FTC and DOJ Release HSR Annual Report for Fiscal Year 2015 | Practical Law

FTC and DOJ Release HSR Annual Report for Fiscal Year 2015 | Practical Law

The Federal Trade Commission (FTC) and the Antitrust Division of the Department of Justice (DOJ) recently released their Hart-Scott-Rodino Annual Report to Congress required under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 (HSR Act) summarizing the agencies' merger enforcement efforts and providing information regarding the premerger notification program for fiscal year 2015.

FTC and DOJ Release HSR Annual Report for Fiscal Year 2015

Practical Law Legal Update w-002-9131 (Approx. 4 pages)

FTC and DOJ Release HSR Annual Report for Fiscal Year 2015

by Practical Law Antitrust
Published on 01 Aug 2016 • USA (National/Federal)
The Federal Trade Commission (FTC) and the Antitrust Division of the Department of Justice (DOJ) recently released their Hart-Scott-Rodino Annual Report to Congress required under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 (HSR Act) summarizing the agencies' merger enforcement efforts and providing information regarding the premerger notification program for fiscal year 2015.
The Federal Trade Commission (FTC) and the Antitrust Division of the Department of Justice (DOJ) recently submitted to Congress their Hart-Scott-Rodino Annual Report (HSR Report) for FY 2015 (October 1, 2014 through September 30, 2015) required under the HSR Act. The HSR Report summarizes the agencies' efforts to identify and investigate transactions that potentially raise antitrust concerns. It provides statistics about both the HSR premerger notification program and the agencies' merger enforcement activity.
The HSR Report contains statistics regarding filings submitted under the HSR program and the agencies' requests for clearance to investigate transactions, the issuance of Second Requests and enforcement activity. Unless otherwise specified, the statistics set out in this Update include only transactions that were correctly reported and do not include transactions for which filings were rejected for any reason by the FTC's Premerger Notification Office.

HSR Filings

The HSR Report states that in FY 2015:
  • 3,585 total HSR filings were received (whether correctly made or not), about an 8% increase from FY 2014.
  • 1,801 transactions were reported under the HSR Act, an 8.3% increase from FY 2014.
  • The cumulative dollar value of reported transactions was $1.9 trillion, an 26% increase from FY 2014.
  • Early termination of the HSR waiting period was:
    • requested in 77.9% of reported transactions, slightly down from 78.7% in FY 2014; and
    • granted 79.5% of the time it was requested in those transactions, down slightly from 80.1% in FY 2014.

Agency Clearance

The HSR Report states that clearance to investigate was granted from one agency to another in 14.7% of reported transactions in FY 2015 (258 transactions), or roughly one in six transactions. In FY 2014, clearance was granted in 16.9% of reported transactions (281 transactions).
In FY 2015, clearance was granted:
  • Most frequently in transactions valued at greater than $1 billion dollars, or 33% of the time, as was also the case in FY 2014.
  • To the FTC in 179 transactions (69% of transactions that obtained clearance).
  • To the DOJ in 79 transactions (31% of transactions that obtained clearance).
For more information on how the agencies obtain clearance see Practice Note, Hart-Scott-Rodino Act: Overview: Allocation of Cases Between the FTC and DOJ.

Second Request Issuance

In FY 2015, 47 investigated transactions resulted in a Second Request (2.6% of reported transactions). In FY 2014, the percentage of Second Requests issued (3.2% of reported transactions) and the number of investigations (51) were higher. The division of Second Requests between the agencies in FY 2015 was as follows:
  • The DOJ issued 27 Second Requests (57% of those issued).
  • The FTC issued 20 Second Requests (43% of those issued).

Merger Enforcement

The HSR Report also contains information regarding the agencies' merger enforcement statistics. Together, the agencies brought enforcement actions in 2.3% of reported transactions in FY 2015, totaling 42 transactions. This number includes enforcement actions brought in transactions not reported under the HSR Act.

FTC Merger Enforcement

The FTC challenged 22 transactions that it concluded might have substantially lessened competition, resulting in:
  • 17 consent decrees.
  • Three administrative complaints.
  • Two transactions that were abandoned or restructured.
For summaries of these enforcement actions, see What's Market, Federal Merger Enforcement Actions.
FTC challenges were brought in a variety of industries, including:
  • Pharmaceuticals.
  • Healthcare.
  • Consumer goods.
  • Food and beverage.
  • Cement.
  • Gasoline blendstock.

DOJ Merger Enforcement

The DOJ challenged 20 transactions that led to:
  • Ten merger challenges brought in federal district court, simultaneously filing the complaint and settlement in eight of the ten and seeing two of the ten abandoned after the complaint was filed.
  • Ten abandoned or restructured transactions.
For summaries of these enforcement actions, see What's Market, Federal Merger Enforcement Actions.
The DOJ challenged transactions in several industries, including:
  • Hop-on, hop-off bus tours.
  • Waste collection services.
  • Cinema and broadcast television spot advertising.