A U.S. law enacted by President Ford that requires large companies to file a report with the Federal Trade Commission and Department of Justice before completing a merger, acquisition or tender offer so that government regulators can determine whether the transaction would violate antitrust laws.
The Hart-Scott-Rodino Antitrust Improvements Act of 1976 requires any investor seeking to acquire a 15% stake or a stake valued at more than $15 million in a security to file with the government. The form is called a premerger notification report (PNR), with the filing marking the beginning of the 30 day review. The acquiring company must also pay a filing fee which can change from year to year.
This act is also known as the HSR Act.
Once the companies have filed the required PNR forms, a waiting period begins. The waiting period is usually 30 days, but for cash tender offers or an acquisition in bankruptcy it is 15 days. The transaction can proceed if the waiting period ends or if the government terminates the waiting period early. If regulators see a potential anticompetitive problem with the proposed transaction, they will request additional information from the companies involved and extend the waiting period or seek an injunction to prevent the transaction.