32768 Federal Register / Vol. 83, No. 136 / Monday, July 16, 2018 / Rules and Regulations 

Wellsville, NY, Wellsville Muni Arpt, 

Tarantine Fld, VOR–A, Amdt 6, 

CANCELED 

Columbus, OH, John Glenn Columbus Intl, 

RNAV (RNP) Z RWY 10L, Amdt 1C 

Columbus, OH, John Glenn Columbus Intl, 

RNAV (RNP) Z RWY 10R, Amdt 1C 

Delaware, OH, Delaware Muni—Jim Moore 

Field, RNAV (GPS) RWY 10, Amdt 1A 

Delaware, OH, Delaware Muni—Jim Moore 

Field, RNAV (GPS) RWY 28, Amdt 1A 

London, OH, Madison County, RNAV (GPS) 

RWY 9, Orig-A 

London, OH, Madison County, RNAV (GPS) 

RWY 27, Orig-A 

Mount Vernon, OH, Knox County, RNAV 

(GPS) RWY 28, Amdt 1C 

New Philadelphia, OH, Harry Clever Field, 

RNAV (GPS) RWY 15, Amdt 1 

New Philadelphia, OH, Harry Clever Field, 

RNAV (GPS) RWY 33, Orig 

New Philadelphia, OH, Harry Clever Field, 

VOR–A, Amdt 2B 

Sidney, OH, Sidney Muni, RNAV (GPS) RWY 

28, Amdt 1A 

Steubenville, OH, Jefferson County Airpark, 

RNAV (GPS) RWY 32, Amdt 1A 

Willard, OH, Willard, Takeoff Minimums and 

Obstacle DP, Amdt 2 

Fairview, OK, Fairview Muni, Takeoff 

Minimums and Obstacle DP, Amdt 4 

Tahlequah, OK, Tahlequah Muni, RNAV 

(GPS) RWY 35, Amdt 1A 

Beaver Falls, PA, Beaver County, LOC RWY 

10, Amdt 4C 

St Marys, PA, St Marys Muni, LOC RWY 28, 

Amdt 4D 

St Marys, PA, St Marys Muni, RNAV (GPS) 

RWY 28, Amdt 1D 

St Marys, PA, St Marys Muni, Takeoff 

Minimums and Obstacle DP, Amdt 2A 

Cleveland, TN, Cleveland Rgnl Jetport, RNAV 

(GPS) RWY 3, Amdt 2 

Cleveland, TN, Cleveland Rgnl Jetport, RNAV 

(GPS) RWY 21, Amdt 2 

Cleveland, TN, Cleveland Rgnl Jetport, 

Takeoff Minimums and Obstacle DP, Amdt 

2 

Austin, TX, Austin-Bergstrom Intl, ILS OR 

LOC RWY 35R, ILS RWY 35R SA CAT I, 

ILS RWY 35R SA CAT II, Amdt 4 

Floydada, TX, Floydada Muni, RNAV (GPS) 

RWY 17, Amdt 1 

Floydada, TX, Floydada Muni, RNAV (GPS) 

RWY 35, Amdt 1 

Renton, WA, Renton Muni, Takeoff 

Minimums and Obstacle DP, Amdt 8A 

Seattle, WA, Seattle-Tacoma Intl, Takeoff 

Minimums and Obstacle DP, Amdt 4B 

Wheeling, WV, Wheeling Ohio Co, RNAV 

(GPS) RWY 34, Amdt 1A 

Jackson, WY, Jackson Hole, RNAV (RNP) Y 

RWY 1, Amdt 1 

Jackson, WY, Jackson Hole, RNAV (RNP) Y 

RWY 19, Amdt 2 

Jackson, WY, Jackson Hole, RNAV (RNP) Z 

RWY 1, Amdt 1 

[FR Doc. 2018–15059 Filed 7–13–18; 8:45 am] 

BILLING CODE 4910–13–P 

FEDERAL TRADE COMMISSION 

16 CFR Parts 801, 802, and 803 

Premerger Notification; Reporting and 

Waiting Period Requirements 

AGENCY: Federal Trade Commission. 

ACTION: Final rule. 

SUMMARY: The Commission is amending 

the Hart-Scott-Rodino (‘‘HSR’’) 

Premerger Notification Rules (the 

‘‘Rules’’) that require the parties to 

certain mergers and acquisitions to file 

reports with the Federal Trade 

Commission (‘‘the Commission’’ or 

‘‘FTC’’) and the Assistant Attorney 

General in charge of the Antitrust 

Division of the Department of Justice 

(‘‘the Assistant Attorney General’’ or 

‘‘DOJ’’) (together the ‘‘Antitrust 

Agencies’’ or ‘‘Agencies’’) and to wait a 

specified period of time before 

consummating such transactions. The 

Commission is amending the Rules to 

make them clearer and easier to apply. 

The Commission is also amending the 

Rules to allow for the use of email in 

certain circumstances. Finally, the 

Commission is adding updated 

Instructions to the Premerger 

Notification and Report Form which 

include amendments for clarity and to 

make several non-substantive changes. 

DATES: Effective August 15, 2018. 

FOR FURTHER INFORMATION CONTACT: 

Nora Whitehead, Attorney, Premerger 

Notification Office, Bureau of 

Competition, Room 5301, Federal Trade 

Commission, 400 7th Street SW, 

Washington, DC 20024. Telephone: 

(202) 326–3100, Email: nwhitehead@

ftc.gov. 

SUPPLEMENTARY INFORMATION: 

Introduction 

Section 7A of the Clayton Act (the 

‘‘Act’’) requires the parties to certain 

mergers or acquisitions to file reports 

with the Commission and DOJ and wait 

a specified period before consummating 

the proposed transaction to allow the 

Agencies to conduct their initial review 

of the transaction’s competitive impact. 

The reporting requirement and the 

waiting period that it triggers are 

intended to enable the Antitrust 

Agencies to determine whether a 

proposed merger or acquisition may 

violate the antitrust laws if 

consummated and, when appropriate, to 

seek a preliminary injunction in federal 

court to prevent consummation. 

Section 7A(d)(1) of the Act, 15 U.S.C. 

18a(d)(1), directs the Commission, with 

the concurrence of the Assistant 

Attorney General, in accordance with 

the Administrative Procedure Act, 5 

U.S.C. 553, to require that premerger 

notification be in such form and contain 

such information and documentary 

material as may be necessary and 

appropriate to determine whether the 

proposed transaction may, if 

consummated, violate the antitrust laws. 

Section 7A(d)(2) of the Act, 15 U.S.C. 

18a(d)(2), grants the Commission, 

with the concurrence of the Assistant 

Attorney General, in accordance with 5 

U.S.C. 553, the authority to define the 

terms used in the Act and prescribe 

such other rules as may be necessary 

and appropriate to carry out the 

purposes of section 7A of the Act. 

Pursuant to that authority, the 

Commission, with the concurrence of 

the Assistant Attorney General, 

developed the Rules, codified in 16 CFR 

parts 801, 802, and 803, and the 

Premerger Notification and Report Form 

(‘‘Form’’) and its associated Instructions, 

codified in the appendix to part 803, to 

govern the form of premerger 

notification to be provided by merging 

parties. 

Potential filing parties rely on the 

Rules to determine whether they must 

file under the Act and often consult the 

Premerger Notification Office to better 

understand how to apply the Rules. 

These changes to the Rules and 

Instructions address many of the 

questions received. 

Amendments to the Rules 

The Commission is amending the 

Rules, as described below, in order to 

clarify them and make them easier for 

potential filing parties to apply. The 

Commission is also amending the Rules 

to allow for the use of email in sending 

notice letters pursuant to 16 CFR 

801.30, granting early termination, 

withdrawing a filing pursuant to 16 CFR 

803.12, and issuing requests for 

additional information or documentary 

material (‘‘Second Requests’’). 

A. Control of a Trust 

The Commission is amending 

§ 801.1(b)(2) to clarify the term 

‘‘control’’ as it pertains to trusts. This 

change explains that a person or entity 

is deemed to control a trust if that 

person or entity has the contractual 

power to designate 50 percent or more 

of the trust’s trustees, where the trust is 

also irrevocable and/or the settlor does 

not retain a reversionary interest. This 

revision does not alter the substance of 

the test, but merely aims to eliminate 

confusion that arises from the text as 

currently written. 


sradovich on DSK3GMQ082PROD with RULES
Federal Register / Vol. 83, No. 136 / Monday, July 16, 2018 / Rules and Regulations 32769 

1 70 FR 11502 (Mar. 8, 2005). 

B. Exemption for Goods Acquired in the 

Ordinary Course of Business 

The Commission is amending § 802.1 

to remove ‘‘realty’’ from the heading and 

introductory paragraph of the rule. 

Although section 7A(c)(1) of the Act 

exempts from the reporting requirement 

both goods and realty transferred in the 

ordinary course of business, § 802.1 

addresses only the exemption of goods, 

and the reference to realty in the 

heading and introductory paragraph is 

misleading and confusing. Prior to 1996, 

§ 802.1 paralleled the language of the 

statute, which allowed for a broad 

ordinary course exemption but 

contained no guidance on specifics. In 

1996, the FTC revised and clarified the 

‘‘ordinary course of business’’ 

exemption with four new rules—§ 802.1 

through§ 802.3 and § 802.5. With this 

change, § 802.1 was amended to address 

only the acquisition of goods in the 

ordinary course of business. The 

removal of the term ‘‘realty’’ from 

§ 802.1does not affect the treatment of 

acquisitions of realty, which are 

addressed in the other regulations noted 

above. 

In addition, the Commission is 

amending example 4 to § 802.1 to clarify 

that the acquisition described could be 

exempt pursuant to § 802.2. 

C. Intraperson Transactions 

The Commission is amending 

§ 802.30(c) to add ‘‘non-corporate 

interests’’ after assets and voting 

securities. This change clarifies that, in 

the context of a formation pursuant to 

§ 801.40 or § 801.50, the contribution of 

non-corporate interests by the acquiring 

person to the newly formed entity, like 

the contribution of assets and voting 

securities, is exempt from the 

requirements of the Act as to that 

contributing acquiring person. This 

change corrects an oversight in the noncorporate rulemaking.1

D. Entity Formation 

The Commission is amending 

§ 802.41, Example 1, to replace the word 

‘‘cash’’ with ‘‘assets.’’ In its current 

form, the example is confusing and 

misleading because the acquisition of an 

entity that holds only cash is not subject 

to notification requirements. 

