57110 Federal Register / Vol. 75, No. 180 / Friday, September 17, 2010 / Proposed Rules 

1 70 FR 77312 (December 30, 2005). 

2 66 FR 8680 (February 1, 2001). 

3 59 FR 30545 (June14, 1994), id. at 46365 (Sept. 

8, 1994) (extending comment period). 

4 70 FR 11502 (March 8, 2005). 

5 71 FR 35995 (June 23, 2006). 

FEDERAL TRADE COMMISSION 

16 CFR Parts 801, 802, and 803 

RIN 3084-AA91 

Premerger Notification; Reporting and 

Waiting Period Requirements 

AGENCY: Federal Trade Commission. 

ACTION: Notice of proposed rulemaking. 

SUMMARY: The Commission is proposing 

amendments to the Hart-Scott-Rodino 

(‘‘HSR’’) Premerger Notification Rules 

(the ‘‘Rules’’), the Premerger Notification 

and Report Form (the ‘‘Form’’) and 

associated Instructions in order to 

streamline the Form and capture new 

information that will help the Federal 

Trade Commission (the ‘‘Commission’’ 

or ‘‘FTC’’) and the Antitrust Division of 

the Department of Justice (the ‘‘Assistant 

Attorney General’’ or the ‘‘Antitrust 

Division’’) (together the ‘‘Antitrust 

Agencies’’ or ‘‘Agencies’’) conduct their 

initial review of a proposed 

transaction’s competitive impact. 

Section 7A of the Clayton Act (the 

‘‘Act’’) requires the parties to certain 

mergers or acquisitions to file with the 

Agencies and to wait a specified period 

of time before consummating such 

transactions. 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, 

pursuant to section 7 of the Act. 

DATES: Comments must be received on 

or before October 18, 2010. 

ADDRESSES: Interested parties are 

invited to submit written comments 

electronically or in paper form, 

byfollowing the instructions in the 

Invitation To Comment part of the 

‘‘SUPPLEMENTARY INFORMATION’’ section 

below. Comments in electronic form 

should be submitted by using the 

following weblink: (https:// 

ftcpublic.commentworks.com/ftc/ 

hsrformchanges) (and following the 

instructions on the web-based form). 

Comments in paper form should be 

mailed or delivered to the following 

address: Federal Trade Commission, 

Office of the Secretary, Room H-135 

(Annex Q), 600 Pennsylvania Avenue, 

NW, Washington, DC 20580, (202) 326- 

2252. 

FOR FURTHER INFORMATION CONTACT: 

Robert L. Jones, Deputy Assistant 

Director, Premerger Notification Office, 

Bureau of Competition, Room 302, 

Federal Trade Commission, 

Washington, DC 20580. Telephone: 

(202) 326-3100. E-mail: (rjones@ftc.gov). 

SUPPLEMENTARY INFORMATION: 

Background 

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 § 7A. 

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 Form 

and its associated Instructions, codified 

at Part 803—Appendix. The Form is 

designed to provide the Commission 

and the Assistant Attorney General with 

the information and documentary 

material necessary and appropriate for 

an initial evaluation of the potential 

anticompetitive impact of significant 

mergers, acquisitions and certain similar 

transactions. 

Over time, it has become clear to the 

Commission that certain items on the 

Form, intended to provide substantive 

information to aid the Agencies’ review, 

are not as helpful as originally 

anticipated. As examples, Item 3(c) 

requires filing parties to provide overly 

detailed information regarding the 

number and classes of voting securities 

to be acquired and Item 5(a) requires the 

reporting of revenues by Department of 

Census base year, currently 2002,1

which yields information that is 

typically too outdated to be of use to the 

Agencies. The Commission therefore 

proposes the deletion of these items on 

the Form, as well as the deletion or 

revision of several other items for 

similar reasons, as outlined below. The 

Commission proposes substantive and 

ministerial revisions, deletions and 

additions to streamline the Form and 

make it easier to prepare while focusing 

the Form on those categories of 

information the Agencies consider 

necessary for their initial review. The 

Commission also proposes amending 

certain Rules and parts of the Form and 

Instructions, as well as the addition of 

Items 4(d) and 7(d), in order to capture 

additional information that would 

significantly assist the Agencies in their 

initial review. Finally, minor changes 

are proposed to §§801.1, 801.15, 801.30, 

802.4, 802.21, 802.52, 803.2 and 803.5, 

primarily to address minor omissions 

from the Commission’s 2005 rulemaking 

involving unincorporated entities, and 

an amendment to §802.21 is proposed to 

remove the reference to the 2001 

transition period. 

It has also become apparent that the 

current Form does not solicit some 

information that would be useful to the 

Agencies in making an initial evaluation 

of a transaction’s competitive impact. 

For instance, the Form does not require 

filing parties to provide current year 

revenues by the more detailed 10-digit 

North American Industry Classification 

System (‘‘NAICS’’) product code, nor 

does it require revenue data for products 

manufactured outside of, but sold into, 

the United States. Moreover, the Form 

does not elicit sufficient information 

about ties between acquiring investment 

funds and other entities that are 

associated with these acquiring entities, 

which have holdings in the same line of 

business as the target. Thus, the 

Commission proposes to amend the 

Rules, the Form and the Instructions to 

require this and other helpful 

information, as discussed more fully 

below. 

Substantive changes to the Rules, as 

well as improvements to the 

Instructions and Form, have been made 

on a number of occasions since the 

Premerger program began in 1978. For 

example, in 2001, the Rules and Form 

were significantly altered to 

accommodate the 2000 amendments to 

the HSR Act2, as well as to implement 

some administrative changes that were 

proposed and that received public 

comment in 1994.3 The Rules were also 

amended in 2005 to bring the treatment 

of non-corporate entities into line with 

the treatment of corporate entities.4 The 

Form was revised in 2006 to 

accommodate the electronic filing 

option and to update some elements to 

make them more useful to the Agencies’ 

initial analysis.5 The Commission now 

seeks comment from the public on its 

current proposed amendments to the 

Rules, Form and Instructions. 


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6The 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 FTC 

Rule 4.9(c), 16 C.F.R. 4.9(c). 

Invitation to Comment 

All persons are hereby given notice of 

the opportunity to submit written data, 

views, facts, and arguments pertinent to 

this rule review. Written comments 

must be received on or before October 

18, 2010, and may be submitted 

electronically or in paper form. 

Comments should refer to ‘‘HSR Form 

Changes’’ to facilitate the organization of 

comments. Please note that your 

comment—including your name and 

your state—will be placed on the public 

record of this proceeding, including on 

the publicly accessible FTC website, at 

(http://www.ftc.gov/os/ 

publiccomments.shtm). 

Because comments will be made 

public, they should not include any 

sensitive personal information, such as 

any individual’s Social Security 

number; date of birth; driver’s license 

number or other state identification 

number, or foreign country equivalent; 

passport number; financial account 

number; or credit or debit card number. 

Comments also should not include any 

sensitive health information, such as 

medical records or other individually 

identifiable health information. In 

addition, comments should not include 

any ‘‘[t]rade secret or any commercial or 

financial information which is obtained 

from any person and which is privileged 

or confidential...,’’ as provided in 

Section 6(f) of the Federal Trade 

Commission Act (‘‘FTC Act’’), 15 U.S.C. 

46(f), and FTC Rule 4.10(a)(2), 16 C.F.R. 

4.10(a)(2). Comments containing 

material for which confidential 

treatment is requested must be filed in 

paper form, must be clearly labeled 

‘‘Confidential,’’ and must comply with 

FTC Rule 4.9(c), 16 C.F.R. 4.9(c).6

Because paper mail addressed to the 

FTC is subject to delay due to 

heightened security screening, please 

consider submitting your comments in 

electronic form. Comments filed in 

electronic form should be submitted by 

using the following weblink: (https:// 

ftcpublic.commentworks.com/ftc/ 

hsrformchanges) (and following the 

instructions on the web-based form). To 

ensure that the Commission considers 

an electronic comment, you must file it 

at (https:// 

ftcpublic.commentworks.com/ftc/ 

hsrformchanges) . If this document 

appears at (http://www.regulations.gov/ 

search/Regs/home.html#home), you 

may also file an electronic comment 

through that website. The Commission 

will consider all comments that 

regulations.gov forwards to it. You may 

also visit the FTC website at (http:// 

www.ftc.gov) to read the document and 

the news release describing it. 

A comment filed in paper form 

should include the ‘‘HSR Form Changes’’ 

reference both in the text and on the 

envelope, and should be mailed or 

delivered to the following address: 

Federal Trade Commission, Office of the 

Secretary, Room H-135 (Annex Q), 600 

Pennsylvania Avenue, NW, Washington, 

DC 20580. The FTC is requesting that 

any comment filed in paper form be sent 

by courier or overnight service, if 

possible, because U.S. postal mail in the 

Washington area and at the Commission 

is subject to delay due to heightened 

security precautions. 

The FTC Act and other laws the 

Commission administers permit the 

collection of public comments to 

consider and use in this proceeding as 

appropriate. The Commission will 

consider all timely and responsive 

public comments that it receives, 

whether filed in paper or electronic 

form. Comments received will be 

available to the public on the FTC 

website, to the extent practicable, at 

(http://www.ftc.gov/os/ 

publiccomments.shtm). As a matter of 

discretion, the Commission makes every 

effort to remove home contact 

information for individuals from the 

public comments it receives before 

placing those comments on the FTC 

website. 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.shtm). 

Statement of Basis and Purpose of the 

Proposed Amendments to the Rules and 

the Form 

The Commission proposes ministerial 

changes in Items 1 through 3 in order to 

make the Form easier to use, as well as 

the revision or deletion of many items, 

such as Items 2(e), 3(b), 3(c), 4(a), 4(b), 

5(a), 5(b)(i), 5(b)(ii), 5(d), 6(a), and 6(b), 

which currently ask for information that 

the Agencies no longer consider 

necessary for their initial review. The 

Commission also proposes amending 

certain Rules and parts of the Form and 

Instructions, such as Items 2(d), 5(b)(iii), 

5(c), 6(c), 7 and 8 in order to capture 

additional information (such as current 

year revenues by 10 digit NAICS 

product code, including products 

manufactured outside of and sold into 

the United States, and entities 

associated with the acquiring person) 

that would significantly assist the 

Agencies in their review. The 

Commission also proposes the addition 

of Item 4(d), which would require filing 

parties to submit certain documents 

useful to the Agencies’ substantive 

review of transactions, and Item 7(d), 

which would require filing parties to 

provide information on overlapping 

NAICS codes between associates of the 

acquiring person and the acquired 

entity(s) or assets. 

The proposed changes will eliminate 

the least helpful information requests in 

the Form and add requests for 

information that will greatly enhance 

the Agencies’ review. The Commission 

believes the proposed changes will 

make the premerger notification process 

more efficient, and will, on balance, 

reduce the overall burden of completing 

the Form. The modifications to the 

relevant Rules, as well as the changes to 

the Form and Instructions, are described 

more fully below. 

Part 801—Coverage Rules 

801.1(d)(ii) Associate 

‘‘Associate’’ in Item 7 Overlapping 

NAICS Codes and in Item 6(c) Minority 

Holdings 

At present, an acquiring person is 

required to provide information in its 

notification with respect to all entities 

included within it at the time of filing. 

In some instances, particularly with 

families of investment funds, entities 

that are commonly managed with the 

acquiring person are not included 

because these ‘‘associated’’ entities are 

not controlled, as defined in §801.1(b) 

of the Rules, by the acquiring Ultimate 

Parent Entity (‘‘UPE’’). As a result, the 

Agencies do not receive the information 

they need to get a complete picture of 

potential antitrust ramifications of an 

acquisition. 

In particular, Item 7 currently requires 

the person filing notification to identify, 

to its knowledge or belief, any 6-digit 

NAICS industry code in which it 

derives revenues and in which any 

other party to the acquisition also 

derives revenues (a NAICS ‘‘overlap’’). 

The information provided in response to 

Item 7 enables the Agencies to compare 

the products and services in which the 

acquired entity(s) or assets derive 

revenues with the products and services 

in which the acquiring person and any 

entity it controls derives revenues. 

