HSR Act Filing Thresholds 2025: Pre-Merger Notification Guide for Turkish Acquirers

The Hart-Scott-Rodino Antitrust Improvements Act of 1976 (HSR Act) requires parties to certain mergers and acquisitions to notify the Federal Trade Commission (FTC) and the Department of Justice (DOJ) before closing and to observe a mandatory waiting period during which the agencies can review the transaction for antitrust concerns.

The HSR Act is one of the most important — and most frequently misunderstood — U.S. regulatory requirements for cross-border M&A. Failure to file when required can result in civil penalties of up to $51,744 per day for each day of non-compliance. Closing a transaction before the HSR waiting period expires — known as "gun-jumping" — is a serious violation that can result in substantial penalties and, in some cases, unwinding of the transaction.

The FTC adjusts HSR thresholds annually based on changes in gross national product. The 2025 thresholds (effective February 2025) are:

• $119.5 million: Transactions valued at or above this amount may be subject to HSR filing requirements (subject to the size of person test)
• $478 million: Transactions valued above this amount are subject to HSR filing regardless of the size of the parties

For transactions between $119.5 million and $478 million, at least one of the following must be true:

• One party has total assets or annual net sales of $239 million or more
• The other party has total assets or annual net sales of $23.9 million or more

The HSR Act covers a broad range of transactions, including:

• Acquisitions of voting securities of a U.S. corporation or a foreign corporation with U.S. assets or sales above specified thresholds
• The filing obligation is triggered at each of three thresholds: $119.5M, $239M, and $478M (a separate filing is required each time a threshold is crossed)

• Acquisitions of assets located in the United States
• Acquisitions of assets located outside the United States if the foreign target had U.S. sales above $50 million in its most recent fiscal year

• Acquisitions of interests in partnerships, LLCs, and other non-corporate entities if the entity holds assets or generates revenues above specified thresholds

Several important exemptions may apply to Turkish acquirers:

Transactions where the acquirer is a foreign person and the acquired entity is also a foreign person are generally exempt — unless the foreign target has U.S. assets or U.S. sales above specified thresholds.

Transactions valued below $119.5 million are generally exempt (subject to the $478 million threshold for large transactions regardless of party size).

Acquisitions of goods or realty in the ordinary course of business are exempt.

Acquisitions of voting securities solely for investment purposes — where the acquirer will hold 10% or less of the outstanding voting securities and will not participate in the formulation, determination, or direction of the basic business decisions of the issuer — are exempt.

Important: The investment-only exemption is narrow and frequently misapplied. Turkish investors who acquire U.S. company shares and subsequently seek board representation or influence over business decisions may lose the exemption retroactively.

Analyze the transaction against the HSR thresholds and exemptions. This analysis should be conducted by experienced antitrust counsel before signing the acquisition agreement.

The HSR notification form requires extensive information about:

• The parties and their affiliates
• The transaction structure and consideration
• The parties' revenues by industry code (NAICS codes)
• Overlapping products and services
• Certain documents prepared by or for senior management discussing the transaction (including deal rationale documents, competitive analyses, and board presentations)

Document production: The HSR form requires production of certain documents, including:

• All studies, surveys, analyses, and reports prepared by or for any officer or director 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
• All documents that constitute or contain an "Item 4(c)" document — typically investment banking presentations, management presentations, and board materials discussing competitive dynamics

Both the acquiring and acquired parties must file separate HSR notifications with the FTC and DOJ. Filing fees range from $30,000 to $335,000 depending on the transaction value.

• Standard waiting period: 30 days from the date both parties' filings are received
• Early termination: Parties may request early termination of the waiting period; the agencies may grant early termination if they determine no further review is needed
• Second Request: If the agencies need additional information, they may issue a Second Request, which extends the waiting period

If the reviewing agency issues a Second Request, the parties must substantially comply before the extended waiting period begins. Second Request compliance is a major undertaking that can take months and cost millions of dollars.

Gun-jumping refers to closing a transaction or integrating the parties' businesses before the HSR waiting period expires. Gun-jumping violations can result in:

• Civil penalties of up to $51,744 per day
• Unwinding of completed transactions
• Reputational damage

Gun-jumping includes:

• Closing the transaction before the waiting period expires
• Transferring control of the target to the acquirer before closing
• Coordinating competitive behavior between the parties before closing
• Sharing competitively sensitive information beyond what is necessary for due diligence

Certain pre-closing activities are permissible:

• Due diligence review of the target's business
• Integration planning (subject to information-sharing restrictions)
• Negotiating transition services agreements
• Obtaining third-party consents required for closing

Turkish companies are "foreign persons" for HSR purposes. The HSR Act applies to foreign acquirers who acquire U.S. assets or voting securities above the applicable thresholds.

For Turkish companies, the "size of person" calculation includes:

• The Turkish acquirer's total assets and annual net sales
• The assets and sales of all entities that the Turkish acquirer controls (directly or indirectly)
• The assets and sales of all entities that control the Turkish acquirer

This means that a Turkish holding company's subsidiaries — including non-U.S. subsidiaries — are included in the size of person calculation.

HSR filings are confidential and not publicly disclosed. This is an important consideration for Turkish acquirers who may have concerns about public disclosure of transaction details.

For Turkish acquirers, HSR and CFIUS reviews often run in parallel. The timing and sequencing of these reviews should be carefully coordinated. In some cases, CFIUS review may take longer than HSR review, making CFIUS the critical path item for closing.

Turkish acquirers should be aware of the current antitrust enforcement environment:

FTC posture: The FTC has maintained an aggressive posture toward M&A across sectors, with particular focus on technology, healthcare, and consumer goods. The FTC has challenged transactions that would have been cleared in prior administrations.

DOJ posture: The DOJ Antitrust Division has similarly increased its scrutiny of mergers, with a focus on vertical mergers and transactions involving nascent competitors.

Remedy preferences: Both agencies have shown a preference for structural remedies (divestitures) over behavioral remedies (conduct commitments) in recent years.

The HSR Act's pre-merger notification requirements are a critical compliance consideration for Turkish companies acquiring U.S. businesses. Understanding the applicable thresholds, exemptions, and process — and engaging experienced antitrust counsel early — is essential to smooth transaction execution.

ULF New York advises Turkish clients on HSR filing requirements, antitrust risk assessment, and U.S. merger control compliance. Contact us to discuss the HSR implications of your planned U.S. acquisition.

This article reflects HSR thresholds and FTC/DOJ enforcement priorities as of early 2025. Thresholds are adjusted annually; confirm current thresholds with counsel before signing. This article does not constitute legal advice.