Reducing Patent Fees for Small Entities and Micro Entities Under the Unleashing American Innovators Act of 2022

AGENCY:

United States Patent and Trademark Office, Department of Commerce.

ACTION:

Final rule.

SUMMARY:

The United States Patent and Trademark Office (Office or USPTO) amends patent fees for small and micro entities set forth in its regulations to implement the provisions of the Consolidated Appropriations Act, 2023—which included the Unleashing American Innovators Act of 2022 (UAIA). The UAIA, signed into law on December 29, 2022, supports the USPTO's efforts to reduce the innovation ecosystem's barriers to entry. The UAIA increased fee discounts for small entities from 50% to 60% and fee discounts for micro entities from 75% to 80% for fees for filing, searching, examining, issuing, appealing, and maintaining patent applications and patents. The UAIA also increased fee discounts for small entities from 75% to 80% for filing a basic nonprovisional utility application electronically.

DATES:

Effective date: This final rule is effective March 22, 2023, except for the amendment to § 1.16(u) at instruction 3, which is effective on April 3, 2023.

Applicability: The amendments to §§ 1.445(a)(5) and 1.482 shall apply to those international applications under the Patent Cooperation Treaty having a receipt date on or after April 1, 2023. The amendments to § 1.18(b)(1) shall apply to those international design applications under the Hague Agreement having a date of international registration on or after May 1, 2023.

FOR FURTHER INFORMATION CONTACT:

Brendan Hourigan, Director, Office of Planning and Budget, by telephone at 571-272-8966, or by email at Brendan.Hourigan@uspto.gov; or Dianne Buie, Director, Forecasting and Analysis Division, by telephone at 571-272-6301, or by email at Dianne.Buie@uspto.gov.

SUPPLEMENTARY INFORMATION:

Purpose of This Action

The Office issues this final rule to amend 37 CFR parts 1 and 41 to reflect amendments enacted by the UAIA on December 29, 2022. See Consolidated Appropriations Act, 2023, Public Law 117-328. Section 107 of the UAIA, “Fee Reduction for Small and Micro Entities,” amended 35 U.S.C. 41(h)(1) and section 10(b) of the America Invents Act (AIA), Public Law 112-29, 125 Stat. 284, as amended by the SUCCESS Act, Public Law 115-273, 132 Stat. 4158, by (1) striking “50 percent” and inserting “60 percent” for fee reductions for small entities and (2) by striking “75 percent” and inserting “80 percent” for fee reductions for micro entities. Consequently, the Office is now required under 35 U.S.C. 41(h)(1) and section 10(b) of the AIA to reduce patent fees for filing, searching, examining, issuing, appealing, and maintaining patent applications and patents by 60% for small entities and by 80% for micro entities. Section 107 of the UAIA also amended 35 U.S.C. 41(h)(3) by striking “75 percent” and inserting “80 percent” for fee reductions for small entities filing a basic nonprovisional utility application electronically under 35 U.S.C. 41(a)(1)(A). Fee rates reflecting these amended discounts for small and micro entities were made available to the public on December 29, 2022, and published on the USPTO's website, https://www.uspto.gov/fees.

The changes in this final rule apply to any small or micro entity that pays any patent fee set forth in this final rule. The reduced fee rates (60% for small entities and 80% for micro entities) apply to any small entity asserting small entity status and to any micro entity certifying micro entity status for filing, searching, examining, issuing, appealing, and maintaining patent applications and patents.

Due to the USPTO's requirement to provide advance notification to the World Intellectual Property Organization (WIPO) for certain fee changes before such fee changes can take effect, as provided under the Hague Agreement and the Patent Cooperation Treaty, the discount to certain small and micro fees are delayed until the expiration of the applicable notification period. The changes to § 1.18(b)(1) shall apply to those international design applications under the Hague Agreement having a date of international registration on or after May 1, 2023. Certain changes to § 1.445(a)(2) and (a)(3) shall apply to those international applications under the Patent Cooperation Treaty having a receipt date on or after April 1, 2023. The changes to § 1.445(a)(5) and § 1.482 shall take effect on April 1, 2023.

