This is Part 3 of a four-part series. Start with Part 1 and Part 2.

After Trump v. Slaughter, many scholars, practitioners, and policymakers are wondering whether there remains a need for a Federal Trade Commission. Given the expected alignment between the FTC and the administration, does it make sense to maintain two antitrust enforcement agencies, the FTC and Department of Justice?

The case for keeping the FTC

Proponents of maintaining the FTC argue that even if it is no longer independent in the traditional sense, the FTC still possesses authorities and characteristics the DOJ does not. For starters, the FTC Act empowers the agency to “prevent unfair methods of competition and unfair or deceptive acts or practices,” as opposed to the Antitrust Division, which polices just the antitrust laws. Of course, whether “unfair methods of competition” prohibits activities that are beyond the reach of the antitrust laws is a matter of some debate.

Second, the FTC Act provides the agency with broad consumer-protection authority, something DOJ lacks. Third, the agency is invested with administrative adjudication powers and rulemaking authority, which are also beyond the powers of DOJ. Finally, given the industries it has investigated over the years, the FTC possesses extensive expertise in consumer protection, privacy, and technology markets. Thus, the justification for maintaining the FTC as a separate and distinct agency shifts from “the FTC is valuable because it is independent” to “the FTC is valuable because it has specialized statutory authorities and expertise.”

The case for consolidation

The strongest argument for abolition or consolidation is institutional rather than substantive. Critics point out that:

• Both DOJ and FTC are executive-branch antitrust enforcers.
• Both are effectively under presidential control.
• Both review mergers and investigate anticompetitive conduct.
• Dual agency jurisdiction creates inefficiencies and uncertainty.

From that perspective, Congress could consolidate federal antitrust enforcement within the DOJ Antitrust Division while transferring consumer protection responsibilities elsewhere. Indeed, there is pending legislation in Congress to do just that.

The One Agency Act

The One Agency Act, introduced as H.R. 384 in the House and S. 1059 in the Senate, would transfer antitrust enforcement authority from the FTC to the Department of Justice and establish DOJ as the sole federal antitrust enforcer. According to the bills’ findings, Congress seeks to promote “vigorous, effective, and efficient enforcement” of the antitrust laws by ending the longstanding system of concurrent antitrust jurisdiction shared by DOJ and the FTC. The legislation asserts that overlapping authority has resulted in wasted resources, hampered enforcement efforts, and unnecessary uncertainty for businesses and consumers.

The proposal is not new. Versions of the One Agency Act have been introduced repeatedly in recent Congresses. Renewed congressional interest, however, combined with broader debates concerning the future role and structure of independent agencies, has elevated the proposal’s significance. One of the key criticisms of the bill is that the FTC’s structure as an independent bipartisan commission arguably provides greater insulation from political change than DOJ, which remains part of the Executive Branch. The recent Supreme Court decision removes that justification. 

What would the One Agency Act do?

The legislation would transfer to DOJ virtually all FTC antitrust authority relating to the Sherman Act, Clayton Act, merger review, competition investigations, and related litigation. Existing FTC antitrust personnel, files, records, funding, and ongoing enforcement matters would be transferred to DOJ. Importantly, the proposal would not eliminate the FTC. Rather, the FTC would continue to operate as a consumer protection agency responsible for enforcing laws prohibiting unfair or deceptive acts and practices. The agency’s competition mission, however, would effectively be removed. The legislation would also transfer responsibility for ongoing FTC antitrust investigations, litigation, and administrative proceedings to DOJ, creating a centralized federal enforcement structure.

Time will tell how all this shakes out. But it is probably safe to assume that the future FTC, assuming there is one, will look quite different from the past. And in our series finale, we will explore whether the constitutionality of the FTC is further jeopardized by the recent Supreme Court decision.

If you have any questions, please contact Jay at 202-778-3021 or jlevine@porterwright.com

Established in 1914, the Federal Trade Commission (FTC) was charged with policing “unfair methods of competition” and “unfair or deceptive acts or practices.” Designed to represent more than one political perspective, the FTC Act mandated that there be five commissioners, but no more than three may belong to the same political party. Each commissioner is appointed for a term of seven years, and the statute further provides that “[a]ny commissioner may be removed by the president for inefficiency, neglect of duty, or malfeasance in office.”