E. Affidavits 

The Commission is amending 

§ 803.5(a)(1) to clarify that the provision 

applies to acquisitions of non-corporate 

interests as well as acquisitions of 

voting securities. With this amendment, 

the Commission brings § 803.5(a)(1) into 

accord with the language in the rest of 

§ 803.5 regarding the applicability of the 

rule to acquisitions of non-corporate 

interests. 

F. Withdraw and Refile Notification 

The Commission is amending 

§ 803.12(c) to clarify that the process for 

withdrawing an HSR filing and 

resubmitting it without incurring a new 

filing fee is available only during the 

initial waiting period. Although a filing 

may be withdrawn at any time while the 

waiting period is open, pursuant to 

§ 803.12(a), a party may refile without 

paying a new fee only prior to the 

expiration or early termination of the 

initial waiting period and prior to the 

issuance of a Second Request. This 

revision eliminates confusion about the 

availability of the withdraw and refile 

process. 

G. Use of Email 

The Commission makes the following 

amendments to allow for the use of 

email. 

• Section 803.5(a)(1) is amended to 

allow notice letters required by § 801.30 

to be sent via email. The PNO has 

permitted notice letters to be sent via 

email for many years, and the 

Commission now formally authorizes 

the use of email to send notice letters 

pursuant to § 801.30. The Commission 

is also amending § 803.5(a)(1) to clarify 

that notice letters sent via email must be 

sent to the email address of an officer 

within the acquired issuer, such as the 

Chief Executive Officer, General 

Counsel or Secretary, or in the case of 

an unincorporated entity, persons 

exercising similar functions. Allowing 

notice letters to be sent via email to an 

appropriate person at the acquired 

entity will make the process of 

providing and receiving the notice letter 

required by § 801.30 more efficient for 

filing parties. 

• Section 803.11(c) is amended to 

provide that grants of early termination 

will become effective upon notice to the 

filing persons transmitted by either 

telephone or email. Notice by email will 

also serve as written confirmation. 

Allowing for notice of grants of early 

termination by email eliminates the 

time-intensive and inefficient process of 

calling each party individually and then 

following-up with a hard copy letter, 

instead combining notice and 

confirmation into one step. 

• Section 803.12(a) and (b) are 

amended to provide that a party’s 

notification to the Agencies of its 

withdrawal of its premerger notification 

may be delivered in writing by email or 

mail to the Agencies. 

• Section 803.20(b) is amended to 

provide that a Second Request may be 

delivered in writing by email. Current 

Agency practice is to send notice via 

mail as well as to email the parties a 

Second Request within the original 

waiting period. In addition, the section 

is amended to eliminate the requirement 

that the full text of a Second Request 

will be read upon request. This 

amendment makes clear that email 

confirmation of the Second Request 

within the original waiting period is 

sufficient for the Second Request to be 

effective, and that email is a valid 

means of communication during the 

waiting period. 

These amendments will make the 

Rules easier to apply for both filing 

parties and the Agencies. Further, 

amending the Rules to allow for the use 

of email in sending notice letters 

pursuant to § 801.30, granting early 

termination, withdrawing a filing, and 

issuing Second Requests will make 

these processes more efficient. 

Revisions to the Instructions to the 

Form 

The Commission is adding updated 

Instructions to the Form with 

amendments as follows. 

D Page I of the Instructions now 

provides an email address for the 

Premerger Notification Office, an 

updated address for DOJ’s Premerger 

and Division Statistics Unit, and a 

reminder that affidavits and 

certifications submitted with DVD 

filings should be in searchable PDF 

format. 

D Page I of the Instructions is also 

edited to clarify how the terms 

‘‘documentary attachments,’’ ‘‘person 

filing,’’ ‘‘filing person,’’ and ‘‘ultimate 

parent entity’’ are used in the 

Instructions. 

D Page II of the Instructions is edited 

to clarify that filing parties should 

continue to use 6- and 10-digit 2012 

NAICS codes when responding to 

certain items in the Form, until further 

announcement by the Premerger 

Notification Office. 

D Page II of the Instructions is further 

edited to clarify that the limitation on 

the acquired person’s response applies 

to Items 5–7 of the Form. 

D Page III of the Instructions is edited 

to indicate that there are now specific, 

limited criteria for fee payment via 

certified check. 

D Page IV of the Instructions is edited 

to remove references to fax numbers. 

D Page V of the Instructions is edited 

to clarify that it is not necessary to list 

all subsidiaries wholly owned by the 

acquired entity in Item 3(a), and to 

require filing parties to provide an index 

of any coded names used to refer to the 

parties in any transaction document(s). 


sradovich on DSK3GMQ082PROD with RULES
32770 Federal Register / Vol. 83, No. 136 / Monday, July 16, 2018 / Rules and Regulations 

D Page V of the Instructions is also 

edited to include a list of the most 

common mistakes when completing the 

HSR Form. 

D Page VI of the Instructions is edited 

to include additional instructions 

regarding the numbering and crossreferencing of Item 4(c) and 4(d) 

documents. 

D Page VI of the Instructions is further 

clarified to note that any privilege log(s) 

should contain the names of inside and 

outside counsel providing privileged 

legal advice. 

D Page IX of the Instructions is edited 

to note that if the acquiring person 

reports an associate overlap only, the 

acquired person need not respond to 

Item 7. 

D Page XI of the Instructions is edited 

to cross-reference the regulation setting 

civil penalties for consummation of a 

reportable transaction without 

providing complete and proper 

notification. 

D The footer on each page of the 

Instructions has been updated to reflect 

the date of the latest revision. 

These amendments to the 

Instructions, which provide additional 

clarity, will benefit filing parties in the 

preparation of the Form. 

Administrative Procedure Act 

The Commission finds good cause to 

adopt these changes without prior 

public comment. Under the 

Administrative Procedure Act (‘‘APA’’), 

notice and comment are not required 

‘‘when the agency for good cause finds 

(and incorporates the finding and a brief 

statement of reasons therefore in the 

rules issued) that notice and public 

procedure thereon are impracticable, 

unnecessary, or contrary to the public 

interest.’’ 5 U.S.C. 553(b)(3)(B). 

The Commission is amending the 

Rules to make them clearer and easier 

to apply. The Commission is also 

amending the Rules to allow for the use 

of email in certain circumstances. 

Finally, the Commission is amending 

the Instructions to the Form for clarity 

and to make several non-substantive 

changes. These amendments fall within 

the category of rules covering agency 

procedure and practice that are exempt 

from the notice-and-comment 

requirements of the APA. See 5 U.S.C. 

553(b)(A). Because the amendments are 

not substantive in nature, they are also 

not subject to the delayed effective date 

provisions of the APA. See 5 U.S.C. 

553(d) (substantive rules may take effect 

no sooner than 30 days after 

publication). For these reasons, the 

Commission finds that there is good 

cause for adopting this final rule as 

effective on August 15, 2018 without 

prior public comment. 

Regulatory Flexibility Act 

The Regulatory Flexibility Act, 5 

U.S.C. 601–612, requires that the agency 

conduct an initial and final regulatory 

analysis of the anticipated economic 

impact of the proposed amendments on 

small businesses, except where the 

agency head certifies that the regulatory 

action will not have a significant 

economic impact on a substantial 

number of small entities. 5 U.S.C. 605. 

The Regulatory Flexibility Act 

requirements apply, however, only to 

rules or amendments that are subject to 

the notice-and-comment requirements 

of the APA. See 5 U.S.C. 603, 604. 

Because these amendments are exempt 

from those APA requirements, as noted 

earlier, they are also exempt from the 

Regulatory Flexibility Act requirements. 

In any event, because of the size of the 

transactions necessary to invoke an HSR 

Filing, the premerger notification rules 

rarely, if ever, affect small businesses. 

Indeed, amendments to the Act in 2001 

were intended to reduce the burden of 

the premerger notification program by 

exempting all transactions valued at less 

than $50 million (as adjusted annually). 

Further, none of the proposed rule 

amendments expands the coverage of 

the premerger notification rules in a 

way that would affect small business. 

Accordingly, to the extent, if any, that 

the Regulatory Flexibility Act applies, 

the Commission certifies that these 

proposed rules will not have a 

significant economic impact on a 

substantial number of small entities. 

This document serves as notice of this 

certification to the Small Business 

Administration. 

Paperwork Reduction Act 

These changes do not contain any 

record maintenance, reporting or 

disclosure requirements that would 

constitute agency ‘‘collections of 

information’’ that would have to be 

submitted for clearance and approval by 

the Office of Management and Budget 

under the Paperwork Reduction Act of 

1995, 44 U.S.C. 3501–3521. 

List of Subjects in 16 CFR Parts 801, 

802, and 803 

Antitrust. 

By direction of the Commission. 

Donald S. Clark, 

Secretary. 

For the reasons stated above, the 

Federal Trade Commission amends 16 

CFR parts 801, 802, and 803 as set forth 

below: 

PART 801—COVERAGE RULES 

■ 1. The authority citation for part 801 

continues to read as follows: 

Authority: 15 U.S.C. 18a(d). 

■ 2. Amend § 801.1 by revising the 

introductory text of paragraph (b)(2) to 

read as follows: 

§ 801.1 Definitions. 

* * * * * 

(b) * * * 

(2) Having the contractual power 

presently to designate 50 percent or 

more of the directors of a for-profit or 

not-for-profit corporation, or 50 percent 

or more of the trustees in the case of 

trusts that are irrevocable and/or in 

which the settlor does not retain a 

reversionary interest. 

* * * * * 

PART 802—EXEMPTION RULES 

■ 3. The authority citation for part 802 

continues to read as follows: 

Authority: 15 U.S.C. 18a(d). 

■ 4. Amend § 802.1 by revising the 

section heading, introductory text, and 

Example 4 of paragraph (d)(4) to read as 

follows: 

§ 802.1 Acquisitions of goods in the 

ordinary course of business. 

Pursuant to section 7A(c)(1) of the 

Clayton Act (the ‘‘Act’’), acquisitions of 

goods transferred in the ordinary course 

of business are exempt from the 

notification requirements of the Act. 

