The Hart-Scott-Rodino (HSR) Act continues to shape the mergers and acquisitions (M&A) landscape, with recent developments introducing new complexities for businesses. The new HSR rules, which went into effect on February 10, 2025, require significantly more information, data, and documents, including written descriptions of transaction rationales and competitive overlaps. As companies adapt to these changes, understanding the practical implications of the HSR rules is crucial for successful deal execution.

Members of McDermott Will & Schulte’s Antitrust Group provided an in-depth examination of the current HSR filing regime and its impact on M&A transactions.

Top takeaways included:

1.  The burden has increased, especially for competitive overlap/supply relationship deals. The new form requires more narrative and ordinary-course materials up front, so preparation and coordination start earlier.
2. Costs and timelines have risen on average. Based on recent industry data, average prep time has roughly doubled, and average cost has risen to around $155,000—though non-overlap deals remain closer to the old baseline. The preparation time for an HSR filing is generally considered to start at around 50 to 60 attorney hours.
3. Deals are still clearing. Even competitor deals are getting through, with some clearing quickly, when filings are well-planned, disciplined, and tell a coherent story about the business and the transaction.
4. The HSR filing itself is now a storytelling exercise. Beyond the mechanics, the filing should explain what your business does, why the deal is happening, how and where you compete, who your customers are, and how you think about competition.
5. The four deal types we’re seeing and how it impacts the HSR filing:
   1. No overlap:
      1. Profile: No North American Industry Classification System (NAICS) overlap, no competitive overlap, and no vertical/supply relationship.
      2. HSR impact: New baseline items are needed like organization charts, minority holders up and down the chain, transaction rationales, and broader custodian set for transaction-related documents. The timing and cost remain closest to pre-rule-change filings.
   2. “False positive” NAICS overlap:
      1. Profile: Parties report revenue in the same NAICS code(s) but do not actually compete due to differences in product sub-segments, geographies, or customers.
      2. HSR impact: Heightened reporting tied to the overlapping NAICS code(s) includes requirements for geographic information, prior acquisitions in the overlap code, minority holdings, and certain government contract disclosures.
      3. Key move: Use the form’s brief overlap narrative to explain why the NAICS overlap is misleading and there’s no competitive overlap.
   3. Actual competitive overlap and/or supply relationship:
      1. Profile: Parties compete or have a vertical relationship, but issues are limited and unlikely to raise substantive concern.
      2. HSR impact: More data and documents are required upfront, as well as the need to identify and briefly describe each overlap, provide sales and customer data, and produce ordinary-course plans and reports for the last year including board and regularly prepared CEO materials addressing markets, market shares, competitors, or competition.
      3. Right-sizing tip: Describe overlaps at sensible product or service categories that reflect how the business is managed, such as service lines and product families. This approach helps avoid providing data and documents for hundreds of different stock keeping unit-level products, while remaining accurate.
      4. Key move: Use the form’s overlap narrative or a cover letter to the HSR to provide facts or advocacy regarding why the competitive overlap does not raise concerns.
   4. Actual competitive overlap and/or supply relationship:
      1. Profile: Overlaps that are likely to prompt questions.
      2. HSR impact: Same added data and document load as above, but the strategy shifts. Treat the form as a necessary process and begin advocacy in parallel by targeted cover letters, voluntary submissions, and early outreach or presentations to use the initial waiting period effectively.
      3. Narrative discipline: Keep the form factual. Reserve legal arguments for cover letters or voluntary submissions.
6. Changes to the M&A playbook:
   1. Profile the deal early. As soon as the buyer and seller is identified, triage and confirm if there is NAICS overlap, actual competitive overlap, or supply/vertical ties
   2. Align the story with the documents. Ensure transaction rationale and overlap descriptions match ordinary-course materials
   3. Right-size the overlap definitions. Use ordinary-course categories to make the filing complete yet manageable