Hart Scott Rodino Act: Essential Compliance Tips to Avoid HSR Filing Delays

The Hart Scott Rodino Act is an American antitrust statute that mandates specific mergers and acquisitions to make a premerger notification (an HSR filing) and then apply for clearance before closing. The HSR requirement only covers transactions more than specific size thresholds, but noncompliance can incur heavy fines as well as freezing the deal until compliance. For smaller and mid-sized law firms, understanding how the HSR Act works so that you can guide clients and avoid violations is essential. This article offers a summary of what is HSR – thresholds, filing fees, deadlines, and best practices. With this background, your firm will be able to stay compliant and keep deals in motion.

Understanding the Hart Scott Rodino Act (HSR Act)

What is HSR Act and Why Does It Exist?

The Hart-Scott-Rodino Antitrust Improvements Act of 1976 (HSR Act) established the federal premerger notification program for large transactions. It requires companies above a certain size to notify the Federal Trade Commission (FTC) and Department of Justice (DOJ) before closing a merger or acquisition. The intent is to give antitrust regulators an opportunity to investigate and potentially challenge mergers that might harm competition before those deals are finalized. Transactions that are too small or otherwise exempt are not subject to HSR filings. (HSR stands for Hart-Scott-Rodino, the Act’s shorthand.) In essence, HSR created a pre-merger notification framework so regulators can review big mergers in advance rather than try to undo them later.

HSR Act Scope – Which Deals Are Covered?

Not every deal trigger Hart Scott Rodino filing. The law applies only to transactions above certain value thresholds involving businesses of significant size (detailed in the next section). Generally, the HSR Act covers acquisitions of voting securities, assets, or controlling interests in non-corporate entities when the deal value is large enough. Clearing an HSR review does not equal full approval of a merger – it simply means the antitrust waiting period has expired without action. (The agencies can still investigate a merger later, though that is uncommon if HSR was cleared.) It’s also important to note that foreign transactions may be subject to HSR if they involve substantial U.S. assets or sales. In practice, if a proposed deal meets the HSR thresholds, both the acquiring and acquired parties (through their ultimate parent entities) must file the notification and observe the waiting period.

Why HSR Compliance Matters for Law Firms

Compliance with the HSR Act is crucial for keeping deals on schedule and avoiding liability. If an HSR filing is required but overlooked, the merging parties could face fines of over $50,000 per day of non-compliance. Beyond fines, failing to file (or “gun jumping” by integrating businesses too early) can lead to injunctions or government lawsuits that derail the transaction. Proper HSR planning is also a client service issue – demonstrating expertise in Hart Scott Rodino filings can prevent last-minute surprises and build client trust. In short, knowing the ins and outs of Hart Scott Rodino filings allows your firm to protect clients’ interests, ensure regulatory compliance, and maintain momentum in M&A deals.

HSR Filing Requirements and Thresholds

Key Filing Thresholds (Size-of-Transaction Test)

A core question is whether a given deal is large enough to require an HSR premerger filing. The size-of-transaction threshold is the starting point: if the value of a deal is below a certain dollar amount, no Hart Scott Rodino filing is required. If it meets or exceeds that amount, a filing may be required (depending on the parties’ sizes). As of 2025, the minimum size-of-transaction threshold is $126.4 million. This figure is adjusted annually for economic changes. In simple terms:

• Less than $126.4 million: No HSR filing required (below the threshold).
• $126.4 million – $505.8 million: Filing required if the size-of-parties test (below) is met.
• $505.8 million or more: HSR filing is always required, regardless of the parties’ size.

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Transaction Value	HSR Filing Requirement
Less than $126.4 million	No HSR filing required (below threshold)
$126.4 million – $505.8 million	Filing required if size-of-parties test is met
$505.8 million or more	HSR filing required (threshold for mandatory filing)

Table 1: Hart Scott Rodino Act Filing Thresholds (2025)

If a deal exceeds $505.8 million, an HSR notification is mandatory in virtually all cases. For transactions in the middle range (~$126M–$505M), the next consideration is the size of the parties involved.

The Size-of-Parties Test

When a transaction’s value falls between the thresholds above, the size-of-parties test determines if a Hart Scott Rodino filing is needed. This test looks at the annual sales or total assets of each party’s ultimate parent entity (UPE). Under the 2025 thresholds:

• One “person” (party) must have at least $252.9 million in total assets or annual sales, and
• The other party must have at least $25.3 million in assets or sales.

