Canon and Toshiba will pay $2.5 million each to settle Hart-Scott-Rodino Act charges
The companies will pay $2.5 million each to settle the charges.
The settlement also requires the companies to implement HSR compliance programs and comply with inspection and reporting requirements, among other obligations imposed under the consent order.
The complaint alleges that Canon and Toshiba devised a scheme to avoid observing the waiting period required by the HSR Act for Canon’s acquisition of Toshiba’s subsidiary Toshiba Medical Systems Corporation (TMSC).
According to the complaint, the scheme devised by Canon and Toshiba “had no purpose” other than to complete the sale of TMSC prior to March 31, 2016, and avoid the HSR Act’s waiting period requirements.
The complaint further alleges that long-running financial irregularities at Toshiba became public in 2015 and, as a result, Toshiba was facing financial difficulty.
To shore up its financial statement, Toshiba needed to recognize the proceeds of the sale of TMSC by the end of its 2015 fiscal year on March 31, 2016.
The complaint also alleges that, by Canon’s and Toshiba’s own admission, Canon could not acquire TMSC outright because “it simply was not possible to complete a significant acquisition of TMSC voting securities before the end of Toshiba’s fiscal year due to the review periods under various merger control laws.”
The HSR Act imposes notification and waiting period requirements for transactions meeting certain size thresholds so that they can undergo premerger antitrust review.
The maximum civil penalty for an HSR violation is currently $42,530 per day. ■