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Washington
FTC merger fee increase
WASHINGTON (1/31/07)—The Federal Trade Commission (FTC) has announced that it is increasing fees for businesses, including credit unions, that are planning a merger or other business combination, but the fee will apply to few, if any, credit unions, according to the Credit Union National Association (CUNA). As of Feb. 28, the pre-merger filing fees will be as follows: for entities with assets between $63.1 million and $126.2, the fee is $45,000; for assets between $126.2 million and $630.8 million , the fee is $125,000, and for assets above $630.8 million, the fee is $280,000. However, most types of credit union assets are excluded from the asset threshold test. According to a written exchange between CUNA and the FTC in 2001 the following credit union assets do not count towards the asset threshold for the FTC fee: cash on hand (coin and currency); cash on deposit; cash equivalents; assets listed as "Investments" on NCUA 5300 call reports; first mortgage real estate loans or lines of credit; other real estate loans or lines of credit; and leases receivable. Credit union land, buildings, and other real estate are also excluded from the asset threshold to the extent provided by the FTC's rules codified at 16 C.F.R. sec. 802.2. "For the fee to apply to a natural person credit union, it would have to have over $63.1 million in non-exempt assets which are, generally speaking, credit cards, unsecured signature loans, and auto loans," said Michael Edwards, CUNA counsel for special projects. Bank and thrift holding companies are generally exempt from the FTC fee and reporting requirements. Section 309 of the Credit Union Regulatory Improvement Act of 2007 (CURIA, H.R. 1537) would extend this exemption to credit unions if it becomes law. Use the resource link below to read the CUNA-FTC exchange on the fee’s asset threshold in CUNA's e-guide on mergers.


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