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

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Federal Trade Commission.




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


Comments must be filed by May 11, 2007.


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

Comments filed in electronic form should be submitted by using the following weblink:​ftc-hsrpra (and following the instructions on the Web-based form). To ensure that the Commission considers an electronic comment, you must file it on the Web-based form at the weblink​ftc-hsrpra. If this notice appears at, you may also file an electronic comment through that Web site. The Commission will consider all comments that forwards to it.

Comments should also be submitted to: Office of Management and Budget, Attention: Desk Officer for the Federal Trade Commission. Comments should be submitted via facsimile to (202) 395-6974 because U.S. Postal Mail is subject to lengthy delays 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. All timely and responsive public comments, whether filed in paper or electronic form, will be considered by the Commission, and will be available to the public on the FTC Web site, to the extent practicable, at As a matter of discretion, the FTC makes every effort to remove home contact information for individuals from the public comments it receives before placing those comments on the FTC Web site. More information, including routine uses permitted by the Privacy Act, may be found in the FTC's privacy policy, at​ftc/​privacy.htm.

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

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Under the Paperwork Reduction Act (“PRA”), 44 U.S.C. 3501-3520, federal agencies must obtain approval from OMB for each collection of information they conduct or sponsor. On January 12, 2007, the FTC sought comment on the information collection requirements associated with the HSR Rules and the corresponding Notification and Report Form (OMB Control Number: 3085-0005). No comments were received. Pursuant to the OMB regulations that implement the PRA (5 CFR Part 1320), the FTC is providing this second opportunity for public comment while seeking OMB approval to extend the existing paperwork clearance for the HSR Rules and the corresponding Notification and Report Form. All comments should be filed as prescribed in the ADDRESSES section above, and must be received on or before May 11, 2007.

Background Information

Section 7A of the Clayton Act (“Act”), 15 U.S.C. 18a, as amended by the Hart-Scott-Rodino Antitrust Improvements Act of 1976, Public Law 94-435, 90 Stat. 1390, requires all persons contemplating certain mergers or acquisitions to file notification with the Commission and the Assistant Attorney General and to wait a designated period of time before consummating such transactions. Congress empowered the Commission, with the concurrence of the Assistant Attorney General, to require “that the notification * * * be in such form and contain such documentary material and information * * * as is necessary and appropriate” to enable the agencies “to determine whether such acquisitions may, if consummated, violate the antitrust laws.” 15 U.S.C. 18a(d). Congress similarly granted rulemaking authority to, inter alia, “prescribe such other rules as may be necessary and appropriate to carry out the purposes of this section.” Id.

Pursuant to that section, the Commission, with the concurrence of the Assistant Attorney General, developed the HSR Rules and the corresponding Notification and Report Form. As discussed below, several changes have been made to the HSR Rules and the Notification and Report Form since FTC staff last sought OMB approval for the clearance.

Burden Statement

Estimated total annual hours burden: 156,000 hours (rounded to the nearest thousand).

The following burden estimates are primarily based on FTC data concerning the number of HSR filings and staff's informal consultations with leading HSR counsel.

In its 2004 PRA submission to OMB regarding the HSR Rules and the Notification and Report Form, FTC staff estimated that there were 21 “index filings” under Clayton Act Sections 7A(c)(6) and 7A(c)(8) that required 2 hours per filing, and 2,192 non-index filings that required an average of 39 Start Printed Page 18252hours per filing.[2] Staff also estimated that a total of 50 transactions would require 40 hours of burden associated with the more precise determination of transaction value as a result of the introduction of a tiered filing fee system. Thus, the total estimated hours burden was 87,530 hours [(21 index-filings × 2 hours) + (2,192 non-index filings × 39 hours) + (50 transactions × 40 hours)]. See 69 FR 18686 (April 8, 2004). In January 2005, staff obtained OMB approval for a nonsubstantive/nonmaterial change request to the FTC's previous burden estimate, resulting in a new burden estimate of 84,020 burden hours. The 3,510 burden hour reduction was based on an anticipated small decrease in the number of non-index filings due to annual adjustments to the statutory thresholds beginning in fiscal year 2005.[3]

There have been two amendments to the HSR Rules and one amendment to the Notification and Report Form since staff last obtained OMB approval in January 2005:

1. Revised treatment of unincorporated entities under the HSR Rules.[4] This amendment changed previously existing reporting requirements. However, based on filing statistics from the effective date of the rulemaking, the amendment appears to have had a de minimis effect on the number of filings received and thereby has not impacted PRA burden.

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

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

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

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

This is a conservative estimate. In estimating PRA burden, staff considered “the total time, effort, or financial resources expended by persons to generate, maintain, retain, disclose or provide information to or for a Federal agency.” 5 CFR 1320.3(b)(1). This includes “developing, acquiring, installing, and utilizing technology and systems for the purpose of disclosing and providing information.” 5 CFR 1320.3(b)(1)(iv). Although not expressly stated in the OMB regulation implementing the PRA, the definition of burden arguably includes upgrading and maintaining computer and other systems used to comply with a rule's requirements. Conversely, to the extent that these systems are used in the ordinary course of business independent of the Rule, their associated upkeep would fall outside the realm of PRA “burden.”

Industry has been subject to the basic provisions of the HSR Rules since 1978. Thus, businesses have had several years (and some have had decades) to integrate compliance systems into their business procedures. Accordingly, most companies now maintain records and provide updated order information of the kind required by the HSR Rules in their ordinary course of business. Nevertheless, staff conservatively assumes that the time devoted to compliance with the Rule by existing and new companies remains unchanged from its preceding estimate.

Estimated labor costs: $73,506,000 (rounded to the nearest thousand).

Using the burden hours estimated above and applying an estimated average of $470/hour for executive and attorney wages,[10] staff estimates that the Start Printed Page 18253total labor cost associated with the HSR Rules and the Notification and Report Form is approximately $73,505,650 (156,395 hours × $470/hour).

Estimated annual non-labor cost burden: $0 or minimal.

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

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William Blumenthal,

General Counsel.

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

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2.  Clayton Act Sections 7A(c)(6) and (c)(8) exempt from the requirements of the premerger notification program certain transactions that are subject to the approval of other agencies, but only if copies of the information submitted to these other agencies are also submitted to the FTC and the Assistant Attorney General. Thus, parties must submit copies of these filings, which are included in the totals shown, but completing the task requires significantly less time than non-exempt transactions.

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3.  Based on actual data concerning the number of non-index filings since then, staff does not anticipate that the annual adjustments will decrease the number of filings going forward. Furthermore, because the adjustments are based on annual change in gross domestic product, as the thresholds increase, the size-of-transactions should increase at the same rate, resulting in no net effect on the number of non-index filings received.

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4.  70 FR 11502 (March 8, 2005)

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5.  71 FR 35995 (June 23, 2006)

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6.  70 FR 73369 (December 12, 2005)

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7.  The switch of the base year from 1997 to 2002 became effective December 30, 2005. 70 FR 77312 (December 30, 2005).

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8.  See 5 CFR 1320.3(b)(2). Staff recognizes that the HSR Rules require companies to report total revenues for a specific NAICS code (whereas, the Census Bureau collects data for a specific NAICS code for each establishment). Nonetheless, staff anticipates that the burden tied to the aggregation of such data as required by the HSR Rules is de minimis.

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

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

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[FR Doc. E7-6773 Filed 4-10-07; 8:45 am]