This section identifies certain 

acquisitions of goods that are exempt as 

transfers in the ordinary course of 

business. This section also identifies 

certain acquisitions of goods that are not 

in the ordinary course of business and, 

therefore, do not qualify for the 

exemption. 

* * * * * 

(d) * * * 

(4) * * * 

Examples: * * * 

4. ‘‘A,’’ a national producer of canned fruit, 

preserves, jams and jellies, agrees to purchase 

from ‘‘B’’ for in excess of $50 million (as 

adjusted) a total of 20,000 acres of orchards 

and vineyards in several locations 

throughout the U.S. ‘‘A’’ plans to harvest the 

fruit from the acreage for use in its canning 

operations. The acquisition is not exempt 

under this section because orchards and 

vineyards are real property, not ‘‘goods.’’ If, 

on the other hand, ‘‘A’’ had contracted to 

acquire from ‘‘B’’ the fruit and grapes 

harvested from the orchards and vineyards, 

the acquisition would qualify for the 

exemption as an acquisition of current 

supplies under paragraph (c)(3) of this 

section. Although the transfer of orchards 

and vineyards is not exempt under this 


sradovich on DSK3GMQ082PROD with RULES
Federal Register / Vol. 83, No. 136 / Monday, July 16, 2018 / Rules and Regulations 32771 

section, the acquisition could be exempt 

under § 802.2(g) as an acquisition of 

agricultural property. 

* * * * * 

■ 5. Amend § 802.30 by revising the 

introductory text of paragraph (c) to 

read as follows: 

§ 802.30 Intraperson transactions. 

* * * * * 

(c) For purposes of applying § 802.4(a) 

to an acquisition that may be reportable 

under § 801.40 or § 801.50, assets, 

voting securities, or non-corporate 

interests contributed by the acquiring 

person to a new entity upon its 

formation are assets, voting securities, 

or non- corporate interests whose 

acquisition by that acquiring person is 

exempt from the requirements of the 

Act. 

* * * * * 

■ 6. Amend § 802.41 by revising 

Example 1 to read as follows: 

§ 802.41 Corporations or unincorporated 

entities at time of formation. 

* * * * * 

Examples: 1. Corporations A and B, each 

having sales of in excess of $100 million (as 

adjusted), each propose to contribute in 

excess of $50 million (as adjusted) in assets 

in exchange for 50 percent of the voting 

securities of a new corporation, N. Under this 

section, the new corporation need not file 

notification, although both A and B must do 

so and observe the waiting period prior to 

receiving any voting securities of N. 

* * * * * 

PART 803—TRANSMITTAL RULES 

■ 7. The authority citation for part 803 

continues to read as follows: 

Authority: 15 U.S.C. 18a(d). 

■ 8. Amend § 803.5 by: 

■ a. Revising the introductory text of 

paragraph (a)(1); 

■ b. Adding an example in paragraph 

(a)(1)(vi); and 

■ c. In paragraph (a)(2), removing 

‘‘Example:’’ and adding in its place 

‘‘Examples to paragraph (a)(2):’’. 

The revisions and addition read as 

follows: 

§ 803.5 Affidavits Required. 

(a)(1) Section 801.30 acquisitions. For 

acquisitions to which § 801.30 applies, 

the notification required by the Act from 

each acquiring person shall contain an 

affidavit, attached to the front of the 

notification, or with the DVD 

submission, attesting that the issuer or 

unincorporated entity whose voting 

securities or non-corporate interests are 

to be acquired has received written 

notice delivered to an officer (or a 

person exercising similar functions in 

the case of an entity without officers) by 

email, certified or registered mail, wire, 

or hand delivery, at its principal 

executive offices, of: 

* * * * * 

(vi) * * * 

Example to paragraph (a)(1)(vi): 1. 

Company A intends to acquire voting 

securities of Company B. ‘‘A’’ sends, via 

email, a notice letter to a general email 

account, information@CompanyB.com. ‘‘A’’ 

has not provided sufficient notice. 

Alternatively, ‘‘A’’ sends, via email, a notice 

letter to ‘‘B’s’’ President, Jane Doe, at 

Jane.Doe@CompanyB.com. ‘‘A’’ has provided 

email notice to a specific officer of ‘‘B.’’ 

* * * * * 

■ 9. Amend § 803.11 by revising 

paragraph (c) to read as follows: 

§ 803.11 Termination of waiting period. 

* * * * * 

(c) The Federal Trade Commission 

and the Assistant Attorney General may, 

in their discretion, terminate a waiting 

period upon the written request of any 

person filing notification or, 

notwithstanding paragraph (a) of this 

section, sua sponte. A request for 

termination of the waiting period shall 

be sent to the offices designated in 

§ 803.10(c). Termination shall be 

effective upon notice to any requesting 

person by either email or telephone, and 

such notice shall be given as soon as 

possible. Such notice shall be made to 

each person which has filed 

notification, and notice of termination 

shall be published in the Federal 

Register in accordance with section 

7A(b)(2) of the Clayton Act (the ‘‘act’’). 

The Federal Trade Commission and the 

Assistant Attorney General also may use 

other means to make the termination 

public, prior to publication in the 

Federal Register in a manner that will 

make the information equally accessible 

to all members of the public. 

■ 10. Amend § 803.12 by revising 

paragraphs (a), (b), and (c)(1) to read as 

follows: 

§ 803.12 Withdraw and refile notification. 

(a) Voluntary. An acquiring person, 

and in the case of an acquisition to 

which § 801.30 does not apply, an 

acquired person, may withdraw its 

notification by notifying the Federal 

Trade Commission and the Antitrust 

Division in writing by email or mail of 

such withdrawal. 

(b) Upon public announcement of 

termination. An acquiring person’s 

notification or, in the case of an 

acquisition to which § 801.30 of this 

chapter does not apply, an acquiring or 

an acquired person’s notification, will 

be deemed to have been withdrawn if 

any filing that publicly announces the 

expiration, termination or withdrawal of 

a tender offer or the termination of an 

agreement or letter of intent is made by 

the acquiring person or the acquired 

person with the U.S. Securities and 

Exchange Commission (‘‘SEC’’) under 

the Securities Exchange Act of 1934 (15 

U.S.C. 78a et seq.) and rules 

promulgated under that act. The 

acquiring person or acquired person 

must notify the Federal Trade 

Commission and the Antitrust Division 

in writing by email or mail that such 

filing has been made with the SEC and 

the withdrawal shall be deemed 

effective on the date of the SEC filing. 

Withdrawal of the HSR notification(s) 

shall occur even if statements are made 

in the SEC filing indicating a desire to 

recommence the tender offer or enter 

into a new or amended agreement or 

letter of intent. This paragraph is 

inapplicable if the initial 15-day or 30- 

day waiting period has expired without 

issuance of a request for additional 

information or documentary material 

and without an agreement in place with 

the Agencies to delay closing of the 

transaction (‘‘a timing agreement’’); or 

early termination of that waiting period 

has been granted, without a timing 

agreement in place; or if a request for 

additional information or documentary 

material has been issued and the 

Agencies have either granted early 

termination or allowed the extended 

waiting period to expire following 

certification of compliance without a 

timing agreement in place. 

(c) Resubmission without a new filing 

fee. (1) An acquiring person whose 

notification has been voluntarily 

withdrawn pursuant to paragraph (a) of 

this section, or an acquiring person 

whose notification is deemed to have 

been automatically withdrawn under 

paragraph (b) of this section, may 

resubmit its notification, thereby 

initiating a new waiting period for the 

same transaction without an additional 

filing fee pursuant to § 803.9(f). This 

procedure may be used only one time, 

and only under the following 

circumstances: 

(i) The notification is withdrawn prior 

to the expiration or early termination of 

the waiting period and prior to the 

issuance of a request for additional 

information pursuant to § 803.20 and 

section 7A(e) of the act; 

(ii) The proposed acquisition does not 

change in any material way; 

(iii) The resubmitted notification is 

recertified, and the submission, as it 

relates to Items 4(a), 4(b), 4(c), and 4(d) 

of the Notification and Report Form, is 

updated to the date of the resubmission; 


sradovich on DSK3GMQ082PROD with RULES
32772 Federal Register / Vol. 83, No. 136 / Monday, July 16, 2018 / Rules and Regulations 

(iv) A new executed affidavit is 

provided with the resubmitted HSR 

filing; and 

(v) The resubmitted notification is 

refiled prior to the close of the second 

business day after withdrawal. 

* * * * * 

■ 11. Amend § 803.20 by revising 

paragraphs (b)(2)(ii) and (b)(3) and the 

example in paragraph (b)(3) to read as 

follows: 

§ 803.20 Requests for additional 

information or documentary material. 

* * * * * 

(b) * * * 

(2) * * * 

(ii) In the case of a written request, 

upon notice of the issuance of such 

request to the person to which it is 

directed within the original 30-day (or, 

in the case of a cash tender offer or of 

an acquisition covered by 11 U.S.C. 

363(b), 15-day) waiting period (or, if 

§ 802.23 applies, such other period as 

that section provides), provided that 

written confirmation of the request is 

emailed or mailed to the person to 

which the request is directed within the 

original 30-day (or, in the case of a cash 

tender offer or of an acquisition covered 

by 11 U.S.C. 363(b), 15-day) waiting 

period (or, if § 802.23 applies, such 

other period as that section provides). 

Notice to the person to which the 

request is directed may be given by 

email, telephone or in person. The 

person filing notification shall keep a 

designated individual reasonably 

available during normal business hours 

throughout the waiting period at the 

email or telephone number supplied in 

the Notification and Report Form. 

Notice of a request for additional 

information or documentary material 

need be given by email or telephone 

only to that individual or to the 

individual designated in accordance 

with paragraph (b)(2)(iii) of this section. 

The written confirmation of the request 

shall be emailed or mailed to the 

ultimate parent entity of the person 

filing notification, or if another entity 

within the person filed notification 

pursuant to § 803.2(a), then to such 

entity. 

