On January 26, 2018, the US Federal Trade Commission (FTC) announced new thresholds relating to the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, 15 U.S.C. § 18a (HSR). The thresholds govern which mergers or acquisitions must be reported to the FTC and the Department of Justice. Since 2005, the thresholds have been adjusted annually according to the change in US gross domestic product.
Once the new HSR thresholds go into effect, notification of mergers or acquisitions will be required if:
The acquiring party will hold another person’s assets or voting securities valued in excess of $84.4 million (previously $80.8 million), and the transaction involves both one party with annual net sales or total assets in excess of $16.9 million (previously $16.2 million) and another party with annual net sales or total assets in excess of $168.8 million (previously $161.5 million); or
The acquiring party will hold assets or voting securities of another person valued in excess of $337.6 million (previously $323 million).
In addition to amendments to the HSR thresholds, the HSR filing fee tiers also will be updated. The HSR filing fee is pegged to the value of the transaction. The new filing fee tiers are as follows:
Filing fee of $45,000 will apply to transactions valued at greater than $84.4 million but less than $168.8 million (previously greater than $80.8 million but less than $161.5 million).
Filing fee of $125,000 will apply to transactions valued at $168.8 million or greater but less than $843.9 million (previously greater than $161.5 million but less than $807.5 million).
Filing fee of $280,000 will apply to transactions valued at $843.9 million or greater (previously $807.5 million or greater).
The new thresholds will apply to any mergers or acquisitions closed 30 days after the thresholds are published in the Federal Register.
For More Information To help navigate the complex HSR Act rules in order to determine if a filing is actually required, Mayer Brown has created an interactive presentation that provides quick and practical HSR guidance. Based on current 2018 FTC thresholds, this presentation allows you to choose the criteria that best applies to your organization or transaction and then takes you through a basic analysis of whether an HSR Act filing is necessary.
The FTC’s Federal Register notice and a complete list of all HSR threshold adjustments can be found on the FTC’s website.