In the wake of COVID-19 and the mass telework directives, the Premerger Notification Office of the Federal Trade Commission (FTC) and the Antitrust Division of the Department of Justice (DOJ) instituted a temporary e-filing system for all filings made to the agencies pursuant to the Hart-Scott-Rodino Act (HSR Act) and halted granting any early terminations of the waiting period under the HSR Act while the e-filing system is in place. The temporary e-filing system has so far been successful for the agencies and effective March 30, 2020, both the FTC and DOJ resumed processing requests for early termination of the waiting period under the HSR Act when the FTC and DOJ have determined that no enforcement action will be taken with respect to the transaction.
Even though the agencies are resuming early terminations, parties to a transaction should keep in mind that early terminations of the waiting period are not guaranteed, particularly during the COVID-19 outbreak. Both agencies are at capacity, so early terminations will be granted less often and more slowly than under normal circumstances. Parties should factor in the full 30-day waiting period (or 15-days for cash tender offers or acquisitions covered by 11 U.S.C. 363(b)) in the transaction timing in case the agencies are slower or don’t grant early termination. And given the unprecedented times during the COVID-19 outbreak, the policies and procedures of the FTC and DOJ could change again.
On a positive note, we are pleased to hear that the temporary e-filing system has been successful for the agencies during the first two weeks of implementation and hope that this encourages the agencies to work towards a more permanent e-filing system.