* * * * * 

(3) Requests to natural persons. A 

request addressed to an individual, 

requiring that he or she submit 

additional information or documentary 

material, shall be transmitted to the 

person filing notification of which the 

individual is an ultimate parent entity, 

officer, director, partner, agent or 

employee, and shall be effective as to 

that individual when effective as to the 

person filing notification pursuant to 

paragraph (b)(2) of this section. A 

written copy of the request shall also be 

delivered to the individual by email, by 

hand, or by registered or certified mail 

at his or her home or business address. 

Example: A designee of the Federal 

Trade Commission sends, by email, a 

written request for additional 

information to the CEO of corporation 

W, the ultimate parent entity within a 

person that filed notification. The 

request is effective under paragraph 

(b)(2)(i) of this section. If the email also 

addressed a request for documentary 

material to the Secretary of corporation 

W, a named individual, under this 

paragraph (b)(3), the request would 

likewise be effective as to the individual 

upon receipt of the email by corporation 

W. In the latter case, the Federal Trade 

Commission also would send a copy of 

the request to the Secretary of the 

corporation at his or her home or 

business address, or email. 

* * * * * 

Appendix to Part 803 [Redesignated as 

Appendix A to Part 803] 

■ 12. Redesignate the appendix to part 

803 as appendix A to part 803. 

■ 13. Add appendix B to part 803 to 

read as follows: 

Appendix B to Part 803—Instructions to 

the Notification and Report Form for 

Certain Mergers and Acquisitions 

BILLING CODE 6750–01–P 


sradovich on DSK3GMQ082PROD with RULES
Federal Register / Vol. 83, No. 136 / Monday, July 16, 2018 / Rules and Regulations 32773 


sradovich on DSK3GMQ082PROD with RULESER16JY18.001</GPH>

ANTITRUST IMPROVEMENTS ACT 

NOTIFICATION AND REPORT FORM 

for Certain Mergers and Acquisitions 

The Notification and Report Form ("the Form") is required to be 

submitted pursuant to § 803.1 (a) of the premerger notification 

rules, 16 CFR Parts 801-803 ("the Rules"). These instructions 

specify the information that must be provided in response to the 

items on the Form. 

Information 

The central office for information and assistance concerning the 

Form and the Rules is: 

Premerger Notification Office 

Federal Trade Commission, Room #5301 

400 ylh Street, S.W. 

Washington, D.C. 20024 

Phone: (202) 326-3100 

E-mail: HSRhelp@ftc.gov 

Copies of the Form, Instructions and as well as information 

to assist in completing the Form are available at the PNO 

website. 

Definitions 

The definitions used in this Form are set forth in the Rules. See 

Statute, Rules and Formal Interpretations for copies of the HartScott-Rodino Act ("the Act"), the Rules, and the Federal Register 

Notices issuing the Rules and Rule amendments ("Statements of 

Basis and Purpose"). 

The term "documentary attachments" refers .Q.!J.]y to materials 

submitted in response to Item 3(b), Item 4 and to submissions 

pursuant to§ 803.1 (b) of the Rules. 

The terms "person filing" or "filing person" mean the ultimate 

parent entity ("UPE"). (See§ 801.1 (a)(3)). The terms are used 

herein interchangeably. 

Filing 

Parties should file the completed Form, together with all 

documentary attachments, with the Premerger Notification Office 

("PNO") of the Federal Trade Commission ("FTC") and the 

Premerger Unit of the Antitrust Division of the Department of 

Justice ("DOJ") (together, "the Agencies"). Filers have the option 

of submitting a DVD filing or a paper filing. Filings should be 

submitted to: 

Premerger Notification Office 

Federal Trade Commission, Room #5301 

400 ylh Street, S.W. 

Washington, D.C. 20024 

and 

Department of Justice 

Antitrust Division 

Premerger and Division Statistics Unit 

450 Fifth Street, N.W., Suite 1100 

Washington, D.C. 20530 

If one or both delivery sites are unavailable, the Agencies may 

announce alternate sites for delivery through the media and, if 

possible, at the PNO website. 

Instructions to FTC Form C4 (rev. 02/04/2018) 

CMXCV 

The Form must be a searchable PDF document. All other files 

must be in searchable PDF or MS Excel spreadsheet format and 

saved in color, if applicable. This includes the affidavit and 

certification. 

Label each DVD with the name of the person filing, the name of a 

contact person and that person's phone number. Leave space on 

the DVD for the Agencies to write the assigned transaction 

number and date of receipt. 

If the DVD or files contain viruses, passwords, or are not 

readable, the filing will not be accepted and the waiting period will 

not start. 

For further instructions on DVD filing and specific DVD 

requirements, go to HSR Resources on the PNO website. 

Affidavits 

Affidavit(s) are required by § 803.5 and must attest to the good 

faith of the persons filing to complete the transaction. Affidavits 

must be notarized or use the language found in 28 U.S.C. § 1746 

relating to unsworn declarations under penalty of perjury. If an 

entity is filing on behalf of the acquiring or acquired person, the 

affidavit must still attest to the good faith of the UPE. 

In non-§ 801.30 transactions, the affidavit(s) (submitted by 

both persons filing) must attest that a contract, agreement in 

principle or letter of intent to merge or acquire has been 

executed, and further attest to the good faith intention of the 

person filing notification to complete the transaction. (See 

§ 803.5(b)). 

In § 801.30 transactions, the affidavit (submitted .Q.!J.]y by the 

acquiring person) must attest: 

1) that the issuer whose voting securities or the 

unincorporated entity whose non-corporate interests are 

to be acquired has received notice, as described below, 

from the acquiring person; 

2) in the case of a tender offer, that the intention to make 

the tender offer has been publicly announced; and 

CMXCV 
32774 Federal Register / Vol. 83, No. 136 / Monday, July 16, 2018 / Rules and Regulations 


sradovich on DSK3GMQ082PROD with RULESER16JY18.002</GPH>

3) the good faith intention of the person filing notification to 

complete the transaction. 

Acquiring persons in § 801.30 transactions are required to 

submit a copy of the notice received by the acquired person 

pursuant to§ 803.5(a)(3) along with the filing. This notice 

must include: 

1) the identity of the acquiring person and the fact that the 

acquiring person intends to acquire voting securities of 

the issuer or non-corporate interests of the 

unincorporated entity; 

2) the specific notification threshold that the acquiring 

person intends to meet or exceed in an acquisition of 

voting securities; 

3) the fact that the acquisition may be subject to the Act, 

and that the acquiring person will file notification under 

the Act; 

4) the anticipated date of receipt of such notification by the 

Agencies; and 

5) the fact that the person within which the issuer or 

unincorporated entity is included may be required to file 

notification under the Act. (See§ 803.5(a)). 

Responses 

Enter the name of the person filing notification in Item 1 (a) on 

page 1 of the Form, and enter the same name and the date on 

which the Form is completed at the top of each page of the Form. 

If there is insufficient room on the Form for a response to a 

particular item, attach "additional pages" behind that item on the 

Form. Filers must submit a complete set of additional pages 

within each copy of the Form. 

Each additional page should identify, at the top of the page, the 

name of the person filing notification, the date on which the Form 

is completed and the item to which it is addressed. 

Voluntary submissions pursuant to§ 803.1 (b) should be identified 

as V-1, V-2, etc. 

If unable to answer any item fully, provide such information as is 

available and a statement of reasons for non-compliance as 

required by § 803.3. If exact answers to any item cannot be 

given, enter best estimates and indicate the source or basis of 

such estimates. Add an endnote with the notation "est." to any 

item where data are estimated. 

All financial information should be expressed in millions of dollars 

rounded to the nearest one-tenth of a million dollars. 

Limited Response 

The acquired person should limit its response in Items 5-7: 

1) in the case of an acquisition of assets, to the assets 

being acquired; 

2) in the case of an acquisition of voting securities, to the 

issuer(s) whose voting securities are being acquired and 

all entities controlled by such acquired entities; and 

3) in the case of an acquisition of non-corporate interests, 

to the unincorporated entity(s) whose non-corporate 

interests are being acquired and all entities controlled by 

such acquired entities. 

Separate responses may be required where a person is both 

acquiring and acquired. (See§ 803.2(b)). 

Information need not be supplied regarding assets, voting 

securities or non-corporate interests currently being acquired 

Instructions to FTC Form C4 (rev. 02/04/2018) 

CMXCVI 

when their acquisition is exempt under the Act or Rules. (See 

§ 803.2(c)). 

Year 

All references to "year" refer to calendar year. If data are not 

available on a calendar year basis, supply the requested data for 

the fiscal year reporting period that most nearly corresponds to 

the calendar year specified. References to "most recent year" 

mean the most recent calendar or fiscal year for which the 

requested information is available. 

North American Industry Classification System (NAICS) Data 

The Form requests "dollar revenues" categorized by NAICS 

codes for non-manufactured and manufactured products with 

respect to operations conducted within the United States, and for 

products manufactured outside of the United States and sold into 

the United States. (See§ 803.2(d)). Filing persons must submit 

data at the 6-digit NAICS national industry code level to reflect 

non-manufacturing dollar revenues. To the extent that dollar 

revenues are derived from manufacturing operations (NAICS 

Sectors 31-33), filing persons must only submit data at the 10-

digit NAICS product code levels, not the 6-digit level. (See Item 5 

below). 

In reporting information by 6-digit NAICS industry code, refer to 

the 2012 North American Industry Classification System - United 

States published by the Executive Office of the President, Office 

of Management and Budget. In reporting information by 10-digit 

NAICS product code, refer to the 2012 Numerical List of 

Manufactured and Mineral Products published by the Bureau of 

the Census. Information regarding NAICS is available at 

www.census.gov. This site also provides assistance in choosing 

the proper code(s) for reporting in Item 5 of the Form. 

Filers should continue to use 6- and 10-digit 2012 NAICS codes 

when filling out Items 5, 7, and 8 of the Form. The U.S. Census 

Bureau is transitioning to a new classification system and the 

PNO will wait until that system is fully functional before switching. 

Please monitor the PNO's website for further announcements on 

this topic. 

Thresholds 

Filing fee and notification thresholds are adjusted annually 

pursuant to 15 U.S.C. § 18A(a)(2)(A) based on the change in 

gross national product, in accordance with 15 U.S.C. § 19(a)(5). 

The current threshold values can be found at Current Filing 

Thresholds. 

