The Hart-Scott-Rodino Antitrust Improvement Act of 1976 (the “HSR Act”) provides for review by the Federal Trade Commission (FTC) and the Department of Justice (DOJ) of all acquisitions that meet certain objective criteria. The Act imposes a premerger notification program so the regulatory agencies can review the anticompetitive effect before the transaction can be completed. Even if the filing requirements are met, the statute provides certain exemptions. These exemptions include acquisitions by a acquirer that already owns 50 percent or more of the voting securities, transaction traditional exempted from antitrust laws, certain acquisitions solely for investment or effected by certain institutional investors, and certain regulated acquisitions. Further, small acquisitions involving relatively small parties that are less likely to raise antitrust concerns are excluded from the Act’s coverage.
If either agency determines that there is an anticompetitive effect, the FTC can refuse to clear the transaction and seek a second request for information. This extends the normal 30-day waiting period but allows the reviewing agencies to further investigate and if necessary seek injunction in federal district court to prohibit consummation of the transaction.