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PTO 21st Century Strategic Plan Proposes Deferred Patent Examination, 4-Tier Fee System



Fee Purpose

Purpose and Need for Fee Legislation


The proposed statutory changes to patent fees in section 41 of title 35, United States Code, and the authorization to change trademark fees to levels in excess of the increase in the Consumer Price Index over the last twelve months, provide an alternative to the surcharges proposed in the President's 2003 budget proposal for the U.S. Patent and Trademark Office (USPTO), and would still generate the levels of patent and trademark fee income reflected in that budget even though the USPTO has received fewer patent and trademark application filings than the estimates on which the 2003 budget was based and, therefore, a corresponding reduction in fee income.

The President's 2003 budget proposes a 19.3 percent surcharge on all patent fees and a 10.3 percent surcharge on trademark fees to cover necessary costs to fund the USPTO's long-term quality, e-Government, and pendency initiatives, and to pay the full Government share of the accruing cost of retirement for current CSRS employees and post-retirement health benefits for current civilian employees. Private sector interests oppose the use of surcharges because such surcharges do not reflect accurately the costs of the particular services for which the fees are paid. The proposed fee changes in this legislation provide an alternative to the surcharges, an alternative that reflects more accurately the costs of the services provided. The alternative would produce income levels equivalent to the 2003 budget proposal, taking into account the reductions in patent and trademark application filings. The resulting revenues will ensure that there was no delay in the implementation of the USPTO's new initiatives aimed at improving the quality of granted patents and trademark registrations, increasing efficiency through e-Government programs, and reducing pendency in processing applications for patents and for registration of trademarks.

The proposed changes to section 41 also will initiate a restructuring of patent fees by, among other things, providing a separate filing fee and an examination fee, rather than the composite fee currently charged. This change will provide patent applicants with a reduced filing fee and an opportunity to evaluate the commercial value of their invention before having to pay a fee to cover the cost of patent examination. This change also will eliminate the need for the USPTO to examine all patent applications, regardless of whether the applicant determines that its invention is of sufficient commercial value to justify prosecuting its application.

It is critical that the proposal be given expedited treatment, since the changes need to be in place by the beginning of fiscal year 2003. The Office of Management and Budget has no objection from the standpoint of the Administration's program to the submission of this legislative proposal to the Congress.

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