If both conditions are met and the transaction value is ≥ $126.4M, an HSR filing is required. If one party is smaller than these thresholds, then no filing is mandated for deals in that mid-range band. However, if the deal value is high enough (≥ $505.8M), the size-of-parties test is moot – a filing is required regardless of the companies’ sizes. The logic is that extremely large deals deserve antitrust scrutiny even if a small business is involved on one side.

Annual Adjustments and Notable Exemptions

HSR thresholds change annually, so always verify the current figures (the FTC publishes updated values at the start of each year). Some exemptions can exclude certain transactions even if they exceed the dollar thresholds. Common examples include:

• Passive investments: Buying up to 10% of a company’s voting securities purely for investment (with no intent to influence management) is exempt.
• Intrapersonal transactions: Transfers where the buyer and seller are under the same ultimate ownership (e.g., reorganizations within a company) don’t require an HSR filing.
• Foreign commerce exemptions: Acquisitions of foreign assets or businesses may be exempt if they have minimal U.S. sales or assets (for instance, foreign assets with under $100 million in U.S. sales are often exempt).

These are just a few examples – the HSR rules contain many detailed exemptions. When in doubt, consult the regulations or the FTC’s Premerger Notification Office for guidance on whether a particular deal might be exempt.

Preparing for Hart Scott Rodino Filing

Information and Documents Needed for the HSR Form

Once you determine that a deal triggers HSR, the next step is preparing the HSR Notification and Report Form. This form requires a significant amount of information about each party and the transaction. Key items include:

• Basic information: Each party’s name, address, and U.S. revenue breakdown by industry (using NAICS codes), plus identification of all entities within the UPE (parent company and subsidiaries).
• Transaction details: A description of the transaction structure (asset purchase, stock purchase, merger, etc.), what is being acquired, and the deal value or purchase price.
• Ultimate parent entity (UPE): Identification of the ultimate parent of each party (which could be an individual, a holding company, etc.).
• Overlap information: Data on any market where the two parties compete or have a vertical relationship (usually by listing overlapping industry NAICS codes for products/services).

Competitive analyses (Item 4 documents): Copies of all internal documents prepared by or for officers/directors that analyze the transaction’s competitive aspects – for example, documents discussing market share, competition, competitors, or synergies. These often include pitch books, strategic plans, or board presentations.

Affidavits and certification: A signed affidavit from each party attesting to a good-faith intent to complete the deal, and a certification by an officer that the HSR filing is complete and accurate.

The form is submitted electronically (as of 2025, via the FTC’s new e-filing system). Given the breadth of required data, start assembling information early – incomplete filings can be rejected by the FTC, restarting the waiting period clock.

HSR Filing Fees and Payment

Hart Scott Rodino filings carry a substantial filing fee. In 2023, the fee structure was overhauled to a six-tier system (replacing the old three-tier system). The fee is based on the size of the transaction:

Transaction Size	HSR Filing Fee (2025)
Less than $179.4 million	$30,000
$179.4 million – <$555.5 million	$105,000
$555.5 million – <$1.111 billion	$265,000
$1.111 billion – <$2.222 billion	$425,000
$2.222 billion – <$5.555 billion	$850,000
$5.555 billion or more	$2,390,000

Table 2: HSR Filing Fees by Transaction Size (2025)

Larger deals thus pay much higher fees – for example, a $6 billion merger incurs a $2.39 million fee. By law, these fee thresholds are adjusted annually for inflation, so always check the current thresholds for the year of filing. The filing fee is usually paid by the acquiring person (buyer) as part of the deal expenses, though the parties can negotiate who ultimately bears the cost. Payment is made to the FTC (via wire or ACH), and proof of payment must be included with the HSR submission.

Timing the Filing to Keep Deals on Track

Timing is critical in HSR planning. The 30-day waiting period does not even begin until both parties have submitted their Hart Scott Rodino filings (and the fee is paid). Thus, the buyer and seller should coordinate to file around the same time, rather than let one side’s delay hold up the process. Generally, you should submit the HSR notification as soon as a definitive agreement is signed (or even on a letter of intent, if the deal is far along) to start the clock promptly. Delaying the filing will directly delay closing, so integrate HSR timing into your deal timeline.

Also, note that recent changes to HSR rules have increased the information required from filers. Preparing an HSR filing can now take longer than in the past – the FTC estimated it could take up to four times more effort under the new form compared to the old one. Starting early and dedicating enough resources to the HSR process will help avoid last-minute bottlenecks.

