[Federal Register: December 30, 2005 (Volume 70, Number 250)]
[Rules and Regulations]
[Page 77312-77319]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr30de05-7]
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FEDERAL TRADE COMMISSION
16 CFR Parts 801 and 803
Premerger Notification; Reporting and Waiting Period Requirements
AGENCY: Federal Trade Commission.
ACTION: Final rule.
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SUMMARY: This final rule amends 16 CFR part 801 and part 803, Appendix,
the Antitrust Improvements Act Notification and Report Form for Certain
Mergers and Acquisitions (the ``Form''). The Form must be completed and
submitted by persons required to report mergers and acquisitions
pursuant to Section 7A of the Clayton Act, as added by Title II of the
Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended. The
revised Form requires that 2002 revenue data, identified by the 2002
North American Industry Classification System (``NAICS''), be provided
in response to certain items on the Form.
DATES: Effective December 30, 2005. To facilitate the changeover from
using 1997 to 2002 NAICS information, filers may use either 1997 or
2002 information for 30 days following the Effective Date, provided
that all filing parties to a transaction use the same year and use the
same codes in Item 7. This will allow an orderly transition while
minimizing the burden on filing parties.
FOR FURTHER INFORMATION CONTACT: Comments or questions may be directed
to Robert L. Jones, Deputy Assistant Director, Premerger Notification
Office, Bureau of Competition, Room 302, Federal Trade Commission,
Washington, DC 20580. Telephone: (202) 326-2740. E-mail:
HSRHelp@hsr.gov. For information about the NAICS system, including the
2002 update, see the U.S. Census Bureau's Web site at http://www.census.gov/epcd/www/naics.html
.
SUPPLEMENTARY INFORMATION:
Background
Section 7A of the Clayton Act, 15 U.S.C. 18a, as added by the Hart-
Scott-Rodino Antitrust Improvements Act of 1976, Pub. L. 94-435, 90
Stat. 1390, and amended by Pub. L. 106-553, 114 Stat. 2762 (``HSR
Act''), requires all persons contemplating certain mergers or
acquisitions to file notification with the Commission and the Assistant
Attorney General for the Antitrust Division of the Department of
Justice (``Assistant Attorney General''). The HSR Act further provides
that such persons must 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.'' 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.'' 15 U.S.C.18a(d). Pursuant to this section, the Commission,
with the concurrence of the Assistant Attorney General, promulgated
rules governing the filing process (``Rules'') \1\ and the Antitrust
Improvements Act Notification and Report Form for Certain Mergers and
Acquisitions and accompanying Instructions on July 31, 1978, with an
effective date of September 5, 1978, 43 FR 33450 (July 31, 1978). The
agencies have since amended or revised the Rules and Form on multiple
occasions.
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\1\ 16 CFR parts 801, 802 and 803.
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Completion of the Form provides the Commission and the Assistant
Attorney General with information and documentary material necessary to
conduct an initial review of mergers, acquisitions, and other similar
transactions. The Form is not designed to elicit all potentially
relevant information relating to a transaction; rather, the information
requested assists the Commission and the Assistant Attorney General in
determining whether to open an investigation or, alternatively, whether
to grant a request for early termination of the waiting period or to
allow the waiting period to expire if no such request has been made.
The Form and Instructions currently require that filing persons
report revenue data contained in the ``North American Industry
Classification System, 1997'' and the ``1997 Numerical List of
Manufactured and Mineral Products.'' This requirement was established
in a 2001 rulemaking \2\ that changed the required reporting format
from the Standard Industrial Classification (``SIC'') to the North
American Industry Classification System (``NAICS''). The Executive
Office of the President, Office of Management and Budget (``OMB'')
recently published its North American Industry Classification System--
United States, 2002 (``2002 NAICS Manual'') and the Census Bureau has
published its 2002 Numerical List of Manufactured and Mineral Products.
To allow use of
[[Page 77313]]
this updated information, the Form and Instructions are hereby amended
to replace references to the 1997 base year with a 2002 base year and
to replace the references to the 1997 Numerical List of Manufactured
and Mineral Products (EC97M31R-NL) with the 2002 Numerical List of
Manufactured and Mineral Products (EC02M31R-NL).
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\2\ Interim Rule: 66 FR 23561 (May 9, 2001). Final Rule: 66 FR
35541 (July 6, 2001).
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Statement of Basis and Purpose for the Commission's Revision of the
Form and the Instructions
The Commission, with the concurrence of the Assistant Attorney
General, is adopting and implementing these amendments to the Form and
the Instructions relating to Item 5 and Item 7, as well as to Section
801.1(j) of the Rules, to require submission of 2002 NAICS information.
The Commission has traditionally relied upon the most current economic
data to analyze the potential anticompetitive effects of proposed
transactions.\3\ The information in the 2002 NAICS Manual and 2002
Numerical List of Manufactured and Mineral Products is the most current
information available. We reiterate that filing parties may use either
the 1997 or 2002 year for 30 days following the effective date December
30, 2005, provided that all filing parties to a transaction use the
same year and use the same codes for Item 7.
