On February 12, 2026, the United States District Court for the Eastern District of Texas vacated a rule promulgated by the Federal Trade Commission (“FTC”) in 2024 that revised and expanded the information required of merging parties in filings submitted pursuant to the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (“HSR Act”). In a 34-page opinion granting the motion for summary judgment filed by the plaintiff, the United States Chamber of Commerce, the court held that the revised HSR form and required information were not “necessary and appropriate” as required by the Administrative Procedure Act. The Court also held that the Final Rule was arbitrary and capricious because the FTC failed to show that the expanded requirements’ benefits outweighed the burden on filing parties and that less burdensome alternatives were properly considered and rejected.
In 2024, the FTC proposed replacing the HSR form that had been in place for decades with a new form that significantly expanded the data and documents required of filing parties. The FTC estimated that the amount of time filing parties would take to complete the HSR form would climb from an average of 37 hours to 105 hours, nearly tripling the preparation time. Among the new categories of information required by the expanded form were certain plans and reports generated in the ordinary course of business, certain documents generated by or for individuals primarily responsible for the negotiation of the transaction (not just by or for officers and directors, as the old form required), and information about vertical supply and purchase arrangements between the target and the acquirer or its competitors. Other requirements were streamlined or dropped altogether. Practitioners quickly found that for transactions in which the parties did not competitively overlap, completion of the new HSR form took about as much time (or even a little less time) as the old one to complete; but for transactions between parties with competitive overlaps or vertical relationships, the new form required significantly more time and effort to complete.
The Texas court found that the FTC had failed to show that the benefits of the expanded requirements (which applied to only the eight percent of HSR filers whose deals sparked further investigation) outweighed the costs (which would be borne by all filers). In addition, the FTC failed to identify any anticompetitive prior mergers that the expanded upfront disclosure requirements would have prevented. Accordingly, the new rules were not “necessary and appropriate” and were “arbitrary and capricious.”
The court stayed the effectiveness of its order for seven days so that the FTC can file an emergency appeal and seek a stay pending appeal, both of which it will likely do. The FTC’s Premerger Notification Office has notified the public that the new form should be used through February 19, 2026, and further guidance will be forthcoming. Should the court’s order stand, the HSR filing system will revert (at least for a time) to what was in place for decades. The antitrust agencies will still receive a significant amount of information in HSR filings, and will again rely heavily on their ability to request the production of information and documents voluntarily during the initial waiting period in order to evaluate whether to issue a Second Request, which pauses the transaction until the parties certify substantial compliance.
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