BUSINESS WIRE
Yet the majority anticipate it having a positive impact on business and trade, according to a global study by CSC
Research Reveals Fundamental Misconceptions and Concerns About the Corporate Transparency Act Amongst Legal Professionals
For more information
Citigate Dewe Rogerson
Camilla Wyatt
cscteam@citigatedewerogerson.com
CSC
Laura Crozier
PR Manager
laura.crozier@cscglobal.com
New research among senior in-house legal and compliance executives including general counsels and corporate secretaries has revealed a significant knowledge gap when it comes to the Corporate Transparency Act (CTA), with three quarters (75%) under the misconception that the drive towards transparent Beneficial Ownership Information (BOI) will make too much ownership-related information available to the public. Furthermore, just two in five expect CTA and Ultimate Beneficial Owner (UBO) regulations to harmonize into one global standard over the next 10 years, engendering regulatory complications.
This is according to a recent study1 conducted among 200 senior professionals across a broad range of industries in the U.S., Continental Europe, the U.K., and APAC, commissioned by CSC, the world’s leading provider of global business administration and compliance solutions.
Effective January 1, 2024, the CTA’s main objective is to provide law enforcement and other government agencies with greater means of protecting national security by strengthening their abilities to combat corruption, terrorism, and money laundering. As part of this, the CTA requires disclosure of BOI for corporations, limited liability companies, and similar entities that do not fall under one of the 23 enumerated exemptions.
“Concerns about accessibility of the personal identifiable information required by the CTA are understandable, but they are also misplaced,” says Julie Dallmann, product management director at CSC. “BOI is only available to the Financial Crimes Enforcement Network and to other government agencies for investigatory purposes; it is not available to the public.”
The research showed that just 40% of respondents anticipate the CTA and UBO regulations will harmonize into one global standard over the next decade, as governing authorities continue to give no indication that they plan to establish uniform standards.
“In the U.S. alone, there is considerable nuance from state to state, and as these regulatory differences are replicated globally, each jurisdiction is unique,” says Dallmann. “Indeed, as further regulations are introduced, standards could get even more fragmented, even just within the U.S.”
“Overall, regulatory complexity is driving organizations to work with service providers who can bring multi-jurisdiction expertise to the table,” adds Dallmann. “CSC’s full-service framework and industry-leading team of experts offer an invaluable solution to the CTA, helping clients manage multiple entities and simplify complexity, consequently freeing up our clients to focus on their strategic business priorities.”
Despite knowledge gaps, low confidence levels around harmonization, and widespread concerns around their firm’s own CTA compliance, an overwhelming majority (84%) believe it will lead to more trust and ultimately support stronger business relationships and trade. Nearly half (44%) believe the CTA places the U.S. as the global leader in the regulatory push for greater corporate transparency.
To receive a copy of CSC’s The Corporate Transparency Act: Readiness, Concerns, and Implications report, contact Camilla Wyatt at cscteam@citigatedewerogerson.com.
Notes to editors
1CSC, in partnership with Pure Profile, surveyed 200 general counsels, corporate secretaries, and other senior in-house legal and compliance executives from across a broad range of industries in the U.S., Continental Europe, the U.K., and APAC, to gauge views on the introduction of the Corporate Transparency Act, which took effect on January 1, 2024. Respondents were from U.S.-based corporations or non-U.S. based multinational corporations with entities registered in the United States.
About CSC
CSC is the trusted partner of choice for more than 90% of the Fortune 500®, more than 90% of the 100 Best Global Brands (Interbrand®), and more than 70% of the PEI 300. We are the world’s leading provider of global business administration and compliance solutions, specialized administration services to alternative asset managers across a range of fund strategies, transactions involving capital markets participants in both public and private markets, domain name system management and digital brand and fraud protection, and corporate tax software solutions. Founded in 1899 and headquartered in Wilmington, Delaware, USA, CSC prides itself on being privately held and professionally managed for more than 125 years. CSC has office locations and capabilities in more than 140 jurisdictions across Europe, the Americas, Asia Pacific, and the Middle East. We are a global company capable of doing business wherever our clients are—and we accomplish that by employing experts in every business we serve. We are the business behind business®. Learn more at cscglobal.com.
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