END OF GENERAL SECTION 

CMXCVI 
Federal Register / Vol. 83, No. 136 / Monday, July 16, 2018 / Rules and Regulations 32775 


sradovich on DSK3GMQ082PROD with RULESER16JY18.003</GPH>

Fee Information 

The fee for filing the Form is based on the aggregate total value 

of assets, voting securities and controlling non-corporate interests 

to be held as a result of the acquisition: 

greater than $50 million (as 

adjusted) but less than $100 million 

(as adjusted) 

$100 million (as adjusted) or greater 

but less than $500 million 

(as adjusted) 

$500 million or greater 

(as adjusted) 

$45,000 

$125,000 

$280,000 

For current thresholds and fee information, see the PNO website. 

Amount Paid 

Indicate the amount of the filing fee paid. This amount should be 

net of any banking or financial institution charges. 

Payer Identification 

Provide the payer's name and 9-digit Taxpayer Identification 

Number (TIN). If the payer is a natural person with no TIN, 

provide the natural person's social security number. 

Method of Payment 

The preferred method of payment is by electronic wire transfer 

(EWT). For EWT payments, provide the EWT confirmation 

number and the name of the financial institution from which the 

EWT is being sent. If the EWT confirmation number is not 

available at the time of filing, provide this information to the PNO 

within two business days of filing. 

In order for the FTC to track payment, the payer must provide 

information required by the Fedwire Instructions to the financial 

institution initiating the EWT. A template of the Fedwire 

Instructions is available at the PNO website on the Filing Fee 

Information page. 

There are now specific, limited criteria for paying by certified 

check. Please see the Filing Fee Information page for details. 

Corrective Filings 

Put an X in the appropriate box to indicate whether the notification 

is a corrective filing (i.e., an acquisition that has already taken 

place without filing, in violation of the statute). See Procedures 

for Submitting Post-Consummation Filings for more information 

on how to proceed in the case of a corrective filing. 

Cash Tender Offer 

Put an X in the appropriate box to indicate whether the acquisition 

is a cash tender offer. 

Bankruptcy 

Put an X in the appropriate box to indicate whether the acquired 

person's filing is being made by a trustee in bankruptcy or by a 

debtor-in-possession for a transaction that is subject to Section 

363(b) of the Bankruptcy Code (11 U.S.C. § 363). 

Instructions to FTC Form C4 (rev. 02/04/2018) 

CMXCVII 

Early Termination 

Put an X in the "yes" box to request early termination of the 

waiting period. Notification of each grant of early termination will 

be published in the Federal Register, as required by 15 U.S.C. 

§ 18A(b)(2), and on the PNO website. Note that if either party in 

.§!JY transaction requests early termination, it may be granted and 

published. 

Transactions Subject to International Antitrust Notification 

If, to the knowledge or belief of the filing person at the time of 

filing, a non-U.S. antitrust or competition authority has been or will 

be notified of the proposed transaction, list the name of each such 

authority. Response to this item is voluntary. 

CMXCVII 
32776 Federal Register / Vol. 83, No. 136 / Monday, July 16, 2018 / Rules and Regulations 


sradovich on DSK3GMQ082PROD with RULESER16JY18.004</GPH>

Item 1(a) 

Provide the name, headquarters address and website (if one 

exists) of the person filing notification. The name of the person 

filing is the name of the UPE. (See§ 801.1 (a)(3)). 

Item 1(b) 

Indicate whether the person filing notification is an acquiring 

person, an acquired person, or both an acquiring and acquired 

person. (See§ 801.2). 

Item 1(c) 

Put an X in the appropriate box to indicate whether the person in 

Item 1 (a) is a corporation, unincorporated entity, natural person, 

or other (specify). (See§ 801.1). 

Item 1(d) 

Put an X in the appropriate box to indicate whether data furnished 

in Item 5 is by calendar year or fiscal year. If fiscal year, specify 

the time period. 

Item 1(e) 

Put an X in the appropriate box to indicate if the Form is being 

filed on behalf of the UPE by another entity within the same 

person authorized by it to file notification on its behalf pursuant to 

§ 803.2(a), or if the Form is being filed pursuant to§ 803.4 on 

behalf of a foreign person. Then provide the name and mailing 

address of the entity filing notification on behalf of the filing 

person named in Item 1 (a) of the Form. 

Item 1(f) 

For the acquiring person, if an entity other than the UPE listed in 

Item 1(a) is making the acquisition, provide the name and mailing 

address of that entity and the percentage of its voting securities or 

non-corporate interests held directly or indirectly by the person 

named in Item 1 (a) above. 

For the acquired person, if the assets, voting securities or noncorporate interests of an entity other than the UPE listed in Item 

1 (a) are being acquired, provide the name and mailing address of 

that entity and the percentage of its voting securities or noncorporate interests held directly or indirectly by the person named 

in Item 1 (a) above: 

Item 1(g) 

Provide the name and title, firm name, address, telephone 

number, and e-mail address of the primary and secondary 

individuals to contact regarding the Form. A second contact 

person is required. (See§ 803.20(b)(2)(ii)). 

Item 1(h) 

Foreign filing persons must provide the name, firm name, 

address, telephone number, and e-mail address of an individual 

located in the United States designated for the limited purpose of 

receiving notice of the issuance of a request for additional 

information or documentary material. (See § 803.20(b)(2)(iii)). 

Note: The Form has fields for fax numbers in Item 1. Providing fax 

numbers is no longer necessary. The fields will be deleted during 

the next update of the HSR Form. 

END OF ITEM 1 

Instructions to FTC Form C4 (rev. 02/04/2018) 

CMXCVIII 

Item 2(a) 

Provide the names of all UPEs of acquiring and acquired persons 

that are parties to the transaction, whether or not they are 

required to file notification. If a person is not required to file, 

check the non-reportable box. 

Item 2(b) 

Put an X in all the boxes that apply to the transaction. 

Item 2(c) 

This item should only be completed by the acquiring person 

where voting securities are being acquired. If more than 

voting securities are being acquired, respond to this item only 

regarding voting securities. Put an X in the box to indicate the 

highest applicable threshold for which notification is being filed: 

$50 million (as adjusted), $100 million (as adjusted), $500 million 

(as adjusted), 25% (if the value of voting securities to be held is 

greater than $1 billion, as adjusted), or 50%. (See§ 801.1 (h)). 

Note that the 50% notification threshold is the highest threshold 

and should be used for any acquisition of 50% or more of the 

voting securities of an issuer, regardless of the value of the voting 

securities. For instance, an acquisition of 100% of the voting 

securities of an issuer, valued in excess of $500 million (as 

adjusted) would cross the 50% notification threshold, not the $500 

million (as adjusted) threshold. 

Item 2(d) 

Provide the requested information on assets, voting securities 

and non-corporate interests. If a combination of assets, voting 

securities and/or non-corporate interests are being acquired and 

allocation is not possible, note such information in an endnote. 

For determining percentage of voting securities, evaluate total 

voting power per § 801.12. 

For determining percentage of non-corporate interests, evaluate 

the economic interests per§ 801.1 (b)(1)(ii). 

Item 2(d)(i) 

State the value of voting securities already held. (See § 801.1 0). 

Item 2(d)(ii) 

State the percentage of voting securities already held. (See 

§ 801.12). 

Item 2(d)(iii) 

State the total value of voting securities to be held as a result of 

the acquisition. (See§ 801.1 0). 

Item 2(d)(iv) 

State the total percentage of voting securities to be held as a 

result of the acquisition. (See § 801.12). 

Item 2(d)(v) 

State the value of non-corporate interests already held. (See 

§ 801.10). 

Item 2(d)(vi) 

State the percentage of non-corporate interests already held. 

(See§ 801.1 (b)(1)(ii)). 

Item 2(d)(vii) 

State the total value of non-corporate interests to be held as a 

result of the acquisition. (See§ 801.1 0). 

CMXCVIII 
Federal Register / Vol. 83, No. 136 / Monday, July 16, 2018 / Rules and Regulations 32777 


sradovich on DSK3GMQ082PROD with RULESER16JY18.005</GPH>

Item 2(d}(viii} 

State the total percentage of non-corporate interests to be held as 

a result of the acquisition. (See§§ 801.10 and 801.1 (b)(1)(ii)). 

Item 2(d}(ix} 

State the value of assets to be held as a result of the acquisition. 

(See§801.10). 

Item 2(d}(x} 

State the aggregate total value of assets, voting securities and 

non-corporate interests of the acquired person to be held as a 

result of the acquisition. (See§§ 801.10, 801.12, 801.13 and 

801.14). 

END OF ITEM 2 

Instructions to FTC Form C4 (rev. 02/04/2018) 

CMXCIX 

Item 3(a} 

At the top of Item 3(a), list the name and mailing address of each 

acquiring and acquired person, and acquiring and acquired entity, 

whether or not required to file notification. It is not necessary to 

list every subsidiary wholly-owned owned by an acquired entity. 

In the Transaction Description section, briefly describe the 

transaction, indicating whether assets, voting securities or noncorporate interests (or some combination) are to be acquired. 

Describe the business operation(s) being acquired. If assets, 

describe the assets and whether they comprise a business 

operation. Also, indicate what consideration will be received by 

each party and the scheduled consummation date of the 

transaction. 

If any attached transaction documents use coded names to refer 

to the parties, please provide an index identifying the codes. 

If there are additional filings, such as shareholder backside filings, 

associated with the transaction, identify those. Also, identify any 

special circumstances that apply to the filing, such as whether 

part of the transaction is exempt under one of the exemptions 

found in Part 802. 

Item 3(b} 

Furnish copies of all documents that constitute the agreement(s) 

among the acquiring person(s) and the person(s) whose assets, 

voting securities or non-corporate interests are to be acquired. 

Also furnish agreements not to compete and other agreements 

between the parties. Do not submit schedules and the like unless 

they contain agreements not to compete, other agreements 

between the parties, or other important terms of the transaction. 

For purposes of Item 3(b), responsive documents must be 

submitted; identifying an internet address or providing a link is not 

sufficient. 

Documents that constitute the agreement(s) (e.g., a Letter of 

Intent, Merger Agreement, Purchase and Sale Agreement) must 

be executed, while agreements not to compete may be provided 

in draft form if that is the most recent version. 