The constitutionality of this limitation on a president’s ability to remove a commissioner was discussed previously in Part I of this series. After President Trump fired two Democratic commissioners over policy disputes, as opposed to “inefficiency, neglect of duty, or malfeasance in office,” the Supreme Court affirmed President Trump’s ability to expressly overruling a 91-year old precedent.

Undoubtedly, the decision may have a profound impact on several agencies. But focusing on the FTC, the decision is about much more than who sits on the FTC—it fundamentally changes the FTC’s relationship with the White House, and by extension with the business community at large.

Below are five areas where the future FTC may look (and act) quite differently from the agency to which we have become accustomed.

1. The FTC becomes more directly accountable to the president

FTC commissioners serve staggered seven-year terms and, until recently, could be removed only for cause. Historically, presidents were able to influence the commission through the voluntary resignation of the outgoing president’s designated chair, or by waiting for fixed seven-year terms to expire. The practical result was a degree of continuity across administrations and some insulation from political pressure.

After Trump v. Slaughter, commissioners can be removed because of policy disagreements rather than misconduct or neglect of duty. The president therefore has substantially greater leverage over the agency’s leadership and direction. The practical implication is that FTC policy may become more closely aligned with the priorities of the sitting administration.

2. Antitrust enforcement may become more politically responsive

The FTC’s core antitrust authority remains unchanged. The agency still reviews mergers, investigates conduct, and litigates competition cases. What changes, however, is the ability of a new administration to reshape those priorities quickly by replacing commissioners and leadership. Future administrations may be able to pivot more rapidly on questions such as:

• Merger enforcement intensity
• Vertical merger policy
• Labor-market antitrust issues
• Technology platform investigations
• Use of FTC rulemaking authority
• Consumer protection priorities

The FTC could therefore experience larger swings in enforcement philosophy from one administration to the next. This could have a more chilling effect than in the past on certain business practices or transactions towards the end of one administration while the business community waits to see what enforcement agenda the new administration announces.

3. The FTC may look more like DOJ antitrust

Historically, many observers viewed the FTC as somewhat more insulated from electoral politics than the Antitrust Division because of the commission structure and removal protections. One consequence of Slaughter may be that the FTC and DOJ become more similar institutionally:

• Both remain executive-branch antitrust enforcers
• Both become more responsive to presidential priorities
• Both may see more substantial leadership transitions across administrations

That does not mean the agencies will always reach identical outcomes, but the distinction between an “independent” FTC and an executive-branch DOJ is narrower than it was before June 2026. (As for the question that must be asked “Do we still need an FTC?”, stay tuned for Part III)

4. Increased litigation challenging agency structure and actions

The decision is likely to generate further constitutional litigation involving the FTC and other independent agencies.

Parties subject to FTC investigations or enforcement actions may test:

• Whether other structural protections remain valid
• Whether prior precedents relying on Humphrey’s Executor survive
• Whether additional aspects of agency independence are constitutionally vulnerable

The decision does not answer all of those questions, but it provides a powerful new framework for litigants to challenge agency structures.

5. Potential effects on business planning

For clients, the biggest takeaway is not necessarily more or less enforcement—it is greater uncertainty and faster policy change.

Businesses planning transactions, compliance programs, or regulatory strategies may need to place greater weight on:

• Election outcomes
• Presidential transitions
• Changes in FTC leadership
• Shifts in agency enforcement priorities

The FTC’s substantive statutory authority remains intact, but the likelihood of sharp changes in policy direction may increase.

Key takeaway

The most significant consequence of Trump v. Slaughter may not be the removal of any particular commissioner, but the transformation of the FTC from a comparatively insulated independent regulator into an agency more directly accountable to the president. While the Federal Trade Commission retains its statutory antitrust and consumer protection authorities, future administrations will likely possess greater ability to reshape the agency’s leadership, priorities, and enforcement agenda. For businesses, the result may be increased volatility in regulatory policy and a closer connection between antitrust enforcement and presidential priorities.

