The Federal Trade Commission (FTC) announced on January 10, 2025 that it will raise the Hart-Scott-Rodino Act (HSR Act) jurisdictional and filing fee thresholds. The increased thresholds will go into effect 30 days after their forthcoming publication in the Federal Register.
The new “size of transaction” test will capture transactions valued at greater than $126.4 million, up from $119.5 million in 2024. For HSR purposes, acquisitions valued at or under the new threshold will not require a pre-closing filing and approval.
NEW JURISDICTIONAL THRESHOLDS
Generally, the HSR Act requires both “Acquiring Persons” and “Acquired Persons” (as defined in the HSR Act) to file notifications if the following post-adjustment jurisdictional thresholds are met:
- One person has net sales or total assets of at least $25.3 million;
- The other person has net sales or total assets of at least $252.9 million; and
- As a result of the transaction, the Acquiring Person will hold stock and/or assets of the Acquired Person valued at more than $126.4 million.
or
- As a result of the transaction, the Acquiring Person will hold stock and/or assets of the Acquired Person valued at more than $505.8 million, regardless of the sales or assets of the Acquiring and Acquired Persons.
Conditions 1 and 2 are generally referred to as the “size of person” test, while conditions 3 and 4 are commonly described as the “size of transaction” test. The HSR Act rules relating to acquisitions of partnership interests and membership interests in a limited liability company (LLC) remain the same. Only acquisitions of economic control in an LLC or partnership may be reportable. “Control” is defined as having a right to 50% or more of the profits of a partnership or LLC or 50% or more of the assets upon the dissolution of such entity.
The following table illustrates the year-over-year changes.
NEW FILING FEE TIER THRESHOLDS
The figures below represent the new base filing fee tier thresholds. These fees are adjusted based on any increase in the Consumer Price Index as determined by the US Department of Labor. All filings made on or after 30 days post publication in the Federal Register will be subject to these new fees.
These revised thresholds, effective 30 days post publication in the Federal Register,[1] will accompany the new final HSR rules, currently set to become effective February 10, 2025, and will apply to all transactions that close on or after each effective date, respectively.
Law clerk Christina Cacioppo contributed to this LawFlash.
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