Sean Heather
Senior Vice President, International Regulatory Affairs & Antitrust, U.S. Chamber of Commerce
Published
October 22, 2024
What is the HSR Act?
Enacted in 1976, the HSR Act has established the rules, reporting requirements, and regulations for M&A and the review process. Under current rules, companies file a notification form with a comprehensive amount of information for the FTC and DOJ to check for competition concerns if they may exist. If the agencies flag an issue, companies need to go through a second, more extensive review. Annually, about 2% of transactions went through this second process. This low number reflects the fact that most transactions pose no anticompetitive concerns.
What changes have been instituted?
Despite that small percentage, the new HSR process would subject all companies to extensive transaction reporting requirements. As noted in our letter to lawmakers last November, “The proposed new regime would flip the process on its head and require every company to submit substantial amounts of information in their initial notification, subjecting 100% of transactions to a level of burdensome reporting only potentially necessary for less than 2% of deals.”
Why do these changes matter?
These new review requirements will prove costly and time-intensive -- though the agencies failed to estimate costs, as required by law. The requirements appear designed to chill deal activity and will have an outsized effect on small- to medium-sized companies. Finally, it will also overwhelm government agencies who would conduct such a review of the 1,500 to 3,000 mergers they receive in a given year
How does this hurt American consumers?
M&A is a critical tool for promoting innovation, allowing small businesses to grow, and providing capital investment — all of which helps American consumers. The new HSR rules jeopardize these benefits and is yet the latest example of the FTC forgetting the consumer. Lawmakers should lean into America’s competitive advantage — smart, sensible, and justifiable regulation — and hold the FTC and DOJ accountable.
About the authors
Sean Heather
Sean Heather is Senior Vice President for International Regulatory Affairs and Antitrust.