Item 7 does not currently capture all 

relevant overlap information when an 

acquisition is being made by a limited 

partnership (‘‘LP’’) that is one of a 

number of LPs managed by the same 

general partner. Even though the general 

partner typically manages the LP, that 


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7 16 CFR § 801.1(b)(1)(ii). 

8 Investment funds often form limited 

partnerships to make acquisitions. For FY07, 445 of 

the 2,201 total transactions (20.2%) featured a 

limited partnership as an acquiring person that 

potentially would have had to report information 

on associates. 

9 66 FR 8680 (February 1, 2001). 

10 74 FR 857 (January 9, 2009). 

general partner often has the right to 

only a small percentage of the profits of 

the LP. The definition of control of any 

unincorporated entity7 requires the right 

to 50 percent or more of the profits or 

50 percent or more of the assets upon 

dissolution. Thus, the general partner 

often does not control the LP for HSR 

purposes, making the LP its own UPE. 

Yet, that same general partner often 

manages other LPs with holdings that 

derive revenues in the same NAICS 

code as the acquired entity(s) or assets. 

Because the general partner does not 

have HSR control over the acquiring LP 

and any other LPs of which it is the 

general partner, overlaps across entities 

under the effective control of the general 

partner are not currently captured in 

Item 7. This scenario frequently arises 

in the energy industry with Master 

Limited Partnerships, where potentially 

crucial overlaps among LPs with the 

same general partner may go 

undetected. 

Current Item 7 also falls short when 

an acquisition is being made by an 

investment fund that is one of a family 

of investment funds under common 

management. The acquiring investment 

fund is generally either its own UPE or 

possibly controlled by a limited partner 

that, by law, cannot have an active role 

in the management of the fund. It is not 

unusual for another investment fund 

under common management with the 

acquiring investment fund to have 

holdings that derive revenues in the 

same NAICS code as the acquired 

entity(s) or assets. 

The current Form may also fail to 

detect instances in which entities that 

are under common management with 

the acquiring person, but are not part of 

the same UPE (e.g., funds that are part 

of a family of investment funds), already 

have minority holdings of the acquired 

entity(s) or assets. While holders of five 

percent or greater minority interests in 

the acquired entity(s) are disclosed in 

response to Item 6(b), the Agencies may 

not be aware that one or more of such 

holders is under common management 

with the acquiring person. 

In these instances, because the 

entities are under common 

management, requiring reporting of 

where these entities’ holdings overlap 

with the acquired entity(s) or assets 

would provide a more complete and 

accurate picture of the competitive 

impact of the acquisition. The 

Commission believes that capturing this 

information in the manner proposed 

herein would allow for a more complete 

analysis of the competitive impact of 

these types of transactions without 

imposing substantial additional burden 

on the acquiring person. Based on past 

experience, only a relatively small 

percentage of all acquiring persons will 

fall into the categories that would cause 

this additional notification 

requirement.8

To capture this information on 

associated entities, the Commission 

proposes three changes. First, the term 

‘‘associate’’ would be added in new 

§801.1(d)(2) to define entities that are 

under common management with the 

acquiring person, but are not under 

common HSR control with the acquiring 

person. Examples of such associates 

include, but are not limited to, general 

partners of a limited partnership, other 

partnerships with the same general 

partner, other investment funds whose 

investments are managed by a common 

entity or under a common investment 

management agreement, and investment 

advisers of a fund. 

Second, the instructions to Item 7 

would be amended as follows: 

Item 7(a) would require reporting any 

6-digit NAICS industry code in which 

the acquiring person, or any associate 

of the acquiring person, derives 

revenues and in which the acquired 

entity(s) or assets also derive 

revenues; 

Item 7(b)(i) would require reporting 

the name of any entity(s) controlled 

by the acquiring person that derived 

revenues in the overlapping NAICS 

code in the most recent fiscal year and 

Item 7(b)(ii) would require reporting 

the name of any entity(s) controlled 

by an associate of the acquiring 

person that derived revenues in the 

overlapping NAICS code in the most 

recent fiscal year; and 

Item 7(c) would require reporting the 

geographic information for any 

entity(s) controlled by the acquiring 

person that derived revenues in the 

overlapping NAICS code in the most 

recent fiscal year and Item 7(d) would 

require reporting the geographic 

information for any entity(s) 

controlled by an associate of the 

acquiring person that derived 

revenues in the overlapping NAICS 

code in the most recent fiscal year. 

Third, the Commission also proposes 

amending Item 6(c) to require an 

acquiring person to report, based on its 

knowledge or belief, all its associates’ 

holdings of voting securities and noncorporate interests of 5 percent or more 

and less than 50 percent in entities 

having 6-digit NAICS industry code 

overlaps with the acquired entity(s) or 

assets. The proposed changes to Item 

6(c), as well as more details on the 

proposed changes to Item 7, are 

discussed more fully below. 

Part 803–Transmittal Rules 

As a result of the proposed changes to 

the Notification and Report Form and its 

Instructions, certain sections of Part 803 

need to be amended in order to be 

consistent with the Form. Specifically, 

minor ministerial changes are required 

to §803.2. 

Part 803—Appendix: Premerger 

Notification and Report Form 

General Instructions 

Item by Item 

* * * 

Fee Information 

The 2001 revisions to the Form9

expanded the Fee Information Item to 

obtain more information concerning 

electronic wire transfers (‘‘EWT’’), the 

preferred method of paying the HSR 

filing fee. The additional information 

concerning this method of payment, 

such as the Taxpayer Identification 

Number (or Social Security number for 

Natural Persons), is necessary under 31 

U.S.C. §7701. Purely ministerial 

changes, such as repositioning and 

reformatting, are proposed in this 

section of the Form to make it easier to 

complete. 

* * * 

Privacy Act Statement 

The Privacy Act Statement on the 

Form has been amended to reflect the 

change in civil penalties, effective on 

February 9, 2009, from a maximum of 

$11,000 per day to a maximum of 

$16,000 per day.10

Items 1-3 

Items 1 through 3 require filing 

parties to supply basic information 

about the transaction and the parties to 

the transaction. The Commission 

proposes both ministerial and 

substantive changes to these items. 

Item 1 

Item 1 of the Form seeks information 

about the identity of the filing party, its 

contact information, whether it is an 

acquiring or acquired person or both, 

the definition of its fiscal year and what 

type of entity it is. 


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11 The revised Item 2(d) contemplates an overall 

percentage of all classes of voting securities held in 

the target. Filing parties should use 16 C.F.R. 

§801.12 as necessary to calculate the appropriate 

percentage of all classes of voting securities. The 

percentage of non-corporate interests should reflect 

economic interests. 

12 70 FR 11502 (March 8, 2005). 

13 66 FR 8680 (February 1, 2001). 14 Id. 

The Commission proposes to 

reorganize Item 1 so that it is easier to 

complete. Item 1(a), for example, which 

currently asks for ‘‘Name and 

Headquarters address of person filing’’ 

would be amended to be consistent with 

Items 1(g) and 1(h) in specifically 

requesting line by line address 

information. In addition, Item 1(a) 

would ask for a website address to make 

it easier for the Agencies to learn more 

about the filing person, as well as to 

find information that might relate to the 

structure of the transaction described in 

Item 3(a). If a filer has several websites, 

it should use its best judgment as to 

which website would be the most 

relevant for Agency staff. It is 

understood that some parties may not 

have a relevant website to reference. 

The Commission also proposes to 

revise Item 1(g), which currently asks 

for a contact person in case of questions 

or problems with the Form. PNO staff 

frequently finds it difficult to quickly 

reach the contact person to resolve any 

outstanding issues with a filing. To 

avoid unnecessary delay in processing 

the filing, the Commission proposes that 

filers provide a secondary contact 

person. The secondary contact 

information will only be used in the 

event the primary contact is unavailable 

or if the Agencies are specifically 

instructed by the parties to contact the 

secondary person. Given the timesensitive nature of HSR filings and the 

problems that arise when information is 

incorrect or missing from the filing, 

having a second contact person is a 

reasonable safeguard that imposes 

minimal additional burden on the 

parties. 

Item 2 

Item 2 requires the reporting person to 

identify the ultimate parent entities of 

the parties in the transaction as well as 

to identify the type and value of the 

transaction. The Commission proposes 

minor, non-substantive format changes, 

such as repositioning and reformatting 

text, to Items 2(a), (b) and (c) to improve 

the readability of the Form. There are no 

proposed substantive changes to Items 

2(a), (b) and (c). 

Item 2(d) 

As discussed below, the Commission 

proposes removing the obligation of 

parties to provide certain details 

pertaining to assets, non-corporate 

interests and voting securities of the 

acquired person held by the acquiring 

party prior and subsequent to the 

acquisition, including, for example, the 

classes of shares to be acquired. The 

percentage of voting securities and noncorporate interests held both prior to, 

and as a result of, the acquisition are 

necessary, however, for the Agencies to 

determine that the parties are correctly 

adhering to the Act and to conduct a 

substantive review of the transaction. 

Thus, the Commission proposes to 

modify Item 2(d) to include the 

percentage and value of voting 

securities and non-corporate interests of 

the acquired person held prior to and as 

a result of the acquisition.11 Item 2(d) 

will continue to require parties to 

identify the value of assets to be held as 

a result of the acquisition, and to 

provide the aggregate total value of the 

acquisition. Additionally, the 

Commission proposes reformatting Item 

2(d) into an expanded table format for 

ease of use by the filer and the Agencies. 

This approach is in line with the 2005 

amendments to the Rules which require 

the reporting of acquisitions of control 

of unincorporated entities and 

reconcile, as much as possible, the 

Rules’ treatment of unincorporated and 

incorporated entities. Several changes 

were made to the Form at that time to 

reflect the new reportability of these 

acquisitions.12 The Commission 

inadvertently failed to amend Item 2(d) 

at that time to include a reference to 

non-corporate interests and proposes to 

do so now. 

Item 2(e) 

Item 2(e) was added to the Form in 

2001 to request the name of the 

person(s) who performed any fair 

market valuation used to determine the 

total value of the transaction.13 The 

reasoning was that the new tiered filing 

fee structure made the determination of 

the fair market value more important 

than had previously been the case, and 

identifying a contact person familiar 

with the fair market valuation 

methodology would benefit the 

Agencies in the event that a valuation 

question arose. 

The 2001 rulemaking acknowledges 

that in the event of questions, the 

Agencies will likely contact the Item 

1(g) contact person first. ‘‘Although the 

agencies would initially contact the 

person listed for that purpose in Items 

1(g) and (h) should any questions arise 

regarding information supplied on the 

Form, this addition should help the 

parties and the agencies pinpoint who 

would be most knowledgeable on the 

issue of valuation.’’14

The additional information obtained 

by Item 2(e) has not proven to be useful. 

In all cases, the contact person in Item 

1(g) and (h) has been the person 

contacted. The contact person, of 

course, can point the Agencies to the 

person who prepared the valuation, thus 

making the direct contact information in 

Item 2(e) unnecessary. In the interest of 

reducing the burden on the parties, as 

small as it may be in this instance, the 

Commission proposes to delete Item 

2(e). 

Item 3(a) 

In Item 3(a), filing parties are required 

to provide information on the filing 

parties, the contours of the transaction, 

the amount and form of consideration, 

and the time line for closing. The 

Commission proposes to amend Item 

3(a) to require that, in the case of 

acquisitions of voting securities or noncorporate interests, filing parties list the 

names of all issuers and non-corporate 

entities whose shares or interests are 

being acquired. In the case of asset 

acquisitions, filing parties would be 

required to describe the business the 

assets being acquired comprise. If there 

are additional filings, such as 

shareholder backside filings, associated 

with the transaction, filing parties 

would be required to list those, as well 

as any special circumstances that apply 

to the filing, such as whether part of the 

transaction is exempt under one of the 

exemptions found in Section 802. These 

amendments to Item 3(a) will facilitate 

the Agencies’ review and, on balance, 

reduce the burden on filers because they 

will allow Items 3(b) and 3(c) to be 

eliminated as discussed below. 

Item 3(b) 

Item 3(b) requests a description of the 

assets to be acquired, a description of 

any assets previously acquired from the 

acquired person and currently held by 

the acquiring person, and a description 

of assets held by any unincorporated 

entities that are being acquired. The 

Agencies have found that much of this 

level of detail is not helpful in the 

initial review of the transaction. Given 

the proposed amendment to Item 3(a) to 

include a description of the assets being 

acquired in a transaction, the 

Commission proposes to delete Item 

3(b). 