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\3\ Periodically, the Commission has adjusted the base year when
the U.S. Census Bureau published a new ``Economic Census.'' See 45
FR 14205 (March 5, 1980); 51 FR 10368 (March 26, 1986); 55 FR 31371
(August 2, 1990); 60 FR 40704 (August 9, 1995), and 66 FR 23561 (May
9, 2001).
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Part 801--Coverage Rules[FEDREG][VOL]*[/VOL][NO]*[/NO][DATE]*[/
DATE][RULES][RULE][PREAMB][AGENCY]*[/AGENCY][SUBJECT]*[/SUBJECT][/
PREAMB][SUPLINF][HED]*[/HED]
Section 801.1 Definitions
Paragraph (j), the definition of Engaged in Manufacturing, is
amended to refer to the 2002 edition of the North American Industry
Classification System, rather than the 1997 edition.
Part 803--Transmittal Rules
Appendix to Section 803 Instructions Applicable to Notification and
Report Form
Generally, references to ``1997 base year'' will be replaced with
``2002 base year'' throughout the Form and Instructions. Filing persons
should refer to the ``2002 NAICS Manual'' and the ``2002 Numerical List
of Manufactured and Mineral Products,'' published by the Census Bureau
to locate product class codes and product codes.\4\
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\4\ Executive Office of the President, Office of Management and
Budget, North American Industry Classification System--United
States, 2002 (2002). U.S. Census Bureau, Numerical List of
Manufactured and Mineral Products (EC02M31R-NL) (April, 2004).
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In response to Item 5 of the Form, filing parties are required to
provide revenue data for the most current year and the base year.
Specifically, Item 5 is amended as follows: Item 5(a) requires that the
filing person provide 2002 base year revenue data for each 6-digit
NAICS industry code(s) in which it derived revenues. Item 5(b)(i)
requires that a filing person engaged in manufacturing provide 2002
base year revenue for each 10-digit NAICS-based product code(s) in
which it derived revenue. Item 5(b)(ii) requires that the filing person
identify each manufactured product it has added or deleted since 2002
by 10-digit NAICS-based product code(s).
In response to Item 7 of the Form, for specified industries, filers
are required to provide 6-digit NAICS industry codes and descriptions
and to list geographic markets for any industry in which the filer and
any other party to the transaction derived revenues. Many of these
referenced NAICS codes have been changed in the 2002 update. The
Instructions to Item 7, specifically Items 7(c)(ii), (iii), (iv), and
(v), are amended to identify the updated 2002 codes.
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. See 5 U.S.C. 605.
Because of the size of the transactions necessary to invoke a Hart-
Scott-Rodino filing, the premerger notification rules rarely, if ever,
affect small businesses. Indeed, the 2000 amendments to the Act were
intended to reduce the burden of the premerger notification program by
exempting all transactions valued at $50 million or less.\5\ Further,
none of the proposed rule amendments changes the coverage of the
premerger notification rules in any 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.
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\5\ That figure is now $53.1 million, adjusted for the change in
the Gross National Product, and will be adjusted annually.
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Paperwork Reduction Act
The Paperwork Reduction Act, 44 U.S.C. 3501-3518, 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, record keeping, or
disclosure requirements contained in regulations. The 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, 2007.
The Commission's proposed revisions to the Form and Rules do not
``substantive[ly] or material[ly] modify'' the existing terms of the
currently approved collection of information (OMB Control Number 3084-
0005) to necessitate OMB's further review and approval. See 44 U.S.C.
3507(h)(3); 5 CFR 1320.5(g). The individual rule modifications are
described more fully below.
Administrative Procedure Act
These rule changes are procedural and do not alter the existing
legal obligations of filing parties to submit the most currently
available industry classification information. Accordingly, the
amendments are not subject to the notice and comment requirements of
the Administrative Procedure Act. See 5 U.S.C. 553(b)(A).
List of Subjects in 16 CFR Parts 801 and 803
Antitrust.
0
For the reasons stated in the preamble, the Federal Trade Commission
amends 16 CFR parts 801 and 803 as set forth below:
PART 801--COVERAGE RULES
0
1. The authority citation for part 801 continues to read as follows:
Authority: 15 U.S.C. 18a(d).
0
2. Amend Sec. 801.1 by revising paragraph (j) to read as follows:
Sec. 801.1 Definitions.
* * * * *
(j) Engaged in manufacturing. A person is engaged in manufacturing
if it produces and derives annual sales or revenues in excess of $1
million from products within industries in Sectors 31-33 as coded by
the North American Industry Classification System (2002 Edition)
published by the Executive Office of the President, Office of
Management and Budget.
* * * * *
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PART 803--TRANSMITTAL RULES
0
3. The authority citation for part 803 continues to read as follows:
Authority: 15 U.S.C. 18a(d).
0
4. Revise pages I, V, and VI of the Instructions, and pages 7 and 8 of
the Notification and Report Form For Certain Mergers and Acquisitions,
in the Appendix to part 803 to read as follows:
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By direction of the Commission.
Donald S. Clark,
Secretary.
[FR Doc. 05-24684 Filed 12-29-05; 8:45 am]
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