CAI filed an amicus brief this month supporting high court review of a case that seeks to repeal the Corporate Transparency Act.
This is the latest move CAI has taken to protect community associations from a law it believes imposes burdensome and unnecessary requirements.
Here’s what you need to know now.
Q: What case is CAI supporting?
A: CAI’s amicus brief backs a petition by the National Small Business Association asking the U.S. Supreme Court to hear its challenge to the constitutionality of the act. The appeal asks the justices to review an 11th Circuit Court of Appeals ruling that upheld the law.
Q: What is an amicus brief, and has CAI been involved before?
A: An amicus curiae brief is filed by a party with a strong interest in a case or relevant specialized knowledge to help the court by offering added information or perspective. CAI previously filed an amicus brief in May 2024 with the 11th Circuit in support of the NSBA challenge.
Q: Why does CAI oppose the Corporate Transparency Act?
A: CAI’s position since enactment has been that the Corporate Transparency Act is detrimental to the 373,000 community associations and volunteer boards across the country. The brief argues the law was not intended to apply to volunteer-driven, locally based nonprofit corporations whose sole purpose is providing municipal-like services to residents.
Q: What does the act require, and what is its current status?
A: Signed into law in December 2020, the act required community associations to disclose beneficial owner information to the Treasury Department’s Financial Crimes Enforcement Network. Although it was initially designed to deter financing of international terrorism and money laundering, it has caused significant confusion and turmoil. Last year, FinCEN issued an interim final rule removing the requirement for U.S. companies and citizens to report beneficial ownership information. A final rule is still pending, and currently the act remains federal law.
Q: Who drafted CAI’s amicus brief?
A: Edmund Allcock, Robert Diamond, Todd Sinkins, Thomas Ware, Julie Howard, and Brendan Bunn, fellows in CAI’s College of Community Association Lawyers, led the team that drafted the amicus brief to the high court.
Q: Did CAI take any additional action?
A: Yes. Along with filing the amicus brief, CAI signed onto a joint letter from organizations that represent and protect small businesses from excessive government mandates. The letter reiterates CAI’s concerns about the act and urges federal agencies to support Supreme Court review of the significant constitutional and privacy questions involved.
Q: What is happening on Capitol Hill?
A: Discussion of the act continues on Capitol Hill. A bill introduced last year by Ohio Rep. Warren Davidson would repeal the act and eliminate its potential threats to community associations. The House Financial Services Committee approved the bill in April, and it has moved to the House floor for consideration.
>>Learn more about CAI’s Corporate Transparency Act efforts.