Item 3(c) 

Item 3(c) requires parties to provide a 

list and description of voting and nonvoting securities to be acquired, 


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15 43 FR 33450 (July 31, 1978). 

16 52 FR 7066 (March 6, 1987). Note this was Item 

2(c) at the time. 

17 If parties are filing on an executed Letter of 

Intent, they may also submit a draft of the definitive 

agreement. Note that transactions subject to §801.30 

and bankruptcies under 11 USC §363 do not require 

an executed agreement or letter of intent. 

18 46 FR 38710 (July 29, 1981). 

19 43 FR 33450 (July 31, 1978). 

20 70 FR 73369 (December 12, 2005). 

21 A Central Index Key or CIK number is a 

number given to an individual or company by the 

United States Securities and Exchange Commission. 

The number is used to identify the filings of a 

company, person or entity in several online 

databases, including EDGAR. 

including the classes, the rights of each 

class, the total number of outstanding 

shares post-acquisition, the shares to be 

acquired, each class of share to be held 

by each acquiring person, and the dollar 

value of the shares to be acquired. First 

added in 1978,15 this item was amended 

in 1987 to eliminate the need for a 

detailed response when 100% of the 

voting securities of the acquired entity 

are being acquired, requiring only that 

parties provide the total dollar value of 

the transaction in these instances.16

The Commission has further 

determined that obtaining the detailed 

information currently required in Item 

3(c) for acquisitions of less than 100% 

does not significantly aid the Agencies 

in their initial review. It has determined 

that it is sufficient for initial review 

purposes that the parties provide 

information as to the names of all 

issuers and non-corporate entities 

whose shares or interests are being 

acquired, and the percentage and value 

of voting securities of the acquired 

entity or interests in the non-corporate 

entity held by the acquiring person prior 

and subsequent to the transaction. As 

discussed above, such information will 

be required under the proposed 

revisions to Item 2(d) and Item 3(a) of 

the Form. The Commission thus 

proposes deleting Item 3(c). 

Item 3(d) 

The Commission proposes 

redesignating Item 3(d), which requires 

copies of all documents that constitute 

the agreement(s) between the parties, to 

Item 3(b) to reflect the proposed 

elimination of former Items 3(b) and 

3(c). Further, the Commission proposes 

amending the Instructions to the Form 

for the new Item 3(b) to make clear that 

all Agreements Not to Compete are 

required to be submitted with the Form. 

The Instructions would specify that 

documents that constitute the 

agreement(s) (e.g., a Letter of Intent, 

Merger Agreement or 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.17 There are no proposed 

substantive changes to Item 3(d). 

Items 4-6 

Item 4 

Item 4 seeks various documents, 

including some created in the ordinary 

course of business and some produced 

by the parties in connection with the 

current transaction. The Commission is 

proposing changes to reduce the burden 

of producing documents in response to 

Items 4(a) and (b). The Commission also 

proposes the addition of new Item 4(d) 

which would require filing parties to 

submit certain documents useful to the 

Agencies’ substantive review of 

transactions. 

Item 4(a) Documents filed with the 

United States Securities and Exchange 

Commission (‘‘SEC’’) 

Item 4(a) seeks materials submitted to 

the SEC, including a company’s most 

recent proxy statement, its most recent 

10-K filing, all 10-Q and 8-K filings 

made since the end of the period 

reflected in the most recent 10-K, any 

registration statement filed in 

connection with the transaction, and, if 

the acquisition is a tender offer, the 

Schedule TO. Inclusion of these 

documents under Item 4(a) was 

‘‘intended to provide financial 

information about the reporting person, 

information about its operations and 

those of its subsidiaries, and 

occasionally about the reported 

transaction itself.’’18

The Commission initially required 

parties to provide paper copies of the 

required SEC filings. In doing so, the 

Commission stated that although the 

documents were available from the SEC, 

the Agency staff would be under severe 

time constraints in reviewing filings 

under the Act and that obtaining the 

required documents for each reporting 

person would be extremely timeconsuming.19 However, with the advent 

of the Internet and the SEC’s EDGAR 

database, the Commission determined 

that staff could quickly and easily 

obtain the relevant information and that 

the provision by the parties of electronic 

links to the documents would be 

sufficient. Therefore, in 2005, the 

Commission amended the Form to allow 

filers to provide Internet links to the 

documents required in Item 4(a) and 

Item 4(b).20

A number of filers have taken 

advantage of this change and provide 

Internet links in Item 4(a). Because 

virtually all filings are still made in 

paper form, however, Agency staff 

cannot simply click on the link and be 

directed to the document. Rather, to use 

these links, staff must type out long web 

addresses. The length of these addresses 

increases the chance that either the filer 

or the Agency staff might enter an 

incorrect address and delay the 

processing of the filing. 

In the meantime, the sophistication of 

the SEC website has increased and now 

provides for immediate access to all 

filed materials. Thus, the Commission 

now proposes further simplifying Item 

4(a) by only requiring filers to provide 

a list of all entities within the person 

filing notification, including the UPE, 

that file annual reports (10-K or 20-F 

filings) with the SEC, and to provide the 

Central Index Key number (CIK)21 for 

each entity. Such information will 

provide staff with sufficient information 

to find and review these documents 

easily. 

Item 4(b) Annual Reports, Annual Audit 

Reports, and Regularly Prepared 

Balance Sheets 

Item 4(b) requires parties to provide 

the most recent annual reports and 

annual audit reports of the person filing 

notification and of each unconsolidated 

United States issuer included within the 

person. The person filing must also 

provide, if different, the most recent 

regularly prepared balance sheet of the 

person filing notification and of each 

unconsolidated United States issuer 

included within the person. 

It is often challenging for filing parties 

to provide balance sheets, particularly 

where the filing person is a natural 

person or a foreign entity, as these 

balance sheets are not readily available. 

Typically, these balance sheets contain 

no substantive information on the filing 

party, and are merely a snapshot of the 

party’s assets and liabilities. The 

Commission has determined, based on 

the Agencies’ experience, that the 

information contained in the most 

recently prepared balance sheet is not 

useful beyond providing evidence, 

where necessary, that the party has 

sufficient assets to meet the size of 

person test. 

Thus, the Commission proposes the 

elimination of Item 4(b)’s requirement to 

submit a company’s most recent 

regularly prepared balance sheet. Parties 

must continue to provide the most 

recent annual report and/or audit report 

for the filing person and any 

unconsolidated U.S. issuers, because 

these reports are often quite useful in 

understanding the business of the filing 

person. In addition, the Commission 

proposes expanding the requirement to 

submit annual reports and/or audit 

reports to include any unconsolidated 


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22 70 FR 11502 (March 8, 2005). 

23 This requirement is intended to capture 

documents from both the buyer and the seller. 

24See REFORMS TO THE MERGER REVIEW 

PROCESS (p.19) announced by then Chairman 

Deborah Platt Majoras on February 16, 2006. (http:// 

www.ftc.gov/os/2006/02/mergerreviewprocess.pdf) 

25 This requirement is intended to capture 

documents from both the buyer and the seller. 

non-corporate U.S. entities. This 

proposed change will bring this item in 

line with other changes that attempt to 

reconcile the treatment of corporations 

and unincorporated entities.22 For 

natural persons, the Commission 

proposes requiring the person to submit 

only the most recent annual report and/ 

or audit report from the highest level 

entity(s) that the person controls. 

Personal balance sheets from natural 

persons would thus no longer be 

required. 

As balance sheets will no longer be 

required, filing parties will have to be 

more cognizant of demonstrating that 

they meet the size of person test when 

applicable. If the annual report or 

annual audit report does 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 parties must stipulate in 

Item 4(b) that the filing person meets the 

test. 

The Commission believes that the 

proposed changes to Items 4(a) and 4(b) 

will reduce the burden of producing 

documents for filing parties. 

Proposed Item 4(d): Additional 

Documents 

Certain categories of documents 

typically created in the course of a 

transaction are quite useful for the 

Agencies’ initial substantive analysis of 

transactions but are not always provided 

because parties have differing 

interpretations as to whether they are 

called for under current Item 4(c). The 

Commission thus proposes new Item 

4(d) to enumerate these documents and 

require their submission with the Form. 

Item 4(d)(i): Offering Memoranda 

When a company is preparing to put 

itself up for sale, it will often draft or 

hire a third party to draft a confidential 

information memorandum that lays out 

the details of the company for 

prospective buyers. Such offering 

memoranda are extremely valuable to 

the Agencies in their initial review. 

Most parties already submit these along 

with their HSR Filings and proposed 

Item 4(d)(i), which would require filing 

parties to do so, should not create any 

additional burden for them or 

substantial additional burden for others. 

Under proposed Item 4(d)(i), offering 

memoranda must be submitted 

regardless of whether they 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. Any such study, survey, 

analysis or report will only be 

responsive to Item 4(d)(i) if it also 

contains some reference to the acquired 

entity(s) or assets.23 If the seller 

circulates an existing presentation to 

provide an overview of the company to 

a prospective buyer(s), this type of 

document would be the equivalent of an 

offering memorandum for the purposes 

of Item 4(d)(i) and must be submitted. 

The Commission recognizes that 

without a date cutoff, a search for these 

documents could be extremely 

burdensome. Accordingly, the 

Commission proposes a limit of two 

years before the date of filing for 

documents responsive to this item. This 

proposed time frame is consistent with 

the specified ‘‘relevant time period’’of 

two years as applicable to second 

requests in the 2006 merger process 

reforms.24

Item 4(d)(ii): Materials Prepared by 

Investment Bankers, Consultants or 

Other Third Party Advisors 

Investment bankers, consultants or 

other third party advisors are often 

active at all stages of a transaction, 

generating due diligence, valuation and 

other broad categories of materials. 

Some of these materials contain 

competition-related content and can be 

invaluable to the Agencies in their 

initial review of the potential 

competitive impact of a transaction. 

Many parties already submit such 

competition-related third party 

materials along with their HSR Filings 

and proposed Item 4(d)(ii), which 

would require filing parties to do so, 

should not create substantial additional 

burden for them or substantial 

additional burden for others. Under 

proposed Item 4(d)(ii), studies, surveys, 

analyses and reports prepared by 

investment bankers, consultants or other 

third party advisors must be submitted 

if they were prepared 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 

market shares, competition, 

competitors, markets, potential for sales 

growth or expansion into product or 

geographic markets. Any such study, 

survey, analysis or report will only be 

responsive to Item 4(d)(ii) if it also 

contains some reference to the acquired 

entity(s) or assets.25 If such studies, 

surveys, analyses and reports are found 

in the files of any officer(s) or director(s) 

(or, in the case of unincorporated 

entities, individuals exercising similar 

functions), they should be deemed to 

have been prepared for that individual. 

For the reasons state above, the 

Commission also proposes a limit of two 

years before the date of filing for 

documents responsive to this item. 

Item 4(d)(iii): Documents Discussing 

Synergies and/or Efficiencies 

Documents that discuss synergies 

and/or efficiencies likely to result from 

a transaction can be very useful in the 

Agencies’ initial review. Proposed Item 

4(d)(iii) would require filing parties to 

submit studies, surveys, analyses and 

reports evaluating or analyzing such 

synergies and/or efficiencies if they 

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. Financial models without 

stated assumptions need not be 

provided in response to this item. As 

many filing parties already submit such 

documents, this item should present 

little additional burden for them or 

substantial additional burden for others. 

The proposed instructions to Item 

4(d) would read as follows: 

Item 4(d) - Additional Documents 

For each category below, indicate (if 

not contained in the document itself) 

the date of preparation, and the name 

of the company or organization that 

prepared each such document. 

Item 4(d)(i): Provide all offering 

memoranda (or documents that served 

that function) that reference the 

acquired entity(s) or assets. 

Documents responsive to this item are 

limited to those produced up to two 

years 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 if they were prepared 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 market shares, 

competition, competitors, markets, 

potential for sales growth or 

expansion into product or geographic 

markets, and that also reference the 


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26 70 FR 77312 (December 30, 2005). 

27 43 FR 33450 (July 31, 1978). 

