Annual Update of Thresholds for Premerger Notification Filings and Interlocking Directorates
As required by law, the Federal Trade Commission has revised the monetary thresholds that determine whether companies are required to notify federal antitrust authorities about a transaction under Section 7A of the Clayton Act. The FTC has also revised the monetary thresholds that trigger prohibitions on certain interlocking directorates under Section 8 of the Clayton Act.
The Hart-Scott-Rodino Antitrust Improvements Act, Section 7A of the Clayton Act, requires companies proposing a merger or acquisition to notify federal authorities if the size of the parties involved and the value of a transaction exceed certain monetary thresholds, absent an applicable exemption. The FTC revises the thresholds set forth in the HSR Act annually, based on the change in the gross national product. As a result of this revision, the size-of-transaction threshold for reporting proposed mergers and acquisitions subject to antitrust enforcement will increase from $76.3 million for 2015 to $78.2 million for 2016.
The Clayton Act also requires the FTC to revise the monetary thresholds that trigger a prohibition preventing companies from having interlocking memberships on their corporate boards of directors under Section 8. These thresholds are also adjusted annually based on the change in the gross national product. The 2016 thresholds are $31,841,000 for Section 8(a)(l) and $3,184,100 for Section 8(a)(2)(A).
A full listing of current thresholds can be found on the FTC’s website, which will be updated once the revised thresholds are published in the Federal Register.
The votes to approve Federal Register notices announcing the threshold revisions were both 4-0. The revised thresholds under Section 7A of the Clayton Act will apply to all transactions that close on or after the effective date of the notice, which is 30 days after its publication in the Federal Register. The thresholds for Section 8 of the Clayton Act become effective upon publication in the Federal Register. (FTC File No. P859910; the staff contact for Section 7A is Nora Whitehead, Bureau of Competition, 202-326-3262; the staff contact for Section 8 is James Mongoven, Bureau of Competition, 202-326-2879)
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