HSR and Section 8 Jurisdictional Thresholds Decrease Two Percent for 2021
The Federal Trade Commission (“FTC”) has published the 2021 revised jurisdictional thresholds for the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (“HSR Act”), which show a decrease of approximately two percent from the 2020 thresholds1. The revised thresholds apply to all covered acquisitions occurring on or after March 4, 2021.
The HSR Act requires parties to a covered transaction to notify the transaction to the FTC and the Antitrust Division of the United States Department of Justice, provide certain information about the transaction and the parties, and observe a waiting period prior to consummation.
Because the thresholds are revised each year to reflect prior-year changes in the gross national product, the thresholds will decrease from 2020 levels, reflecting the economic impact of the novel coronavirus pandemic. In general, under the revised thresholds, transactions valued at over $92 million may require prior notification if one side has more than $184 million in net sales or total assets and the other side has more than $18.4 million in net sales or total assets2. Transactions valued at over $368 million are reportable without regard to the size of the parties.
Filing fees remain unchanged, but the thresholds for determining the amount of the fee will change: transactions valued in excess of $92 million but less than $184 million require a fee of $45,000; transactions of at least $184 million but less than $919.9 million require a fee of $125,000; and transactions valued at $919.9 million or more require a fee of $280,000.
In addition, on January 21, 2021, the FTC revised the thresholds downward that apply to the Clayton Act’s prohibition of interlocking officers or directors under Section 8. Unless an exemption or certain safe harbor thresholds apply, competitor corporations are covered if each has aggregated capital, surplus and undivided profits of more than $37,382,000, and the competitive sales of each is at least $3,738,200. The new thresholds took effect on January 21.
1 Federal Trade Comm’n, Notice, 86 Fed. Reg. 7870 (2021).
2 The personal size thresholds differ slightly depending on whether one or more of the parties is engaged in manufacturing.