FTC Announces 2023 HSR Merger Filing Thresholds and Fees

On January 26, 2023, the Federal Trade Commission (FTC) published revised size-of-transaction filing thresholds and new filing fees under the Hart-Scott-Rodino Antitrust Improvements Act ("HSR Act"), which will take effect on February 27, 2023.

The HSR Act requires the FTC to annually revise filing thresholds based on the change in gross domestic product while the filing fees are set by statute. Companies of a certain size involved in a transaction exceeding reportability thresholds must file a premerger notification and undergo a review process with the FTC and Department of Justice (DOJ) and observe a 30-day waiting period unless an exemption applies.

2023 Filing Threshold Increases

In 2023, the FTC will increase the size-of-transaction threshold from $101 million to $111.4 million. The new threshold will apply to deals closing on or after February 27, 2023. The current $101 million threshold remains in effect for any transaction closing before that date.

The revised $111.4 million size-of-transaction threshold applies to transactions in which the acquiring party will hold voting securities, non-corporate interests, or assets valued at or above $111.4 million (as measured using the HSR Act's rules and regulations). Such transactions may require a premerger notification if the "size of parties" test is also satisfied and no HSR Act exemptions are applicable.

The HSR "size of parties" threshold generally requires that one party to the transaction have annual net sales or total assets of $222.7 million or more (up from $202 million in 2022), and that the other party have annual net sales or total assets of $22.3 million (up from $20.2 million).

For transactions valued at more than $111.4 million but $445.5 million or less, no premerger notification is required if the "ultimate parent entities" of one or both parties to the transaction do not satisfy the "size of parties" threshold. Transactions valued at more than $445.5 million (up from $403.9 million) will be subject to premerger notification requirements regardless of the size of the parties, unless an HSR Act exemption applies.

New Filing Fees

The new filing fees under the HSR Act established by the Merger Filing fee Modernization Act, which was signed into law on December 29, 2022, as part of H.R. 2617, the Fiscal Year 2023 Consolidated Appropriations Act, will also take effect on February 27, 2023. For more information on the new filing fees, see our prior advisory: Senate Amends and Hikes Fees for Premerger Review Process.

Unlike the filing thresholds that determine what transactions are subject to regulatory review and approval, HSR filing fees can only be changed by an act of Congress. Last year's legislation marked the first time in more than 20 years that Congress revised the HSR filing fees. The Congressional Budget Office estimates that the higher filing fees, particularly for transactions valued at $5 billion or more, will raise more than $1.4 billion of additional revenue for FTC and the DOJ Antitrust Division enforcement efforts over the next five years.

The new filing fee schedule under the HSR Act will be as follows: