September 18, 2020

Volume X, Number 262

September 18, 2020

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September 17, 2020

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September 16, 2020

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COVID-19: Proposed Legislation Would Prohibit Many Mergers and Acquisitions During Pandemic

Senator Elizabeth Warren and Rep. Alexandria Ocasio-Cortez are sponsoring legislation to halt certain mergers and acquisitions during the coronavirus pandemic.

The “Pandemic Anti-Monopoly Act” would impose a moratorium on mergers and acquisitions meeting any of the following criteria:

  1. Companies with over US$100 million in revenue or financial institutions with over US$100 million in market capitalization;

  2. Private equity companies, hedge funds, or companies that are majority-owned by a private equity company or hedge fund;

  3. Companies with an exclusive patent that impacts the crisis, like personal protective equipment; and

  4. Transactions that must otherwise be reported to the Federal Trade Commission (FTC) under current law.

The legislation would also pause ”all waiting periods and deadlines imposed on antitrust agencies during the moratorium.”

The legislation would apply to all transactions that are reportable under the Hart-Scott-Rodino Antitrust Improvements Act (HSR Act) and would likely apply to any filings currently in the waiting period or under review by one of the federal antitrust agencies. Currently, transactions valued at more than US$94 million are typically reportable under the HSR Act.

There is no sunset provision in the legislation; rather, the moratorium would continue until the FTC affirmatively determines that “small businesses, workers, and consumers are no longer under severe financial distress.”

Sen. Warren’s press release on the proposed legislation may be found at the following website: https://www.warren.senate.gov/imo/media/doc/Merger%20Moratorium%20One%20Pager.pdf.

Copyright 2020 K & L GatesNational Law Review, Volume X, Number 121

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About this Author

Ken Knox Trade Regulation Attorney K&L Gates Law Firm
Counsel

Ken Knox is counsel with the antitrust & trade regulation practice group. He represents companies and individuals in a variety of litigation support and e-discovery roles, focusing on the preparation and submission of Hart-Scott-Rodino filings and related activities.

Mergers & Acquisitions (Hart-Scott-Rodino Filings)

Mr. Knox has almost 20 years of experience in preparing and submitting Hart-Scott-Rodino (HSR) filings on behalf of both Fortune 500 clients and smaller companies. He regularly advises clients on all aspects of HSR compliance, including submission...

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