Navigating the HSR Review Process

The Waiting Period and “Gun Jumping” Restrictions

After both parties file, an HSR waiting period of 30 days begins (15 days for cash tender offers or certain bankruptcy deals). During this period, the parties may not close the transaction. They should also be careful to avoid “gun jumping” – implementing any part of the merger or otherwise coordinating their competitive conduct prematurely. Each company must continue to operate independently until the waiting period expires (or is terminated early). For instance, the buyer cannot start directing the seller’s business, and the two firms shouldn’t exchange sensitive competitive information except under controlled circumstances (e.g. via clean teams). Gun jumping is illegal and can incur the same steep HSR penalties discussed earlier. Essentially, don’t act like you’ve merged before you have.

If the antitrust agencies finish their review quickly and see no issues, they might grant early termination of the waiting period. Early termination (ET) ends the wait before Day 30, allowing the deal to close immediately. ET was suspended in 2021 due to policy changes, but the FTC reinstated the early termination program in early 2025. Note that ET is entirely discretionary – parties cannot force it, and it’s only granted in clear-cut cases. If early termination is granted, the FTC publicly posts notice of it, and the parties are free to close. If not, the parties must wait the full 30 days (or longer if additional review is initiated).

Second Requests and In-Depth Antitrust Review

If the FTC or DOJ suspects that a transaction could significantly harm competition, they may extend the review by issuing a Second Request. A Second Request is a formal demand for extensive additional information and documents from the merging parties, which pauses the HSR waiting period. Second Requests are effectively a full investigative phase – the parties might have to turn over hundreds of thousands of documents, data on pricing and customers, and even have executives sit for depositions. Complying can take months, not days, and it’s very costly.

Only a small fraction of deals receive Second Requests. In FY2022, out of 3,152 HSR filings, the agencies issued Second Requests in just 47 cases (1.6%). Historically, about 1–3% of transactions get this level of scrutiny. These tend to be the largest or most competitively sensitive deals – for example, mergers of direct competitors in a concentrated market. The table below shows how rare Second Requests are:

Fiscal Year	HSR Filings	Second Requests	% of Filings with Second Request
FY 2021	3,520	65	1.8%
FY 2022	3,152	47	1.6%

Table 3: Hart Scott Rodino Filings and Second Requests (Recent Years)

If a Second Request is issued, the merging parties cannot close the deal until 30 days after they have fully complied with the Second Request (this post-compliance waiting period is 10 days for a cash tender offer). Often, parties will negotiate with the agencies during this time – possibly offering to divest certain business lines to resolve competitive concerns. It’s also worth noting that if the initial 30-day wait is nearly up and the agency is still undecided, the parties sometimes withdraw and refile their HSR notification to restart a new 30-day period (this “pull-and-refile” is allowed once without a new fee). That tactic can buy more time for the agency to review without resorting to a Second Request.

Outcomes and Next Steps

In most cases, HSR review ends with the waiting period expiring quietly or being terminated early, and the parties can consummate the deal. If a Second Request is issued, the deal’s timeline extends considerably – often by several months – and the ultimate outcome might be: clearance (with or without divestitures), a negotiated settlement, or the agencies suing to block the deal. Merging parties should approach the HSR waiting period as just one part of the overall regulatory clearance process. It’s wise to keep open communication with the FTC/DOJ during review; responding quickly to any informal inquiries can sometimes resolve questions and avoid a Second Request. And if serious antitrust issues are likely, engage experienced antitrust counsel early and consider remedies (like agreeing to sell off a division) that you could proactively offer to address competitive concerns.

Compliance, Penalties, and Best Practices

Consequences of Non-Compliance

If parties violate the HSR Act – either by failing to file when required or by closing a deal before the waiting period expires – they can face civil penalties up to $50,000 per day of violation (about $53,000 per day as of 2025). These fines accrue for each day of violation until a corrective filing is made, and the waiting period is observed. In fact, the FTC and DOJ do enforce these rules: in 2022, two companies paid a combined $1.89 million in penalties for closing transactions without filing. The government can also go to court to unwind a merger completed in violation of HSR.

That said, the agencies have often not sought fines for first-time inadvertent violations if the parties promptly correct the mistake. However, this leniency is not guaranteed – firms should never assume they’ll get a free pass on HSR requirements.

Best Practices for HSR Filing

Assess HSR Early: Determine if a deal meets HSR thresholds (and whether any exemptions apply) as soon as the transaction is on the horizon. If in doubt, consult specialized antitrust counsel or reach out to the FTC’s Premerger Notification Office for guidance.