28 66 FR 35541 (July 6, 2001). 29 70 FR 77312 (December 30, 2005). 

acquired entity(s) or assets. 

Documents responsive to this item are 

limited to those produced up to two 

years before the date of filing. 

Item 4(d)(iii): Provide all studies, 

surveys, analyses and reports 

evaluating or analyzing synergies and/ 

or efficiencies if they 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. Financial models without 

stated assumptions need not be 

provided in response to this item. 

Item 5 

Item 5 requires persons to submit 

information regarding dollar revenues 

and lines of commerce with respect to 

operations conducted within the United 

States during a company’s most recently 

completed year and the base year, 

currently 2002.26 All filing persons must 

submit certain data at the 6-digit NAICS 

industry code level. To the extent that 

dollar revenues are derived from 

manufacturing operations (NAICS 

Sectors 31-33), data must also be 

provided at the 7-digit product code 

level for the most recent year and at the 

10-digit product code level for the base 

year. 

The Item 5 reporting requirement was 

first based on Standard Industrial 

Classification (‘‘SIC’’) codes, and at the 

time it was contemplated that such a 

reporting requirement would not be 

unduly burdensome. Reporting persons 

were presumed to compile yearly SICbased data for submission to the Bureau 

of Census and, thus, would have such 

information readily available.27 This 

presumption remained in place when 

SIC codes were supplanted by NAICS 

codes in 2001.28

Based on informal input from 

practitioners, it appears that filing 

parties generally do not rely on data 

compiled for previous Census 

requirements in responding to Item 5, 

either because they were never 

compiled or are no longer available. In 

fact, the appropriate NAICS codes and 

underlying revenues generally are 

determined by the parties when 

preparing the filing. Because the parties 

do not, as the Commission believed they 

would, reference previously compiled 

data, the burden of gathering this 

information is not as minimal as the 

Commission originally believed. This is 

particularly true for the base year 

requirement in Items 5(a) and 5(b)(i). 

The incorporation of a base year in 

the Form was intended to provide 

context for the company’s most recent 

year’s revenues. The reasoning was that 

the Agencies would be able to see how 

much a given industry had grown in the 

span of time between the base year and 

the most current year. The base year was 

intended to coincide with the 

publication schedules of the 

quinquennial economic censuses and 

the Annual Survey of Manufacturers, 

publications that serve as the most 

readily available and reliable statistical 

sources of industry components and 

market universe to which individual 

company product and revenue data can 

be compared. 

Even though the U.S. Economic 

Census occurs every five years, it can 

take as long as three years for the results 

to be published. Consequently, new 

base years are not adopted by the 

Commission until well after the relevant 

census occurred. For example, the 

current 2002 base year was not adopted 

by the Commission until the end of 

2005.29 The result is that parties are 

required to assemble data that may be as 

much as eight years old. This is often a 

difficult task, particularly in the case of 

assets acquired since the base year. 

Moreover, comparing current revenues 

of the parties to an economic universe 

that is at a minimum three and at a 

maximum eight years old is of minimal 

value to the Agencies in analyzing the 

potential competitive impact of a 

transaction. The Commission, therefore, 

proposes eliminating the base year 

reporting requirements in Items 5(a) and 

5(b)(i). 

Once the base year requirements are 

removed, Item 5(b)(ii), which requires a 

listing of revenues for products added or 

deleted between the base year and the 

most recent year, becomes moot. The 

Commission, therefore, also proposes 

deleting Item 5(b)(ii). 

Item 5(b)(iii) requires parties to list 

dollar revenues by manufactured 

product class (7-digit) for the most 

recent year and Item 5(c) requires 

parties to submit revenues by nonmanufacturing industry code (6-digit) 

for the most recent year. To provide the 

Agencies with a more accurate view of 

recent revenues, the Commission 

proposes to revise Item 5(b)(iii) by 

substituting the reporting of the more 

precise 10-digit product codes for 

manufactured products for the most 

recent year in place of the currently 

required 7-digit product classes. Based 

on informal input from practitioners, 

filing parties generally find these 

revenues to be far less burdensome to 

compile than base year revenues, and 

10-digit product codes are typically 

prepared by the parties as part of the 

analysis of the transaction to identify 

potentially problematic overlaps. The 

Commission thus proposes that Item 5 

be revised to have only one reporting 

section, proposed Item 5(a), where filing 

parties will list manufacturing revenues 

by 10-digit product codes and nonmanufacturing revenues by 6-digit 

industry codes for the most recent year. 

The Commission believes this change 

will result in the Agencies getting more 

useful NAICS code information in Item 

5 than they currently receive. 

In addition, the Commission proposes 

the elimination of the million dollar 

minimum applicable to current Item 

5(c). The million dollar minimum was 

based on the way filing persons reported 

non-manufacturing data to the Bureau of 

Census. As discussed above, filing 

parties may not rely on data compiled 

for Census in responding to Item 5, and, 

in fact, generally determine the 

appropriate NAICS codes in response to 

Item 5 at the time of filing. In addition, 

this million dollar minimum often 

creates confusion about whether there is 

a need to report an overlap in Item 7. 

For instance, if an acquiring person has 

less than $1 million in sales in a nonmanufacturing NAICS industry code 

and does not report that code in the 

current Item 5(c), it still is required to 

report an overlap in Item 7 if the 

acquired person also derives revenue in 

that same non-manufacturing NAICS 

industry code; however, most filing 

parties do not indicate an overlap in 

Item 7 in this instance, assuming the 

million dollar minimum in Item 5(c) 

means there are essentially no revenues 

to report in that code. The elimination 

of the million dollar minimum would 

thus eliminate confusion for filing 

parties and ensure that the Agencies get 

this overlap information. 

Occasionally a filing party will not 

have revenue to report in proposed Item 

5. To speed review of the Form, the 

Commission proposes inserting a 

checkbox indicating ‘‘None’’ into the 

Form at Item 5 in the event the filing 

party has no Item 5 information to 

report. Parties checking the box will be 

required to provide a brief explanation 

for the lack of reportable Item 5 

information. Explanations may include, 

but are not limited to, situations where: 

1. An acquiring person is newlyformed in a transaction valued in excess 

of $200 million (as adjusted); 

2. An acquiring person is foreign and 

has no sales in or into the U.S; 

3. A filing person is a development 

stage company that has not yet 

generated sales; or 


wwoods2 on DSK1DXX6B1PROD with PROPOSALS-PART 2
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30 Reporting in this manner is in line with current 

practice when companies have both domestic 

manufacturing and wholesale or retail operations. 

4. A filing person’s holding is an 

exclusive license for intellectual 

property related to a product that has 

not yet gone into production. 

Item 5 Foreign Manufactured Products 

Section 803.2(c)(1) of the Rules 

instructs filing persons to provide 

information in response to Items 5, 7, 

and 8 ‘‘with respect to operations 

conducted within the United States.’’ 

Filing persons are not required to 

submit NAICS code information on a 

detailed manufacturing basis for 

products they manufacture outside the 

United States even if they sell the 

products in the United States. For 

example, if a filing person manufactured 

a product in Canada, imported it into 

the United States, and sold that product 

at the wholesale or retail level, the filing 

person would report revenues derived 

from those sales in current Item 5(c) 

using a wholesale or retail 6-digit 

NAICS industry code. The filing person 

would not be required to identify the 

product it manufactured in Canada 

using the more detailed 10-digit 

manufacturing product codes that 

would have been required had the 

product been manufactured in the 

United States. 

Absent NAICS code information at the 

manufacturing level, the Agencies have 

found it very difficult to determine 

whether a filing person that 

manufactures products outside the 

United States but sells them in the U.S. 

may be involved in manufacturing 

activities similar to those of another 

party to the transaction. As foreign 

imports and their effect on the nation’s 

economy have increased, this 

information has become more 

important. Accordingly, the 

Commission believes that 10-digit 

NAICS product code information 

concerning products manufactured 

outside the U.S. that are sold in or into 

the U.S. at the wholesale or retail level 

would provide a more complete picture 

of the impact of the transaction at the 

initial review stage. 

Consistent with other proposed 

changes to Item 5, the Commission 

proposes to modify the Form to require 

filing persons to identify the 10-digit 

NAICS product codes and revenues for 

each product they manufacture outside 

the U.S. and sell in the U.S. at the 

wholesale or retail level, or that they 

sell directly to customers in the U.S. 

Filing parties would include 10-digit 

NAICS product codes and revenues for 

such foreign manufactured products 

only for the most recent year in 

proposed Item 5(a). Sales made directly 

into the U.S. would be reported in a 

manufacturing code while sales made in 

to the U.S. through a wholesale 

operation within the same person would 

be reported in both manufacturing 

(transfer price) and wholesale or retail 

(sales price) codes.30 This information 

will aid the Agencies in their initial 

review and, as the provision of the 10- 

digit NAICS information is based on the 

most recent year, it should not impose 

a significant additional burden on filing 

persons. 

The Commission therefore proposes 

to revise the instructions to new Item 

5(a) to read as follows: 

Item 5(a): Provide 6-digit NAICS 

industry data concerning the 

aggregate operations of the person 

filing notification for the most recent 

year in NAICS Sectors other than 31- 

33 (non-manufacturing industries) in 

which the person engaged and 10- 

digit NAICS product code data for 

each product code within NAICS 

Sectors 31-33 (manufacturing 

industries) in which the person 

engaged, including revenues for each 

product manufactured outside the 

U.S. but sold in or into the U.S. Sales 

made directly into the U.S. should be 

reported in a manufacturing code. 

Sales made into the U.S. through a 

wholesale or retail operation within 

the same person should be reported in 

both manufacturing (transfer price) 

and wholesale or retail (sales price) 

codes. 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 if a statement describing the 

method of estimation is furnished. 

In conjunction with this proposed 

change to Item 5, the Commission 

proposes deleting §803.2(c)(1) to remove 

the limitation to operations conducted 

within the U.S. 

Item 5(d) 

Item 5(d) requires filing parties to 

provide certain information with regard 

to the formation of a joint venture (‘‘JV’’), 

including the name and address of the 

JV in Item 5(d)(i); a description of the 

contributions that each person forming 

the JV has agreed to make in Item 

5(d)(ii)(A); a description of any 

contracts or agreements related to the JV 

and a description of any credit 

guarantees or obligations applicable to 

the JV in Items 5(d)(ii)(B) and (C); the 

consideration which each person 

forming the JV will receive in Item 

5(d)(ii)(D); the business in which the JV 

will engage in Item 5(d)(iii); and the 

expected source of the JV’s revenues by 

NAICS code in Item 5(d)(iv). 

Informal discussions with FTC and 

Antitrust Division staff have revealed 

that some of this information, such as 

the description of the contributions that 

each person forming the JV has agreed 

to make, the consideration which each 

forming person will receive, the 

business in which the JV will engage, 

and the source of the JV’s revenues by 

NAICS code, is crucial to the Agencies’ 

initial analysis of the joint venture’s 

competitive impact; however, other 

parts of Item 5(d) are not as important 

to staff’s substantive analysis of the JV. 

The name and the address of the JV, a 

description of any contracts or 

agreements whereby the JV will obtain 

assets or capital from sources other than 

the persons forming it (as opposed to 

the formation agreement), and a 

description of any credit guarantees or 

obligations applicable to the JV provide 

the Agencies with little helpful 

information for their initial review. The 

Commission therefore proposes to 

delete Item 5(d)(i) and Items 5(d)(ii)(B) 

and (C) from the Form. 

The Commission also proposes to 

revise Item 5(d)(iv) to require 

information on the expected source of 

the JV’s dollar revenues by 6-digit 

NAICS industry codes (nonmanufacturing) and 10-digit NAICS 

product codes (manufacturing) to be 

consistent with the proposal to require 

10-digit NAICS product codes for the 

most recent year in Item 5(a) as 

discussed above. 

Finally, the Commission proposes 

redesignating Item 5(d) to Item 5(b) to 

reflect the proposed changes to this item 

and renumbering the subsections within 

Item 5(b). 

Item 6(a) Entities within person filing 

notification 

Item 6(a) requires information 

concerning entities within the party 

filing notification: the acquiring person 

must list all entities within it having 

total assets of $10 million or more, 

including foreign entities, and the 

acquired person must list all entities 

within the acquired entity, including 

foreign entities. 

