Hart-Scott-Rodino Act Amendments Affecting Partnerships, LLCs and Other Unincorporated Entities

The Federal Trade Commission’s Premerger Notification Office ("PNO") published in the Federal Register on March 8, 2005 a final rule amending the Hart-Scott-Rodino ("HSR") Act regulations, effective on April 7, 2005. The new regulations expand the applicability of the HSR notification requirements to transactions involving partnerships, limited liability companies ("LLCs") and other unincorporated entities, along with making various conforming and administrative changes.

Under the current PNO rules and policies applicable to partnerships and LLCs, the acquisition of a partnership interest or membership interest in an existing LLC is not reportable unless, as a result of the transaction, the acquiring person will hold 100% of the partnership or membership interests. The formation of a partnership is never reportable, and the formation of an LLC is not reportable unless (a) two or more pre-existing, separately controlled businesses are being contributed and (b) at least one of the