The Department of Justice's Antitrust Division (“Antitrust Division”) and the Federal Trade Commission (“FTC”) will accept Hart-Scott-Rodino (“HSR”) premerger notification filings during the U.S. federal government shutdown.
The Antitrust Division and the FTC split reviews under the HSR Act, which requires that mergers or acquisitions worth over $70.9 million must notify the federal government. The HSR Act requires that parties subject to the Act must wait 30 days before closing their transaction. This waiting period provides the agencies with time to determine whether to challenge a transaction prior to closing. The waiting period does not start until the filing is made to the FTC and the Antitrust Division.
The agencies use the 30 days to clear the transaction or request additional information known as a second request. If a second-request is issued, the government is granted another 30 days after certification of compliance with the second request. Parties to transactions can apply for early termination, which is typically granted in about two weeks and is granted in most cases. Given the limited staff on hand during the shut down, early terminations may not occur as quickly.
During the shutdown, the FTC will continue HSR investigations to the extent that a failure by the government to challenge the transaction before it is consummated will result in a substantial impairment of the government's ability to secure effective relief at a later time. Likewise, the DOJ will also prepare cases that must be filed due to expiration of the HSR waiting period.
It is good news for merging parties that the FTC and the Antitrust Division are still accepting HSR filings, however, limited staff will be available to organize those filings. Nevertheless, a filing starts the 30 day clock. Therefore, parties should still be able to complete deals in a timely manner unless the transaction raises significant antitrust concerns.