New Premerger Notification Regime to Fundamentally Change M&A Strategy

By: Jon B. Dubrow, Raymond A. Jacobsen, Jr., Lisa P. Rumin, Ryan C. Tisch, Noah Feldman Greene, Graham J. Hyman & Marisa E. Poncia

On October 10, 2024, the Federal Trade Commission (FTC) unanimously voted to approve new rules that will significantly reshape the U.S. premerger notification filing process. These rules represent the most substantial revision to the Hart-Scott-Rodino (HSR) filing requirements since the HSR Act was enacted nearly 50 years ago. Although the final rules omit some of the more contentious proposals from the 2023 draft, such as requiring draft documents and labor data, they still impose considerably greater obligations on parties than the current filing system. These changes will have far-reaching effects on all entities required to notify the FTC of mergers under the HSR Act.

The new rules will make the filing process more complex and time-consuming. In addition to requiring a significantly larger amount of data, documentation, and information as part of the initial submission, merging parties must now provide written analyses explaining the rationale behind the transaction, any competitive overlaps, and potential vertical relationships. This means that parties will need to address potential antitrust concerns much earlier, even for deals that may only raise minor competition issues. Additionally, the FTC and the Department of Justice (the Agencies) will now receive a broader range of transactional documents with the initial filing, including ordinary course planning materials that previously were only submitted later in the process, such as during a Second Request or through voluntary disclosure. This shift front-loads much of the work that was once deferred to later stages.

While the impact of these changes will be most pronounced for transactions involving horizontal, vertical, or competitive concerns, the new rules will affect all deals subject to HSR reporting. Companies active in mergers and acquisitions (M&A) should begin preparing now by updating their premerger filing processes and ensuring that they have readily available information to ease the burden when the new rules come into effect…

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