Parties to a transaction subject to the reporting requirements of the Hart-Scott-Rodino Antitrust Improvements Act of 1976 (HSR) must adhere to a statutory waiting period (30 days for most transactions) after filing their Notification and Report Forms before closing on the deal.
The Federal Trade Commission (FTC) and the Department of Justice are authorized to terminate this waiting period early, upon the request of the parties or on their own, after determining that no additional information is necessary and that the transaction does not pose significant competitive concerns. A request for early termination can be made directly on the HSR Notification and Report Form, and decisions to grant early termination are made public on the FTC’s website.
In February 2021, the early termination process was “temporarily” suspended due to a backlog of reported transactions and the impact of COVID-19. Prior to the suspension, early termination was granted in approximately half of all reported transactions.
However, according to recent remarks made by Commissioner Noah J. Phillips during an antitrust symposium at George Mason University’s Antonin Scalia Law School, the FTC has no plans to re-implement the early termination process anytime soon. Commissioner Phillips attributed the failure to revisit the early termination process to the prevailing view in Washington that mergers, rather than being an “important part of commerce,” are nothing more than a driver of harmful corporate concentration. Commissioner Phillips also railed against the FTC’s use of warning letters, which place parties on notice that, despite expiration of the waiting period related to their particular transaction, the FTC may later choose to challenge the transaction.
Commissioner Phillips stated that as far as he knows, there are no ongoing investigations of transactions in which these warning letters have been issued.
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