On January 23, 2023, the Federal Trade Commission announced its annual adjustment to the Hart-Scott-Rodino Act (“HSR Act”) merger notifications thresholds. The Federal Trade Commission also published new merger filing fees pursuant to the recently enacted Merger Filing Fee Modernization Act of 2022 (“MFFMA”), contained within the 2023 Consolidated Appropriations Act. The filing fee is reduced for transactions valued under $161.5 million while the filing fee is dramatically increased for transactions valued over $1 billion. The MFFMA also requires notifying parties to now disclose information regarding any subsidies (including grants, loans, guarantees, tax concessions, government ownership or control, or preferential government procurement policies) received from “foreign entities of concern” in their HSR filings.

The Federal Trade Commission is required by the HSR Act to make annual adjustments to the thresholds based on changes in GDP for each fiscal year. 

These changes become effective 30 days after publication in the Federal Register. Such publication is expected to occur imminently.

Notification Thresholds

The determination of whether a transaction meets jurisdictional thresholds for premerger notification is dependent on several circumstances in each case, including the measure of size of persons and the size of transactions. Upon the effective date, there are no notification requirements for transactions valued at less than $111.4 million, while transactions in excess of $445.5 M are reportable regardless of the size of the parties unless otherwise exempted. Transactions valued between $111.4 M and $445.5 M are reportable based on the size of person test, which requires that one side of the transaction have sales or assets of at least $22.3M and the other side to have sales or assets of at least $222.7 M.

Filing Fees

The Federal Trade Commission also published changes to filing fee thresholds in accordance with the 2023 Consolidated Appropriations Act. The 2023 Consolidated Appropriations Act required the Commission to revise the filing fee thresholds and will require the filing fees to be increased by percentage increases to the consumer price index. Parties to transactions valued at less than $161.5 will pay the lowest fee of $30,000 while parties to transactions in excess of $5 billion will pay filing fees of $2.25 million. Prior to this revision, parties had to pay $45,000 for reportable transactions valued less than $202 million, $125,000 for transactions valued at or greater than $202 million but less than $1,009.8 million, and $280,000 for transactions valued at or greater than $1,009.8 million.

Penalties for Noncompliance

Failure to comply with the HSR Act can result in significant monetary penalties—up to $46,517 per day—as well as delays in completing a transaction. For questions about complying with the HSR Act, please contact Ausra Deluard or Brian O’Bleness.