If parties are filing on an executed Letter of Intent, they may also 

submit a draft of the definitive agreement, if one exists. 

Note that transactions subject to § 801.30 and bankruptcies under 

11 U.S.C. § 363 do not require an executed agreement or letter of 

intent. For bankruptcies, provide the order from the bankruptcy 

court. 

END OF ITEM 3 

CMXCIX 
32778 Federal Register / Vol. 83, No. 136 / Monday, July 16, 2018 / Rules and Regulations 


sradovich on DSK3GMQ082PROD with RULESER16JY18.006</GPH>

Item 4(a) 

Provide the names of all entities within the person filing 

notification, including the UPE, that file annual reports (Form 1 0-K 

or Form 20-F) with the United States Securities and Exchange 

Commission, and provide the Central Index Key (CIK) number for 

each entity. 

Item 4(b) 

Provide the most recent annual reports and/or annual audit 

reports (or, if audited is unavailable, unaudited) of the person 

filing notification. 

The acquiring person should also provide the most recent reports 

of the acquiring entity(s) and any controlled entity whose dollar 

revenues contribute to an overlap reported in Item 7. 

The acquired person should also provide the most recent reports 

of the acquired entity(s). 

Natural persons need only provide the most recent reports for the 

highest level entity(s) they control. Do not provide personal 

balance sheets or tax returns. 

If the most recent reports do not show sales or assets sufficient to 

meet the size of person test, and the size of person test is 

relevant given the size of the transaction, the filing person must 

stipulate in Item 4(b) that it meets the test. 

Note that the person filing notification may incorporate a 

document by reference to an internet address directly linking to 

the document. (See§ 803.2(e)). 

Items 4(c) and 4(d) 

For each document responsive to Items 4(c) and 4(d), provide 

the: 

1) document's title; 

2) date of preparation; and 

3) name and title of each individual who prepared the 

document. 

If a specific date is not available, indicate the month and year the 

document was prepared. 

If a large group of people prepared the document, list all the 

authors and their titles, identifying the principal authors. 

Alternatively, it is acceptable to indicate that the document was 

prepared under the supervision of the lead author and to provide 

the name and title of that author. If a third party prepared the 

document, the date of preparation and the name of the third party 

will suffice. 

Numbering 

Number each document provided in response to Items 4(c) and 

4(d). Number 4(c) documents 4(c)-1, 4(c)-2, 4(c)-3, 

etc. Likewise, number 4(d) documents 4(d)-1, 4(d)-2, 4(d)-3, etc., 

regardless of the three sub-categories within Item 4(d). If 

providing only one document, identify it as 4(c)-1 or 4(d)-1. 

When submitting a document responsive to both 4(c) and 4(d), list 

it only once, under 4(c) Q[ 4(d). If a document is responsive to 

both 4(c) and 4(d), do not cross-reference. 

Instructions to FTC Form C4 (rev. 02/04/2018) M 

M 

Privilege 

Note that if the filing person withholds or redacts portions of any 

document responsive to Items 4(c) and 4(d) based on a claim of 

privilege, the person must provide a statement of reasons for noncompliance (a "privilege log") detailing the claim of privilege for 

each withheld or redacted document. (See§ 803.3(d)). 

For each document, include the: 

1) title of the document; 

2) its author; 

3) author's title/position; 

4) addressee; 

5) addressee's title/position; 

6) date; 

7) subject matter; 

8) all recipients of the original and any copies; 

9) recipients' titles/positions; 

1 0) document's present location; and 

11) who has control over it. 

Additionally, the filing person must state the factual basis 

supporting the privilege claim in sufficient detail to enable staff to 

assess the validity of the claim for each document without 

disclosing the protected information. 

If a privileged document was circulated to a group, such as the 

Board or an investment committee, the name of the group is 

sufficient, but the filing person should be prepared to disclose the 

names and titles/positions of the individual group members, if 

requested. If the claim of privilege is based on advice from inside 

and/or outside counsel, the name of the inside and/or outside 

counsel providing the advice (and the law firm, if applicable) must 

be provided. If several lawyers participated in providing advice, 

identifying lead counsel is sufficient. In identifying who controls a 

document, the name of the law firm is sufficient. 

When creating a privilege log, use a separate numbering system 

for withheld documents, such as P-1, P-2, etc. Redacted 

documents should also be listed in a separate log that complies 

with§ 803.3(d). 

Item 4(c) 

Provide all studies, surveys, analyses and reports which were 

prepared by or for any officer(s) or director(s) (or, in the case of 

unincorporated entities, individuals exercising similar functions) 

for the purpose of evaluating or analyzing the acquisition with 

respect to market shares, competition, competitors, markets, 

potential for sales growth or expansion into product or geographic 

markets. 

Item 4(d) 

Item 4(d)(i) 

Provide all Confidential Information Memoranda prepared by or 

for any officer(s) or director(s) (or, in the case of unincorporated 

entities, individuals exercising similar functions) of the UPE of the 

acquiring or acquired person or of the acquiring or acquired 

entity(s) that specifically relate to the sale of the acquired entity(s) 
Federal Register / Vol. 83, No. 136 / Monday, July 16, 2018 / Rules and Regulations 32779 


sradovich on DSK3GMQ082PROD with RULESER16JY18.007</GPH>

or assets. If no such Confidential Information Memorandum 

exists, submit any document(s) given to any officer(s) or 

director(s) of the buyer meant to serve the function of a 

Confidential Information Memorandum. This does not include 

ordinary course documents and/or financial data shared in the 

course of due diligence, except to the extent that such materials 

served the purpose of a Confidential Information Memorandum 

when no such Confidential Information Memorandum exists. 

Documents responsive to this item are limited to those produced 

up to one year before the date of filing. 

Item 4(d)(ii) 

Provide all studies, surveys, analyses and reports prepared by 

investment bankers, consultants or other third party advisors 

("third party advisors") for any officer(s) or director(s) (or, in the 

case of unincorporated entities, individuals exercising similar 

functions) of the UPE of the acquiring or acquired person or of the 

acquiring or acquired entity(s) for the purpose of evaluating or 

analyzing market shares, competition, competitors, markets, 

potential for sales growth or expansion into product or geographic 

markets that specifically relate to the sale of the acquired entity(s) 

or assets. This item requires only materials developed by third 

party advisors during an engagement or for the purpose of 

seeking an engagement. Documents responsive to this item are 

limited to those produced up to one year before the date of filing. 

Item 4(d)(iii) 

Provide all studies, surveys, analyses and reports evaluating or 

analyzing synergies and/or efficiencies prepared by or for any 

officer(s) or director(s) (or, in the case of unincorporated entities, 

individuals exercising similar functions) for the purpose of 

evaluating or analyzing the acquisition. Financial models without 

stated assumptions need not be provided in response to this item. 

END OF ITEM 4 

Instructions to FTC Form C4 (rev. 02/04/2018) 

Ml 

ITEMS 5 THROUGH 7 

Limited response for acquired person. For Items 5 through 7, 

the acquired person should limit its response in the case of an 

acquisition of: 

1) assets, to the assets to be acquired; 

2) voting securities, to the issuer(s) whose voting securities 

are being acquired and all entities controlled by such 

issuer; and/or 

3) non-corporate interests, to the unincorporated entity(s) 

being acquired and all entities controlled by such 

unincorporated entity(s). 

A person filing as both acquiring and acquired persons may be 

required to provide a separate response to Items 5 through 7 in 

each capacity so that it can properly limit its response as an 

acquired person. (See§§ 803.2(b) and (c)). 

This item requests revenue information by NAICS code regarding 

dollar revenues. (See NAICS Data section on page II). All 

persons must submit data on non-manufacturing dollar revenues 

at the 6-digit NAICS industry code level. To the extent that dollar 

revenues are derived from manufacturing operations (NAICS 

Sectors 31-33), only submit data at the 10-digit product code level 

(NAICS-based codes). 

List all NAICS codes in ascending order. 

Persons filing notification should include the total dollar revenues 

for all entities included within the person filing notification at the 

time the Form is prepared. If no dollar revenues are reported, 

check the "None" box and provide a brief explanation. 

Item 5(a) 

Provide 6-digit NAICS industry data concerning the aggregate 

U.S. operations of the person filing notification for the most recent 

year in all non-manufacturing NAICS Sectors in which the person 

engaged. If the dollar revenues for a non-manufacturing NAICS 

code totaled less than one million dollars in the most recent year, 

that code may be omitted from Item 5(a). 

Provide 1 0-digit NAICS product code data for each product code 

within all manufacturing NAICS Sectors (31-33) in which the 

person engaged in the U.S., including dollar revenues for each 

product manufactured outside the U.S. but sold into the U.S. 

Sales of any manufactured product should be reported in a 

manufacturing code only, even if sold through a separate 

warehouse or retail establishment. 

If such data have not been compiled for the most recent year, 

estimates of dollar revenues by 6-digit NAICS industry codes and 

10-digit NAICS product codes may be provided. 

Check the Overlap box for a NAICS code if both parties to the 

transaction generate dollar revenues in that NAICS code. If there 

is Q[!Jy a 6-digit overlap in a manufacturing code in Item 7, do not 

check the Overlap box for a related 1 0-digit code in Item 5. 

Ml 
32780 Federal Register / Vol. 83, No. 136 / Monday, July 16, 2018 / Rules and Regulations 


sradovich on DSK3GMQ082PROD with RULESER16JY18.008</GPH>

Item 5(b) 

Complete only if the acquisition is the formation of a joint 

venture corporation or unincorporated entity. (See§§ 801.40 

and 801.50). If the acquisition is not the formation of a joint 

venture, check the "Not Applicable" box. 

Item 5(b)(i) 

List the contributions that each person forming the joint venture 

corporation or unincorporated entity has agreed to make, 

specifying when each contribution is to be made and the value of 

the contribution as agreed by the contributors. 

Item 5(b)(ii) 

Describe fully the consideration that each person forming the joint 

venture corporation or unincorporated entity will receive in 

exchange for its contribution(s). 

Item 5(b)(iii) 

Describe generally the business in which the joint venture 

corporation or unincorporated entity will engage, including its 

principal types of products or activities, and the geographic areas 

in which it will do business. 

