g., banks, credit unions, registered brokers or dealers, and publicly-traded companies).”

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