Over the course of thirty years, it has 

become clear that the value of such 

detailed information in Item 6(a) is 

limited. Compiling a list of the name 

and street address of every entity within 

a person, regardless of whether the 

entity has a nexus with the U.S., can be 

often quite burdensome for filing 

parties, particularly with respect to 

foreign addresses. The Commission thus 

proposes to limit the entities that must 


wwoods2 on DSK1DXX6B1PROD with PROPOSALS-PART 2
57118 Federal Register / Vol. 75, No. 180 / Friday, September 17, 2010 / Proposed Rules 

31 Under the proposal, it is permissible for a filing 

person to report all entities within it in response to 

Item 6(a). 32 43 FR 33450 (July 31, 1978). 33 Id. 34 70 FR 11502 (March 8, 2005). 

35 Under the proposal, it would be permissible for 

a filing person to list all entities in which it has a 

reportable minority interest in response to Item 

6(c)(i). 

36 Under the proposal, it would be permissible for 

an acquiring person to list all entities in which its 

associate(s) has a reportable minority interest in 

response to Item 6(c)(i)(ii). 

be listed in Item 6(a) to those located in 

the U.S. and those foreign entities that 

have sales in or into the U.S.31 In 

addition, the Commission believes that 

identifying the street addresses of these 

entities is not necessary to the Agencies’ 

initial premerger review and proposes 

limiting responses in Item 6(a) to a list 

of responsive entities with only city and 

state or city and foreign country 

designations. 

Item 6(b) Shareholders of Person Filing 

Notification and Item 6(c) Holdings of 

Person Filing Notification 

Item 6(b) of the Form currently 

requires the filing person to identify 

shareholders holding five percent or 

more of the voting securities of any 

entity included within the filing person 

(including the ultimate parent entity) 

having total assets of $10 million or 

more. For each shareholder, the filing 

person must list the issuer, the class, the 

number and the percentage of each class 

of voting securities held. Item 6(c) 

requires the filing person to list its 

minority voting stock holdings of five 

percent or more in any issuer having 

total assets of $10 million or more. 

Items 6(b) and 6(c) are designed to 

obtain information to ‘‘alert the 

enforcement agencies to situations in 

which the potential antitrust impact of 

the reported transaction does not result 

solely or directly from the acquisition, 

but may arise from direct or indirect 

shareholder relationships between the 

parties to the transaction.’’32 For 

example, Items 6(b) and 6(c) may reveal 

situations in which ‘‘a person known to 

be a competitor, customer or supplier of 

one of the parties is also a significant 

shareholder of the other party, or when 

the acquiring party holds stock in a 

competitor, customer or supplier of the 

acquired company, or vice versa.’’33

Responses to these two items are very 

useful to the Agencies in their initial 

review and the Commission proposes 

several changes to them to give the 

Agencies an even clearer picture of the 

competitive impact of a given 

transaction, while in some ways 

reducing the scope of the required 

responses. 

As noted above, the Commission 

amended the rules in 200534 to more 

closely align the treatment of 

unincorporated entities with the 

treatment of corporations, and the 

Commission now proposes amending 

Items 6(b) and 6(c) to include noncorporate interests to reflect this earlier 

change. Item 6(b) will not require a list 

of limited partners, as the limited 

partners have no control over the 

operations of the fund or the portfolio 

companies and the identity and 

investment level of limited partners is 

often highly confidential. Any general 

partner(s) would have to be listed in 

proposed Item 6(b), regardless of the 

percentage held, as these are entities 

that typically manage the limited 

partnership. 

The Commission also proposes to 

limit the response to Item 6(b) to the 

acquired entity(s) and the acquiring 

entity(s) and its UPE (or in the case of 

natural persons, the top-level corporate 

or non-corporate entity(s) within that 

UPE), and not to require a response to 

Item 6(b) for any other entities included 

within, but not wholly owned by, the 

UPE. The additional detail regarding 

other included entities that is required 

in current Item 6(b) is not essential to 

the Agencies’ initial review. Finally, the 

Commission proposes to eliminate the 

$10 million asset threshold from Item 

6(b). This would require filing parties to 

provide the identities of shareholders or 

interest holders of the UPE and 

acquiring entity(s) regardless of the 

amount of assets held. This change will 

be of significant use to the Agencies in 

their initial review, especially in the 

case of newly formed entities. To know 

which investment funds hold interests 

in a newly formed entity, particularly 

when these funds are not associates of 

the filing person, will give the Agencies 

a better picture of the competitive 

impact of a given transaction. 

Proposed Item 6(c)(i) would require 

filing parties to report their holdings of 

5 percent or greater, but less than 50 

percent, of the voting securities or noncorporate interests of an issuer or 

unincorporated entity. For the acquiring 

person, the response would be limited, 

based on its knowledge or belief, to 

entities that derive revenues in the same 

6-digit NAICS industry code as the 

acquired entity(s) or assets. For the 

acquired entity, the response would be 

limited, based on its knowledge or 

belief, to entities that derive revenues in 

the same 6-digit NAICS industry code as 

the acquiring person. The Commission 

recognizes that it may be difficult for a 

filing person to determine in what 

NAICS codes an entity derives revenues 

if it does not control the entity. 

Therefore, the Commission proposes 

that if NAICS codes are unavailable, the 

filing person may report, based on its 

knowledge or belief, holdings in entities 

that have operations in the same 

industry as the acquired entity(s) or 

assets.35 Furthermore, in Item 6(c), the 

Commission proposes the deletion of 

the seldom-exercised option to list the 

entity within the person filing that 

holds the securities. 

Consistent with the other changes 

related to associated entities, the 

Commission also proposes amending 

Item 6(c) to require the acquiring person 

to include, based on its knowledge or 

belief, the minority holdings of its 

associates. Proposed Item 6(c)(ii) would 

require the filing person, based on its 

knowledge or belief, to report the 

holdings of its associates of 5 percent or 

greater, but less than 50 percent, of the 

voting securities or non-corporate 

interests of an issuer or unincorporated 

entity that derives revenues in the same 

6-digit NAICS industry code as the 

acquired entity(s) or assets. The 

Commission recognizes that it may be 

difficult for an acquiring person to 

determine in what NAICS codes an 

entity derives revenues if it does not 

control the entity. Therefore, the 

Commission proposes that if NAICS 

codes are unavailable, the acquiring 

person may report, based on its 

knowledge or belief, holdings in entities 

that have operations in the same 

industry as the acquired entity(s) or 

assets.36

Accordingly, the Commission 

proposes to revise Items 6(b) and 6(c) of 

the Instructions to the Form to read as 

follows: 

Item 6(b) 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 noncorporate entity(s) within that UPE, 

list the name and headquarters 

mailing address of each other person 

that holds (See §801.1(c)) five percent 

or more 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. 

For limited partnerships, only the 

general partner(s), regardless of 

percentage held, should be listed. 

Item 6(c)(i) If the person filing 

notification holds five percent or 

more but less than fifty percent of the 

voting securities of any issuer or noncorporate interests of any 

unincorporated entity, list the issuer 

and percentage of voting securities 

held, or in the case of an 


wwoods2 on DSK1DXX6B1PROD with PROPOSALS-PART 2
Federal Register / Vol. 75, No. 180 / Friday, September 17, 2010 / Proposed Rules 57119 

37 70 FR 11502 (March 8, 2005). 

38 Id. 

unincorporated entity, 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 entity 

should limit its response, based on its 

knowledge or belief, to entities that 

derive revenues in the same 6-digit 

NAICS industry code as the acquiring 

person. If NAICS codes are 

unavailable, holdings in entities that 

have operations in the same industry, 

based on the knowledge or belief of 

the filing person, should be listed. 

Holdings of issuers or unincorporated 

entities with total assets of less than 

$10 million, may be omitted. In 

responding to Item 6(c)(i), it is 

permissible for a filing person to list 

all entities in which it has a 

reportable minority interest. 

Item 6(c)(ii) - (Acquiring person only) 

For each associate (see §801.1(d)(2)) 

of the person filing notification 

holding five percent or more but less 

than fifty percent of the voting 

securities of any issuer or noncorporate 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, based on 

the knowledge or belief of the 

acquiring person, the top level 

associate, the issuer or 

unincorporated entity and percentage 

held. 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. 

Holdings of entities with total assets 

of less than $10 million may be 

omitted. In responding to Item 6(c)(ii), 

it is permissible for the acquiring 

person to list all entities in which its 

associate(s) has a reportable minority 

interest. 

Items 7-8 

Item 7 

The Commission proposes 

reorganizing Item 7 to make it more 

consistent with other items in the Form. 

The only proposed change to the 

substance of Items 7(a) and 7(b) is the 

requiring of information for associates, 

as discussed above. 

In Item 7(b)(i) the Commission 

proposes that filing parties not only be 

required to list the name of each person 

that is a party to the acquisition that 

also derived dollar revenues in the 6- 

digit NAICS industry code but also, if 

different, the name of the entity(s) that 

actually derived those revenues. In Item 

7(b)(ii), the acquiring person would be 

required to list the name of each 

associate of the acquiring person that 

also derived dollar revenues in the 6- 

digit industry and, if different, the name 

of the entity(s) that actually derived 

those revenues. Having the name of the 

entity(s), instead of just the UPE or 

associate, will be very useful to the 

Agencies and, as many filing parties 

already submit such information, this 

item should present little additional 

burden for them or substantial 

additional burden for others. 

There are also some proposed changes 

to Items 7(c)(iv) and (v) and a proposed 

new Item 7(d). 

Items 7(c)(iv) and (v) Geographic Market 

Information 

For each overlap listed in Item 7(a) 

that falls within certain 6-digit NAICS 

industry codes, the parties are required 

to provide in Item 7(c)(iv) 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. 

Based on the Agencies’ review of past 

transactions, the Commission has 

determined that the list of NAICS codes 

in Item 7(c)(iv) should be updated to 

include more detailed geographic 

market information for some industries 

not currently captured in Item 7(c)(iv) 

and to delete certain industries 

currently included in Item 7(c)(iv) for 

which this detailed geographic market 

information is not necessary. The 

Commission therefore proposes 

amending the list included in Item 

7(c)(iv) to add the following NAICS 

codes. 

Nonmetallic mineral mining and 

quarrying (2123) 

Concrete (32732) 

Concrete products (32733) 

Industrial gases (32512) 

The Commission proposes moving the 

following NAICS codes to Item 7(c)(v), 

which requires listing only the states in 

which establishments are located: 

Furniture and home furnishings stores 

(442) 

Electronics and appliance stores (443) 

Recreational vehicle parks and 

recreational camps (7212) 

Rooming and boarding houses (7213) 

Personal and household goods repair 

and maintenance (8114) 

Item 7 Overlaps 

As discussed above, the Commission 

proposes to require the acquiring person 

to provide information in Item 7, based 

on its knowledge or belief, for any 

associates that derive revenues in the 

same 6-digit NAICS industry code as the 

acquired entity in Item 7. Accordingly, 

the Commission proposes to add new 

Item 7(d) in order to capture geographic 

market information regarding associates 

in the same manner as for the person 

filing notification. Within this item, the 

Commission proposes that the acquiring 

person be required to list separately the 

geographic information for each of its 

associates and, if different, for the 

entity(s) that actually derived the 

revenues. Having the geographic 

information broken out in this specific 

manner will be very useful to the 

Agencies as they conduct their initial 

review. 

Item 8 Previous acquisitions 

Item 8 requires the parties to identify 

certain previous acquisitions in each 6- 

digit industry code identified in Item 

7(a). As noted above, the Commission 

amended the rules in 200537 to more 

closely align the treatment of 

unincorporated entities with the 

treatment of corporations, and the 

Commission now proposes amending 

Item 8 to include non-corporate 

interests to reflect this earlier change. 

Other Proposed Ministerial Revisions to 

the Rules 

Additionally, the Commission 

proposes revisions to certain rules that 

should have been included in the 2005 

non-corporate rulemaking that sought to 

apply the Act as consistently as possible 

to all forms of legal entities38 and other 

minor ministerial changes. 

§ 801.1 Definitions 

§ 801.1(a)(2) Entity 

The proposed revision to §801.1(a)(2) 

would add ‘‘non-corporate entity’’ after 

‘‘corporation’’ in the two parentheticals 

in its last sentence of this paragraph. 

