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FTC Proposes Dramatic Overhaul of U.S. Merger Reporting

On June 29, 2023 the Federal Trade Commission, in collaboration with the Antitrust Division of the U.S. Department of Justice, published in the Federal Register a 133-page notice of proposed rulemaking (“NPRM”) that would overhaul merger reporting obligations in the U.S., representing the first large-scale change since the implementation of the Hart-Scott-Rodino Act of 1976 (“HSR Act”). Although the changes would not increase the range of reportable deals, they would dramatically increase the amount and type of information required for all filers, demanding substantially more documents, information and narrative responses than are required currently. Following a public comment period, the rules may become effective as early as late December 2023.

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FTC Announces Decreased HSR Thresholds

Practices: Antitrust

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The Federal Trade Commission has announced revised jurisdictional and filing fee thresholds under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 (“the Act”), as amended. The new thresholds under the Act represent an approximately 2% decrease from last year, when the thresholds were increased over 2019 thresholds based on changes in the gross national product.

Transactions closing on or after March 4 will be subject to the following revised thresholds:

  • Size-of-Transaction Test: The $50 million (as adjusted) threshold used in the size-of-transaction test will decrease from $94 million to $92 million.
  • Size-of-Persons Test: The $10 million (as adjusted) and $100 million (as adjusted) sales and assets thresholds used in the size-of-persons test will decrease from $18.8 million to $18.4 million and from $188 million to $184 million, respectively. The $200 million (as adjusted) threshold, below which the size-of-persons test applies, will decrease from $376 million to $368 million.
  • Filing Fees: The filing fees under the Act are not revised under these changes, but the filing thresholds, based upon the value of assets or voting securities, which trigger each fee, will be revised as follows:
Value of Transaction Filing Fee

In excess of $92 million but less than $184 million
(previously $94 million but less than $188 million)

 $45,000

$184 million or greater but less than $919.9 million
(previously $188 million but less than $940.1 million)

$125,000

$919.9 million or more
(previously $940.1 million or more)

$280,000

Other value limitations contained in the HSR coverage and exemption rules have also been adjusted. The FTC has increased the maximum civil penalties for noncompliance with the HSR Act to $43,792 (previously $43,280) for each day during which a person is in violation of the Act.

The revised jurisdictional thresholds will remain in effect until the next adjustment issued by the FTC, which is expected in the first quarter of 2022.

For additional information regarding HSR jurisdictional thresholds and reporting requirements, please feel free to contact any member of Ropes & Gray’s Antitrust Practice Group.

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