On January 24, 2012, the Federal Trade Commission (FTC) announced the revised thresholds that determine whether companies are required to notify federal antitrust authorities about a transaction under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (HSR Act). Under the HSR Act, parties involved in proposed mergers, acquisitions of stock, assets or unincorporated interests, or other business combinations that meet certain thresholds must report the contemplated transactions to the FTC and the U.S. Department of Justice and must observe a waiting period before the transactions can be consummated. Section 7A(a)(2) of the Clayton Act requires the FTC to revise all of the HSR Act thresholds annually, based on changes in the gross national product.
The new HSR Act thresholds likely will be published in the Federal Register sometime in the next week or so, and will take effect sometime in early March 2012, which by statute will be 30 days after the date of publication in the Federal Register.
In addition, the FTC announced the revised jurisdictional dollar thresholds that will apply to potential prohibitions that prevent companies from having interlocking officers or directors on their corporate boards of directors under Section 8 of the Clayton Act. The revised thresholds for the prohibition on interlocking directorates are $27,784,000 for Section 8(a)(1) and $2,778,400 for Section 8(a)(2)(A), and they will take effect upon publication in the Federal Register.
The revised HSR Act thresholds are higher than the current thresholds, as shown on the following chart:
(Effective as of early March 2012)
(or $1.319 billion)
(or $1.364 billion)
These revised thresholds will affect the jurisdictional requirements and certain exemptions under the HSR Act, as well as the HSR Act’s filing fee schedule. Thus, for example, a transaction valued below the revised minimum notification threshold of $68.2 million generally will not need to be reported, and the size-of-person test will not apply to a transaction valued at more than $272.8 million. The filing fees for reportable transactions will be as follows: