Proposed HSR Rule Amendment: Foreign Today But Not Tomorrow?

On November 8, 2019, the Federal Trade Commission (“FTC”) and the Antitrust Division of the U.S. Department of Justice (“DOJ”) proposed changes to the premerger notification rules (“Rules”) relating to how U.S. and foreign entities are defined for purposes of determining reportability under the Hart-Scott-Rodino Antitrust Improvements Act (“HSR Act”).¹ As a result of the proposed amendments to the Rules, certain acquisitions of foreign voting securities and assets currently exempt from the HSR Act’s filing requirements would be reportable. In particular, if the proposed changes are finalized, acquisitions by offshore funds of minority interests in a foreign issuer may no longer be exempt even though those transactions likely would not raise any competition concerns.