[Federal Register Volume 72, Number 8 (Friday, January 12, 2007)]
[Notices]
[Pages 1531-1533]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E7-293]


=======================================================================
-----------------------------------------------------------------------

FEDERAL TRADE COMMISSION


Agency Information Collection Activities; Proposed Collection; 
Comment Request; Extension

AGENCY: Federal Trade Commission.

ACTION: Notice.

-----------------------------------------------------------------------

SUMMARY: The information collection requirements described below will 
be submitted to the Office of Management and Budget (``OMB'') for 
review, as required by the Paperwork Reduction Act (``PRA'') (44 U.S.C. 
3501-3520). The Federal Trade Commission (``FTC'' or ``Commission'') is 
seeking public comments on its proposal to extend through May 31, 2010 
the current PRA clearance for information collection requirements 
contained its Antitrust Improvements Act Rules (``HSR Rules'') and 
corresponding Notification and Report Form for Certain Mergers and 
Acquisitions (``Notification and Report Form''), 16 CFR. Parts 801-803. 
That clearance expires on May 31, 2007.

DATES: Comments must be filed by March 13, 2007.

ADDRESSES: Interested parties are invited to submit written comments. 
Comments should refer to ``HSR Rules: FTC File No. P989316'' to 
facilitate the organization of comments. A comment filed in paper form 
should include this reference both in the text and on the envelope, and 
should be mailed or delivered, with two complete copies to the 
following address: Federal Trade Commission/Office of the Secretary, 
Room H 135 (Annex J), 600 Pennsylvania Avenue, NW., Washington, DC 
20580. Because paper mail in the Washington area and at the Commission 
is subject to delay, please consider submitting your comments in 
electronic form, as prescribed below. However, if the comment contains 
any material for which confidential treatment is requested, it must be 
filed in paper form, and the first page of the document must be clearly 
labeled ``Confidential.''\1\ The FTC is requesting

[[Page 1532]]

that any comment filed in paper form be sent by courier or overnight 
service, if possible.
---------------------------------------------------------------------------

    \1\ Commission Rule 4.2(d), 16 CFR 4.2(d). The comment must be 
accompanied by an explicit request for confidential treatment, 
including the factual and legal basis for the request, and must 
identify the specific portions of the comment to be withheld from 
the public record. The request will be granted or denied by the 
Commission's General Counsel, consistent with applicable law and the 
public interest. See Commission Rule 4.9(c), 16 CFR 4.9(c).
---------------------------------------------------------------------------

    Comments filed in electronic form should be submitted by using the 
following weblink: https://secure.commentworks.com/ftc-hsrpra 
(and following the instructions on the Web-based form). To ensure that 
the Commission considers an electronic comment, you must file it on the 
Web-based form at the weblink: https://secure.commentworks.com/ftc-hsrpra. If this notice appears at www.regulations.gov, you 
may also file an electronic comment through that Web site. The 
Commission will consider all comments that regulations.gov forwards to 
it.
    The FTC Act and other laws the Commission administers permit the 
collection of public comments to consider and use in this proceeding as 
appropriate. All timely and responsive public comments, whether filed 
in paper or electronic form, will be considered by the Commission, and 
will be available to the public on the FTC Web site, to the extent 
practicable, at www.ftc.gov. As a matter of discretion, the FTC makes 
every effort to remove home contact information for individuals from 
the public comments it receives before placing those comments on the 
FTC Web site. More information, including routine uses permitted by the 
Privacy Act, may be found in the FTC's privacy policy, at http://www.ftc.gov/ftc/privacy.htm.

FOR FURTHER INFORMATION CONTACT: Requests for additional information or 
copies of the proposed information requirements should be addressed to 
B. Michael Verne, Compliance Specialist, 600 Pennsylvania Ave., NW., 
Room 301, Washington, DC 20580. Telephone: (202) 326-3100.

