Series 79 practice questionmediumHart-Scott-Rodino Act
What is the consequence if parties to a transaction subject to HSR are found to have 'jumped the gun' by coordinating their businesses before HSR clearance?
- AThey can face civil penalties and forced divestiture✓ Correct answer
- BThere are no consequences unless the transaction closes
- CThe transaction is automatically cancelled
- DThey must refile and restart the HSR waiting period
Explanation
Why A — They can face civil penalties and forced divestiture
Gun-jumping can result in significant civil penalties and, in some cases, remedial actions like divestiture. The trap is believing penalties only apply if the deal is completed.
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