On January 22, 2024, the Federal Trade Commission (the “FTC”) announced revised statutory thresholds for the Hart-Scott-Rodino Antitrust Improvements Act of 1976 (the “Hart-Scott-Rodino Act” or “HSR”). These thresholds, which are revised annually based on the change in gross national product, were published in the Federal Register on February 5, 2024 (available here) and will apply to transactions closing on or after March 6, 2024.
Mergers and Acquisitions: Unless otherwise exempted, parties to a merger or acquisition are required to make HSR filings if the size-of-transaction test is satisfied. Per the updated thresholds, this test is satisfied if a transaction: (i) is valued over $478.0 million (previously $445.5 million) or (ii) is valued over $119.5 million (previously $111.4 million) and the size-of-person test is also satisfied. The size-of-person test is satisfied if one of the parties has net sales or total assets of at least $239.0 million (previously $222.7 million) and the other party has net sales or total assets of at least $23.9 million (previously $22.3 million). Certain monetary thresholds relating to HSR notification exemptions have also increased.
Acquisitions of Voting Securities: Similarly, the five notification thresholds relating to acquisitions of voting securities (which specify whether a filing or successive filing is necessary) have increased. Per the updated thresholds, HSR filings are required in connection with acquisitions (and subsequent acquisitions) of voting securities that result in an acquirer holding voting securities of a company: (i) valued over $119.5 million (previously $111.4 million), (ii) valued at or over $239.0 million (previously $222.7 million), (iii) valued at or over $1.195 billion (previously $1.1137 billion), (iv) comprising 25% or more of such company’s voting securities, if valued over $2.39 billion (previously $2.2274 billion), or (v) comprising 50% of such company’s voting securities, if valued over $119.5 million (previously $111.4 million). Once an acquirer holds 50% or more of a company’s voting securities, no further notification to the FTC and the Department of Justice (“DOJ”) is required in connection with subsequent acquisitions of such company’s securities.
HSR Filing Fees: Effective March 6, the revised filing fee thresholds and related filing fees for 2024 are as follows:
*At the time of filing.
The FTC also recently announced 2024 thresholds relating to interlocking directorate restrictions as well as increased civil penalty amounts for certain violations of the Hart-Scott-Rodino Act, each described in further detail below.
Interlocking Directorates Thresholds: On January 12, 2024, the FTC announced higher thresholds relating to interlocking directorate restrictions under Section 8 of the Clayton Antitrust Act of 1914 (the “Clayton Act”). The new thresholds are $48,559,000 and $4,855,900 for Sections 8(a)(1) and 8(a)(2)(A) of the Clayton Act, respectively (up from $45,257,000 and $4,525,700 in 2023). Such thresholds became effective upon their publication in the Federal Register on January 22, 2024 (available here).
Civil Penalty Amounts: On January 11, 2024, the FTC announced adjusted civil penalty amounts for certain violations of the Hart-Scott-Rodino Act, which became effective upon their publication in the Federal Register on January 10, 2024 (available here). Civil penalty amounts are revised annually to account for inflation, and the maximum civil penalty amount in 2024 for such violations is $51,744 per day (up from $50,120 in 2023).
