On January 22, 2024, the Federal Trade Commission (FTC) announced revised thresholds for merger notifications under the Hart-Scott-Rodino (HSR) Act. Effective 30 days after the official publication date in the Federal Register, the lowest size-of-transaction filing threshold (also known as the "$50 million threshold") will increase from the current $111.4 million to $119.5 million. Parties to transactions that close on or after the effective date are subject to the revised thresholds.
The "$10 million" and "$100 million" size-of-person thresholds will increase to $23.9 million and $239 million, respectively. The size-of-person test applies to transactions valued at less than $200 million (as adjusted, $478 million) and is based on the total assets and annual net sales of the ultimate parent entities (UPEs) of the acquiring and acquired persons. In general, to be reportable, the UPE of one party to the transaction must have annual net sales or total assets of $10 million or more (as adjusted, $23.9 million) and the UPE of the other party must have annual net sales or total assets of $100 million or more (as adjusted, $239 million). There are, however, several nuances and exceptions to the size-of-person test that must be examined separately for each transaction.
The increased thresholds arise from amendments to the HSR Act in 2000 that require the FTC to adjust the thresholds annually in response to the change in the gross national product (GNP). This year, the thresholds went up to reflect the increase in 2023 GNP. All the notification and exemption dollar thresholds in the HSR statute, regulations and reporting instructions that are subject to annual adjustments will also be adjusted upward. The new HSR dollar thresholds will be as follows:
| Original Thresholds | 2023 Thresholds | 2024 Thresholds |
|
$10 million |
$22.3 million | $23.9 million |
| $50 million | $111.4 million | $119.5 million |
| $100 million | $222.7 million | $239 million |
| $110 million | $245 million | $262.9 million |
| $200 million | $445.5 million | $478 million |
| $500 million | $1.1137 billion | $1.195 billion |
| $1 billion | $2.2274 billion | $2.39 billion |
Filing fees and tier transaction values will also be adjusted based on amendments to the HSR Act in 2023 that require the FTC to adjust the fees annually in response to the change in the U.S. Consumer Price Index. The adjusted filing fee tiers, which are also expected to go into effect 30 days after the official publication date in the Federal Register, are as follows:
| Transaction Values | Filing Fee |
|
Greater than $119.5 million but less than $173.3 million |
$30,000 |
|
At least $173.3 million but less than $536.5 million |
$105,000 |
|
At least $536.5 million but less than $1.073 billion |
$260,000 |
|
At least $1.073 billion but less than $2.146 billion |
$415,000 |
|
At least $2.146 billion but less than $5.365 billion |
$830,000 |
|
$5.365 billion or more |
$2,335,000 |
Finally, earlier this year, the FTC increased the maximum civil penalty for HSR Act violations from $50,120 to $51,744 per day. This increased penalty is effective for all penalties assessed as of January 10, 2024, even if the underlying violation preceded that date.
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