Part 3 in this series will discuss the reasons for, and against, maintaining the FTC as an enforcement agency. 

If you have any questions, please contact Jay at 202-778-3021 or jlevine@porterwright.com

Executive summary

On June 29, the Supreme Court overruled a 91-year-old precedent that permitted Congress to protect leaders of certain independent agencies from at-will presidential removal. The decision significantly strengthens presidential control over executive agencies and may signal the end of independence for numerous multimember commissions and boards across the federal government. Businesses regulated by agencies such as the FTC, SEC, FCC, FERC, CFTC, NLRB and others should anticipate potentially greater policy swings between administrations and increased political accountability for agency decision-making.

Keep reading for an explanation of how we got here and what it means for the future.

Background

Almost a century ago, in Humphrey’s Executor v. United States, the Supreme Court held that Congress could limit the President’s ability to remove FTC Commissioners except for specified causes such as “inefficiency, neglect of duty, or malfeasance in office.” The decision became the constitutional foundation for the modern “independent agency,” allowing Congress to create multimember commissions whose leaders were insulated from direct presidential control.

The issue returned to the court after President Trump removed FTC Commissioners Rebecca Slaughter and Alvaro Bedoya without asserting any statutory cause for removal. The terminated commissioners challenged their dismissals, relying on the protection recognized in Humphrey’s Executor.

The Supreme Court’s decision

In a 6-3 decision, the court expressly overruled Humphrey’s Executor and held that statutory restrictions preventing the president from removing FTC Commissioners at will are unconstitutional. Chief Justice Roberts, writing for the majority, concluded that Article II vests executive power in the president and that officials exercising executive authority must remain accountable to the president through the removal power.

The court rejected the longstanding distinction that FTC Commissioners perform “quasi-legislative” and “quasi-judicial” functions that justify insulation from presidential control, holding instead that those labels do not change the fact that commissioners exercise executive power and therefore must remain subject to presidential supervision and removal under Article II.  Accordingly, agencies exercising executive authority cannot be placed beyond the president’s supervision through statutory removal restrictions.

Implications for independent agencies

The consequences of the decision are likely to extend far beyond the FTC.

Many federal agencies are led by multimember commissions whose members serve fixed terms and traditionally enjoy protection from at-will removal. These structures were designed to promote expertise, continuity and political independence. Following Trump v. Slaughter, political independence will no longer be a key attribute (or, perhaps, even a desirable one) of these agencies. 

The decision may affect agencies including:

• Federal Trade Commission (FTC)
• Securities and Exchange Commission (SEC)
• Federal Communications Commission (FCC)
• Commodity Futures Trading Commission (CFTC)
• Federal Energy Regulatory Commission (FERC)
• National Labor Relations Board (NLRB)
• Consumer Product Safety Commission (CPSC)

While the precise impact will vary from agency to agency based on statutory design and future litigation, the court’s reasoning strongly favors increased presidential oversight of executive branch regulators. Notably, the court appears to have preserved a distinct constitutional status for the Federal Reserve in a related decision issued the same day, suggesting that certain uniquely structured entities may remain exceptions.

What this means for businesses

The ruling is expected to reshape the regulatory environment in several important respects.

• Increased Policy Volatility. Presidents may now have greater ability to replace agency leadership shortly after taking office, potentially accelerating shifts in enforcement priorities, rulemaking agendas and regulatory interpretations.
• Expanded Executive Influence. Agency actions previously viewed as insulated from political direction may become more closely aligned with presidential priorities. Businesses engaged with federal regulators should expect changes in enforcement intensity and policy emphasis to coincide more directly with changes in administration.
• New Litigation Opportunities. The decision is likely to generate challenges to agency actions, agency structures and existing removal protections across the federal government. Parties subject to agency regulation may seek to leverage the court’s reasoning in ongoing administrative and constitutional litigation.
• Impact on Antitrust Enforcement. For antitrust practitioners, the decision has particular significance because it directly concerns the FTC. Future administrations may have greater flexibility to reshape the FTC’s leadership and priorities, potentially affecting merger review, competition rulemaking and enforcement initiatives.

