Hinckley Allen Corporate & Business
By: Joseph A. Kuzneski, Meaghan L. Krupa
On January 23, 2023, the Federal Trade Commission (the “FTC”) announced revised statutory thresholds for the Hart-Scott-Rodino Antitrust Improvements Act of 1976 (the “Hart-Scott-Rodino Act” or “HSR”). These thresholds, which are revised annually based on the change in gross national product, were published in the Federal Register on January 26, 2023 (available here) and will apply to transactions closing on or after February 27, 2023.
Mergers and Acquisitions: Unless otherwise exempted, parties to a merger or acquisition are required to make HSR filings if the size-of-transaction test is satisfied. Beginning February 27, this test is satisfied if a transaction (i) is valued over $445.5 million (previously $403.9 million) or (ii) is valued over $111.4 million (previously $101.0 million) and the size-of-person test is also satisfied. The size-of-person test is satisfied if one of the parties has net sales or total assets of at least $222.7 million (previously $202.0 million) and the other party has net sales or total assets of at least $22.3 million (previously $20.2 million). Certain monetary thresholds relating to HSR notification exemptions have also increased.
Acquisitions of Voting Securities: Similarly, the five notification thresholds relating to acquisitions of voting securities (which specify whether a filing or successive filing is necessary) have increased. Beginning February 27, HSR filings are required in connection with acquisitions (and subsequent acquisitions) of voting securities that result in an acquirer holding voting securities of a company: (i) valued over $111.4 million (previously $101.0 million), (ii) valued at or over $222.7 million (previously $202.0 million), (iii) valued at or over $1.1137 billion (previously $1.0098 billion), (iv) comprising 25% or more of such company’s voting securities, if valued over $2.2274 billion (previously $2.0196 billion), or (v) comprising 50% of such company’s voting securities, if valued over $111.4 million (previously $101.0 million). Once an acquirer holds 50% or more of a company’s voting securities, no further notification to the FTC and the Department of Justice (“DOJ”) is required in connection with subsequent acquisitions of such company’s securities.
HSR Filing Fees: On January 23, the FTC also announced the filing fee thresholds for 2023, within the new fee structure enacted by the Consolidated Appropriations Act, 2023. Effective February 27, the revised filing fee thresholds and related filing fees are as follows:
| Transaction Value* |
Filing Fee |
| Less than $161.5 million |
$30,000 |
| At or above $161.5 million, but less than $500.0 million |
$100,000 |
| At or above $500 million, but less than $1.0 billion |
$250,000 |
| At or above $1.0 billion, but less than $2.0 billion |
$400,000 |
| At or above $2.0 billion, but less than $5.0 billion |
$800,000 |
| At or above $5.0 billion |
$2.25 million |
* At the time of filing.
Interlocking Directorates Thresholds: The FTC also announced higher thresholds relating to interlocking directorate restrictions under Section 8 of the Clayton Antitrust Act of 1914 (the “Clayton Act”). The new thresholds are $45,257,000 and $4,525,700 for Sections 8(a)(1) and 8(a)(2)(A) of the Clayton Act, respectively (up from $41,034,000 and $4,103,400 in 2022). Such thresholds became effective upon their publication in the Federal Register on January 20, 2023 (available here).
Civil Penalty Amounts: On January 6, 2023, the FTC announced adjusted civil penalty amounts for certain violations of the Hart-Scott-Rodino Act, which became effective upon their publication in the Federal Register on January 11, 2023 (available here). Civil penalty amounts are revised annually to account for inflation, and the maximum civil penalty amount in 2023 for such violations is $50,120 per day (up from $46,517 in 2022).
