USA Law and Practice Contributed by: Bradley Justus, Lisl Dunlop, Josh Jowdy and Sandhya Taneja, Axinn
3.8 Pre-Notification Discussions With Authorities Pre-notification discussions with the Agencies are not required. When a transaction is likely to raise signifi - cant competitive concerns, parties may engage the Agencies in pre-notification discussions to provide additional time to review the transaction and reduce the risk (or narrow the scope) of a second request. 3.9 Requests for Information During the Review Process Voluntary Access Letter If the reviewing Agency opens a preliminary investi - gation, the reviewing Agency may issue a “voluntary access letter” during the initial HSR waiting period. Voluntary access letters request information not required in the HSR filing, including business plan - ning documents, top customer contact information, customer win/loss data, competitor and supplier lists, and other information. Parties should be prepared to respond to a voluntary access letter within a few days. Prompt co-operation increases the likelihood that the reviewing Agency will be able to resolve competitive concerns within the initial waiting period. Second Request If competitive concerns are not resolved at the end of the initial waiting period, the reviewing agency may issue a “second request”, which generally extends the waiting period until 30 days after compliance. A second request is a voluminous demand for docu - ments and data as well as detailed interrogatories. Second requests are extraordinarily burdensome and costly. A typical second request response includes millions of pages of documents and compliance may take several months. Both Agencies have published model second requests that provide examples of the type of information typically requested. Parties that receive second requests may enter into a timing agreement with the Agency establishing proto - cols for compliance with a second request, milestone dates for events leading up to substantial compliance, and extensions of time for the Agency to make an enforcement decision after waiting period expiry. Both Agencies have published model timing agreements on their websites.
3.10 Accelerated Procedure All transactions subject to HSR notification require - ments must complete an HSR filing. There is no short form or simplified procedure. The Agencies may grant “early termination” of the ini - tial waiting period for transactions that pose little com - petitive risk. If early termination is granted, the names of the parties to the transaction are published in the Federal Register and posted on the FTC’s website. A detailed guide to the Agencies’ approach to merger analysis is contained in the 2023 Merger Guidelines. The 2023 Merger Guidelines outline a wide range of theories of competitive harm for both horizontal and non-horizontal transactions, and signal aggressive merger enforcement. In general, the Agencies review a proposed transac - tion to determine whether the transaction will cre - ate, enhance or entrench market power or facilitate its exercise. The Agencies consider whether a hori - zontal transaction is likely to reduce competition or negatively impact consumers (eg, result in increased prices or reduced output, quality or innovation) either because (i) the merged firm will have sufficient mar - ket power such that raising prices or reducing output, quality or innovation will be profitable, or (ii) there will be so few firms left in the market that the remaining firms will be able to co-ordinate their conduct. The Agencies consider vertical issues of whether a trans - action will combine market power at different levels of the supply chain in a manner that might create the incentive and ability to disadvantage rivals or provide access to competitively sensitive information of com - petitors. The Agencies also examine trends towards consolidations, serial acquisitions, multi-sided plat - forms, potential competition, labour market effects, and the potential impact of minority interests, among other issues. 4. Substance of the Review 4.1 Substantive Test To block a transaction, the Agencies must show in court that a transaction is likely to substantially reduce
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