The omission of this change from the 

non-corporate rulemaking meant that 

corporations controlled by foreign, 

federal, state or local governments, that 

are not themselves agencies of a 

government, are required to file 

notification in an acquisition that 

satisfies the jurisdictional requirements 

of the Act, while non-corporate entities 


wwoods2 on DSK1DXX6B1PROD with PROPOSALS-PART 2
57120 Federal Register / Vol. 75, No. 180 / Friday, September 17, 2010 / Proposed Rules 

39 70 FR 11502 (March 8, 2005). 

40 43 FR 33450 (July 31, 1978). 

making the same acquisition are not. 

This proposed amendment would 

correct this oversight by treating 

similarly all types of legal entities 

controlled by a government. 

§ 801.1(b)(2) Control 

§ 801.1(f)(1)(ii) Non-corporate interest 

The proposed revision to §801.1(b)(2) 

would change the reference to ‘‘trusts 

described in paragraphs (c)(3) through 

(5) of this section’’ to ‘‘trusts that are 

irrevocable and/or in which the settlor 

does not retain a reversionary interest’’. 

An example would be added to clarify 

that such trusts do not include business 

trusts in which persons have an equity 

interest that entitles them to profits or 

assets upon dissolution of the trust. In 

the change to the definition of control 

in the non-corporate rulemaking, the 

reference to paragraphs (c)(3) through 

(c)(5) inadvertently eliminated a class of 

trusts (e.g., family trusts) from the 

control rule. The intent of the change 

was to differentiate between traditional 

trusts that have beneficiaries, and 

business trusts that have unit holders 

with equity interests. What was 

intended was to classify the business 

trusts as non-corporate entities whose 

control is determined by rights to profits 

and assets upon dissolution of the 

business trust, as opposed to traditional 

trusts whose control is determined by 

the right to designate a majority of the 

trustees. By referencing paragraphs 

(c)(3) through (5), traditional trusts that 

are irrevocable and/or in which the 

settlor does not retain a reversionary 

interest are not included in the 

definition of control. The trusts 

described in paragraphs (c)(3) through 

(5) are revocable and/or the settlor 

retains a reversionary interest in the 

trust. These trusts do not require a 

control definition because the settlor is 

already deemed to hold the assets of the 

trust. For the same reason, this change 

is also being applied to the definition of 

non-corporate interests in 

§801.1(f)(1)(ii). 

Additionally, in 2005 the Commission 

amended the definition of control for an 

unincorporated entity to remove the 

reference to an individual exercising 

similar functions to a corporate director. 

However, it inadvertently failed to 

remove the same reference in Example 

2 of §801.1(b)(2). This revision 

eliminates the reference to that 

alternative test of control for 

unincorporated entities from that 

example. 

§ 801.10 Value of voting securities, noncorporate interests and assets to be 

acquired. 

In 200539 , the Commission stated that 

the value of an acquisition of noncorporate interests is determined in the 

same manner as determining the value 

of non-publicly traded voting securities. 

In order to clarify that acquisition price 

for non-corporate interests is the same 

as for voting securities, the Commission 

proposes to add non-corporate interests 

to paragraph (c)(2) of the rule. 

§ 801.15 Aggregation of voting securities 

and assets the acquisition of which was 

exempt 

The Commission also proposes 

revising §801.15, which specifies the 

circumstances in which certain classes 

of assets and voting securities are held 

as a result of an acquisition. The change 

would add references to §7A(c)(3) and 

§802.30 to paragraph (a), in order to 

allow the intraperson exemption to have 

its intended effect. The Statement of 

Basis and Purpose for the original HSR 

rules explained the omission of 

§7A(c)(3) as follows: 

While voting securities acquired 

under a section 7A(c)(3) exemption 

are deemed held for purposes of later 

acquisitions of the same person’s 

securities the later acquisitions are 

themselves exempt if prior to that 

transaction the acquiring person holds 

at least 50 percent of the outstanding 

voting securities of the acquired 

person. So long as the later 

acquisitions are exempt, it is not 

significant whether the voting 

securities acquired under the section 

7A(c)(3) exemption are held.40

While this is true for acquisitions of 

voting securities of a parent issuer, it 

does not take into account the 

acquisition of voting securities of 

multiple subsidiaries of the same 

parent. For example, A already holds 50 

percent of the voting securities of B1, 

while parent B holds the other 50 

percent. A now intends to acquire the 

other 50 percent of B1 from B as well 

as 100 percent of the voting securities of 

B2, a wholly owned subsidiary of B. 

Neither acquisition satisfies the size of 

transaction test on its own, but the two 

acquisitions do if aggregated. The 

acquisition of the remaining 50 percent 

of B1’s voting securities is exempt under 

§7A(c)(3); however, because that 

exemption is not referenced in §801.15, 

the exempt voting securities are deemed 

to be held as a result of the acquisition 

of B2’s voting securities. Therefore, an 

acquisition is made reportable because 

of the aggregation of an exempt 

acquisition. This is certainly not the 

result that was intended. 

The proposed addition of §7A(c)(3) to 

§801.15(a)(1) corrects this problem. The 

proposed addition of §802.30 to 

§801.15(a)(2) eliminates the same 

potential problem in an acquisition of 

non-corporate interests. Also, because 

acquisitions of non-corporate interests 

are exempted under §802.4 and §802.30, 

and will be exempt under §802.52 if 

these proposed rules are finalized, a 

reference to non-corporate interests is 

proposed in both paragraphs (a) and (b) 

of this section. 

§ 801.30 Tender offers and acquisitions 

of voting securities from third parties 

Two scenarios have come to light 

involving acquisitions of non-corporate 

interests that should invoke §801.30. In 

one case, the interests in an 

unincorporated entity were being 

acquired from its members where the 

entity was hostile to the acquisition and 

refused to file notification. Because 

§801.30 currently only covers voting 

securities acquisitions, the waiting 

period did not begin upon notification 

by the acquiring person and the 

unincorporated entity was able to block 

the acquisition indefinitely. This clearly 

thwarts the intent of §801.30, which 

prevents a hostile target from holding 

up a transaction by not filing. Even if 

the unincorporated entity had been 

willing to file notification, it is unclear 

how it could profess its good faith intent 

to consummate the acquisition in the 

affidavit required of non-§801.30 filers, 

since it was not a party to any 

agreement with the acquiror. 

In the second scenario, publicly 

traded master limited partnership 

interests conferring control were being 

acquired on the open market. Because 

non-corporate interests are not included 

in §801.30, the partnership was at risk 

of failing to file and thereby delaying 

the deal because it did not receive the 

notification letter required by §803.5(a) 

in §801.30 transactions. Also, because 

there is no agreement in an open market 

purchase, the parties would be unable to 

attest to the execution of an agreement 

or letter of intent in the affidavit 

required of non-§801.30 filers. The 

proposed addition to §801.30 of a 

reference to non-corporate interests 

addresses both of these potential 

problems. 


wwoods2 on DSK1DXX6B1PROD with PROPOSALS-PART 2
Federal Register / Vol. 75, No. 180 / Friday, September 17, 2010 / Proposed Rules 57121 

41 Id. 

42 66 FR 8680 (February 1, 2001). 

§ 802.4 Acquisitions of voting securities 

of issuers or non-corporate interests in 

unincorporated entities holding certain 

assets the acquisition of which is 

exempt 

The last sentence in paragraph (a) of 

this exemption is intended to exclude 

the value of any non-controlling interest 

in a corporation or unincorporated 

entity, held by the acquired entity, in 

determining whether the $50 million (as 

adjusted) limitation on non-exempt 

assets is exceeded. This is intended to 

apply to acquisitions of both voting 

securities and non-corporate interests, 

as the title of the rule and the Statement 

of Basis and Purpose accompanying its 

introduction made clear.41 However, the 

phrase ‘‘not included within the 

acquired issuer’’ could be interpreted to 

mean that the exemption only applies to 

acquisitions of voting securities because 

unincorporated entities are not issuers. 

Although the PNO informally interprets 

this language to apply the intent of the 

rule to non-corporate entities, this 

proposed amendment adds 

unincorporated entities to the language 

of the rule to make it clear. 

§ 802.21 Acquisitions of voting 

securities not meeting or exceeding 

greater notification threshold (as 

adjusted) 

Section 802.21 permits an acquiring 

person that filed for an acquisition at a 

given threshold, to make additional 

acquisitions up to, but not exceeding, 

the next threshold, for five years, 

without a further filing. When the 

Commission changed from percentagebased notification thresholds to 

notification thresholds that matched the 

tiered filing fee thresholds, a new 

paragraph was added to this section to 

advise how to address transactions 

where the original acquisition was made 

under the old thresholds and the 

acquiring person was now acquiring 

additional voting securities after the 

effective date of the rule change 

introducing the new thresholds, but 

within five years of the termination of 

the waiting period for the original 

acquisition.42 As it has now been over 

five years from the end of the waiting 

period on any filing made using the old 

notification thresholds, this paragraph is 

unnecessary and is accordingly 

removed. 

§ 802.52 Acquisitions by or from foreign 

governmental corporations 

Section 802.52 exempts acquisitions if 

the ultimate parent entity of either the 

acquiring person or the acquired person 

is controlled by a foreign state, foreign 

government, or agency thereof; and the 

acquisition is of assets located within 

that foreign state or of voting securities 

of an issuer organized under the laws of 

that state. This means that an 

acquisition of non-corporate interests of 

an entity organized under the laws of 

the foreign state but with assets outside 

that foreign state would not be 

exempted. In order to treat acquisitions 

of corporate and unincorporated entities 

consistently, the Commission proposes 

to change the title of the rule to 

‘‘Acquisitions by or from foreign 

governmental entities’’, and to add noncorporate interests to paragraph (b) of 

the rule. 

§ 803.2 Instructions applicable to 

Notification and Report Form 

Section 803.2(b) provides guidance on 

how the Form is to be completed by 

acquiring and acquired persons. In the 

case of acquired persons, the response is 

limited, as laid out in §§803.2(b)(1)(ii), 

(iii), and (iv), to assets, voting securities 

or non-corporate interests being 

acquired in the transaction. §803.2(b)(2) 

provides further guidance on 

completing the Form and refers to 

§§803.2(b)(1)(ii) and (iii). This part of 

§803.2(b) should also include a 

reference to paragraph (b)(1) (iv). The 

Commission proposes to correct this 

omission in §803.2(b)(2) accordingly. 

Section 803.2(c)(1) limits the 

responses to Items 5, 7 and 8 to 

information with respect to operations 

conducted within the United States. 

Because the proposed changes to these 

Items would now require some 

reporting with respect to operations 

conducted outside of the United States, 

it is proposed that §803.2(c)(1) be 

removed. 

Additionally, minor ministerial 

changes to §803.2(e) are required to 

conform to the proposed changes 

discussed above. 

§ 803.5 Affidavits required 

With the proposed change to §801.30 

adding non-corporate interests, 

§803.5(a) needs to be revised to 

incorporate a reference to non-corporate 

interests as well. The proposed revision 

to §803.5(a) would add the terms ‘‘noncorporate interests’’ and 

‘‘unincorporated entity’’ where 

applicable. 

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 

Commission certifies that the regulatory 

action will not have a significant 

economic impact on a substantial 

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

Because of the size of the transactions 

necessary to trigger a Hart-Scott-Rodino 

filing, the premerger notification rules 

rarely, if ever, affect small businesses. 

Indeed, these proposed amendments are 

intended to reduce the burden of the 

premerger notification program. Further, 

none of the proposed rule amendments 

expands the coverage of the premerger 

notification rules in a way that would 

affect small business. Accordingly, 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 the required 

notice of this certification to the Small 

Business Administration. 

Paperwork Reduction Act 

The Paperwork Reduction Act, 44 

U.S.C. 3501-3521, requires agencies to 

submit ‘‘collections of information’’ to 

the Office of Management and Budget 

(‘‘OMB’’) and obtain clearance before 

instituting them. Such collections of 

information include reporting, 

recordkeeping, or disclosure 

requirements contained in regulations. 