Item 5(b)(iv) 

Identify each 6-digit NAICS industry code in which the joint 

venture corporation or unincorporated entity will derive dollar 

revenues. If the joint venture corporation or unincorporated entity 

will be engaged in manufacturing, also specify each 10-digit 

NAICS product code in which it will derive dollar revenues. 

END OF ITEM 5 

Instructions to FTC Form C4 (rev. 02/04/2018) 

An acquired person does not complete Item 6 if the 

transaction involves only the acquisition of assets. If the 

transaction involves a mix of assets along with voting securities 

and/or non-corporate interests, the acquired person must 

complete Item 6 as related to the voting securities and noncorporate interests. 

Item 6(a) 

Mil 

Subsidiaries of filing person. List the name, city and 

state/country of all U.S. entities, and all foreign entities that have 

sales in or into the U.S., that are included within the person filing 

notification. Entities with total assets of less than $10 million may 

be omitted. Alternatively, the filing person may report all entities 

within it. 

Item 6(b) 

Minority shareholders. For the acquired entity(s) and for the 

acquiring entity(s) and its UPE or, in the case of natural persons, 

the top-level corporate or unincorporated entity(s) within that 

UPE, list the name and headquarters mailing address of each 

shareholder that holds 5% or more but less than 50% of the 

outstanding voting securities or non-corporate interests of the 

entity, and the percentage of voting securities or non-corporate 

interests held by that person. (See§ 801.1 (c)) 

For limited partnerships, only the general partner(s), regardless of 

percentage held, should be listed. 

Item 6(c) 

Minority holdings. Item 6(c) requires the disclosure of holdings 

of 5% or more but less than 50%, of any entity(s) that derives 

dollar revenues in any 6-digit NAICS code reported by the other 

person filing notification. Holdings in those entities that have total 

assets of less than $10 million may be omitted. 

The acquiring person may rely on its regularly prepared financials 

that list its investments, and those of its associates that list their 

investments, to respond to Items 6(c)(i) and (ii), provided the 

financials are no more than three months old. 

If NAICS codes are unavailable, holdings in entities that have 

operations in the same industry, based on the knowledge or belief 

of the acquiring person, should be listed. In responding to Items 

6(c)(i) and 6(c)(ii), it is permissible for the acquiring person to list 

all entities in which it or its associate(s) holds 5% or more but less 

than 50% of the voting securities of any issuer or non-corporate 

interests of any unincorporated entity. Holdings in those entities 

that have total assets of less than $10 million may be omitted. 

Item 6(c)(i) 

Minority holdings of filing person. If the person filing 

notification holds 5% or more but less than 50% of the voting 

securities of any issuer or non-corporate interests of any 

unincorporated entity, list the issuer and percentage of voting 

securities held, or in the case of an unincorporated entity, list the 

unincorporated entity and the percentage of non-corporate 

interests held. 

The acquiring person should limit its response, based on its 

knowledge or belief, to entities that derived dollar revenues in the 

most recent year from operations in industries within any 6-digit 

NAICS industry code in which the acquired entity(s) or assets 

also derived dollar revenues in the most recent year. 

The acquired person should limit its response, based on its 

knowledge or belief, to entities that derive dollar revenues in the 

Mil 
Federal Register / Vol. 83, No. 136 / Monday, July 16, 2018 / Rules and Regulations 32781 


sradovich on DSK3GMQ082PROD with RULESER16JY18.009</GPH>

same 6-digit NAICS industry code as the acquiring person. 

Item 6(c)(ii) 

Minority holdings of associates. 

This item should only be completed by the acquiring person. 

Based on the knowledge or belief of the acquiring person, for 

each associate (see§ 801.1 (d)(2)) of the acquiring person 

holding: 

1) 5% or more but less than 50% of the voting securities or 

non-corporate interests of the acquired entity(s); and/or 

2) 5% or more but less than 50% of the voting securities of 

any issuer or non-corporate interests of any 

unincorporated entity that derived dollar revenues in the 

most recent year from operations in industries within any 

6-digit NAICS industry code in which the acquired 

entity(s) or assets also derived dollar revenues in the 

most recent year; 

list the associate, the issuer or unincorporated entity and the 

percentage held. 

END OF ITEM 6 

Instructions to FTC Form C4 (rev. 02/04/2018) 

Mill 

If, to the knowledge or belief of the person filing notification, the 

acquiring person, or any associate (see§ 801.1 (d)(2)) of the 

acquiring person, derived any amount of dollar revenues (even if 

omitted from Item 5) in the most recent year from operations: 

1) in industries within any 6-digit NAICS industry code in 

which any acquired entity that is a party to the 

acquisition also derived any amount of dollar revenues in 

the most recent year; Q[ 

2) in which a joint venture corporation or unincorporated 

entity will derive dollar revenues; 

then for each such 6-digit NAICS industry code follow the 

instructions below for this section. 

Note that if the acquired entity is a joint venture, the only overlaps 

that should be reported are those between the assets to be held 

by the joint venture and any assets of the acquiring person or its 

associates not contributed to the joint venture. 

Also, if the acquiring person reports an associate overlap only, 

the acquired person does not need to respond to Item 7. 

Item ?(a) 

Industry Code Overlap Information 

Provide the 6-digit NAICS industry code and description for the 

industry, and indicate whether the overlap is from the person, an 

associate or both. 

Item ?(b) 

Item 7(b)(i) 

If the UPE of the other person(s) filing notification derived dollar 

revenues in the same 6-digit industry code(s) listed in Item ?(a), 

list the name of that UPE and the name of the entity(s) within that 

UPE that actually derived those dollar revenues, if different from 

the entity(s) listed in Item 3(a). 

Item ?(b)(ii) 

This item should only be completed by the acquiring person. 

List the name of each associate of the acquiring person that also 

derived dollar revenues through a controlled operating 

company(s) in the 6-digit industry and, if different, the name of the 

entity(s) that actually derived those dollar revenues. 

Item ?(c) 

Geographic Market Information 

Use the 2-digit postal codes for states and territories and provide 

the total number of states and territories at the end of the 

response. 

Note that except in the case of those NAICS industries in the 

Sectors and Subsectors mentioned in Item 7(c)(iv)(b), the person 

filing notification may respond with the word "national" if business 

is conducted in all 50 states. 

Item 7(c)(i) 

NAICS Sectors 31-33 

For each 6-digit NAICS industry code within NAICS Sectors 31-33 

(manufacturing industries) listed in Item ?(a), list the relevant 

geographic information in which, to the knowledge or belief of the 

person filing the notification, the products in that 6-digit NAICS 

industry code produced by the person filing notification are sold 

without a significant change in their form (whether they are sold 

by the person filing notification or by others to whom such 

products have been sold or resold). Except for industries covered 

Mill 
32782 Federal Register / Vol. 83, No. 136 / Monday, July 16, 2018 / Rules and Regulations 


sradovich on DSK3GMQ082PROD with RULESER16JY18.010</GPH>

by Item 7(c)(iv)(b), the relevant geographic information is all 

states or, if desired, portions thereof. 

Item 7(c)(ii) 

NAICS Sector 42 

For each 6-digit NAICS industry code within NAICS Sector 42 

(wholesale trade) listed in Item ?(a), list the states or, if desired, 

portions thereof in which the customers of the person filing 

notification are located. 

Item 7(c)(iii) 

NAICS Industry Group 5241 

For each 6-digit NAICS industry code within NAICS Industry 

Group 5241 (insurance carriers) listed in Item ?(a), list the state(s) 

in which the person filing notification is licensed to write 

insurance. 

Item 7(c)(iv)(a) 

Other NAICS Sectors 

For each 6-digit NAICS industry code listed in item ?(a) within the 

NAICS Sectors or Subsectors below, list the states or, if desired, 

portions thereof in which the person filing notification conducts 

such operations. 

11 

21 

22 

23 

48-49 

511 

515 

517 

71 

Item 7(c)(iv)(b) 

agriculture, forestry, fishing and hunting 

mining 

utilities 

construction 

transportation and warehousing 

publishing industries 

broadcasting 

telecommunications 

arts, entertainment and recreation 

For each 6-digit NAICS industry code listed in item ?(a) within the 

NAICS Sectors or Subsectors below, provide the address, 

arranged by state. county and city or town, of each establishment 

from which dollar revenues were derived in the most recent year 

by the person filing notification. 

2123 

32512 

32732 

32733 

44-45 

512 

521 

522 

532 

62 

72 

811 

812 

Item 7(c)(iv)(c) 

nonmetallic mineral mining and quarrying 

industrial gases 

concrete 

concrete products 

retail trade, except 442 (furniture and home 

furnishings stores), and 443 (electronics and 

appliance stores) 

motion picture and sound recording industries 

monetary authorities - central bank 

credit intermediation and related activities 

rental and leasing services 

health care and social assistance 

accommodations and food services, except 

7212 (recreational vehicle parks and 

recreational camps), and 7213 (rooming and 

boarding houses) 

repair and maintenance, except 8114 (personal 

and household goods repair and maintenance) 

personal and laundry services 

For each 6-digit NAICS industry code listed in item ?(a) within the 

NAICS Sectors or Subsectors below, list the states or, if desired, 

portions thereof in which the person filing notification conducts 

such operations. 

Instructions to FTC Form C4 (rev. 02/04/2018) 

442 furniture and home furnishings stores 

443 electronics and appliance stores 

516 internet publishing & broadcasting 

518 internet service providers 

519 other information services 

523 securities, commodity contracts and other 

financial investments and related activities 

MIV 

5242 insurance agencies and brokerages, and other 

insurance related activities 

525 funds, trusts and other financial vehicles 

53 real estate and rental and leasing 

54 professional, scientific and technical services 

55 management of companies and enterprises 

56 administrative and support and waste 

management and remediation services 

61 educational services 

7212 recreational vehicle parks and recreational 

camps 

7213 rooming and boarding houses 

813 religious, grantmaking, civic, professional, and 

similar organizations 

8114 personal and household goods repair and 

maintenance 

Item 7(d) 

This item should only be completed by the acquiring person. 

Use the geographic markets listed in Items 7(c)(i) through 7(c)(iv) 

to respond to this item, providing the information for associates of 

the acquiring person. Provide separate responses for each 

associate of the acquiring person and, if different, the controlled 

operating company(s) that actually derived the dollar revenues. 

