The U.S. District Court for the Eastern District of Texas issued a nationwide preliminary injunction temporarily blocking enforcement of the Corporate Transparency Act (CTA) and its requirements for certain companies to submit Beneficial Ownership Information Reports (BOIR). The preliminary injunction applies nationwide, meaning that all companies currently subject to the CTA’s reporting requirements are now exempt from filing beneficial ownership reports until further notice.

Enforcement could resume if the Court’s order is overturned on appeal, or the Government ultimately succeeds in defending the merits of the CTA. We encourage clients who may have reporting obligations to be prepared, potentially at a moment’s notice, to make the CTA’s required filings—either before the January 1, 2025, deadline, or, if the injunction runs past January 1, 2025, but is then overturned, immediately thereafter.

(See the Q3 2022 Regulatory Update FinCEN Beneficial Ownership Reporting Requirements for a summary of the reporting requirements that were adopted in September 2022.)