May 24, 2022

Volume XII, Number 144

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May 23, 2022

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FTC's 2021 Adjustments to HSR Filing Thresholds

The Federal Trade Commission (“FTC”) previously announced its annual adjustment for notification thresholds regarding proposed mergers and acquisitions under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 (the “HSR Act”), and the adjustments went into effect on March 4, 2021. 

These threshold adjustments are based on the annual change in the U.S. gross national product. Due to contraction of the U.S. economy in 2020 and the related drop in gross national product, the HSR Act thresholds have decreased.

Summary of Adjustments

An HSR Filing May Be Necessary If:

  • As a result of the transaction, the acquirer will hold voting securities, assets, or non-corporate interests of the acquired that are valued in the aggregate at more than $92 million but not more than $368 million, and the “size-of-person” thresholds are met. To meet the “size-of-person” test, one party must have annual net sales or total assets of at least $184 million and the other party must have annual net sales or total assets of at least $18.4 million. 

  • Or, as a result of the transaction, the acquirer will hold voting securities, assets, or non-corporate interests of the acquired that are valued in the aggregate at greater than $368 million (the size-of-person test is not applied), unless another exemption applies.

The FTC also reduced the thresholds under 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 $37,382,000, and (2) each corporation’s competitive sales are at least $3,738,200.

© Steptoe & Johnson PLLC. All Rights Reserved.National Law Review, Volume XI, Number 71
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About this Author

Bryan Prosek, Steptoe Johnson Law Firm, Columbus, Corporate and Finance Law Attorney
Member

Bryan Prosek chairs the firm's securities practice group.  He focuses his practice in the area of business transactions, including securities offerings and federal and state registration compliance, corporate and real estate matters, mergers and acquisitions, contracts, licenses and similar agreements, corporate governance, banking and finance, corporate and partnership tax matters, and non-profit tax-exempt matters.

614-458-9793
John Chadd, Steptoe Johnson Law Firm, Energy Transaction and Mineral Law Attorney
Of Counsel

John Chadd focuses his practice in the areas of energy transactional and mineral title law. He advises companies, investors, and lenders on a broad spectrum of oil and gas and energy transactions including finance, acquisitions and divestitures, development and operational matters as well as general mergers and acquisitions and renewable energy projects.  He also represents companies and lenders in lending and finance transactions across a wide array of industries. 

303-389-4316
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