On January 10, 2025, the Federal Trade Commission (“FTC”) published new, higher notification thresholds under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 (the “HSR Act”). The HSR Act requires the FTC to adjust the thresholds annually to reflect changes in U.S. gross national product. The new reporting thresholds are expected to go into effect in mid-February, thirty days after their publication in the Federal Register. This announcement comes in advance of the new HSR rules, which are currently set to take effect on February 10, 2025. Those rules include several new requirements for additional information, which will impose additional time, burden, and cost on parties preparing and submitting HSR filings.
Under the new thresholds, the minimum “size of transaction” threshold will become $126.4 million, up from $119.5 million, representing an increase of 5.77% over 2024. Transactions resulting in aggregate holdings of voting securities, assets, or non-corporate interests exceeding this threshold will be reportable to the U.S. antitrust authorities, unless otherwise exempt. The new thresholds are as follows:
Filing fees (which were restructured in December 2022, as discussed in this client alert) are also updated annually (both the fee amount and the fee filing threshold) in accordance with the consumer price index as determined by the Department of Labor. The filing fee structure for 2025 is as follows:
HSR Notification Thresholds Overview
The HSR Act requires premerger notification of transactions that satisfy the “size of transaction” and “size of person” tests and are not otherwise exempt. The thresholds are adjusted annually to reflect changes in U.S. gross national product. The new thresholds will be applicable through the next annual adjustment, expected in Q1 2026.
Size of Transaction Test
Under the new thresholds, the size of transaction test will be met if, as a result of a transaction, the acquiring person at the ultimate parent entity (“UPE”) level will hold aggregate voting securities, assets, or non-corporate interests of the acquired person valued at more than $126.4 million. For transactions valued at more than $126.4 million but $505.8 million or less, the parties must also meet the size of person test. Transactions valued at more than $505.8 million will be reportable regardless of the size of the parties unless an exemption applies.
Size of Person Test
Under the new thresholds, where it applies, the size of person test will generally be satisfied where one party to the transaction at the UPE level has total assets or annual net sales of $252.9 million or more and the UPE of the other party has total assets or annual net sales of $25.3 million or more.
Revised Thresholds for Interlocking Directorates
The FTC also announced revised thresholds relating to Section 8 of the Clayton Act. Section 8 prohibits interlocking directorates in which one person serves simultaneously as an officer or director of two or more competing corporations, subject to certain exceptions. Under the revised thresholds, Section 8 may apply when each of the competing corporations has capital, surplus, and undivided profits aggregating more than $51.380 million and each corporation’s competitive sales are at least $5.138 million.
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