Setting and Adjusting Patent Fees During Fiscal Year 2020

Citation85 FR 46932
Record Number2020-16559
Published date03 August 2020
SectionRules and Regulations
CourtPatent And Trademark Office
Federal Register, Volume 85 Issue 149 (Monday, August 3, 2020)
[Federal Register Volume 85, Number 149 (Monday, August 3, 2020)]
                [Rules and Regulations]
                [Pages 46932-46993]
                From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
                [FR Doc No: 2020-16559]
                [[Page 46931]]
                Vol. 85
                Monday,
                No. 149
                August 3, 2020
                Part III Department of Commerce-----------------------------------------------------------------------Patent and Trademark Office-----------------------------------------------------------------------37 CFR Parts 1, 11, 41, et al.Setting and Adjusting Patent Fees During Fiscal Year 2020; Final Rule
                Federal Register / Vol. 85, No. 149 / Monday, August 3, 2020 / Rules
                and Regulations
                [[Page 46932]]
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                DEPARTMENT OF COMMERCE
                Patent and Trademark Office
                37 CFR Parts 1, 11, 41, and 42
                [Docket No. PTO-P-2018-0031]
                RIN 0651-AD31
                Setting and Adjusting Patent Fees During Fiscal Year 2020
                AGENCY: United States Patent and Trademark Office, Department of
                Commerce.
                ACTION: Final rule.
                -----------------------------------------------------------------------
                SUMMARY: The United States Patent and Trademark Office (Office or
                USPTO) sets or adjusts patent fees as authorized by the Leahy-Smith
                America Invents Act (Act or AIA), as amended by the Study of
                Underrepresented Classes Chasing Engineering and Science Success Act of
                2018 (SUCCESS Act). The USPTO is a business-like operation where the
                demand for patent products and services and the cost of operations are
                affected by external factors, such as the economy, legislation, court
                decisions, and increases in the costs of supplies and contract
                services, as well as internal factors, such as changes in patent
                examination processes and procedures. The fee adjustments are needed to
                provide the Office with a sufficient amount of aggregate revenue to
                recover the aggregate cost of patent operations in future years (based
                on assumptions and estimates found in the FY 2021 Congressional
                Justification (FY 2021 Budget)) and to allow the Office to continue
                progress toward achieving its strategic goals.
                DATES: This rule is effective on October 2, 2020, except for the
                amendment to Sec. 1.16(u) in amendatory instruction 2i, which is
                effective on January 1, 2022. The changes to Sec. 1.18(b)(1) shall
                apply to those international design applications under the Hague
                Agreement having a date of international registration on or after
                October 2, 2020.
                FOR FURTHER INFORMATION CONTACT: Brendan Hourigan, Director of the
                Office of Planning and Budget, by telephone at (571) 272-8966; or
                Dianne Buie, Director, Forecasting and Analysis Division, by telephone
                at (571) 272-6301.
                SUPPLEMENTARY INFORMATION:
                I. Executive Summary
                A. Purpose of This Action
                 The Office issues this Final Rule under section 10 of the AIA
                (section 10), Public Law 112-29, 125 Stat. 284, as amended by Public
                Law 115-273, 132 Stat. 4158 (the SUCCESS Act), which authorizes the
                director of the USPTO to set or adjust by rule any patent fee
                established, authorized, or charged under title 35 of the United States
                Code (U.S.C.) for any services performed, or materials furnished, by
                the Office. Section 10 prescribes that fees may be set or adjusted only
                to recover the aggregate estimated costs to the Office for processing,
                activities, services, and materials relating to patents, including
                administrative costs of the Office with respect to such patent fees.
                Section 10 authority includes flexibility to set individual fees in a
                way that furthers key policy factors, while taking into account the
                cost of the respective services. Section 10 also establishes certain
                procedural requirements for setting or adjusting fee regulations, such
                as public hearings and input from the Patent Public Advisory Committee
                (PPAC) and congressional oversight. The revenue and workload
                assumptions in this Final Rule are based on the assumptions and
                estimates found in the FY 2021 Budget. However, projections of
                aggregate revenues and costs are based on point-in-time estimates, and
                are subject to change. Notably, since the FY 2021 Budget was published,
                fee collections have been lower than anticipated, due, in part, to
                fewer application filings resulting from the COVID-19 outbreak.
                 Although economic circumstances have changed substantially since
                the FY 2021 Budget was developed, the USPTO determined it remains the
                most appropriate starting point for developing this Final Rule. First,
                the USPTO's projections of aggregate revenues and costs are necessarily
                estimates that can change substantially from one point in time to the
                next due to numerous factors outside the USPTO's control, including
                cyclical economic changes or exogenous shocks, such as COVID-19,
                changes in the laws governing USPTO revenues or expenditures, and other
                events. Nevertheless, the USPTO has historically used its most recent
                budget assumptions when setting fees, because they are the most recent
                complete evaluation of the USPTO's budget expectations and
                requirements, and provide assumptions for stakeholders to use when
                formulating their comments. Those projections were developed in late
                calendar year 2019, prior to the COVID-19 outbreak, and assumed
                continuing stable economic growth, not the sharp economic downturn and
                rebound of 2020.
                 The FY 2021 Budget was developed based on the assumptions that real
                GDP would grow around 2.2 percent in FY 2020 and 1.9 percent in FY
                2021. The USPTO appreciates that revenue estimates based on those
                assumptions may be higher than what will ultimately be collected.
