On January 24, the Federal Trade Commission (FTC) announced its annual update to the Hart-Scott-Rodino (HSR) filing thresholds. The new thresholds were published in the Federal Register on January 24 and will take effect 30 days after publication. Therefore, they will apply to all closings which occur on or after February 23, 2022, (see below) and will remain in effect until the next annual change in early 2023. See Federal Register: Revised Jurisdictional Thresholds for Section 7A of the Clayton Act.

What You Need to Know

• Are you involved in a merger, acquisition or other similar business arrangement approaching $100 million+ in value?
• Are you aware that transactions of that size may require a filing with the Federal Trade Commission and U.S. Department of Justice?
• Have you consulted with antitrust counsel concerning the possibility of having to do a mandatory merger review filing?

​The amended thresholds are an increase from 2021 thresholds (which were a decrease from 2020 thresholds) based on the change in gross national product in the intervening year. For the purposes of determining whether an HSR filing is required, the increased thresholds are as follows:

Additionally, the 2022 thresholds under Section 8 of the Clayton Act that trigger prohibition on certain interlocking memberships on corporate boards increased to $41,034,000 (in capital, surplus or undivided profits) and $4,103,400 (in competitive sales). See Federal Register: Revised Jurisdictional Thresholds for Section 8 of the Clayton Act.

HSR filing fees remain the same, but there is currently a bill in Congress to increase merger filing fees for large transactions. The bill, if passed, would also require annual adjustments to the merger filing fees. 

Be alert: The $9 million increase in the size of the transaction threshold is big enough to raise the possibility that there are transactions in the works which would require a filing under the 2021 threshold but not under the 2022 threshold. Similarly, the size of parties thresholds, with the respective increases of $1.8 million and $18 million, could also possibly negate the need for a filing for no longer meeting the size of parties thresholds. Therefore, those upward swings in the “size rules” should be kept in mind and revisited for deals set to close after February 23, 2022 valued previously over $92 million but less than $101 million and with party sizes over $18.4 million/$184 million and under $20.2 million/$202 million. A similar assessment needs to be made in large deals where the size of the parties becomes irrelevant, given the $35,900,000 increase — some large deals which were over may now be under as of a post-February 23 closing date.

In addition, the FTC press announcement of the changes included a Concurring Statement by FTC Chair Lina Khan and Commissioner Rebecca Slaughter, in which they highlighted the need for a change in the filing fees, increased funding for merger review activities, and other changes in antitrust law regarding mergers and monopolies, referencing pending legislation being promoted by Senator Amy Klobuchar. This year will be one in which to keep an eye out for those changes, which could be quite material.