Federal Trade Commission (FTC)

16 CFR § 803.20(b) — specifically the portions that exempt certain acquisitions from premerger notification under the Hart–Scott–Rodino Act, including intra-person transactions and secondary acquisitions in vertical mergers.

Premerger Notification: Certain Exempt Transactions and Filing Requirements

This rule exempts certain vertical and intra-corporate acquisitions from antitrust review under Hart–Scott–Rodino (HSR) thresholds. It allows large firms—especially private equity rollups—to consolidate supply chains without triggering public disclosure or FTC scrutiny. Rescinding these carveouts would help regulators detect anti-competitive vertical mergers before they reshape markets.

Federal Trade Commission 600 Pennsylvania Avenue NW Washington, DC 20580

Office of Policy Planning Phone: (202) 326-2045 Email: antitrust@ftc.gov

Under the Hart–Scott–Rodino Act (15 U.S.C. § 18a), companies must notify the FTC and DOJ of certain large mergers or acquisitions. However, 16 CFR § 803.20(b) grants exemptions for intra-person transactions and certain vertical or secondary acquisitions. These carveouts were justified as “low-risk” or “internal restructurings,” but in practice, they now shield aggressive consolidation strategies—particularly in healthcare, data platforms, and agriculture—from public view and regulatory intervention.

The safe harbor provision in § 803.20(b) allows acquirers to build vertically integrated empires piece by piece, with each acquisition below the HSR filing threshold or considered “internal.” As a result, the FTC can’t see the full picture of consolidation until it’s too late. Private equity firms exploit this rule to dominate regional hospital chains, veterinary practices, farm inputs, and more. Rescinding this provision would close a major loophole in merger oversight and support more comprehensive antitrust enforcement.

16 CFR § 803.20(b) would be revised to remove exemptions for: • Acquisitions between commonly controlled entities (intra-person transactions) • Secondary acquisitions where the primary interest is below HSR thresholds • Vertical or adjacent-market transactions previously deemed low-risk After rescission, parties would be required to file premerger notifications for any acquisition where consolidation may materially impact vertical competition, even if technically internal or layered through subsidiaries.

Andrew Ferguson

Chair, Federal Trade Commission