Women in VC (via Zoom): Are You Ready For The New Corporate Transparency Act yet?
Description
Women in VC Community,
As you may be aware, the Corporate Transparency Act’s final reporting rule (the “CTA”) goes into effect on January 1, 2024. The CTA imposes sweeping new requirements on companies to provide beneficial ownership information to the Department of Treasury’s Financial Crimes Enforcement Network (“FinCEN”) via electronic filing on the newly created Beneficial Ownership Secured System (“BOSS”), and to keep that information current.
As this will impact virtually all our emerging company and investor clients and friends in the Women in VC startup and venture community, we’re offering a brief seminar via Zoom with our regulatory experts at Lowenstein on Monday, December 18th at 9 - 10 AM Pacific Time / 12 - 1 PM Eastern Time to provide a brief overview of what the CTA means for you.
If you are an investor, to the extent you or your fund has not done so already, we recommend that you review your practices related to new entity formation to be sure that there are not any inadvertent compliance violations of the CTA. If you are a founder or a member of management of a startup, your company will likely have to make a BOSS filing, so you should be aware of the deadlines and information requirements.
Whether or not you can attend the session on December 18th, we are happy to put any of our clients in touch with our CTA experts if you would like to discuss how to comply.
Below we’re sharing a link to a recent Lowenstein client alert, along with a brief summary of the CTA.
- The CTA applies to all entities that are (i) formed by the filing of a document with any U.S. state, territory, or tribal land (e.g., corporations, LLCs or LLPs) or (ii) registered to do business in any U.S. state, territory, or tribal land. Under the CTA, such companies are called “Reporting Companies.”
- Each Reporting Company will be required to file a BOSS report unless one of 23 exemptions applies.
- Companies formed or registered on or before December 31, 2023 will have until December 31, 2024 to make a BOSS filing if one is required.
- Companies formed or registered on or after January 1, 2024 and before January 1, 2025 will have 90 days to make a BOSS filing if one is required.
- Companies formed or registered on or after January 1, 2025 will have 30 days to make a BOSS filing if one is required.
- Among other things, BOSS filings will need to include the name, address, and a copy of photo identification for any individual who either directly or indirectly:
- exercises substantial control over such Reporting Company, or
- owns or controls 25% or more of the ownership interests of such Reporting Company.
- There is a continuing obligation to keep current any information reported to FinCEN on a BOSS filing. Accordingly, if there are changes to ownership or control over the entity, then updated filings must be made within 30 days of any such changes.
- Failing to make a BOSS filing where one is required or providing incorrect information on a BOSS filing can result in criminal and civil penalties for the company, for the person who made the BOSS filing, and for senior officers of the company.
Alyssa has spent the last decade in the SF Bay area representing venture capital funds and the startups and growth companies they back in venture deals, PE deals and M&A. Prior to her time at Lowenstein Sandler she practiced at Wilson Sonsini. She earned her BA at Yale and her JD from NYU Law.
Chandra has 10+ years of experience representing growth stage and early stage startups and venture capital funds and other angel and strategic investors. Based in our Palo Alto office, she helps lead the firm’s Women’s Initiative Network and Diversity Leadership Network and is dedicated to advancing DEI initiatives at the firm and beyond. She earned her BA and JD at Santa Clara University.
Melissa has over 20 years of experience in tax controversy and litigation on a wide range of civil tax matters at the federal and state level. She represents clients at all levels of administrative controversy with the IRS, including audits and cases before the IRS Office of Appeals, and has significant experience handling penalty and international information reporting matters. She also counsels on voluntary disclosures of prior tax noncompliance.
Meredith has 15+ years of experience leading M&A transactions. Based in our New York office, she represents buyers and sellers of venture and PE-backed companies. Meredith was previously a partner at Cooley. She earned her BA at Dartmouth and her JD from Duke Law (where she has served as a visiting lecturer on venture M&A).
Paula advises investment managers, private equity funds, portfolio companies, and other publicly traded and privately held businesses on compliance with anti-money laundering (AML), Know Your Customer (KYC), and other regulatory regimes. Paula also works on matters related to futures, interest rate swaps, credit default swap account setups, and complex investment and finance transactions.
Rob focuses on internal investigations, SEC examinations and enforcement, regulatory compliance advice and counseling, compliance program design and implementation, cross-border due diligence, compliance auditing and monitoring, and commercial disputes. He regularly advises clients on matters related to the Foreign Corrupt Practices Act (FCPA), anti-money laundering (AML) statutes and related know your customer (KYC) regulations, trade sanctions, and compliance best practices.
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