Antitrust Client Advisory - New HSR Thresholds and Penalties

The Federal Trade Commission has announced its annual adjustments to the dollar-value thresholds that trigger filing requirements under the Hart-Scott-Rodino Antitrust Improvements Act.  Adjustments are made based on changes in the gross national product.  While the thresholds rose by 3% from last year's levels, based on GNP changes for the fiscal year ending September 30, 2008, contraction of the US economy in the current economic downturn could cause them to decrease next year.

The FTC also announced the first increase in the penalty for violations of the HSR Act and rules in more than a decade.  The penalty rises from $11,000 to $16,000 for each violation—which applies for each day a required HSR filing was not made or Item 4(c) documents were not produced as part of a filing.

In addition, the FTC raised thresholds for company size and competitive sales that trigger prohibitions on interlocking directors and officers between competitors under Section 8 of the Clayton Act.

The new HSR Act thresholds, set forth below alongside the original statutory amounts they adjust, go into effect February 12, 2009, as do the Clayton Act changes.  The new penalty takes effect on February 9, 2009. 

While threshold adjustments are made annually, the penalty increase is the first since 1996, when it rose from $10,000 to $11,000.  The change, mandated under the Federal Civil Penalties Inflation Adjustment Act, reflects Consumer Price Index changes from 1996 through 2007.

The FTC and the Department of Justice aggressively pursue HSR violations. Two related investment partnerships were recently fined $800,000 for failing to make required HSR Act filings.

For More Information, Please Contact:

Kenneth Ewing, kewing@steptoe.com, (202) 429-6264
Robert Fleishman, rfleishman@steptoe.com, (202) 429-6240
Tim Walsh, twalsh@steptoe.com, (202) 429-6277