Clifford Chance

U.S. Antitrust Agencies Propose Significant Changes to the HSR Act's Rules for Investment Entities and Master Limited Partnerships

October 1, 2020

On September 21, 2020, the Federal Trade Commission and the Antitrust Division of the Department of Justice published proposed amendments to the rules implementing the Hart-Scott Rodino Antitrust Improvements Act of 1976, as amended, which governs pre-merger antitrust notification filing requirements. There are two main proposed changes, the first of which could have a significant impact on financial investors, such as private equity firms, and other investors that often rely on master limited partnerships. The other proposed change, while appearing to alleviate certain filings by creating a ten percent exemption, leaves important issues unanswered. First, the proposed amendments expand the definition of "person" under the HSR rules to now include certain related "associates." The change will result in acquisitions becoming reportable that currently do not meet the HSR Act's filing thresholds and increase the scope of information required in the HSR filing. Second, the proposed amendments create a new de minimis exemption for certain acquisitions that would result in the acquiring person holding less than 10-percent of an issuer. This briefing will discuss each proposed amendment, beginning with a discussion of the US Antitrust Agencies' objectives and then evaluating the practical impact for firms impacted by the proposed changes.

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