On February 15, 2019, the Federal Trade Commission (the “FTC”) announced revised 2019 thresholds for the The Hart-Scott-Rodino (HSR) Antitrust Improvements Act of 1976 (the “Act”) as required by the 2000 amendment of Section 7A of the Clayton Act. The revised thresholds apply to all subject transactions closing on or after April 3, 2019.
Section 7A of the Clayton Act requires all persons contemplating certain mergers or acquisitions which meet or exceed jurisdictional thresholds set forth in the Act to file notifications with the FTC and Assistant Attorney General and to wait a designated period of time before consummating such transaction.
Section 7(A)(2) of the Clayton Act requires the FTC to revise these thresholds annually, based on changes in the gross national product.
For 2019, the “size of transaction” test is met if the transaction is valued at more than $90 million. The “size of person test” is met if the ultimate parent entity (“UPE”) of one person has annual net sales or total assets of $180 million or more and the UPE of the other person in the transaction has annual net sales or total assets of $18 million or more. However, for transactions larger than $359.9 million, the size of person test is not applicable.
Filing fees for 2019 remain the same as in 2018, but the sizes of transaction thresholds have been increased. For transactions less than $180 million, the fee is $45,000; for transactions equal to or greater than $180 million and less than $899.8 million, the fee is $125,000; and for transactions equal to or greater than $899.8 million, the fee is $280,000.
See the attached diagram for a complete overview of the new thresholds.
If you have questions regarding compliance with the new HSR requirements for mergers and acquisitions, please contact George H. Wang.