SUPPLEMENTARY INFORMATION: Under the Paperwork Reduction Act (``PRA''), 
44 U.S.C. 3501-3520, federal agencies must obtain approval from OMB for 
each collection of information they conduct or sponsor. ``Collection of 
information'' means agency requests or requirements that members of the 
public submit reports, keep records, or provide information to a third 
party. 44 U.S.C. 3502(3); 5 CFR 1320.3(c). As required by section 
3506(c)(2)(A) of the PRA, the FTC is providing this opportunity for 
public comment before requesting that OMB extend the existing paperwork 
clearance for the HSR Rules and the corresponding Notification and 
Report Form.
    The FTC invites comments on: (1) Whether the proposed collection of 
information is necessary for the proper performance of the functions of 
the agency, including whether the information will have practical 
utility; (2) the accuracy of the agency's estimate of the burden of the 
proposed collection of information, including the validity of the 
methodology and assumptions used; (3) ways to enhance the quality, 
utility, and clarity of the information to be collected; and (4) ways 
to minimize the burden of the collection of information on those who 
are to respond, including through the use of appropriate automated, 
electronic, mechanical, or other technological collection techniques or 
other forms of information technology, e.g., permitting electronic 
submission of responses.
    All comments should be filed as prescribed in the ADDRESSES section 
above, and must be received on or before March 13, 2007.

Background Information

    Section 7A of the Clayton Act (``Act''), 15 U.S.C. 18a, as amended 
by the Hart-Scott-Rodino Antitrust Improvements Act of 1976, Pub. L. 
94-435, 90 Stat. 1390, requires all persons contemplating certain 
mergers or acquisitions to file notification with the Commission and 
the Assistant Attorney General and to wait a designated period of time 
before consummating such transactions. Congress empowered the 
Commission, with the concurrence of the Assistant Attorney General, to 
require ``that the notification * * * be in such form and contain such 
documentary material and information * * * as is necessary and 
appropriate'' to enable the agencies ``to determine whether such 
acquisitions may, if consummated, violate the antitrust laws.'' 15 
U.S.C. 18a(d). Congress similarly granted rulemaking authority to, 
inter alia, ``prescribe such other rules as may be necessary and 
appropriate to carry out the purposes of this section.'' Id.
    Pursuant to that section, the Commission, with the concurrence of 
the Assistant Attorney General, developed the HSR Rules and the 
corresponding Notification and Report Form. As discussed below, several 
changes have been made to the HSR Rules and the Notification and Report 
Form since FTC staff last sought OMB approval for the clearance.

Burden Statement

    Estimated total annual hours burden: 156,000 hours (rounded to the 
nearest thousand).
    The following burden estimates are primarily based on FTC data 
concerning the number of HSR filings and staff's informal consultations 
with leading HSR counsel.
    In its 2004 PRA submission to OMB regarding the HSR Rules and the 
Notification and Report Form, FTC staff estimated that there were 21 
``index filings'' under Clayton Act Sections 7A(c)(6) and 7A(c)(8) that 
required 2 hours per filing, and 2,192 non-index filings that required 
an average of 39 hours per filing.\2\ Staff also estimated that a total 
of 50 transactions would require an additional 40 hours of burden 
associated with the more precise determination of transaction value as 
a result of the introduction of a tiered filing fee system. Thus, the 
total estimated hours burden was 87,530 hours [(21 index-filings x 2 
hours) + (2,192 non-index filings x 39 hours) + (50 transactions x 40 
hours)]. See 69 FR 18686 (April 8, 2004). In January 2005, staff 
obtained OMB approval for a nonsubstantive/nonmaterial change request 
to the FTC's previous burden estimate, resulting in a new burden 
estimate of 84,020 burden hours. The 3,510 burden hour reduction was 
based on an anticipated small decrease in the number of non-index 
filings due to annual adjustments to the statutory thresholds beginning 
in fiscal year 2005.\3\
---------------------------------------------------------------------------

