Adjusted threshold for the size-of-transaction test
The minimum value of a transaction that could trigger an HSR filing will increase from $92 million to $101 million.
For any agreement entered into prior to the effective date (February 23, 2022), the new thresholds will apply so long as the transaction is closed on or after the effective date.
Adjusted threshold for the size-of-person test
The following table reflects the new annual thresholds for the size-of-person test. For transactions valued at more than $101 million and up to $403.9 million, an HSR filing is only required if the size-of-person test is met.
Filing fee thresholds
The new thresholds do not change the HSR filing fee amounts, but the applicable filing fee will be based on the new thresholds as of February 23, 2022. For transactions that are imminent or currently underway, the applicable filing fee thresholds are those in effect at the time of filing notification.
Civil penalties
On January 6, 2022, the FTC announced that the maximum civil penalty amount for HSR Act violations will increase from $43,792 to $46,517 per day, effective as of the date of publication in the Federal Register (January 10, 2022).
Non-reportable and cleared transactions
Noncompliance with the HSR Act carries serious penalties, but the fact that a transaction does not meet HSR filing thresholds does not mean that such a transaction is immune from scrutiny by antitrust enforcers. Also, the fact that a transaction has received HSR clearance to close does not mean it will avoid the scrutiny of enforcers. The Antitrust Division of the Department of Justice and the FTC have previously filed suits seeking to unwind consummated mergers, including mergers that had received clearance following antitrust review. Enforcers have also challenged transactions well below the threshold for the size-of-transaction test, including those with a purchase price of less than $10 million.
The FTC also began issuing “pre-consummation warning letters” for transactions that it cannot fully investigate during the HSR waiting period due to the recent “tidal wave of merger filings,” alerting companies that the FTC’s investigation remains open and reminding companies that the agency may subsequently challenge a deal even if the parties elect to close.
Given the complexities and nuances in this area of the law, it is always wise to consult with experienced antitrust counsel regarding HSR filing obligations and substantive antitrust issues in connection with transactions of all sizes. To learn more about our experience, please contact any of the authors listed below.
Client Alert 2022-020