END OF ITEM 7 

MIV 
Federal Register / Vol. 83, No. 136 / Monday, July 16, 2018 / Rules and Regulations 32783 


sradovich on DSK3GMQ082PROD with RULESER16JY18.011</GPH>

This item should only be completed by the acquiring person. 

Determine each 6-digit NAICS industry code listed in Item 7(a), in 

which the acquiring person derived dollar revenues of $1 million 

or more in the most recent year and in which either: 

1) the acquired entity derived dollar revenues of $1 million 

or more in the recent year (or in the case of the 

formation of a joint venture corporation or 

unincorporated entity, the joint venture corporation or 

unincorporated entity reasonably can be expected to 

derive dollar revenues of $1 million or more); Q!: 

2) in the case of acquired assets, to which dollar revenues 

of $1 million or more were attributable in the most recent 

year. 

For each such 6-digit NAICS industry code, list all acquisitions of 

entities or assets deriving dollar revenues in that 6-digit NAICS 

industry code made by the acquiring person in the five years prior 

to the date of the instant filing, even if the transaction was nonreportable. List only acquisitions of 50% or more of the voting 

securities of an issuer or 50% or more of non-corporate interests 

of an unincorporated entity that had annual net sales or total 

assets greater than $10 million in the year prior to the acquisition, 

and any acquisitions of assets valued at or above the statutory 

size-of-transaction test at the time of their acquisition. 

This item pertains only to acquisitions of U.S. entities/assets and 

foreign entities/assets with sales in or into the U.S., i.e., with 

dollar revenues that would be reported in Item 5. 

For each such acquisition, supply: 

1) the 6-digit NAICS industry code (by number and 

description) identified above in which the acquired entity 

derived dollar revenues; 

2) the name of the entity from which the assets, voting 

securities or non-corporate interests were acquired; 

3) the headquarters address of that entity prior to the 

acquisition; 

4) whether assets, voting securities or non-corporate 

interests were acquired; and 

5) the consummation date of the acquisition. 

END OF ITEM 8 

Instructions to FTC Form C4 (rev. 02/04/2018) 

MV 

See § 803.6 for requirements. 

The certification must be notarized or use the language found in 

28 U.S.C. § 1746 relating to unsworn declarations under penalty 

of perjury. 

Section 18a(a) ofTitle 15 of the U.S. Code authorizes the 

collection of this information. Our authority to collect Social 

Security numbers is 31 U.S.C. § 7701. The primary use of 

information submitted on this Form is to determine whether the 

reported merger or acquisition may violate the antitrust laws. 

Taxpayer information is collected, used, and may be shared with 

other agencies and contractors for payment processing, debt 

collection and reporting purposes. Furnishing the information on 

the Form is voluntary. Consummation of an acquisition required 

to be reported by the statute cited above without having provided 

this information may, however, render a person liable to civil 

penalties up to the amount listed in 16 C.F.R. §1.98(a) per day. 

We also may be unable to process the Form unless you provide 

all of the requested information. 

Public reporting burden for this report is estimated to vary from 8 

to 160 hours per response, with an average of 37 hours per 

response, including time for reviewing instructions, searching 

existing data sources, gathering and maintaining the data 

needed, and completing and reviewing the collection of 

information. Send comments regarding the burden estimate or 

any other aspect of this report, including suggestions for reducing 

this burden to: 

Premerger Notification Office 

Federal Trade Commission, Room #5301 

400 7th Street, S.W. 

Washington, D.C. 20024 

and 

Office of Information and Regulatory Affairs 

Office of Management and Budget 

Washington, D.C. 20503 

Under the Paperwork Reduction Act, as amended, an agency 

may not conduct or sponsor, and a person is not required to 

respond to, a collection of information unless it displays a 

currently valid OMB control number. The operative OMB control 

number, 3084-0005, appears within the Notification and Report 

Form and these Instructions. 

END OF FORM INSTRUCTIONS 

MV 
32784 Federal Register / Vol. 83, No. 136 / Monday, July 16, 2018 / Rules and Regulations 

[FR Doc. 2018–14378 Filed 7–13–18; 8:45 am] 

BILLING CODE 6750–01–C 

DEPARTMENT OF JUSTICE 

Drug Enforcement Administration 

21 CFR Part 1303 

[Docket No. DEA–480] 

RIN 1117–AB48 

Controlled Substances Quotas 

AGENCY: Drug Enforcement 

Administration, Department of Justice. 

ACTION: Final rule. 

SUMMARY: The Drug Enforcement 

Administration (DEA) is publishing this 

final rule to strengthen the process for 

setting controls over diversion of 

controlled substances and make other 

improvements in the quota management 

regulatory system for the production, 

manufacturing, and procurement of 

controlled substances. 

DATES: This final rule is effective August 

15, 2018. 

FOR FURTHER INFORMATION CONTACT: 

Michael J. Lewis, Diversion Control 

Division, Drug Enforcement 

Administration; Mailing Address: 8701 

Morrissette Drive, Springfield, Virginia 

22152; Telephone: (202) 598–8953. 

SUPPLEMENTARY INFORMATION: 

Legal Authority 

Provisions of the Controlled 

Substances Act, 21 U.S.C. 801 et seq., 

authorize the Attorney General to issue 

rules and regulations relating to 

registration and control of the 

manufacture, distribution, and 

dispensing of controlled substances and 

listed chemicals. 21 U.S.C. 821. 

Pursuant to this authority, the Attorney 

General, through the Drug Enforcement 

Administration (DEA), has issued and 

administers regulations setting aggregate 

production quotas for each basic class of 

controlled substances in schedules I and 

II, manufacturing quotas for individual 

manufacturers, and procurement quotas 

for manufacturers to produce other 

controlled substances or to convert the 

substances into dosage form. See 21 CFR 

part 1303. 

The current regulations, issued 

initially in 1971, need to be updated to 

reflect changes in the manufacture of 

controlled substances, changing patterns 

of substance abuse and markets in illicit 

drugs, and the challenges presented by 

the current national crisis of controlled 

substance abuse. This final rule 

modifies the regulations to strengthen 

controls over diversion—that is, the 

redirection of controlled substances 

which may have lawful uses into illicit 

channels—and makes other 

improvements in the controlled 

substance regulatory quota system. 

The quota process, in general terms, is 

a critical element of the Controlled 

Substances Act’s regulatory system that 

seeks to prevent or limit diversion by 

preventing the accumulation of 

controlled substances in amounts 

exceeding legitimate need. The 

measures the final rule adopts to 

strengthen the system include 

authorizing the requisition from quota 

applicants of additional information 

helpful in detecting and preventing 

diversion, and ensuring that DEA’s 

determinations regarding the 

appropriate quotas are adequately 

informed by input from other federal 

agencies, from the states, and from 

quota applicants. 

Section-by-Section Analysis 

The DEA is finalizing the rule as 

proposed without changes. Below are 

summaries of provisions contained in 

the final rule. 

Section 1303.11—Aggregate Production 

Quotas 

Section 1303.11 currently directs the 

Administrator of DEA to determine the 

total quantity of each basic class of 

controlled substance listed in schedule 

I or II needed in the calendar year for 

the medical, scientific, research, and 

industrial needs of the United States, for 

lawful export requirements, and for the 

establishment and maintenance of 

reserve stocks. Section 1303.11(b)(1) 

through (4) identifies a number of 

factors that are categorically to be 

considered in determining aggregate 

production quotas—relating to total net 

disposal, net disposal trends, 

inventories and inventory trends, and 

demand—followed by a final catchall 

factor, (5), regarding factors to be 

considered as the Administrator finds 

relevant. 

The final rule makes two additions to 

the list of factors that must regularly be 

considered in setting the aggregate 

production quotas because of their 

importance. First, it adds to the list the 

extent of any diversion of the controlled 

substance in the class, which will 

ensure that the allowed aggregate 

production quota is limited to that 

needed to provide adequate supplies for 

the United States’ legitimate needs. 

Second, the final rule amends the list of 

factors to be considered in establishing 

these quotas to include relevant 

information from the Department of 

Health and Human Services (HHS) and 

its components, including the Food and 

Drug Administration (FDA), the Centers 

for Disease Control and Prevention 

(CDC), and the Centers for Medicare and 

Medicaid Services (CMS), as well as 

relevant information obtained from the 

states. The amendment will ensure that 

information will be requested from the 

relevant HHS components and will be 

considered in setting the aggregate 

production quotas. 

The final rule provides that the 

Administrator will consider information 

from the states in setting the aggregate 

production quotas and make additional 

changes enhancing their role in 

§ 1303.11(c). The states are critically 

situated to provide information about 

the extent of legitimate and illegitimate 

use of controlled substances because of 

their responsibilities for drug 

enforcement within their jurisdictions, 

including through the Prescription Drug 

Monitoring Programs (PDMP), their 

responsibilities for administration of 

their health care systems, and their 

responsibilities for dealing with the 

human and social costs of drug abuse 

and diversion. States may have relevant 

information indicating that individual 

procurement quota requests reflect 

quantities which will in fact be diverted 

to illicit use, which may in turn yield 

an exaggerated picture of the aggregate 

production quotas needed for legitimate 

purposes. 

The final rule accordingly includes 

amendments to § 1303.11(c) which 

provide for (i) transmitting notices of 

proposed aggregate production quotas, 

and final aggregate production quota 

orders, to the state attorney general, and 

(ii) holding a hearing if necessary to 

resolve an issue of material fact raised 

by a state’s objection to a proposed 

aggregate production quota as excessive 

in relation to legitimate United States 

need. 

Section 1303.12—Procurement Quotas 

Section 1303.12 currently directs the 

Administrator to issue procurement 

quotas for manufacturers that use 

controlled substances to put them into 

dosage form or to make other 

substances. The section requires 

applicants for procurement quotas to 

state what basic class of controlled 

substance is needed, the purpose or 

purposes for which the class is desired, 

the quantity desired for each purpose 

during the next calendar year, and the 

quantities used and estimated to be used 

for each purpose during the current and 

preceding two calendar years. If the 

applicant’s purpose is to manufacture 

another basic class of controlled 

substance, the applicant also must state 

the quantity of the other basic class that 

the applicant has applied to 


sradovich on DSK3GMQ082PROD with RULES