    \2\ Clayton Act Sections 7A(c)(6) and (c)(8) exempt from the 
requirements of the premerger notification program certain 
transactions that are subject to the approval of other agencies, but 
only if copies of the information submitted to these other agencies 
are also submitted to the FTC and the Assistant Attorney General. 
Thus, parties must submit copies of these filings, which are 
included in the totals shown, but completing the task requires 
significantly less time than non-exempt transactions.
    \3\ Based on actual data concerning the number of non-index 
filings since then, staff does not anticipate that the annual 
adjustments will decrease the number of filings going forward. 
Furthermore, because the adjustments are based on annual change in 
gross domestic product, as the thresholds increase, the size-of-
transactions should increase at the same rate, resulting in no net 
effect on the number of non-index filings received.
---------------------------------------------------------------------------

    There have been two amendments to the HSR Rules and one amendment 
to the Notification and Report Form since staff last obtained OMB 
approval in January 2005:
    1. Revised treatment of unincorporated entities under the HSR 
Rules.\4\ This amendment changed previously existing reporting 
requirements. However, based on filing

[[Page 1533]]

statistics from the effective date of the rulemaking, the amendment 
appears to have had a de minimis effect on the number of filings 
received and thereby has not impacted PRA burden.
---------------------------------------------------------------------------

    \4\ 70 FR 11502 (March 8, 2005).
---------------------------------------------------------------------------

    2. Electronic submission of premerger notification filings.\5\ 
Since the effective date of this rulemaking only one electronic 
submission has been made. FTC staff anticipates that as the business 
community becomes more familiar with the new submission process more 
persons will choose to e-file and that such persons will experience a 
one hour reduction in burden (the estimated time to print or make 
copies of the documents when filing the traditional way). However, due 
to the low volume of electronic filings, the availability of the e-
filing system currently has a de minimis effect on burden and the FTC 
conservatively declines to reduce its burden estimate at this time.
---------------------------------------------------------------------------

    \5\ 71 FR 35995 (June 23, 2006).
---------------------------------------------------------------------------

    3. Allowing Internet links to be used for responses to Items 4(a) 
and (b) of the Notification and Report Form.\6\ Staff projects that 50 
percent of non-index filings will utilize this alternative method of 
providing financial data, resulting in a reduction in burden of one 
hour per non-index filing.
---------------------------------------------------------------------------

    \6\ 70 FR 73369 (December 12, 2005).
---------------------------------------------------------------------------

    Finally, since staff last obtained OMB approval, the switch of the 
base year from 1997 to 2002 became effective.\7\ Arguably there is some 
burden involved in changing the revenue numbers from 1997 to 2002 for 
the base year. However, this data is reported by large companies to the 
U.S. Census Bureau every five years in the ordinary course of business 
and, thus, the FTC is not required to account for such burden under the 
PRA.\8\ Furthermore, based on staff's informal consultations with 
industry, staff anticipates that any increase in burden would be offset 
by a reduction in burden because recent revenue data is generally more 
easily retrievable by and readily available to reporting persons than 
older data. Nonetheless, although it appears a reduction in burden may 
be warranted, staff conservatively declines to make an adjustment to 
its previous burden estimate on this basis.
---------------------------------------------------------------------------

    \7\ The switch of the base year from 1997 to 2002 became 
effective December 30, 2005. 70 FR 77312 (December 30, 2005).
    \8\ See 5 CFR 1320.3(b)(2). Staff recognizes that the HSR Rules 
require companies to report total revenues for a specific NAICS code 
(whereas, the Census Bureau collects data for a specific NAICS code 
for each establishment). Nonetheless, staff anticipates that the 
burden tied to the aggregation of such data as required by the HSR 
Rules is de minimis.
---------------------------------------------------------------------------