Discussion of Specific Rules

The following table shows all of the small entity and micro entity fees in 37 CFR parts 1 and 41 that are being adjusted in this final rule to reflect the new small entity and micro entity discounts. Only the fee amounts for small and micro entities set forth below are being adjusted. Any other fees paid by small and micro entities are not affected by this final rule.

Rulemaking Considerations

A. Administrative Procedure Act (APA): This final rule implements amendments enacted in section 107 of the UAIA on December 29, 2022, which amended 35 U.S.C. 41(h) and section 10(b) of the America Invents Act (AIA), Public Law 112-29, 125 Stat. 284, to require the Office to reduce patent fees for filing, searching, examining, issuing, appealing, and maintaining patent applications and patents by 60% for small entities and by 80% for micro entities and to reduce the basic filing fee for nonprovisional utility applications filed electronically by 80% for small entities. The changes in this final rule simply implement the provisions of the UAIA, and involve the rules of agency practice and procedure, and/or interpretive rules. See Perez v. Mortgage Bankers Ass'n, 135 S. Ct. 1199, 1204 (2015) (interpretive rules “advise the public of the agency's construction of the statutes and rules which it administers”) (citations and internal quotation marks omitted); Nat'l Org. of Veterans' Advocates v. Sec'y of Veterans Affairs, 260 F.3d 1365, 1375 (Fed. Cir. 2001) (rule that clarifies interpretation of a statute is interpretive); Bachow Commc'ns Inc. v. FCC, 237 F.3d 683, 690 (D.C. Cir. 2001) (rules governing an application process are procedural under the Administrative Procedure Act); Inova Alexandria Hosp. v. Shalala, 244 F.3d 342, 350 (4th Cir. 2001) (rules for handling appeals are procedural where they do not change the substantive standard for reviewing claims).

Accordingly, prior notice and opportunity for public comment for the changes in this rulemaking are not required pursuant to 5 U.S.C. 553(b) or (c), or any other law. See Perez, 135 S. Ct. at 1206 (notice-and-comment procedures are not required when an agency “issue[s] an initial interpretive rule” or when it amends or repeals that interpretive rule); Cooper Techs. Co. v. Dudas, 536 F.3d 1330, 1336-37 (Fed. Cir. 2008) (stating that 5 U.S.C. 553, and thus 35 U.S.C. 2(b)(2)(B), do not require notice-and-comment rulemaking for “interpretative rules, general statements of policy, or rules of agency organization, procedure, or practice” (quoting 5 U.S.C. 553(b)(A))).

In addition, the Office finds good cause pursuant to the authority at 5 U.S.C. 553(b)(B) and (d)(3) to dispense with prior notice and opportunity for public comment, and to publish this final rule with an immediate effective date, because such procedures are impracticable and contrary to the public interest. The discount percentages and the fees to which they are applicable are set by the terms of the UAIA, and the Office has no discretion to make changes in those areas. The UAIA amendments were effective as of the date of enactment of the statute, which is December 29, 2022. Thus, this final rule revises the patent fees for filing, searching, examining, issuing, appealing, and maintaining patent applications and patents, to reflect the new discount percentages immediately. If this rulemaking were to be delayed to allow for prior notice and opportunity for public comment and a 30-day delay in effective date, USPTO's regulations would remain out of date with the current fees adjusted by statute, which would create confusion as to current fee amounts. Thus, the USPTO implements this final rule without prior notice and opportunity for comment and with immediate effect.

B. Regulatory Flexibility Act: As prior notice and an opportunity for public comment are not required pursuant to 5 U.S.C. 553 or any other law, neither a Regulatory Flexibility Act analysis nor a certification under the Regulatory Flexibility Act (5 U.S.C. 601 et seq.) is required. See5 U.S.C. 603.

C. Executive Order 12866 (Regulatory Planning and Review): This rulemaking has been determined to be not significant for purposes of Executive Order (E.O.) 12866 (Sept. 30, 1993).

