Antitrust - HSR Transaction and Filing Fee Thresholds Adjusted
The Hart-Scott-Rodino Antitrust Improvements Act of 1976 (“HSR”) requires parties to stock and asset transactions that satisfy specified jurisdictional thresholds to provide the Federal Trade Commission (“FTC”) and Department of Justice (“DOJ”) with information for use in evaluating whether to raise antitrust objections to the proposed transaction. The parties must wait a designated period of time (usually 30 calendar days) after providing that information before the proposed transaction can be consummated. The FTC and DOJ frequently grant requests to terminate the waiting period early (particularly where the proposed transaction raises no substantive antitrust concerns), and also have the right to extend the waiting period (as part of a so-called “second request”).
The FTC has announced its most recent adjustments to those HSR jurisdictional thresholds. These adjustments will be effective February 28, 2008, and will apply to all transactions that close on or after that effective date.
When HSR was adopted in 1976, its jurisdictional thresholds were never indexed for inflation. As a result, by the late 1990’s a significant number of the transactions reported under HSR were relatively small. Congress fixed this problem as part of a broader amendment to HSR, which became effective February 1, 2001. As part of that legislation, the FTC was directed to adjust the various HSR jurisdictional thresholds for inflation, annually, beginning in 2005. This new adjustment represents the FTC’s fourth annual adjustment.
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HSR Test |
Old Threshold |
New Threshold |
Size-of-Parties |
Larger Party: $119.6 million |
Larger Party: $126.2 million |
Size-of-Transaction |
$59.8 million |
$63.1 million |
Size-of-Transaction |
$239.2 million |
$252.3 million |
The basic HSR jurisdictional tests were restated as part of the legislation effective February 1, 2001. Transactions are reportable if three distinct tests (commerce test, size-of-transaction test, and size-of-parties test) are satisfied and no exemption applies. At present, the size-of-transaction test is satisfied if the transaction has a value (as determined under HSR) in excess of $59.8 million. Moreover, if the size-of-transaction exceeds $239.2 million, then the transaction could be reportable whether or not the size-of-parties test also is satisfied.
As part of the adjustments announced by the FTC, the size-of-transaction test is increasing, to $63.1 million; and the transaction size above which the size-of-parties test no longer applies is rising to $252.3 million.
For transactions that satisfy the size-of-transaction test but are valued at or below $252.3 million, the size-of-parties test also is being adjusted. In general, one “person” (as determined under HSR) must have worldwide annual net sales or worldwide total assets of $126.2 million, and the other person $12.6 million.
The FTC also is adjusting the corresponding thresholds, based on the value of the transaction, that are used to determine the applicable HSR filing fee. (The filing fees themselves have not been adjusted.)
The new thresholds will be:
Summary of Adjustments to HSR Filing Fee Thresholds |
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HSR Filing Fee |
Old Threshold(Value of Transaction) |
New Threshold(Value of Transaction) |
$45,000 |
Less than $119.6 million |
Less than $126.2 million |
$125,000 |
Less than $597.9 million |
Less than $630.8 million |
$280,000 |
$597.9 million or more |
$630.8 million or more |
For questions on HSR requirements and compliance, contact:
June Ann Sauntry
404.885.3210
Mitchell P. Portnoy
212.704.6135
Lori H. Jones
404.885.3828