ECNETNews reports that the National Federation of Independent Business (NFIB) has formally filed an amicus brief with the U.S. Court of Appeals for the Fourth Circuit, calling for the rejection of the Corporate Transparency Act (CTA). The NFIB contends that the reporting obligations imposed by the CTA create unconstitutional burdens on small businesses. This action is part of the case, Community Associations Institute, et al. v. U.S. Department of Treasury, which scrutinizes the beneficial ownership reporting requirements stipulated by the CTA.
The NFIB’s brief challenges the legality of the CTA under the Commerce Clause, asserting that the law fails to regulate any meaningful activity or economic conduct.
“The Corporate Transparency Act fails to regulate any activity, including economic activities, while imposing excessive reporting requirements on small businesses, raising significant privacy concerns,” stated an NFIB representative. “NFIB will steadfastly advocate for the interests of small businesses by fighting against this detrimental legislation.”
Key Legal Contentions Against the CTA
NFIB outlines three primary legal arguments:
- The CTA does not regulate any identifiable activity, rendering it incompatible with Congress’s authority under the Commerce Clause.
- Congress’s regulatory powers must focus on economic activities, which are defined as the introduction, production, or exchange of goods and services.
- Since the CTA does not regulate economic activities, it fails to meet the legal standards established by the Commerce Clause.
Alongside this case, NFIB is pursuing its own lawsuit against the CTA. Additionally, NFIB is advocating for legislative reform through the Repealing Big Brother Overreach Act, aimed at abolishing the CTA and its associated beneficial ownership reporting requirements for small businesses.
The Fourth Circuit is currently reviewing the case, as NFIB intensifies its campaign against federal mandates perceived as overreaching.