D. Executive Order 13563 (Improving Regulation and Regulatory Review): The Office has complied with E.O. 13563 (Jan. 18, 2011). Specifically, the Office has, to the extent feasible and applicable: (1) made a reasoned determination that the benefits justify the costs of this final rule; (2) tailored this final rule to impose the least burden on society consistent with obtaining the regulatory objectives; (3) selected a regulatory approach that maximizes net benefits; (4) specified performance objectives; (5) identified and assessed available alternatives; (6) involved the public in an open exchange of information and perspectives among experts in relevant disciplines, affected stakeholders in the private sector, and the public as a whole, and provided online access to the rulemaking docket; (7) attempted to promote coordination, simplification, and harmonization across government agencies and identified goals designed to promote innovation; (8) considered approaches that reduce burdens and maintain flexibility and freedom of choice for the public; and (9) ensured the objectivity of scientific and technological information and processes.

E. Executive Order 13132 (Federalism): This rulemaking does not contain policies with federalism implications sufficient to warrant preparation of a Federalism Assessment under E.O. 13132 (Aug. 4, 1999).

F. Executive Order 13175 (Tribal Consultation): This rulemaking will not: (1) have substantial direct effects on one or more Indian tribes, (2) impose substantial direct compliance costs on Indian tribal governments, or (3) preempt tribal law. Therefore, a tribal summary impact statement is not required under E.O. 13175 (Nov. 6, 2000).

G. Executive Order 13211 (Energy Effects): This rulemaking is not a significant energy action under E.O. 13211 (May 18, 2001) because this rulemaking is not likely to have a significant adverse effect on the supply, distribution, or use of energy. Therefore, a Statement of Energy Effects is not required under E.O. 13211.

H. Executive Order 12988 (Civil Justice Reform): This rulemaking meets applicable standards to minimize litigation, eliminate ambiguity, and reduce burden as set forth in sections 3(a) and 3(b)(2) of E.O. 12988 (Feb. 5, 1996).

I. Executive Order 13045 (Protection of Children): This rulemaking does not concern an environmental risk to health or safety that may disproportionately affect children under E.O. 13045 (Apr. 21, 1997).

J. Executive Order 12630 (Taking of Private Property): This rulemaking will not affect a taking of private property or otherwise have taking implications under E.O. 12630 (Mar. 15, 1988).

K. Congressional Review Act: Under the Congressional Review Act provisions of the Small Business Regulatory Enforcement Fairness Act of 1996 (5 U.S.C. 801 et seq.), the USPTO will submit a report containing the final rule and other required information to the United States Senate, the United States House of Representatives, and the Comptroller General of the Government Accountability Office. The changes in this rulemaking are not expected to result in an annual effect on the economy of $100 million or more, a major increase in costs or prices, or significant adverse effects on competition, employment, investment, productivity, innovation, or the ability of United States-based enterprises to compete with foreign-based enterprises in domestic and export markets. Therefore, this rulemaking is not expected to result in a “major rule” as defined in 5 U.S.C. 804(2).

L. Unfunded Mandates Reform Act of 1995: The changes set forth in this rulemaking do not involve a federal intergovernmental mandate that will result in the expenditure by state, local, and tribal governments, in the aggregate, of $100 million (as adjusted) or more in any one year, or a federal private sector mandate that will result in the expenditure by the private sector of $100 million (as adjusted) or more in any one year, and will not significantly or uniquely affect small governments. Therefore, no actions are necessary under the provisions of the Unfunded Mandates Reform Act of 1995. See2 U.S.C. 1501 et seq.

M. National Environmental Policy Act: This rulemaking will not have any effect on the quality of the environment and is thus categorically excluded from review under the National Environmental Policy Act of 1969. See42 U.S.C. 4321 et seq.

N. National Technology Transfer and Advancement Act: The requirements of section 12(d) of the National Technology Transfer and Advancement Act of 1995 (15 U.S.C. 272 note) are not applicable because this rulemaking does not contain provisions that involve the use of technical standards.

O. Paperwork Reduction Act: The Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq.) requires that the Office consider the impact of paperwork and other information collection burdens imposed on the public. This Final Rule involves information collection requirements that are subject to review by the OMB under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3549). The collection of information involved in this Final Rule have been reviewed and previously approved by the OMB under control numbers: 0651-0016, 0651-0021, 0651-0024, 0651-0031, 0651-0032, 0651-0033, 0651-0059, 0651-0062, 0651-0063, 0651-0064, and 0651-0073. In addition, updates to the aforementioned information collections as a result of this Final Rule have been submitted to the OMB as non-substantive change requests.

