US finalizes rule exempting American firms from ownership reporting

The Trump administration has finalized a rule that exempts American companies and individuals from reporting beneficial ownership information to the Treasury Department's financial crimes unit. The move rolls back disclosure requirements established under a 2021 law aimed at combating illicit finance.

The Treasury Department's Financial Crimes Enforcement Network, known as FinCEN, will still require foreign reporting companies to disclose beneficial ownership information for foreign individuals, the department said in a statement.

Treasury Secretary Scott Bessent said the change eliminates a burdensome reporting requirement for millions of law-abiding business owners without compromising national security.

Beneficial owners are defined as anyone holding at least a 25% ownership interest in a business or anyone who exerts substantial control over an entity.

FinCEN had previously implemented rules requiring certain companies to report beneficial ownership data as part of anti-corruption and anti-money laundering efforts supported by lawmakers and the Treasury under former President Joe Biden.

The Treasury said FinCEN will delete previously reported information by Americans from the government's beneficial ownership database.

Under the finalized rule, foreign companies will not be required to report Americans who helped those companies register to do business in the United States. It also exempts foreign pooled investment vehicles registered in the US from reporting the beneficial ownership information of a US person in control of the vehicle.