Hart-Scott-Rodino Act Requires Pre-Merger Notification, Last Major Antitrust Strengthening Before Reagan Dismantlement

President Gerald Ford signed the Hart-Scott-Rodino Antitrust Improvements Act (HSR Act), requiring companies to notify the Federal Trade Commission and Department of Justice Antitrust Division of large proposed mergers and wait 30 days before consummating transactions, giving regulators time to investigate and challenge anticompetitive deals before assets were irreversibly combined. Named for sponsors Senator Philip Hart (D-MI), Senator Hugh Scott (R-PA), and Representative Peter Rodino (D-NJ), the Act represented the most far-reaching change in antitrust enforcement since the Clayton Act of 1914. Before HSR, companies could merge first and regulators had to ‘unscramble the eggs’ afterward—attempting to reverse completed mergers, a legally and economically messy process that rarely succeeded. The Act addressed this by creating mandatory pre-merger notification for transactions above certain dollar thresholds, with parties required to file detailed ’notification and report forms’ and observe waiting periods during which agencies could request additional information or file suit to block deals. President Ford stated the law would ‘allow these agencies to conduct careful investigations prior to consummation of mergers and, if necessary, bring suit before often irreversible steps have been taken toward consolidation.’ However, this seemingly pro-enforcement reform would be systematically weakened through three mechanisms: (1) notification thresholds indexed to inflation, exempting ever-larger transactions; (2) Reagan-era resource starvation of FTC and DOJ antitrust divisions, creating artificial capacity constraints; and (3) the 1982 Merger Guidelines that redefined which mergers agencies should challenge, effectively repealing Celler-Kefauver’s prohibitions on vertical and conglomerate mergers. What appeared as an antitrust strengthening became a processing system that rubber-stamped consolidation.