The U.S. District Court for the Eastern District of Texas has granted a nationwide preliminary injunction that prevents the enforcement of the federal Corporate Transparency Act (CTA).

The CTA went into effect January 1, 2024, and requires “reporting companies” in the United States to disclose information about their beneficial owners to the Treasury Department’s Financial Crimes Enforcement Network (FinCEN). Beneficial owners are defined under the law as individuals who ultimately own or control a company.

NFDA previously reported on the CTA and has been monitoring the challenges that have been filed against it.

This ruling does not invalidate the CTA, it is simply a preliminary injunction which is granted by a court to maintain the status quo if there is a real possibility of irreparable harm, there is no other remedy, there is a substantial likelihood that the party requesting the injunction will win the suit, and the injunction will serve the best interests of the general public.

The Court’s order states that, for now, the CTA cannot be enforced and that reporting companies need not file beneficial ownership reports by the previous January 1, 2025, deadline.

We will continue monitoring developments on the CTA and will let you know as the situation develops.