Looking ahead

The court has fundamentally altered the constitutional framework governing independent agencies and significantly expanded presidential control over the administrative state. Companies operating in highly regulated industries should closely monitor agency leadership changes, enforcement priorities and forthcoming litigation testing the scope of the decision. The practical effects are likely to unfold over several years as courts, agencies and Congress respond to this major shift in administrative law. Enhanced presidential control over agency leadership could materially affect regulatory strategy, enforcement risk assessments, and long-term compliance planning, affecting clients involved in various regulatory matters, including mergers and acquisitions, antitrust investigations, consumer protection matters, securities regulation, energy regulation, and labor relations, to name just a few.

Be on the lookout for our part two post where we will examine how the decision is likely to affect the FTC specifically and whether the FTC’s days are numbered. 

If you have any questions, please contact Jay at 202-778-3021 or jlevine@porterwright.com

California has enacted a sweeping new premerger notification law that will significantly expand the state’s visibility into M&A activity. On Feb. 10, 2026, Governor Gavin Newsom signed the California Uniform Antitrust Premerger Notification Act (SB 25), making California the third state—after Washington and Colorado—to adopt a broad, cross‑industry premerger filing regime. The law becomes effective Jan. 1, 2027. Previously, notifications were required only of healthcare, retail grocery and retail drug transactions.

Key requirements

SB 25 is modeled on the Uniform Law Commission’s draft legislation and ties its applicability to federal Hart‑Scott‑Rodino (HSR) filings. A company must submit its HSR filing to California within one business day if either of the following thresholds is met:

• The company’s principal place of business is in California; or
• The company or its subsidiaries have more than $26.8 million in annual California net sales of the goods or services involved in the transaction.

Further guidance on the filing mechanism and threshold calculations is expected later in 2026.

Fees and penalties

California diverges from other states by imposing:

• Filing fee: up to $1,000
• Civil penalties: up to $25,000 per day for non‑compliance

Despite these requirements, there is no mandatory waiting period before closing.

Implications for companies

SB 25 is expected to have a broader impact than similar laws in other states due to California’s economic scale. Companies with California operations or sales above the $26.8 million threshold should anticipate:

• Earlier and more frequent state‑level scrutiny of transactions
• Automatic access by the California Attorney General (AG) to key HSR information
• Potential multistate review, as the law permits sharing filings with Washington, Colorado and any future states that adopt the premerger law

Enforcement posture

California officials have signaled that the intent is to receive filings concurrently with federal agencies. Nonetheless, SB 25 aligns with a broader trend of increasing state activism in merger review, particularly where state interests or consumers may be affected.

What companies should do now

• Assess California nexus early in deal planning
• Incorporate SB 25 filings into transaction timelines beginning January 2027
• Evaluate potential for increased state AG engagement, especially for deals involving significant California sales
• Monitor forthcoming guidance on filing procedures and thresholds

If you have any questions, please contact Jay at 202-778-3021 or jlevine@porterwright.com

On Jan. 14, 2026, the Federal Trade Commission (FTC) announced the annual changes to the notification thresholds for filings under the Hart-Scott-Rodino Antitrust Improvements Act (HSR) and certain other values under the HSR rules. The new thresholds will become effective on Feb. 17, 2026.

As background, the HSR Act requires that acquisitions of voting securities or assets that exceed certain thresholds be disclosed to U.S. antitrust authorities for review before they can be completed. The size-of-transaction threshold requires that the transaction exceeds a certain value. Under certain circumstances, the parties involved also must exceed size-of-person thresholds. This year’s thresholds, which are adjusted annually based on changes in the gross national product (GNP), will increase from 2025 thresholds, reflecting the economy’s growth from the previous year. The FTC also adjusted the safe harbor thresholds that govern interlocking directorates in competing companies.