    There were 3,510 non-index filings and 48 index filings in fiscal 
year 2006. Based on an average increase of 13% in fiscal year 2004--
fiscal year 2006 in the number of non-index filings, staff projects a 
total of 3,966 non-index filings for fiscal year 2007. Likewise based 
on an average decrease of 34% in index filings over the same time 
period, staff projects a total of 32 index filings for fiscal year 
2007. Retaining the FTC's previous assumptions, staff estimates that 
non-index filings require approximately 39 burden hours per filing and 
index filings require an average of 2 hours per filing. Finally, staff 
continues to estimate that approximately 91 transactions will require 
an additional 40 hours of burden due to the need for a more precise 
valuation of transactions that are near a filing fee threshold.\9\ 
Thus, the total estimated hours burden before adjustment is 158,378 
hours [(3,966 non-index filings x 39 hours) + (32 index filings x 2 
hours) + (91 acquiring person non-index filings requiring more precise 
valuation x 40 hours)]. Adjusting for the reduced burden due to 
incorporating Item 4(a) and Item 4(b) documents by reference to an 
Internet link reduces the total burden by 1,983 hours (3,966 non-index 
filings x .5 = 1,983 x 1 hour = 1,983 hours), resulting in total burden 
for fiscal year 2007 of 156,395 hours.
---------------------------------------------------------------------------

    \9\ The FTC retains its previous estimate that 4.6% of non-index 
filings for acquiring persons will require a more precise valuation. 
Using staff's projections for fiscal year 2007, 91 transactions will 
undergo a more precise valuation process [(3,966 non-index filings / 
2) = 1,983 (number of non-index filings for acquiring persons) x 
4.6%].
---------------------------------------------------------------------------

    This is a conservative estimate. In estimating PRA burden, staff 
considered ``the total time, effort, or financial resources expended by 
persons to generate, maintain, retain, disclose or provide information 
to or for a Federal agency.'' 5 CFR 1320.3(b)(1). This includes 
``developing, acquiring, installing, and utilizing technology and 
systems for the purpose of disclosing and providing information.'' 5 
CFR 1320.3(b)(1)(iv). Although not expressly stated in the OMB 
regulation implementing the PRA, the definition of burden arguably 
includes upgrading and maintaining computer and other systems used to 
comply with a rule's requirements. Conversely, to the extent that these 
systems are used in the ordinary course of business independent of the 
Rule, their associated upkeep would fall outside the realm of PRA 
``burden.''
    Industry has been subject to the basic provisions of the HSR Rules 
since 1978. Thus, businesses have had several years (and some have had 
decades) to integrate compliance systems into their business 
procedures. Accordingly, most companies now maintain records and 
provide updated order information of the kind required by the HSR Rules 
in their ordinary course of business. Nevertheless, staff 
conservatively assumes that the time devoted to compliance with the 
Rule by existing and new companies remains unchanged from its preceding 
estimate.
    Estimated labor costs: $73,506,000 (rounded to the nearest 
thousand).
    Using the burden hours estimated above and applying an estimated 
average of $470/hour for executive and attorney wages,\10\ staff 
estimates that the total labor cost associated with the HSR Rules and 
the Notification and Report Form is approximately $73,505,650 (156,395 
hours x $470/hour).
---------------------------------------------------------------------------

    \10\ The FTC's previous estimate of $425 per hour has been 
increased by the Social Security COLA percentage for fiscal year 
2004-fiscal year 2006 (fiscal year 2004 (2.7%), fiscal year 2005 
(4.1%), fiscal year 2006 (3.3%)).
---------------------------------------------------------------------------

    Estimated annual non-labor cost burden: $0 or minimal.
    The applicable requirements impose minimal start-up costs, as 
businesses subject to the HSR Rules generally have or obtain necessary 
equipment for other business purposes. Staff believes that the above 
requirements necessitate ongoing, regular training so that covered 
entities stay current and have a clear understanding of federal 
mandates, but that this would be a small portion of and subsumed within 
the ordinary training that employees receive apart from that associated 
with the information collected under the HSR Rules and the 
corresponding Notification and Report Form.

William Blumenthal,
General Counsel.
 [FR Doc. E7-293 Filed 1-11-07; 8:45 am]
BILLING CODE 6750-01-P