February 5, 2023

Volume XIII, Number 36

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February 03, 2023

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February 02, 2023

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Higher Jurisdictional and Filing Fees Thresholds for HSR Act Premerger Notifications and Interlocking Directorates Announced

1. Higher Jurisdictional Thresholds For HSR Filings

On January 23, 2023, the Federal Trade Commission announced revised, higher thresholds for premerger filings under the Hart-Scott-Rodino Antitrust Improvements Act of 1976. The jurisdictional thresholds are revised annually based on the change in Gross National Product (GNP).

The new thresholds will become effective on February 22, 2023. Acquisitions that have not closed by the effective date will be subject to the new thresholds.

The HSR Act notification requirements apply to transactions that satisfy the specified “size of transaction” and “size of person” thresholds. The key adjusted thresholds are summarized here:

Size of Transaction Test

Notification is required if
– the acquiring person will hold assets, voting securities, and/or interests in non-corporate entities valued at $111.4 million or more AND the parties meet the Size of Person test; OR
– the acquiring person will hold assets, voting securities, and/or interests in non-corporate entities valued at $445.5 million or more– such transactions are not subject to the Size of Person test.

Size of Person Test

Generally, one “person” to the transaction must have at least $222.7 million in total assets or annual net sales, and the other must have at least $22.3 million in total assets or annual net sales.

The above rules are general guidelines only and their application may vary depending on the particular transaction.

2. New Filing Fees For HSR Filings

As previewed in our blog post dated January 5, 2023, the new filing fee thresholds below also will become effective on February 22, 2023. Going forward, the FTC will revise the filing fees annually based on the change in the U.S. consumer price index and publish the adjusted amounts no later than January 31 of each year.

New filing fee

Size of Transaction

$30,000

Deals valued from $111.4M but less than $161.5M

$100,000

Deals valued from $161.5M but less than $500M

$250,000

Deals valued from $500M but less than $1B

$400,000

Deals valued from $1B but less than $2B

$800,000

Deals valued from $2B but less than $5B

$2,250,000

Deals valued at $5B or more

3. Higher Thresholds For the Prohibition Against Interlocking Directorates

Higher thresholds for the prohibition in Section 8 of the Clayton Act against interlocking directorates became effective on January 23, 2023. Section 8 prohibits, with certain exceptions, one person from serving as a director or officer of two competing corporations if two thresholds are met. Applying the new thresholds, competitor corporations are covered by Section 8 if each one has aggregated capital, surplus and undivided profits of more than $45,257,000, unless the competitive sales of either corporation are less than $4,525,700.

Copyright © 2023, Sheppard Mullin Richter & Hampton LLP.National Law Review, Volume XIII, Number 24
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About this Author

John D. Carroll Antitrust Lawyer Sheppard Mullin
Partner

John D. Carroll is a partner in the Antitrust & Competition Practice Group in the Washington, D.C. office.

Areas of Practice

John’s practice focuses on civil and criminal antitrust matters, including mergers & acquisitions, strategic counseling and compliance, and global cartel investigations, where he represents clients before the Department of Justice Antitrust Division, Federal Trade Commission, and international and state antitrust enforcement authorities.

Prior to private practice, John was in the Mergers I Division of the Federal Trade...

1.202.747.1951
Leo Caseria Antitrust & Competition Attorney Sheppard Mullin Washington, DC
Partner

Leo Caseria is a partner in the Antitrust and Competition Practice Group in the Washington, D.C. and Los Angeles offices. 

Areas of Practice

Leo advises companies on antitrust issues in civil litigation, government investigations, mergers and acquisitions and proposed or contemplated business strategies. He has litigated numerous antitrust cases in federal and state courts, including cases based on alleged price-fixing, market allocation, boycott, monopolization and attempted monopolization.  He also has experience in consumer protection issues relating to...

202-747-1925
Malika Levarlet, Attorney, Sheppard Mullin, Corporate Practice, mergers
Associate

Ms. Malika Levarlet is an associate in the Corporate Practice Group in the firm's Washington, D.C. office.

Areas of Practice

Ms. Levarlet's practice focuses on advising international and domestic companies in connection with mergers and acquisitions, cross-border transactions (with a focus on U.S. and European companies), joint ventures, licensing agreements, and corporate governance. She represents clients operating in a wide range of industries including technology, hospitality, fashion and apparel, healthcare, financial services, and aerospace and defense...

202-772-5331
Bevin M.B. Newman Antitrust Lawyer Sheppard Mullin Law Firm
Partner

Bevin Newman is a partner in the Antitrust and Competition Practice Group in the firm's Washington, D.C. office.

Areas of Practice

Bevin is a strategic adviser to clients in cutting edge affiliations and collaborative arrangements. She focuses much of her practice in the healthcare industry bringing over twenty years of experience advising and defending globally renowned health systems, academic medical centers, providers, payers, and pharmaceuticals companies undertaking significant transactions, including mergers and acquisitions, joint ventures,...

202-747-1940
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