1. Higher Jurisdictional Thresholds For HSR Filings
On January 22, 2024, the Federal Trade Commission announced revised, higher thresholds for premerger filings under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 (HSR Act). The jurisdictional thresholds are revised annually, based on the change in Gross National Product (GNP).
The new thresholds will become effective 30 days after publication in the Federal Register. Acquisitions that close on or after the effective date will be subject to the new thresholds.
The HSR Act notification requirements apply to transactions that satisfy the specified “size of transaction” and “size of person” thresholds. The key adjusted thresholds are summarized in the following chart:
| Size of Transaction Test | Notification is required if – the acquiring person will hold certain assets, voting securities, and/or interests in non-corporate entities valued at more than $119.5 million AND the parties meet the Size of Person test; OR – the acquiring person will hold certain assets, voting securities, and/or interests in non-corporate entities valued at more than $478 million – such transactions are not subject to the Size of Person test. |
| Size of Person Test | Generally, one “person” to the transaction must have at least $239 million in total assets or annual net sales, and the other must have at least $23.9 million in total assets or annual net sales. |
The above descriptions are general guidelines only. Determining if a transaction meets the thresholds can be complex and applying the thresholds may vary depending on the particular transaction. Parties engaging in transactions that may meet the thresholds or in series of transactions should consult counsel.
The adjusted filing fees will be based on the new thresholds as follows:
| Filing fee | Size of Transaction |
| $30,000 | Greater than $119.5M to less than $173.3M |
| $105,000 | $173.3 M to less than 536.5M |
| $260,000 | $536.5M to less than $1.073 B |
| $415,000 | $1.073B to less than $2.146B |
| $830,000 | $2.146B to less than $5.365B |
| $2,335,000 | Deals valued at $5.365B or more |
In addition, the maximum civil penalty amount for premerger filing notification violations has increased to $51,744 per day from the date of the violation (e.g., closing a transaction without filing and observing the statutory waiting period).
2. Higher Thresholds For the Prohibition Against Interlocking Directorates
New higher thresholds applicable to the prohibition in Section 8 of the Clayton Act against interlocking directorates became effective on January 12, 2024. Section 8 prohibits, with certain exceptions, one person from serving as a director or officer of two competing corporations if two thresholds are met. Applying the new thresholds, competitor corporations are covered by Section 8 if each one has capital, surplus and undivided profits aggregating to more than $48,559,000, with the exception that the interlock is not prohibited if the competitive sales of either corporation are less than $4,855,900.