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The Federal Trade Commission (“FTC”) has announced
that the Hart-Scott-Rodino (“HSR”) Act filing thresholds
will increase again in 2023. These thresholds determine which
mergers and acquisitions must be reported to the federal government
before consummation. The higher thresholds are expected to take
effect on February 27 and will remain in effect through early
The FTC also confirmed that new HSR filing fee thresholds will
take effect the same day. Parties to any transaction that will
close on or after February 27 may wish to confirm their HSR filing
analysis using the adjusted thresholds.
Adjusted HSR Jurisdictional Thresholds
Size-of-Transaction Threshold. An HSR filing
may be required if an acquirer will hold, as a result of a
transaction, voting securities, noncorporate interests, and/or
assets of an acquired person valued in excess of $111.4 million
(the 2022 threshold was $101 million). If the Size-of-Transaction
is between $111.4 million and $445.5 million, the transaction also
must satisfy the Size-of-Person threshold, described below.
Transactions valued in excess of $445.5 million need not satisfy
the Size-of-Person threshold.
Size-of-Person Threshold. A transaction meets
the Size-of-Person threshold if either the acquired or acquiring
person has annual net sales or total assets of at least $222.7
million and the other party to the transaction has at least $22.3
million in annual net sales or total assets. (The 2022 thresholds
were $202 million and $20.2 million, respectively.) If the acquired
person is not “engaged in manufacturing,” the threshold
is not met unless that person has at least $22.3 million in total
assets or $222.7 million in annual net sales.
The tables below summarize these threshold changes.
As detailed in our prior
Alert, and shown below, a law passed in late 2022
introduced additional HSR filing fee thresholds, increased filing
fees for large transactions, and decreased fees for small
transactions. The FTC clarified that those new thresholds also will
take effect on February 27.
There are exceptions to the reporting requirements under the HSR
Act. Qualified counsel should be consulted whenever a transaction
may implicate this statute.
Interlocking Directorates Thresholds and Civil Penalties
Amounts Also Increase
The FTC also increased the jurisdictional thresholds for the
prohibition on interlocking directorates under Section 8 of the
Clayton Act. Section 8 prohibits a person from serving as an
officer or director of competing corporations if each company has a
net worth of more than $45,257,000. However, there is no violation
if the competitive sales of either are less than $4,525,700.
Earlier in January, the FTC announced an increase in the maximum
civil penalty for violations of the HSR Act (among other statutes)
from $46,517 per day to $50,120 per day.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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