FTC Releases 2024 Thresholds for Hart-Scott-Rodino Act Filings and Raises HSR Filing Fees

The U.S. Federal Trade Commission (FTC) approved new premerger notification thresholds and revised HSR filing fees under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 (HSR). The FTC revises the HSR thresholds and filing fees annually based on changes in the gross national product and in the consumer price index. The new thresholds and filing fees become effective 30 days after publication in the Federal Register and are expected to take effect on March 6, 2024.

Size-of-Transaction Threshold

The minimum “size-of-transaction” threshold for acquisitions of voting securities, non-corporate interests, or assets will increase from $111.4 million to $119.5 million.

Size-of-Person Thresholds

Acquisitions with a total aggregate value of greater than $119.5 million (up from $111.4 million) but less than $478 million (up from $445.5 million) are potentially reportable only if the “size-of-person” threshold is met. The “size-of-person” threshold is met if one party to the transaction has annual net sales or total assets of at least $239 million (up from $222.7 million) and the other party has annual net sales or total assets of at least $23.9 million (up from $22.3 million).

Reportability Thresholds for Acquisitions of Voting Securities

Acquisitions of less than 50% of an issuer’s voting shares may trigger an HSR filing where the acquirer’s total holdings of the issuer crosses one of several reportability thresholds, assuming the Size-of-Person threshold is met (when applicable) and no exemption applies.¹  These thresholds have been increased as follows:

• aggregate holdings of an issuer’s voting securities valued at greater than $119.5 million but less than $239 million
• aggregate holdings of an issuer’s voting securities valued at $239 million or greater but less than $1.195 billion
• aggregate holdings of an issuer’s voting securities valued at $1.195 billion or greater
• 25% of the outstanding voting securities of an issuer if the holdings are valued at greater than $2.39 billion
• 50% of the outstanding voting securities of an issuer if the holdings are valued at greater than $119.5 million
  
  

New Filing Fee Amounts

The FTC also announced new filing fee amounts:

FTC Revises Clayton Act Section 8 Thresholds for Interlocking Directorates

The FTC also revised the thresholds for interlocking directorates under Section 8 of the Clayton Act. Section 8 prohibits, with certain exceptions, a person from serving as a director or officer of two competing corporations if two thresholds are met. Section 8 applies if each competitor corporation has capital, surplus, and undivided profits of more than $10 million, though not if the competitive sales of either corporation are less than $1 million. These amounts are subject to annual revision; following last year’s revision, they were $45,257,000 and $4,525,700, respectively. The new thresholds, effective as of January 22, 2024, are $48,559,000 and $4,855,900, respectively. The Federal Register notice on the revised Section 8 thresholds can be found here.

FTC Revises Maximum Civil Penalty Amount for HSR Violations

Finally, the FTC has announced the annual increase to the maximum civil penalty amount for HSR violations, raising the amount from $50,120 per day to $51,744 per day. The new maximum applies to civil penalties assessed on or after January 10, 2024, even where the underlying violation preceded that date. The Federal Register notice on the revised civil penalty amount can be found here.

¹ Acquisitions of less than 50% of an unincorporated entity do not require an HSR filing if the acquirer will hold less than 50% of the entity’s (i) profits and (ii) assets upon dissolution.