The penalty for not filing Form 8621 (the PFIC reporting form) can be severe, but it depends on the circumstances.
If no distributions are made, there might not be an immediate penalty, but failing to file can cause your entire tax return to be considered incomplete, leading to potential interest charges and penalties when income is realized or distributions are made.
Noncompliance can also trigger extended audit periods, so it’s usually in the taxpayer’s best interest to report PFICs and avoid these complications.