The existing information collection 

requirements in the HSR rules and Form 

have been reviewed and approved by 

OMB under OMB Control No. 3084- 

0005. The current clearance expires on 

May 31, 2013. Because the rule 

amendments proposed in this NPR 

would change existing reporting 

requirements, the Commission is 

submitting a Supporting Statement for 

Information Collection Provisions 

(‘‘Supporting Statement’’) to OMB. 

Increase or decrease in filings due to 

proposed ministerial changes in filing 

requirements 

The proposed amendments are 

primarily changes to the information 

reported on the Notification and Report 

Form and do not affect the reportability 

of a transaction. Most of the proposed 

ministerial changes to the rules are 

clarifications (e.g., the change to §802.4) 

or new procedures (e.g., the change to 

§801.30), which also would have no 

effect on reporting obligations. One 

proposed amendment could 

theoretically produce an increase in 

filings. The definition of ‘‘entity’’ in 

§801.1(a)(2) is being modified to include 

non-corporate entities engaged in 

commerce that are controlled by a 

government. The definition currently 

includes only corporations engaged in 

commerce. Another proposed 

amendment could theoretically produce 


wwoods2 on DSK1DXX6B1PROD with PROPOSALS-PART 2
57122 Federal Register / Vol. 75, No. 180 / Friday, September 17, 2010 / Proposed Rules 

43 75 FR 27558 (May 17, 2010). 

44 Id. 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 ‘‘index’’ filings, but 

completing the task requires significantly less time 

than non-exempt transactions that require ‘‘nonindex’’ filings. 

45 Id. 

46 This is determined as follows: [(841 non-index 

filings x 37 hours) + (22 transactions requiring more 

precise valuation x 40 hours) + (20 index filings x 

2 hours)] 

47 The preceding estimate, detailed further at 75 

FR 8992 - 8993, was calculated as follows: [(841 

non-index filings x 1/2 incorporating Item 4(a) and 

Item 4(b) documents by reference to an Internet 

link) x (39 hours less one hour saved this way)] + 

[(841 non-index filings x 1/2 at 39 hours)] + (22 

transactions requiring more precise valuation x 40 

hours) + (20 index filings x 2 hours)] = 33,298 

hours. The reduction within this prior calculation 

for time saved when incorporating Item 4(a) and 

Item 4(b) documents by reference to an Internet link 

would be mooted by the proposed changes. The 

proposals would further reduce time to complete 

the Form, and are factored into the estimated five 

percent reduction stated above. 

48 Id. 

a decrease in filings. The proposed 

amendment to the aggregation rules in 

§801.15 would eliminate the 

unintended effect of requiring 

aggregation when exactly 50 percent of 

multiple subsidiaries have been 

acquired and additional voting 

securities of the same person are newly 

being acquired. The Commission 

believes that any increase or decrease in 

filings as a result of the proposed 

ministerial amendments would be 

negligible. Thus, the same number of 

filings projected for fiscal year 2010 in 

the prior Supporting Statement 

submitted to OMB and appearing in the 

associated Federal Register notice43

will be used in the instant burden hour 

calculations. 

Reduced time collecting data for and 

preparing the Form 

Premerger Notification Office staff 

canvassed eight practitioners from the 

private bar to estimate the projected 

change in burden due to the proposed 

amendments to the Form. All are 

considered HSR experts and have 

extensive experience with preparing 

HSR filings for the types of transactions 

that are most likely to be affected by the 

proposed changes. 

Many of the proposed changes would 

significantly reduce burden for all filers. 

Others would increase burden, 

particularly for acquiring persons that 

are private equity funds and master 

limited partnerships. The consensus of 

those canvassed was that, on average, 

burden for collecting and reporting 

would decrease approximately five 

percent. Thus, 37 hours (rounded to the 

nearest hour) will be allocated to nonindex filings.44 [(Current estimate, 39 

hours45 ) x (1-.05) = 37.05 hours.] 

Net Effect 

The proposed Form changes only 

affect non-index filings which, for FY 

2010, the FTC projects will total 841. 

Assuming an average of 37 hours per 

filer, and combining this revised 

calculation with the preceding 

calculations for index filings and 

estimates of transactions requiring more 

precise valuations results in a revised 

cumulative total of 32,037 hours.46 This 

is a decrease of 1,261 hours from the 

prior estimate of 33,298 hours47 for the 

current rules. Applying the revised 

estimated hours, 32,037, to the previous 

assumed hourly wage of $460 for 

executive and attorney compensation,48

yields $14,737,000 (rounded to the 

nearest thousand) in labor costs, a 

decrease of $580,000 from the prior 

estimate of $15,317,000. The proposed 

amendments presumably will impose 

minimal or no additional capital or 

other non-labor 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. 

The Commission invites comments 

that will enable it to: (1) evaluate 

whether the proposed collections of 

information are necessary for the proper 

performance of the functions of the 

Commission, including whether the 

information will have practical utility; 

(2) evaluate the accuracy of the 

Commission’s estimate of the burden of 

the proposed collections of information, 

including the validity of the 

methodology and assumptions used; (3) 

enhance the quality, utility, and clarity 

of the information to be collected; and 

(4) minimize the burden of the 

collections of information on those who 

must comply, including through the use 

of appropriate automated, electronic, 

mechanical, or other technological 

techniques or other forms of information 

technology. 

Comments on the proposed reporting 

requirements subject to Paperwork 

Reduction Act review by OMB should 

additionally be submitted to: Office of 

Information and Regulatory Affairs, 

Office of Management and Budget, 

Attention: Desk Officer for Federal 

Trade Commission. Comments should 

be submitted via facsimile to (202) 395- 

5167 because U.S. postal mail at OMB 

is subject to delay due to heightened 

security precautions. 

List of Subjects in 16 CFR Parts 801, 

802 and 803 

Antitrust. 

■ For the reasons stated in the preamble, 

the Federal Trade Commission proposes 

to amend 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 

paragraphs (a)(2) and (b)(2), revising 

example 2 to paragraph (b), adding 

example 5 to paragraph (b), 

redesignating paragraph (d) as (d)(1), 

revising newly designated (d)(1), adding 

new paragraph (d)(2), and revising 

paragraph (f)(1)(ii) to read as follows: 

§ 801.1 Definitions. 

* * * * * 

(a) * * * 

(2) Entity. The term entity means any 

natural person, corporation, company, 

partnership, joint venture, association, 

joint-stock company, trust, estate of a 

deceased natural person, foundation, 

fund, institution, society, union, or club, 

whether incorporated or not, wherever 

located and of whatever citizenship, or 

any receiver, trustee in bankruptcy or 

similar official or any liquidating agent 

for any of the foregoing, in his or her 

capacity as such; or any joint venture or 

other corporation which has not been 

formed but the acquisition of the voting 

securities or other interest in which, if 

already formed, would require 

notification under the act and these 

rules: Provided, however, that the term 

entity shall not include any foreign 

state, foreign government, or agency 

thereof (other than a corporation or noncorporate entity engaged in commerce), 

nor the United States, any of the States 

thereof, or any political subdivision or 

agency of either (other than a 

corporation or non-corporate entity 

engaged in commerce). 

(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 in the case 

of trusts that are irrevocable and/or in 


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which the settlor does not retain a 

reversionary interest, the trustees of 

such a trust. 

Examples: * * * 

2. A statutory limited partnership 

agreement provides as follows: The 

general partner ‘‘A’’ is entitled to 50 

percent of the partnership profits, ‘‘B’’ is 

entitled to 40 percent of the profits and 

‘‘C’’ is entitled to 10 percent of the 

profits. Upon dissolution, ‘‘B’’ is entitled 

to 75 percent of the partnership assets 

and ‘‘C’’ is entitled to 25 percent of those 

assets. All limited and general partners 

are entitled to vote on the following 

matters: the dissolution of the 

partnership, the transfer of assets not in 

the ordinary course of business, any 

change in the nature of the business, 

and the removal of the general partner. 

The interest of each partner is 

evidenced by an ownership certificate 

that is transferable under the terms of 

the partnership agreement and is subject 

to the Securities Act of 1933. For 

purposes of these rules, control of this 

partnership is determined by paragraph 

(b)(1)(ii) of this section. Although 

partnership interests may be securities 

and have some voting rights attached to 

them, they do not entitle the owner of 

that interest to vote for a corporate 

‘‘director’’ as required by § 801.1(f)(1) of 

this section. Thus control of a 

partnership is not determined on the 

basis of either paragraph (b)(1)(i) or (2) 

of this section. Consequently, ‘‘A’’ is 

deemed to control the partnership 

because of its right to 50 percent of the 

partnership’s profits. ‘‘B’’ is also deemed 

to control the partnership because it is 

entitled to 75 percent of the 

partnership’s assets upon dissolution. 

* * * 

5. A is the settlor of an irrevocable 

trust in which it does not retain a 

reversionary interest in the corpus of the 

trust. A is entitled under the trust 

indenture to designate four of the eight 

trustees of the trust. A controls the trust 

pursuant to § 801.1(b)(2) and is deemed 

to hold the assets that constitute the 

corpus of the trust. Note that the right 

to designate 50 percent or more of the 

trustees of a business trust that has 

equity holders entitled to profits or 

assets upon dissolution of the business 

trust does not constitute control. Such 

business trusts are treated as noncorporate entities and control is 

determined pursuant to § 801.1(b)(1)(ii). 

(d)(1) Affiliate. An entity is an affiliate 

of a person if it is controlled, directly or 

indirectly, by the ultimate parent entity 

of such person. 

(2) Associate. For purposes of Items 

6(c) and 7 on the Form, an associate of 

an acquiring person shall be an entity 

that is not an affiliate of such person 

but: 

(i) Has the right, directly or indirectly, 

to manage, direct or oversee the affairs 

and/or the investments of an acquiring 

entity (a ‘‘managing entity’’); or 

(ii) Has its affairs and/or investments, 

directly or indirectly, managed, directed 

or overseen by the acquiring person; or 

(iii) Directly or indirectly, controls, is 

controlled by, or is under common 

control with a managing entity; or 

(iv) Directly or indirectly, manages, 

directs or oversees, is managed by, 

directed by or overseen by, or is under 

common management with a managing 

entity. 

Examples to §801.1(d): 

1. ABC Investment Group has 

organized a number of investment 

partnerships. Each of the partnerships is 

its own ultimate parent, but ABC makes 

the investment decisions for all of the 

partnerships. One of the partnerships 

intends to make a reportable 

acquisition. For purposes of Items 6(c) 

and 7, each of the other investment 

partnerships, and ABC Investment 

Group itself are associates of the 

partnership that is the acquiring 

person. In response to Item 6(c), the 

acquiring person will disclose any 

minority holdings of its own, or of any 

of these associates, in any other entity 

that generates revenues in any of the 

same codes as the acquired entity in the 

reportable transaction. In Item 7, the 

acquiring person will indicate whether 

there are any NAICS code overlaps 

between the acquired entity in the 

reportable transaction, on the one hand, 

and the acquiring person and all of its 

associates, on the other. 

2. XYZ Corporation is its own 

ultimate parent and intends to make a 

reportable acquisition. Pursuant to a 

management contract, Fund MNO has 

the right to manage the affairs of XYZ 

Corporation. For the HSR filing by XYZ 

Corporation, Fund MNO is an associate 

of XYZ, as is any other entity that either 

controls, or is controlled by, or manages 

or is managed by Fund MNO or is under 

common control or common 

management with Fund MNO. 

3. EFG Investment Group has the 

contractual power to determine the 

investments of PRS Corporation, which 

is its own ultimate parent. Natural 

person Mr. X, who is not an employee 

of EFG Investment Group, has been 

contracted by EFG Investment Group as 

its investment advisor. When PRS 

Corporation makes an acquisition, its 

associates include (i) EFG Investment 

Group, (ii) any entity over which EFG 

Investment Group has investment 

authority, (iii) any entity that controls, 

or is controlled by, EFG Investment 

Group, (iv) Natural person Mr. X, (v) 

any entity over which Natural person 

Mr. X has management authority, and 

(vi) any entity which is controlled by 

Natural person Mr. X, directly or 

indirectly. 