• Get Organized and Document Everything: Use a checklist to gather all required HSR information and documents well in advance. This includes pulling financial statements, org charts, subsidiary lists, and collecting the necessary internal documents (Item 4 docs). A systematic approach reduces the risk of missing something that could delay the filing.
• Coordinate Filing and Timing: Communicate with the other side’s lawyers to synchronize HSR filings. Both parties’ forms should be submitted around the same time, and the 30-day clock should be factored into the deal timeline. Mark the expected end of the waiting period on your calendar and don’t schedule closing before that date.
• Avoid Gun-Jumping: Educate both companies’ deal teams not to integrate or coordinate operations prematurely. Maintain separate decision-making and competitive conduct until the deal is closed. Use safeguards (like clean teams or NDAs) if you need to exchange sensitive information during due diligence. Every communication should assume the companies are competitors until the deal closes.
• Respond Promptly to Regulators: If the FTC or DOJ contacts you with questions during the waiting period, reply quickly and completely. A prompt, cooperative response can address minor issues and potentially avoid a Second Request. If a Second Request does come, be prepared to dedicate significant resources to complying on time.
• Prepare for In-Depth Review: For mergers in highly concentrated markets or other “close call” deals, plan for the possibility of a prolonged review. This might include a pull-and-refile strategy (withdrawing and refiling the HSR to reset the clock once) or identifying potential divestitures upfront that you could offer as remedies. Being ready with a game plan will help if regulators signal concerns.

Final Thoughts

Filing under the HSR Act can seem daunting, but with informed preparation it becomes manageable. By knowing the thresholds, gathering the right documentation, and following the rules during the waiting period, your firm can guide deals through the HSR process smoothly and confidently.

In the end, careful Hart-Scott-Rodino compliance means you avoid penalties and costly delays while keeping client transactions on track. A bit of upfront planning and diligence ensures faster, problem-free closings – protecting both your clients’ interests and your firm’s reputation.

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FAQs

Which transactions require a Hart Scott Rodino (HSR) filing?

Generally, mergers or acquisitions must be reported under the HSR Act if the deal value exceeds the current threshold (e.g. $126.4 million in 2025) and the companies are large enough to meet the size-of-parties tests. If a transaction is below the threshold, no Hart Scott Rodino filing is needed. Also, certain deals are exempt even if they’re big – for example, acquiring less than 10% of a company purely as an investment is exempt. Always calculate the transaction’s value and compare it to the HSR thresholds (which update annually) to see if a filing is required.

What is HSR filing?

An HSR filing involves a detailed form about the merging parties and the deal. The form asks for information such as each company’s identity and business lines, the structure and value of the transaction, and any overlaps between the parties’ products or services. Filers must also submit certain internal documents analyzing the deal’s competitive impact (often called Item 4 documents). Additionally, the filing requires data on each party’s U.S. revenues by industry code and organizational structure, plus a certification by an executive attesting that the filing is complete and correct.

How long is the HSR waiting period, and can it be shortened?

In most cases, the HSR waiting period is 30 days (counted from the day after filing). Certain fast-track deals, like cash tender offers or bankruptcy sales, have a shorter 15-day period. The wait can end early if the government grants “early termination” – a discretionary clearance that was suspended in 2021 but reinstated in 2025. When early termination is granted, the agencies publicly announce it and the parties are free to close immediately. If no early termination is given, the parties must wait the full 30 days (and note that a Second Request will extend the timeline significantly).

What is a Second Request in the HSR process?

A Second Request is a formal demand by the FTC or DOJ for more information when they suspect a merger may harm competition. It effectively pauses the HSR review process. The merging parties must produce a huge volume of documents and data (often taking months) covering their business operations, market analyses, and communications. Only once the parties fully comply with the Second Request does a new 30-day waiting period start. Second Requests are rare – only about 1–3% of HSR filings get one – and they tend to target the biggest or most problematic deals.

What are the penalties for not filing or “gun jumping” under the HSR Act?

Violating the HSR Act can result in steep penalties. The law authorizes fines up to $50,000 per day for non-compliance (around $53,000 per day as of 2025 after inflation adjustments). That means if you close a deal without filing or before the waiting period ends, the clock ticks at ~$50K daily until the error is fixed. The government can and does impose these fines – in a recent case, two companies paid $1.89 million for closing early. The agencies can even seek to unwind a merger completed illegally.

Sources

1. https://www.ftc.gov/enforcement/premerger-notification-program
2. https://www.ftc.gov/news-events/news/press-releases/2023/12/ftc-doj-issue-fiscal-year-2022-hart-scott-rodino-notification-report
3. https://www.ftc.gov/enforcement/competition-matters/2025/02/new-hsr-thresholds-filing-fees-2025
4. https://www.choate.com/insights/2025-hart-scott-rodino-requirements.html 
5. https://www.jdsupra.com/legalnews/m-a-in-2024-how-to-prepare-for-hsr-9693179/