Massachusetts 2025-2026 Regular Session

Massachusetts House Bill H501 Compare Versions

Only one version of the bill is available at this time.

Old	New	Differences
1	1	1 of 1
2	2	HOUSE DOCKET, NO. 2389 FILED ON: 1/16/2025
3	3	HOUSE . . . . . . . . . . . . . . . No. 501
4	4	The Commonwealth of Massachusetts
5	5	_________________
6	6	PRESENTED BY:
7	7	Erika Uyterhoeven
8	8	_________________
9	9	To the Honorable Senate and House of Representatives of the Commonwealth of Massachusetts in General
10	10	Court assembled:
11	11	The undersigned legislators and/or citizens respectfully petition for the adoption of the accompanying bill:
12	12	An Act to ensure LLC transparency.
13	13	_______________
14	14	PETITION OF:
15	15	NAME:DISTRICT/ADDRESS :DATE ADDED:Erika Uyterhoeven27th Middlesex1/16/2025 1 of 6
16	16	HOUSE DOCKET, NO. 2389 FILED ON: 1/16/2025
17	17	HOUSE . . . . . . . . . . . . . . . No. 501
18	18	By Representative Uyterhoeven of Somerville, a petition (accompanied by bill, House, No. 501)
19	19	of Erika Uyterhoeven relative to limited liability companies. Economic Development and
20	20	Emerging Technologies.
21	21	The Commonwealth of Massachusetts
22	22	_______________
23	23	In the One Hundred and Ninety-Fourth General Court
24	24	(2025-2026)
25	25	_______________
26	26	An Act to ensure LLC transparency.
27	27	Be it enacted by the Senate and House of Representatives in General Court assembled, and by the authority
28	28	of the same, as follows:
29	29	1 SECTION 1. Section 2 of chapter 156C of the General Laws, as appearing in the 2022
30	30	2Official Edition, is hereby amended by inserting after clause (1) the following clause:-
31	31	3 (1½) “Beneficial owner”, a person who, directly or indirectly: (i) holds a membership
32	32	4interest in a limited liability company or foreign limited liability company; (ii) exercises
33	33	5substantial control over the decisions of a membership interest in a limited liability company or
34	34	6foreign limited liability company; or (iii) has been assigned a membership interest in a limited
35	35	7liability company or foreign limited liability company. A beneficial owner shall also include any
36	36	8ultimate beneficial owner regardless of the place of registration of the limited liability company.
37	37	9 A beneficial owner shall not include: (i) a minor child; (ii) a person acting as a nominee,
38	38	10intermediary, custodian or agent on behalf of another person; (iii) a person acting solely as an
39	39	11employee of a limited liability company or foreign limited liability company and whose control
40	40	12over or economic benefits from the limited liability company or foreign limited liability 2 of 6
41	41	13company derives solely from the employment status of the person; (iv) a person whose only
42	42	14interest in a limited liability company or foreign limited liability company is through a right of
43	43	15inheritance unless, the person meets the beneficial owner requirements in this chapter; (v) a
44	44	16creditor of a limited liability company or foreign limited liability company unless, the creditor
45	45	17meets the beneficial owner requirements in this subsection; (vi) any person whose member
46	46	18interest in a limited liability company or foreign limited liability company derives solely from
47	47	19their employment by such limited liability company or foreign limited liability company; and
48	48	20(vii) any person whose member interest in a limited liability company or foreign limited liability
49	49	21company derives solely from a limited liability company’s certificate of organization in sections
50	50	2212 or 13 or a foreign limited liability company’s application for registration in sections 48 or 52.
51	51	23 SECTION 2. Subsection (a) of section 12 of said chapter 156C, as so appearing, is hereby
52	52	24amended by adding the following subparagraph:-
53	53	25 (10) the disclosure of each beneficial owner of the limited liability company.
54	54	26 SECTION 3. Section 13 of said chapter 156C, as so appearing, is hereby amended by
55	55	27adding the following subsection:-
56	56	28 (f) A certificate of organization shall be amended to reflect a change in the beneficial
57	57	29owners of a limited liability company or the information required to be provided relating to each
58	58	30beneficial owner.
59	59	31 SECTION 4. The second paragraph of section 48 of said chapter 156C, as so appearing,
60	60	32is hereby amended by adding the following subparagraph:-
61	61	33 (10) the disclosure of each beneficial owner of the foreign limited liability company. 3 of 6
62	62	34 SECTION 5. Said chapter 156C is hereby amended by striking out section 52, as so
63	63	35appearing, and inserting in place thereof the following section:-
64	64	36 Section 52. (1) If any statement in the application for registration of a foreign limited
65	65	37liability company was false when made or any arrangements or other facts described have
66	66	38changed, making the application inaccurate in any respect, the foreign limited liability company
67	67	39shall promptly file in the office of the state secretary a certificate, signed and sworn to by an
68	68	40authorized person, correcting or amending such statement.
69	69	41 (2) An application for registration shall be amended to reflect a change in the beneficial
70	70	42owners of a foreign limited liability company or the information required to be provided relating
71	71	43to each beneficial owner. The amended application for registration shall be filed with the state