HSR revisions

The most important change is that the minimum size-of-transaction threshold will increase from the current $126.4 million to $133.9 million. The size-of-person thresholds will increase as follows:

• For transactions valued between $133.9 million and $535.5 million, one party to the transaction must have $26.8 million in sales or assets and the other party must have $267.8 million in sales or assets, as reported on the last regularly prepared balance sheet or income statement.
• For transactions valued at greater than $535.5 million, no size-of-person threshold must be met to require an HSR filing.

The filing fee and their thresholds have changed, and increased, significantly. Instead of a three-tier fee structure, the FTC now moves to a six-tier structure, as follows:

Acquisitions that do not cross thresholds

The HSR rules include additional notification thresholds that, in certain circumstances, spare parties from having to submit a new filing each time they acquire additional voting securities of the same issuer. Once an HSR notification is filed, the acquiring person generally has one year from the expiration or termination of the waiting period to cross the transaction-size threshold identified in the filing. Furthermore, after the waiting period has expired or been terminated, the acquiring person may acquire voting securities up to the next applicable notification threshold for a period of five years without submitting an additional HSR filing.

Interlocking directorates

Section 8 of the Clayton Act generally prohibits one person from serving as a director or officer of two competing corporations if two thresholds are met. One relates to the companies’ profitability and one relates to the amount of competitive sales between the companies. The statute requires the FTC to revise these thresholds annually, also based on changes to the GNP. Effective immediately, only companies with capital, surplus and undivided profits aggregating more than $54,402,000 are covered by Section 8. A violation can be found only if the competitive sales of each company are $5,440,200 or greater. 

If you have any questions, please contact Jay at 202-778-3021 or jlevine@porterwright.com

State antitrust enforcement is becoming increasingly significant, with a diverse array of laws across 51 jurisdictions, including the District of Columbia. State Attorneys General (AGs) are not merely filling gaps left by federal enforcement but are actively shaping the landscape with robust state-specific laws. This post provides an overview of the current trends and legislative developments in state antitrust enforcement that businesses need to be aware of as they assess their conduct and develop growth strategies.

State enforcement of federal and state laws

State AGs have the authority to bring federal antitrust suits on behalf of their residents or the state itself. They often collaborate with federal authorities and other states in antitrust investigations that affect their state. Indeed, it is not uncommon for several states to join existing federal investigations looking into proposed mergers or into business conduct that affect various states. And these actions are not strictly partisan as they involve AGs from both red and blue states.

National Association of Attorneys General (NAAG)

NAAG plays a crucial role in coordinating these efforts through its Multistate Task Force, which includes representatives from every state. The Task Force operates several committees and working groups focused on various industries and procedural issues. Notable groups include:

• Agriculture Committee
• Education and Training Committee
• Energy Markets Working Group
• Health Care Provider Committee
• Labor and Antitrust Committee
• Pharmaceutical Industry & PBM Working Group
• Bid Rigging and Criminal Enforcement Committee (BRACE)

BRACE is a relatively new and notable committee as it provides a forum for 30 states to detect bid coordination particularly when directed at public contracts and foreclosure auctions. BRACE also coordinates issuance of state-level civil investigative demands and provides criminal prosecutorial training to enforcers. In February 2025, representatives from 14 states attended a BRACE-sponsored training in Chicago to improve state-level criminal prosecution of antitrust violations. BRACE has gained attention for its efforts in detecting bid coordination and providing criminal prosecutorial training.

State-specific antitrust actions

AGs also enforce state laws, often pursuing individual state actions when specific statutes apply or when the harm is localized. States can be a valuable resource for companies that have been victims of antitrust violations, offering more accessible and locally sensitive enforcement compared to federal counterparts.

Legislative developments

More than at any time in the past, states are proposing new competition-related legislation and creating their own review mechanisms that mirror and differ from those at the federal level. For instance, several states are advancing legislation on algorithmic pricing, with bills pending in at least 14 states, including Ohio, Arizona, California and New York. These bills aim to regulate or ban predictive pricing practices. Some, like California’s SB 52, would prohibit algorithmic pricing in particular situations, such as setting rental rates. Other bills, like Ohio’s SB 79, appear to seek an outright ban on predictive pricing. The varying approaches create the probability that companies will face different predictive pricing rules depending on where they conduct business.