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4. CORP1 controls GP1 and GP2, the 

sole general partners of private equity 

funds LP1 and LP2 respectively. LP1 

controls GP3, the sole general partner of 

MLP1, a newly formed master limited 

partnership which is its own ultimate 


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parent entity. LP2 controls GP4, the sole 

general partner of MLP2, another master 

limited partnership that is its own 

ultimate parent entity and owns and 

operates a natural gas pipeline. In 

addition, GP4 holds 25% of the voting 

securities of CORP2, which also owns 

and operates a natural gas pipeline. 

MLP1 is acquiring 100% of the 

membership interests of LLC1, also the 

owner and operator of a natural gas 

pipeline. MLP2, CORP2 and LLC1 all 

derive revenues in the same NAICS 

code (Pipeline Transportation of Natural 

Gas). All of the entities under common 

management of CORP1, including GP4 

and MLP2, are associates of MLP1, the 

acquiring person. 

In Item 7 of its HSR filing, MLP1 

would identify MLP2 as an associate 

that has an overlap in pipeline 

transportation of natural gas with LLC1, 

the acquired person. Because GP4 does 

not control CORP2 it would not be 

listed in Item 7, however, it would be 

listed in Item 6(c)(ii) as an associate that 

holds 25% of the voting securities of 

CORP2. In this example, even though 

there is no direct overlap between the 

acquiring person (MLP1) and the 

acquired person (LLC1), there is an 

overlap reported for an associate (MLP2) 

of the acquiring person in Item 7. Also, 

while the acquiring person (MLP1) has 

no holdings, the holdings of an associate 

(GP4) of the acquiring person is reported 

in Item 6(c)(ii). 

5. LLC is the investment manager for 

and ultimate parent entity of general 

partnerships GP1 and GP2. GP1 is the 

general partner of LP1, a limited 

partnership that holds 30% the voting 

securities of CORP1. GP2 is the general 

partner of LP2, which holds 55% of the 

voting securities of CORP1. GP2 also 

directly holds 2% of the voting 

securities of CORP1. LP1 is acquiring 

100% of the voting securities of CORP2. 

CORP1 and CORP2 both derive 

revenues in the same NAICS code 

(Industrial Gas Manufacturing). 

All of the entities under common 

management of the managing entity 

LLC, including GP1, GP2, LP2 and 

CORP1 are associates of LP1. In Item 

6(c)(i) of its HSR filing, LP1 would 

report its own holding of 30% of the 

voting securities of CORP1. It would not 

report the 55% holding of LP2 in Item 

6(c)(ii) because it is greater than 50%. It 

also would not report GP2’s 2% holding 

because it is less than 5%. In Item 7, 

LP1 would identify both LP2 and 

CORP1 as associates that derive 

revenues in the same NAICS code as 

CORP2. 

6. LLC is the investment manager for 

GP1 and GP2 which are the general 

partners of limited partnerships LP1 and 

LP2, respectively. LLC holds no equity 

interests in either general partnership 

but manages their investments and the 

investments of the limited partnership 

by contract. LP1 is newly formed and its 

own ultimate parent entity. It plans to 

acquire 100% of the voting securities of 

CORP1, which derives revenues in the 

NAICS code for Consumer Lending. LP2 

controls CORP2, which derives 

revenues in the same NAICS code. All 

of the entities under the common 

management of LLC, including LP2 and 

CORP2, are associates of LP1. For 

purposes of Item 7, LP1 would report 

LP2 and CORP2 as associates that derive 

revenues in the NAICS code that 

overlaps with CORP1. Even though the 

investment manager (LLC) holds no 

equity interest in GP1 or GP2, the 

contractual arrangement with them 

makes them associates of LP1 through 

common management. 

7. Corporation A is its own ultimate 

parent entity and is making an 

acquisition of Corporation B. Although 

Corporation A is operationally managed 

by its officers and its investments, 

including the acquisition of Corporation 

B, are managed by its directors, neither 

the officers nor directors are considered 

associates of A. 

8. Limited partnership A is an 

investment partnership that is making 

an acquisition. LLC B has no equity 

interest in A, but has a contract to 

manage its investments for a fee. LLC B 

has an investment committee comprised 

of twelve of its employees that makes 

the actual investment decisions. LLC B 

is an associate of A but none of the 

twelve employees are associates of A, as 

LLC B is a managing entity and the 

twelve individuals are merely its 

employees. Contrast this with example 

3 where a managing entity, EFG, is itself 

managed by another entity, Mr. X, who 

is thus an associate. 

(f) * * * 

(1) * * * 

(ii) Non-corporate interest. The term 

‘‘non-corporate interest’’ means an 

interest in any unincorporated entity 

which gives the holder the right to any 

profits of the entity or in the event of 

dissolution of that entity the right to any 

of its assets after payment of its debts. 

These unincorporated entities include, 

but are not limited to, general 

partnerships, limited partnerships, 

limited liability partnerships, limited 

liability companies, cooperatives and 

business trusts; but these 

unincorporated entities do not include 

trusts that are irrevocable and/or in 

which the settlor does not retain a 

reversionary interest and any interest in 

such a trust is not a non-corporate 

interest as defined by this rule. 

* * * * * 

■ 3. Amend § 801.10 by revising 

paragraph (c)(2) to read as follows: 

§ 801.10 Value of voting securities, noncorporate interests and assets to be 

acquired. 

* * * 

(c) * * * 

(2) Acquisition price. The acquisition 

price shall include the value of all 

consideration for such voting securities, 

non-corporate interests or assets to be 

acquired. 

* * * * * 

■ 4. Amend § 801.15 by revising the 

heading, introductory text, and 

paragraphs (a) and (b) to read as follows: 

§ 801.15 Aggregation of voting securities, 

non-corporate interests and assets the 

acquisition of which was exempt. 

Notwithstanding § 801.13, for 

purposes of determining the aggregate 

total amount of voting securities, noncorporate interests and assets of the 

acquired person held by the acquiring 

person under Section 7A(a)(2) and 

§ 801.1(h), none of the following will be 

held as a result of an acquisition: a) 

Assets, non-corporate interests or voting 

securities the acquisition of which was 

exempt at the time of acquisition (or 

would have been exempt, had the act 

and these rules been in effect), or the 

present acquisition of which is exempt, 

under— 

(1) Sections 7A(c) (1), (3), (5), (6), (7), 

(8), and (11)(B); 

(2) Sections 802.1, 802.2, 802.5, 

802.6(b)(1), 802.8, 802.30, 802.31, 

802.35, 802.52, 802.53, 802.63, and 

802.70 of this chapter; 

(b) Assets, non-corporate interests or 

voting securities the acquisition of 

which was exempt at the time of 

acquisition (or would have been 

exempt, had the Act and these rules 

been in effect), or the present 

acquisition of which is exempt, under 

Section 7A(c)(9) and §§ 802.3, 802.4, 

and 802.64 of this chapter unless the 

limitations contained in Section 

7A(c)(9) or those sections do not apply 

or as a result of the acquisition would 

be exceeded, in which case the assets or 

voting securities so acquired will be 

held; and 

* * * * * 

■ 5. Amend § 801.30 by revising the 

heading and paragraph (a)(5) to read as 

follows: 

§ 801.30 Tender offers and acquisitions of 

voting securities and non-corporate 

interests from third parties. 

(a) * * * 


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(5) All acquisitions (other than 

mergers and consolidations) in which 

voting securities or non-corporate 

interests are to be acquired from a 

holder or holders other than the issuer 

or unincorporated entity or an entity 

included within the same person as the 

issuer or unincorporated entity; 

* * * * * 

PART 802–EXEMPTION RULES 

■ 6. The authority citation for part 802 

continues to read as follows: 

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

■ 7. Amend § 802.4 by revising 

paragraph (a) introductory text to read 

as follows: 

§ 802.4 Acquisitions of voting securities of 

issuers or non-corporate interests in 

unincorporated entities holding certain 

assets the acquisition of which is exempt. 

(a) An acquisition of voting securities 

of an issuer or non-corporate interests in 

an unincorporated entity whose assets 

together with those of all entities it 

controls consist or will consist of assets 

whose acquisition is exempt from the 

requirements of the Act pursuant to 

§ 7A(c) of the Act, this part 802, or 

pursuant to § 801.21, is exempt from the 

reporting requirements if the acquired 

issuer or unincorporated entity and all 

entities it controls do not hold nonexempt assets with an aggregate fair 

market value of more than $50 million 

(as adjusted). The value of voting or 

non-voting securities of any other issuer 

or interests in any non-corporate entity 

not included within the acquired issuer 

or unincorporated entity does not count 

toward the $50 million (as adjusted) 

limitation for non-exempt assets. 

* * * * * 

■ 8. Amend § 802.21 by removing 

paragraph (b) and its three examples. 

■ 9. Amend § 802.52 by revising the 

heading and paragraph (b) introductory 

text to read as follows: 

§ 802.52 Acquisitions by or from foreign 

governmental entities. 

(b) The acquisition is of assets located 

within that foreign state or of voting 

securities or non-corporate interests of 

an entity organized under the laws of 

that state. 

* * * * * 

PART 803–TRANSMITTAL RULES 

■ 10. The authority citation for part 803 

continues to read as follows: 

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

■ 11. Amend § 803.2 by revising 

paragraph (b)(2) introductory text, 

removing paragraph (c)(1), redesignating 

paragraph (c)(2) as (c), and revising 

paragraph (e) to read as follows: 

§ 803.2 Instructions applicable to 

Notification and Report Form. 

* * * 

(b) * * * 

(2) For purposes of item 7 of the 

Notification and Report Form, the 

acquiring person shall regard the 

acquired person in the manner 

described in paragraphs (b)(1) (ii), (iii) 

and (iv) of this section. 

* * * 

(e) A person filing notification may 

instead provide: 

(1) A cite to a previous filing 

containing documentary materials 

required to be filed in response to item 

4(b) of the Notification and Report 

Form, which were previously filed by 

the same person and which are the most 

recent versions available; except that 

when the same parties file for a higher 

threshold no more than 90 days after 

having made filings with respect to a 

lower threshold, each party may instead 

provide a cite to any documents or 

information in its earlier filing provided 

that the documents and information are 

the most recent available; 

(2) A cite to an Internet address 

directly linking to the document, only 

documents required to be filed in 

response to item 4(b) of the Notification 

and Report Form. If an Internet address 

is inoperative or becomes inoperative 

during the waiting period, or the 

document that is linked to it is 

incomplete, or the link requires 

payment to access the document, upon 

notification by the Commission or 

Assistant Attorney General, the parties 

must make these documents available to 

the agencies by either referencing an 

operative Internet address or by 

providing paper copies to the agencies 

as provided in § 803.10(c)(1) by 5 p.m. 

on the next regular business day. Failure 

to make the documents available, by the 

Internet or by providing paper copies, 

by 5 p.m. on the next regular business 

day, will result in notice of a deficient 

filing pursuant to § 803.10(c)(2). 

* * * * * 

■ 12. Amend § 803.5 by revising 

paragraphs (a)(1) introductory text, 

(a)(1)(ii), (a)(1)(iii), and (a)(1)(vi) to 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 attached as part of the 

electronic submission, attesting that the 

issuer or unincorporated entity whose 

voting securities or non-corporate 

interests are to be acquired has received 

notice in writing by certified or 

registered mail, by wire or by hand 

delivery, at its principal executive 

offices, of: 

* * * 

(ii) The fact that the acquiring person 

intends to acquire voting securities or 

non-corporate interests of the issuer or 

unincorporated entity; 

(iii) The specific classes of voting 

securities or non-corporate interests of 

the issuer or unincorporated entity 

sought to be acquired; and if known, the 

number of voting securities or 

unincorporated interests of each such 

class that would be held by the 

acquiring person as a result of the 

acquisition or, if the number of voting 

securities is not known in the case of an 

issuer, the specific notification 

threshold that the acquiring person 

intends to meet or exceed; and, if 

designated by the acquiring person, a 

higher threshold for additional voting 

securities it may hold in the year 

following the expiration of the waiting 

period; 

* * * 

(vi) The fact that the person within 

which the issuer or unincorporated 

entity is included may be required to 

file notification under the act. 

* * * * * 

BILLING CODE 6750–01–S 


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By direction of the Commission. 

Donald S. Clark 

Secretary 

[FR Doc. 2010–23079 Filed 9–16–10; 8:45 am] 

BILLING CODE 6750–01–C 


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