Antitrust Experts Reject FTC/DOJ Changes to Merger Process

The Chamber conducted a survey of 70 antitrust practitioners asking them questions about the proposed revisions to the HSR merger form and the new draft merger guides.  The survey was conducted from mid-August through early September 2023.   Respondents include a good mix of in-house counsel as well as antitrust expertise from leading law firms. 

Nearly 80% of those surveyed had been involved with more than 50 merger transactions in their career, with 59% of those surveyed having been involved in more than 100 deals.  It is also worth noting that nearly 40% of those surveyed had previous agency experience.  These respondents were asked additional questions about the impact the new HSR form would have on the agencies’ review process. 

Overall, practitioners soundly rejected the proposed new form and merger guides.  Most importantly, the survey data exposes the significant inaccuracy of the government's cost estimates, with survey respondents predicting the costs to file a single merger to be nearly five times greater than estimated.  

With more than 2,500 mergers filed each year, the new form represents up to roughly $2.3 billion in additional costs borne by transactions that do not raise any anticompetitive concerns.  

HSR Form Key Takeaways:

• 88% do not believe the current form causes the agencies to miss problematic mergers, the others argue for a more targeted expansion of the form but only in narrow circumstances.
• 96% worry the new form will have an agency “bounce” a filing for being incomplete, that lead to lengthy drawn-out engagement.
• 98% oppose the proposed new form.

HSR Costs: Current Form vs. Proposed Revised Form

• The FTC estimates the current form takes 37 hours at a cost of $17,020 to complete a filing.  They estimate the hourly cost of a lawyer is $460, an estimate that they have been using for years. Practitioners told us it currently takes about 85 hours and just over 10 days to complete a filing at a cost of roughly $80,000.  The survey shows the cost of outside counsel averages $936.
• The FTC estimates the new form will take on average 144 hours at a cost of $66,240 to complete a filing. Practitioners disagreed.  The survey results estimate the revised form will take on average 327 hours and just under 33 days to complete at a cost of a little under $314,000.   
• Those practitioners with agency experience expect the time it takes for an agency to complete its initial review will go from 11 hours to over 36 hours. Roughly 70% do not believe the agency could complete its work in the statutory period.   Several who thought the period could be met indicated that it was only feasible because the staff would ignore the additional information provided.  If the information were to be reviewed, the survey estimates the statutory deadline would need to be extended another 60 days or more or that the agency staff would need to roughly double in number.

Merger Guidelines Key Takeaways:

• 87% believe the draft guides do not reflect the current state of the law.
• 84% believe the draft guides are either divorced or partially divorced from economic analysis.
• 75% believe the guidance will not have an impact on how the courts interpret the law.
• 96% believe the guidance represents an increasingly politicized approach to antitrust.
• 93% believe the guides will reduce the focus on consumers, inject uncertainty, and grow the role of government. 

The full survey results can be read here.

About the authors

Sean Heather

Sean Heather is Senior Vice President for International Regulatory Affairs and Antitrust.

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