Algorithmic pricing is not the only target of state legislative reform efforts. Just this month, Arkansas prohibited vertical integration between pharmacy benefit managers and pharmacies. A few states are pushing single-firm conduct legislation. New York’s SB 335 seeks, yet again to amend the Donnelly Act to address “abuse of dominance,” more akin to European Union competition law than to United States law under the Sherman Act. In California, watchers await the California Law Revision Commission’s (CLRC) proposed draft legislation on single-firm conduct after CLRC directed its staff in January 2025 to propose legislation addressing “standards . . . that guard against the misuse of market power.”

Pre-merger notification requirements

Pre-merger notification laws, or “Baby HSR” bills, are also gaining traction. States like Ohio and Washington already have such requirements for the healthcare industry, and other states, including California and Colorado, have pending legislation. Washington will be the first state to operate under the Uniform Antitrust Premerger Notification Act starting July 27, 2025.

Key takeaways

The landscape of state antitrust enforcement is evolving, with AGs gaining new tools and increasing their activity. Companies must stay informed about state legislative and NAAG initiatives to navigate this complex environment effectively.

• Increased state enforcement: State AGs are becoming more active in antitrust enforcement, often collaborating on multistate actions. When thinking of potential enforcement, businesses now must consider whether the states will be interested, irrespective of federal involvement.
• Diverse legislative landscape: States are enacting and considering various laws, including those targeting algorithmic pricing and vertical integration. Looking at federal law will no longer suffice and businesses must be aware that states may legislate against certain conduct in different ways.
• Pre-merger notification: New pre-merger notification requirements are being implemented. Not only have the rules governing HSRs changed to require much more information, but merging parties may need to consider building in time to provide the appropriate notification under the “Baby HSRs.”

For further information or assistance, please contact our antitrust team.

When the words “Hart Scott” or “HSR” are mentioned, business executives and deal lawyers often react with indifference. While they recognize the necessity of HSR compliance before closing a transaction, it typically garners little attention unless the deal is expected to face intense scrutiny. The goal is usually to check the HSR box and move forward.

This attitude has shifted recently as the government itself has focused attention on HSR. Over the past few months, the federal government has brought a couple of notable enforcement actions for HSR violations, and the HSR form itself has changed significantly, forcing people to pay closer attention to HSR than perhaps ever before.

Background: The Hart-Scott-Rodino Act

The Hart-Scott-Rodino Antitrust Improvements Act was enacted to allow federal antitrust enforcement agencies a chance to review mergers and acquisitions of a certain size before they closed. The HSR Act requires that parties involved in such transactions notify the antitrust authorities via a “Report and Notification Form” and observe a mandatory 30-day waiting period prior to closing. If the agencies have concerns about the transaction, they can extend the waiting period by issuing what is colloquially known as a “Second Request.” But the key to the Act’s effectiveness is the prohibition that the parties not close until the waiting period expires.

Enforcement actions: “Gun jumping” and incomplete filings

The first recent HSR enforcement action concerned unlawful pre-merger coordination, commonly known as “gun jumping.” Essentially, pre-merger coordination violates the Act’s prohibition against closing until the waiting period expires. The government alleged that the buyer began managing the seller’s business prior to expiration of the waiting period, including halting certain production activities, managing the target’s contracts and coordinating pricing. The defendant agreed to pay a $5.6 million civil penalty, the largest settlement for gun-jumping violations to date.

Shortly after bringing this action, DOJ sued a private equity firm for allegedly filing incomplete and inaccurate HSR forms in at least 16 instances. Many of the alleged deficiencies were related to missing documents that “assessed competition,” previously known as “4(c) documents.” The private equity firm countered by suing the government, claiming it imposed “strict liability for alleged non-compliance with a confusing and at times contradictory web of rules and requirements.”

