FTC Reinforces Narrow Interpretation of Investment-only Exemption

    View Author August 2015

    The US Federal Trade Commission filed a proposed settlement in federal court this week that serves as a reminder of the broad application of the Hart-Scott-Rodino Act and the limited circumstances under which investors may rely on a widely used “investment-only exemption,” which exempts certain acquisitions made “solely for the purpose of investment.” Given the FTC’s narrow interpretation of the exemption in this matter, any action beyond “merely voting” raises substantial risks for firms wishing to rely on the exemption, and warrants consultation with experienced HSR counsel before proceeding.