US Court Declares Beneficiary Disclosure Requirement Unconstitutional

In November 2022, the National Association of Small Businesses in the United States filed a lawsuit against the requirement for beneficiary registration for millions of small enterprises. The law, which came into effect at the beginning of this year, aims to prevent criminal actions by anonymous companies at the US.

Lobbyists argue that this rule on beneficiary declaration contradicts the Constitution, is unduly burdensome for small firms, violates the protection of confidentiality and freedom of speech, and also limits the states’ authority to manage businesses.

Recently, a US district judge ruled that the Corporate Transparency Act is unconstitutional because Congress exceeded its authority in its adoption, making the requirements arising from it illegal.

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