Newsroom/Regulation

FinCEN beneficial ownership rule: the 25% threshold survives

The long-argued cut-off stays. Who has to report, and when, does not.

JUN 17, 2026 · 5 MIN READ · BY THE KYCK DESK

The threshold that stayed

Every version of the US beneficial ownership debate has circled the same number. A beneficial owner, under the Corporate Transparency Act reporting rule, is an individual who exercises substantial control over a company or owns or controls at least 25 percent of its ownership interests. The same 25 percent prong sits in the 2016 customer due diligence rule that banks apply to their legal-entity customers.

Proposals to lower it, to 10 percent or lower, have surfaced repeatedly and have not been adopted. Through the 2025 rulemaking that reshaped the regime, the definition of a beneficial owner, and the 25 percent line inside it, stayed as it was.

The population that did not

What changed is who reports. FinCEN's March 2025 interim final rule removed the reporting obligation for companies formed in the United States and for US persons. The reporting population is now foreign-formed companies registered to do business in a US state, which file within 30 days of registration and update within 30 days of a change. The register that was designed to cover tens of millions of domestic entities covers a thin slice of foreign ones.

That is the cadence change behind the headline: for the companies still in scope, the 30-day clock on updates is the operative obligation, and for everyone else the federal register is no longer a source at all.

What it means for due diligence

Three consequences for teams that verify counterparties. First, there is no federal shortcut for US ownership data: the register was never open to private parties and now covers little. Beneficial ownership of US counterparties has to be established from documents, registry extracts, organisational charts and declarations, and the evidence kept.

Second, the 25 percent standard is now the working threshold on both sides of the Atlantic: the EU AML Regulation confirms 25 percent of shares or voting rights as the Union-wide baseline from 2027. A counterparty file built to that standard once serves both regimes.

Third, treat US guidance dated before March 2025 with care. Much of what still ranks online describes the domestic regime that no longer exists. Our Corporate Transparency Act briefing tracks the current position. KYCK captures the ownership chain and its evidence as part of counterparty onboarding, so a US counterparty file does not depend on a register that may change again.

Sources

• FinCEN: beneficial ownership information reporting
• 31 CFR 1010.380, beneficial ownership information reporting requirements

Related reading

More from the newsroom