FTC Proposes Changes To Hart-Scott-Rodino Requirements

The FTC proposed amendments to the Hart-Scott-Rodino ("HSR") rules, particularly as they apply to financial investors, and requested comment on additional aspects of the mergers and acquisitions framework in anticipation of other possible rule changes.

The first Notice of Proposed Rulemaking would make two changes to the HSR rules. First, it would exempt most transactions in which the acquiring person would hold no more than 10 percent of the target's voting securities as a result of the acquisition. The proposal would repeal HSR Rule 802.9, which currently exempts acquisitions of up to 10 percent, provided the acquisition is "solely for the purpose of investment." Under the proposal, there would be no subjective test of "intent."