The Federal Trade Commission and the Justice Department’s Antitrust Division released the agencies’ 40th Annual Hart-Scott-Rodino Report. The Report provides HSR Premerger Notification data for fiscal year 2017. The HSR Premerger Notification Program is the means by which companies report mergers and acquisitions to the government, enabling the agencies to examine transactions and take action with respect to those that may substantially lessen competition in violation of federal law.
As the Report explains, companies notified the agencies of 2,052 HSR reportable transactions during fiscal year 2017; a 12.0 percent increase over the 1,832 transactions in fiscal year 2016. The Report also summarizes the agencies’ merger enforcement activities for fiscal year 2017, highlighting 39 merger challenges undertaken by both agencies in efforts to protect competition in sectors of the economy including consumer goods and services, pharmaceuticals, healthcare, high tech and industrial goods and energy.
The Federal Trade Commission alone brought 21 merger enforcement actions, 14 of which resulted in consent orders, six of which resulted in the transaction being abandoned or restructured, and one in which the Commission initiated administrative and federal court litigation. Of note, working in tandem with attorney generals from six states, the Commission filed a complaint against DraftKings and FanDuel and sought preliminary relief in federal court, alleging that the combined firm would control more than 90 percent of the U.S. market for paid daily fantasy sports contests. Shortly after the Commission filed its complaint, the parties abandoned the merger.
The Report contains statistical tables profiling HSR filings and investigations conducted by both agencies during fiscal year 2017. Appendices provide a summary of transactions for the past 10 years, as well as the number of transactions reported and the number of filings received by month during this time. The percentage of transactions in which the agencies issued a Second Request decreased from 3.0 percent in fiscal year 2016 to 2.6 percent in fiscal year 2017.
Enacted by Congress in 1976, the Hart Scott Rodino Act gives the federal government the opportunity to investigate and challenge mergers that are likely to harm consumers before injury occurs. The Commission vote to issue the report was 2-0. (FTC File No. P110014; the staff contact is Sam Sheinberg, Bureau of Competition, 202-326-2308.)
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