The Federal Trade Commission (FTC) has announced that the Hart-Scott-Rodino Antitrust Improvements Act of 1976 (HSR Act) thresholds will be increased. The FTC also announced that it has revised the thresholds that trigger prohibitions on certain interlocking directorates under Section 8 of the Clayton Act.
HSR Act Threshold Update
The FTC revises the HSR Act thresholds annually based on changes in the gross national product. The size-of-transaction filing threshold will increase from the current $78.2 million threshold to $80.8 million. The adjustments will become effective February 27, 2017, 30 days after the thresholds are published in the Federal Register. Transactions closing on or after the effective date will be subject to the revised thresholds.
Under the new thresholds, the parties to an acquisition or merger will, absent an applicable exemption, need to file pre-merger notifications with the Department of Justice and the FTC and observe the HSR Act's waiting periods if the transaction will result in either of the following:
Meeting any one of the following subtests satisfies the "size-of-person" test:
For the purposes of applying the thresholds, the term "person" means the ultimate parent entity of the party engaged in the transaction. Certain exemptions may apply depending on the nature of the transaction and the location and nature of the assets and entities involved. As a result, additional analysis is often required before making a final determination regarding the need for a filing.
The filing fees for reportable transactions will be as follows:
Clayton Act Threshold Update
The Clayton Act requires the FTC to revise the thresholds that trigger a prohibition preventing companies from having interlocking memberships on their corporate boards of directors under Section 8.
The thresholds are adjusted annually, based on the change in gross national product. The new 2017 thresholds for the Clayton Act’s prohibition on interlocking directorates are $32,914,000 for Section 8(a)(l) and $3,291,400 for Section 8(a)(2)(A). The new thresholds became effective upon publication in the Federal Register on January 26, 2017.
For more information regarding the HSR or Clayton Act thresholds, please contact Scott Claassen, Allison Hardy, Jennifer Moyer or the Stinson Leonard Street contact with whom you regularly work.