FTC and DOJ Release HSR Annual Report for Fiscal Year 2014 | Practical Law

FTC and DOJ Release HSR Annual Report for Fiscal Year 2014 | 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 2014.

FTC and DOJ Release HSR Annual Report for Fiscal Year 2014

Practical Law Legal Update 1-618-1065 (Approx. 4 pages)

FTC and DOJ Release HSR Annual Report for Fiscal Year 2014

by Practical Law Antitrust
Published on 12 Aug 2015 • 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 2014.
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 2014 (October 1, 2013 through September 30, 2014) 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 2014:
  • 3,307 total HSR filings were received (whether correctly made or not), about a 25% increase from FY 2013.
  • 1,663 transactions were reported under the HSR Act, a 25.4% increase from FY 2013.
  • The cumulative dollar value of reported transactions was $1.5 trillion, an 84% increase from FY 2013.
  • Early termination of the HSR waiting period was:
    • requested in 78.7% of reported transactions, slightly up from 77% in FY 2013; and
    • granted 80.1% of the time it was requested in those transactions, nearly the same as 80.5% in FY 2013.

Agency Clearance

The HSR Report states that clearance to investigate was granted from one agency to another in 16.9% of reported transactions in FY 2014 (281 transactions), or roughly one in six transactions. In FY 2013, clearance was granted in 16.9% of reported transactions (217 transactions).
In FY 2014, clearance was granted:
  • Most frequently in transactions valued at greater than $1 billion dollars, or 36% of the time, as was also the case in FY 2013.
  • To the FTC in 181 transactions (66% of transactions that obtained clearance).
  • To the DOJ in 93 transactions (34% 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 2014, 51 investigated transactions resulted in a Second Request (3.2% of reported transactions). In FY 2013, the percentage of Second Requests issued was higher (3.7%), but the number of investigations was slightly lower (47). The division of Second Requests between the agencies in FY 2014 was as follows:
  • The DOJ issued 21 Second Requests (41% of those issued).
  • The FTC issued 30 Second Requests (58% of those issued).

Merger Enforcement

The HSR Report also contains information regarding the agencies' merger enforcement statistics. Together, the agencies brought enforcement actions in just under 2% of reported transactions in FY 2014, totaling 33 transactions. This number includes enforcement actions brought in transactions not reported under the HSR Act.

FTC Merger Enforcement

The FTC challenged 17 transactions that it concluded might have substantially lessened competition, resulting in:
  • 13 consent decrees.
  • One case in which an administrative complaint was issued, resulting in abandonment of the deal.
  • Three transactions that were abandoned.
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.
  • Hospitals.
  • Supermarkets.
  • Funeral and cemetery services.
  • Class rings.

DOJ Merger Enforcement

The DOJ challenged 16 transactions that led to:
  • Seven merger challenges brought in federal district court, simultaneously filing the complaint and settlement in each.
  • Four abandoned transactions.
  • Five restructured transactions.
For summaries of these enforcement actions, see What's Market, Federal Merger Enforcement Actions.
The DOJ challenged transactions in several industries, including:
  • Television stations.
  • Flour milling.
  • Airlines.