72	72	44secretary within 30 days of the beneficial owner change of the foreign limited liability company.
73	73	45 SECTION 6. Said chapter 156C, as so appearing, is hereby amended by adding the
74	74	46following section:-
75	75	47 Section 73. (a)(1) A limited liability company shall disclose its beneficial owners to the
76	76	48state secretary. The beneficial owner shall identify each and every entity or person linking such
77	77	49beneficial owner to the limited liability company, including: (i) identifying every intermediary
78	78	50by name and explaining the nature of the legal or economic relationship of the beneficial owner
79	79	51to each such intermediary; and (ii) how each such intermediary is linked to every other
80	80	52intermediary and to the limited liability company. The state secretary may permit or require the
81	81	53beneficial owner to provide a diagram in order to meet the disclosure requirement.
82	82	54 (2) Disclosure requirements of this section shall only apply to beneficial owners if: (i)
83	83	55indirect beneficial ownership is exercised through a publicly traded entity, a REIT, a UPREIT or 4 of 6
84	84	56a mutual fund; and (ii) the beneficial owner is holding or controlling 25 per cent or more of the
85	85	57equity in such limited liability company. This subsection shall apply until full disclosure of a
86	86	58beneficial owner by person is achieved.
87	87	59 (3) If a beneficial owner indirectly exercises ownership through a trust or similar
88	88	60arrangement which holds or controls, directly or indirectly, 25 per cent or more of the equity in
89	89	61the limited liability company or exercises substantial control over such company, the limited
90	90	62liability company shall identify as a beneficial owner each person serving as:
91	91	63 (i) a trustee of the trust, a trust protector or any other individual with authority, directly or
92	92	64indirectly, to dispose of trust income, assets or principal;
93	93	65 (ii) a trust beneficiary with the right, directly or indirectly, to receive, demand or
94	94	66withdraw any trust income, assets or principal; and
95	95	67 (iii) a grantor or settlor with the right, directly or indirectly, to revoke the trust or to
96	96	68receive, demand or withdraw trust income, assets or principal.
97	97	69 (b)(1) A limited liability company, when disclosing its beneficial owners pursuant to
98	98	70sections 12 and 13, shall identify each beneficial owner by: (i) name; (ii) date of birth; (iii) their
99	99	71current residential or business address; (iv) a unique identifying number from a non-expired
100	100	72United States passport or a non-expired driver's license or identification card issued by the
101	101	73commonwealth or another state or a non-expired foreign passport bearing a photograph, date of
102	102	74birth and unique identifying information for the beneficial owner; and (5) a federal or state
103	103	75 taxpayer identification number or a legal entity identifier issued by the global legal entity
104	104	76identifier foundation. 5 of 6
105	105	77 (2) A limited liability company, when disclosing its beneficial owners to the state
106	106	78secretary, may submit a copy of the beneficial ownership information submitted to the federal
107	107	79government pursuant to 31 U.S.C. §5336 in order to satisfy disclosure requirements; provided,
108	108	80that such federal registration is current and contains all information required under this section.
109	109	81 (3) A limited liability company, when disclosing its beneficial owners pursuant to
110	110	82sections 12 and 13, shall identify the total number of properties, if any, each beneficial owner
111	111	83owns in the commonwealth and the city or town each property is located in the commonwealth.
112	112	84 (c)(1) A foreign limited liability company, when disclosing its beneficial owners pursuant
113	113	85to sections 48 and 52, shall identify each beneficial owner by: (i) name; (ii) date of birth; (iii)
114	114	86their current residential or business address; (iv) a unique identifying number from a non-expired
115	115	87United States passport or a non-expired driver's license or identification card issued by the
116	116	88commonwealth or another state or a non-expired foreign passport bearing a photograph, date of
117	117	89birth and unique identifying information for the beneficial owner; and (5) a federal or state
118	118	90taxpayer identification number or a legal entity identifier issued by the global legal entity
119	119	91identifier foundation.
120	120	92 (2) A foreign limited liability company, when disclosing its beneficial owners to the state
121	121	93secretary, may submit a copy of the beneficial ownership information submitted to the federal
122	122	94government pursuant to 31 U.S.C. §5336 in order to satisfy disclosure requirements, provided
123	123	95that such federal registration is current and contains all information required under this section.
124	124	96 (3) A foreign limited liability company, when disclosing its beneficial owners pursuant to
125	125	97sections 12 and 13, shall identify the total number of properties, if any, each beneficial owner
126	126	98owns in the commonwealth and the city or town each property is located in the commonwealth. 6 of 6
127	127	99 (d) All disclosed information filed with the state secretary under this section shall be a
128	128	100matter of public record and subject to chapter 66.