FTC’s 2020 Adjustments to HSR Filing Thresholds
The Federal Trade Commission (“FTC”) announced its annual adjustment for notification thresholds for proposed mergers and acquisitions under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 (the “HSR Act”).
HSR Act Threshold Increases:
“Size-of-transaction” threshold increased from $90 million to $94 million
“Size-of-person” thresholds increased from $180 million and $18 million to $188 million and $18.8 million, respectively
“Size-of-transaction” maximum increased from $359.9 million to $376 million
An HSR Filing May be Necessary If:
As a result of the transaction, the acquirer will hold voting securities and assets of the acquired valued at more than $94 million but not more than $376 million, and the “size-of-person” thresholds are also met. To meet the “size-of-person” test, one party must have annual net sales or total assets of at least $188 million, and the other party must have annual net sales or total assets of at least $18.8 million
As a result of the transaction, the acquirer will hold voting securities and assets of the acquired valued at greater than $376 million (the size-of-person test is not applied), unless another exemption applies.
The FTC also adjusted the thresholds in Section 8 of the Clayton Act that trigger the prohibition on “interlocking directorates” - where one person serves as a director or officer of two competing corporations (subject to certain exceptions). Now the prohibition may apply when (1) each corporation has capital, surplus, and undivided profits aggregating more than $38,204,000, and (2) each corporation’s competitive sales are at least $3,820,400.