Notwithstanding any other provision of law, no person is required to respond to, nor shall any person be subject to a penalty for failure to comply with, a collection of information subject to the requirements of the Paperwork Reduction Act unless that collection of information displays a currently valid OMB control number.

P. E-Government Act Compliance: The USPTO is committed to compliance with the E-Government Act to promote the use of the internet and other information technologies, to provide increased opportunities for citizen access to Government information and services, and for other purposes.

List of Subjects

37 CFR Part 1

• Administrative practice and procedure
• Biologics
• Courts
• Freedom of information
• Inventions and patents
• Reporting and recordkeeping requirements
• Small businesses

37 CFR Part 41

• Administrative practice and procedure
• Inventions and patents
• Lawyers
• Reporting and recordkeeping requirements

For the reasons stated in the preamble, the USPTO amends 37 CFR parts 1 and 41 as follows:

PART 1—RULES OF PRACTICE IN PATENT CASES

1. The authority citation for 37 CFR part 1 continues to read as follows:

Authority: 35 U.S.C. 2(b)(2), unless otherwise noted.

2. Effective March 22, 2023, § 1.16 is amended by revising the tables in paragraphs (a) through (s) to read as follows:

3. Effective April 3, 2023, § 1.16 is further amended by revising the table in paragraph (u), as added Aug. 3, 2020, at 85 FR 46985, effective Jan. 1, 2022, and delayed until Jan 1, 2023, at 86 FR 66193, Nov. 22, 2021, and further delayed until Apr. 3, 2023, at 87 FR 80073, Dec. 29, 2022, to read as follows:

4. Effective March 22, 2023, § 1.17 is amended by revising the tables in paragraphs (a)(1) through (5), (c), (d), (e)(1) and (2), (f) through (h), (i)(1), (k), (m), (o), (p), and (r) through (t) to read as follows:

5. Effective March 22, 2023 § 1.18 is amended by revising the tables in paragraphs (a), (b)(1), and (c) to read as follows:

6. Effective March 22, 2023, § 1.20 is amended by revising the tables in paragraphs (c)(1)(i), (c)(2) through (4), (c)(6) and (7), (e) through (h), (k)(1) and (2), and (k)(3)(i) and (ii) to read as follows:

8. Effective March 22, 2023, § 1.445 is amended by:

a. Redesignating paragraphs (a)(1)(i)(A) through (C), as paragraphs (a)(1)(i)(B) through (D);

b. Adding new paragraph (a)(1)(i)(A);

c. Revising newly redesignated paragraph (a)(1)(i)(B) introductory text and table heading;

d. Revising the table heading in newly redesignated paragraph (a)(1)(i)(C);

e. Revising the table heading in paragraph (a)(1)(ii);

f. Redesignating paragraphs (a)(2)(i) through (iii) as paragraphs (a)(2)(ii) through (iv);

g. Adding new paragraph (a)(2)(i);

h. Revising newly redesignated paragraph (a)(2)(ii) introductory text and table heading;

i. Revising the table heading in newly redesignated paragraph (a)(2)(iii);

j. Redesignating paragraphs (a)(3)(i) through (iii) as paragraphs (a)(3)(ii) through (iv);

k. Adding new paragraph (a)(3)(i);

l. Revising newly redesignated paragraph (a)(3)(ii) introductory text and table heading;

m. Revising the table heading in newly redesignated paragraph (a)(3)(iii); and

n. Revising the table in paragraph (a)(5).

The revisions and additions read as follows:

9. Effective March 22, 2023, § 1.482 is amended by revising the tables in paragraphs (a)(1)(i) and (ii), (a)(2), and (c) to read as follows:

11. Effective March 22, 2023, § 1.1031 is amended by revising the table in paragraph (a) to read as follows:

PART 41—PRACTICE BEFORE THE PATENT TRIAL AND APPEAL BOARD

12. The authority citation for 37 CFR part 41 continues to read as follows:

Authority: 35 U.S.C. 2(b)(2), 3(a)(2)(A), 21, 23, 32, 41, 134, 135, and Pub. L. 112-29.

13. Effective March 22, 2023, § 41.20 is amended by revising the tables in paragraphs (b)(1), (b)(2)(ii), and (b)(3) and (4) to read as follows: