§480-7 - Mergers, acquisitions, holdings, and divestitures. - Hawaii Statutes

     §480-7  Mergers, acquisitions, holdings, and divestitures.  (a)  No person shall acquire and hold, directly or indirectly, the whole or any part of the stock, interest, or membership of any other person, or the whole or any part of the assets of any other person, where the effect of the acquisition and holding may be substantially to lessen competition, or to tend to create a monopoly in any line of commerce in any section of the State; provided that this subsection shall not apply to any person acquiring and holding the stock, interest, or membership solely for investment and not using the same by voting or otherwise to bring about, or in attempting to bring about, the substantial lessening of competition or the creation of a monopoly in any line of commerce in any section of the State.  Nor shall anything in this subsection prevent a person from causing the formation of a subsidiary business entity for the actual carrying on of its immediate lawful business, or the natural and legitimate branches or extensions thereof, or from owning and holding all or a part of the stock, interest, or membership of a subsidiary business entity, when the effect of the formation is not substantially to lessen competition.

     As used in this subsection:

     "Control" means:

     (1)  Owning or having the power to vote eighty per cent or more of any class of voting securities of the subsidiary;

     (2)  Having the power to elect, by any means, a majority of the directors; or

     (3)  Having the power to exercise a dominant influence over the management and policies of the subsidiary.

     "Subsidiary" means any person that is under the control of a person.

     (b)  Notwithstanding any other provision in this chapter to the contrary, any person who may or shall be injured in the person's business or property because of anything prohibited under subsection (a) may bring an action for injunctive relief against the proposed merger or acquisition.  In any action brought pursuant to this subsection, the court, as it deems just, may award to a prevailing party and enter as part of its order or judgment, a reasonable sum for costs and expenses incurred, including reasonable attorney's fees.

     (c)  Where the court finds that the holding of the whole or any part of the stock, interest, membership, or assets of any other person may be substantially to lessen competition or to tend to create a monopoly in any line of commerce in any section of the State, and is therefore not in the public interest, then the court may order the divestiture or other disposition of the stock, interest, membership, or assets of the person, and prescribe a reasonable time, manner, and degree of the divestiture or other disposition thereof; provided that the court shall not order the divestiture or other disposition of the assets of the person unless it is necessary to eliminate the lessening of competition or the tendency to create a monopoly. [L 1961, c 190, §5; Supp, §205A-5; HRS §480-7; am L 2005, c 108, §2]

 

Case Notes

 

  Standard of illegality same as §7 of Clayton Act. 518 F.2d 913.

 Mentioned in discussing availability of estoppel as defense in private antitrust action. 296 F. Supp. 920.

  Divestiture not available in private action under §7 of Clayton Act; to recover damages based on conduct subsequent to acquisition, plaintiffs must show actual or imminent injury to competition. 491 F. Supp. 1199.