Antitrust Coordination and Hart-Scott-Rodino (HSR)

The banker coordinates with the seller's antitrust counsel to identify HSR exposure and cross-border regulatory issues before the seller commits to a bid. Antitrust risk allocation is a deal-breaker; bidders that face structural divestiture demands can be deprioritized early.

The Hart-Scott-Rodino Antitrust Improvements Act (HSR Act)

The HSR Act requires both parties to a qualifying transaction to file a Notification and Report Form with the FTC and the DOJ Antitrust Division and observe a mandatory waiting period before closing.

Filing parties:

• Acquirer (or buyer)
• Acquired person (or seller / target)

Filed with:

• Federal Trade Commission (FTC)
• Department of Justice (DOJ) Antitrust Division

Statutory authority:

• Hart-Scott-Rodino Antitrust Improvements Act of 1976

HSR Filing Thresholds (2026)

The thresholds are revised every year based on changes in gross national product (GNP). The 2026 thresholds, effective February 17, 2026, for transactions closing on or after that date:

How to apply:

• If size-of-transaction is below $133.9 million: NO filing required
• If size-of-transaction is between $133.9 million and $535.5 million: filing required only if both size-of-person tests are met
• If size-of-transaction is at or above $535.5 million: filing required regardless of party size

Exam Tip: Gotchas

• HSR thresholds are indexed ANNUALLY. The 2026 size-of-transaction threshold is $133.9 million, up from $126.4M in 2025. Earlier study materials may quote older $50M/$100M figures from before indexing; those are obsolete.
• The size-of-person test is WAIVED at $535.5 million and above. A $600 million deal between two small parties is still reportable. The size-of-person test only matters in the middle tier.

HSR Waiting Periods

The waiting period is the regulator's window to review the deal before closing.

A Second Request (formally a "Request for Additional Information and Documentary Materials") is the FTC's or DOJ's substantive investigation trigger. It is rare in absolute terms but expected for any deal with material antitrust overlap. Compliance with a Second Request can take months and millions of dollars in document review.

Exam Tip: Gotchas

• HSR waiting periods are calendar days, NOT business days. 30 for a standard merger, 15 for a cash tender offer.
• The cash-tender shortcut is one of the structural advantages of going directly to shareholders. A buyer that wants to close fast and avoid the longer waiting period may prefer a cash tender even when a negotiated merger would otherwise be cleaner.

HSR Filing Fees (2026 Tiers)

Filing fees are tiered by transaction size. The 2026 top tier is $2.46 million for transactions at or above $5.616 billion.

Failure to file when required:

• Civil penalties up to approximately $53,000 per day of non-compliance

Exam Tip: Gotchas

• The filing fee is paid by the ACQUIRER, not the target. Negotiated engagement letters sometimes shift the fee, but the statutory obligation is on the acquirer.
• Per-day penalties compound fast. A six-month delay in filing exposes the parties to penalties in the millions.

2025 HSR Form Rule Status

The FTC published sweeping new HSR form requirements effective February 10, 2025, the largest changes in 48 years, expanding required information on:

• Overlapping products
• Supply relationships
• Management organization

Current status (May 2026):

• On March 19, 2026, the Court of Appeals denied the FTC's motion for a stay pending appeal, leaving the district court's vacatur of the new form in place
• The FTC is currently accepting filings on the pre-February-2025 form
• HSR is in flux but the underlying statute and threshold mechanics are unchanged

Series 79 candidates should know that the form is the subject of pending litigation; the substantive HSR Act and the threshold mechanics described above are not affected.

Cross-Border Coordination: CFIUS

The Committee on Foreign Investment in the United States (CFIUS) reviews transactions where a foreign person could acquire control of, or certain non-controlling rights in, a US business.

Statutory authority:

• The Foreign Investment Risk Review Modernization Act of 2018 (FIRRMA) broadened CFIUS jurisdiction beyond control transactions to certain non-controlling investments in US businesses involving critical technology, critical infrastructure, or sensitive personal data of US citizens (TID businesses)

Filing types:

• Short-form declaration: 30-day review window
• Long-form notice: 10 business days to accept + 45-day initial review + possible 45-day investigation

When filing is required:

• Mandatory filings are required for certain TID-business transactions involving a foreign government or substantial foreign-government control
• Most CFIUS filings remain voluntary, but voluntary filing buys safe-harbor protection from future review
• Penalties for failure to file a mandatory notice: up to $5 million or the deal value, whichever is greater

Non-US antitrust review:

• Non-US antitrust review may also be required (EU Merger Regulation, UK Competition and Markets Authority (CMA), Chinese SAMR)
• Each jurisdiction has its own thresholds and waiting periods; large cross-border deals often file in 10-20 jurisdictions

Exam Tip: Gotchas

• HSR is antitrust review; CFIUS is national-security review. They run on separate tracks with separate filings and separate timelines. A single deal can trigger both, or just one, depending on facts.
• A foreign buyer of a US business with critical technology can face a MANDATORY CFIUS filing, not the typical voluntary filing. Failing to file when mandatory triggers the heavy penalty regime.
• Cross-border deals stack reviews. A US-EU deal of meaningful size files HSR with the FTC, files with the European Commission under the EU Merger Regulation, files with the CMA in the UK, and potentially files with the antitrust agencies in dozens of other jurisdictions.