Significant changes to the HSR form

In October 2024, the Federal Trade Commission voted to finalize changes to the HSR form. Those substantial changes went into effect February 10, 2025. Key changes include:

• Separate forms for both the buyer and seller
• Requirement to provide the rationale for the transaction and supporting documents
• Detailed descriptions of overlapping products and services, sales information and the top 10 customers for each
• Descriptions of vertical relationship (one sells to the other), brief descriptions of each product/service and sales information
• Provision of ordinary course strategic analyses for overlapping products/services
• Submission of documents prepared by/for individuals responsible for strategic assessments of the deal, not just documents prepared by/for officers or directors
• Disclosure of officers and directors for assessing interlocking directorates
• Drafts of competition-related documents, even if shared with only one Board member

The FTC estimates that the new requirements will add an average of 68-121 hours to the current filing preparation time.

What does all of this mean?

The bottom line is that businesses must be vigilant from the very start to ensure personnel understand due diligence and integration limitations. Careful attention to document content is crucial, as these may be scrutinized by antitrust agencies. Additionally, it is important to:

• Analyze antitrust concerns early in the process
• Allocate sufficient time for document and information collection and form preparation
• Consider the implications of filing on a Letter of Intent, especially if it lacks key terms, necessitating additional submissions later

If you have any questions, please contact Jay at 202-778-3021 or jlevine@porterwright.com.

On Jan. 10, 2025, the Federal Trade Commission (FTC) announced the annual changes to the notification thresholds for filings under the Hart-Scott-Rodino Antitrust Improvements Act (HSR) and certain other values under the HSR rules. The new thresholds will become effective in late February, 30 days after publication in the Federal Register.

As background, the HSR Act requires that acquisitions of voting securities or assets that exceed certain thresholds be disclosed to U.S. antitrust authorities for review before they can be completed. The “size-of-transaction threshold” requires that the transaction exceeds a certain value. Under certain circumstances, the parties involved also have to exceed “size-of-person thresholds.” This year’s thresholds, which are adjusted annually based on changes in the gross national product (GNP), will increase from 2024 thresholds, reflecting the economy’s growth from the previous year. The FTC also adjusted the safe harbor thresholds that govern interlocking directorates in competing companies.

HSR revisions

The most important change is that the minimum size-of-transaction threshold will increase from the current $119.5 million to $126.4 million. The size-of-person thresholds will increase as follows:

• For transactions valued between $126.4 million and $505.8 million, one party to the transaction must have $25.3 million in sales or assets and the other party must have $252.9 million in sales or assets, as reported on the last regularly prepared balance sheet or income statement.
• For transactions valued at greater than $505.8 million, no size-of-person threshold must be met to require an HSR filing.

The filing fee and their thresholds have changed, and increased, significantly. Instead of a three-tier fee structure, the FTC now moves to a six-tier structure, as follows:

Interlocking directorates

Section 8 of the Clayton Act generally prohibits one person from serving as a director or officer of two competing corporations if two thresholds are met. One relates to the companies’ profitability, and one relates to the amount of competitive sales between the companies. The statute requires the FTC to revise these thresholds annually, also based on changes to the GNP. Effective immediately, only companies with capital, surplus and undivided profits aggregating more than $51,380,000 are covered by Section 8. A violation can be found only if the competitive sales of each company are $5,138,000 or greater. 

Civil penalties

Earlier, the FTC also announced that the maximum civil penalty for violations of many of the provisions of the FTC Act, and for violations of the HSR Act, increased from $51,744 to $53,088.

Company leaders should consider a thorough review of the latest FTC changes to HSR and interlocking directorate thresholds, and discuss revisions with their legal counsel, to ensure they will not be in violation.

For more information, contact Jay Levine at 202.778.3021 or jlevine@porterwright.com.

In Part 3 of their Capper Volstead series, Jay Levine and Don Barnes discuss other statutes that exempt agricultural cooperatives from antitrust liability and delve into the historical and present relationship that USDA and DOJ have with the Capper Volstead Act.

Read a transcript of the episode here.

Find Jay on Twitter and LinkedIn or contact him at jlevine@porterwright.com.

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