                 The USPTO has considered the state of the U.S. economy, the
                operational needs of the agency, and the comments and advice received
                from the public during the 60-day comment period. The USPTO has made
                adjustments to the timing of the Final Rule based on all of these
                considerations, specifically delay publishing the Final Rule from April
                with a July effective date to August with an October effective date.
                This approach is consistent with the USPTO's many other efforts to
                provide various types of relief to stakeholders, including deadline
                extensions and fee postponements. Ultimately, the goal of the USPTO is
                to ensure not only that businesses and entrepreneurs can weather the
                economic downturn, but that they can hit the ground running as it
                passes.
                B. Summary of Provisions Impacted by This Action
                 Consistent with federal fee setting standards, the Office conducted
                a biennial review of fees, costs, and revenues that began in 2017 and
                concluded that fee adjustments are necessary to provide the resources
                needed to improve patent operations, including implementing the USPTO
                2018-2022 Strategic Plan (Strategic Plan). As a result, the 296 fees
                set or adjusted in this rule align directly with the Office's strategic
                goals and four key fee setting policy factors, discussed in detail in
                Part III: Rulemaking Goals and Strategies.
                 The assumptions and estimates found in the FY 2021 Budget show that
                the fee schedule in this rule will recover the aggregate estimated
                costs of patent operations, including achieving the Office's strategic
                goals as detailed in the Strategic Plan, available at: www.uspto.gov/strategicplan. The Strategic Plan defines the USPTO's mission, vision,
                and long-term goals and presents the actions the Office will take to
                realize those goals. This fee setting rule supports the patent-related
                strategic goal to optimize patent quality and timeliness, which
                includes optimizing patent application pendency and examination time
                frames, issuing highly reliable patents, fostering innovation through
                business effectiveness, and enhancing the operations of the Patent
                Trial and Appeal Board (PTAB or Board). To the extent that the
                aggregate revenue generated by this rule will be used to pay for all
                patent-related costs
                [[Page 46933]]
                of the USPTO, this rule also supports the USPTO's goal to provide
                domestic and global leadership to improve intellectual property (IP)
                policy protection and enforcement, as well as the mission support goal
                to deliver organizational excellence, which includes optimizing the
                speed, quality, and cost-effectiveness of IT delivery to achieve
                business value and ensuring financial sustainability to facilitate
                effective USPTO operations. Before issuing this Final Rule, the Office
                considered and analyzed all comments, advice, and recommendations
                received from the public during the 60-day comment period. The Office's
                response to comments received is available in Part VI: Discussion of
                Comments.
                 During a formal process closely tied to the annual budget process,
                the USPTO reviewed and analyzed the overall balance between the
                Office's estimated revenue and costs over the next five years (based on
                the assumptions and estimates found in the FY 2021 Budget) and also
                reviewed individual fee changes and new fee proposals to assess their
                alignment with the Office's strategic goals and fee structure
                philosophy, both of which aim to provide sufficient financial resources
                to facilitate the effective administration of patent operations.
                Specifically, the Office assessed how well each proposal aligned with
                four key fee setting policy factors: Promote innovation strategies,
                align fees with the full cost of products and services, set fees to
                facilitate the effective administration of the patent system, and offer
                processing options for applicants.
                 This Final Rule sets or adjusts 296 patent fees for large, small,
                and micro entities (any reference herein to ``large entity'' includes
                all entities other than those that have established entitlement to
                either a small or micro entity fee discount). The fee rates for small
                and micro entities are tiered, with small entities receiving a 50
                percent discount on certain patent fees and micro entities receiving a
                75 percent discount. Small entity fee eligibility is based on the size
                or certain non-profit status of the applicant's business and that of
                any other party holding rights to the invention. Micro entity fee
                eligibility is described in section 10(g) of the AIA. The Office is
                also introducing five new fees and discontinuing four fees.
                 Overall, the routine fees to obtain a patent (i.e., filing, search,
                examination, and issue fees) will increase under this Final Rule,
                relative to the current fee schedule, in order to ensure financial
                sustainability and accommodate increases needed to improve the
                predictability and reliability of patent IP protection. Applicants who
                meet the definition for small or micro entity discounts will continue
                to pay a reduced fee for the fees eligible for a discount under section
                10(b) of the AIA. Additional information describing the fee adjustments
                is included in Part V: Individual Fee Rationale in this rulemaking and
                in the ``Table of Patent Fees: Current, Final Patent Fee Schedule, and
                Unit Cost'' (hereinafter ``Table of Patent Fees'') available at https://www.uspto.gov/FeeSettingAndAdjusting.
                 As background, section 10 of the AIA changed the Office's fee
                setting model and authorized the USPTO to set or adjust patent fees
                within the regulatory process. Section 10 better equips the Office to
                respond to changing circumstances. In Fiscal Year (FY) 2013 and FY
                2018, the USPTO used the AIA's fee setting authority to achieve key fee
                setting policy factors--to promote innovation strategies, align fees
                with the full cost of products and services, set fees to facilitate the
                effective administration of the patent system, and offer patent
                processing options for applicants--and to generate sufficient resources
                needed to meet the Office's strategic patent priorities. With the
                additional fees collected as a result of the January 2013 Setting and
                Adjusting Patent Fees Final Rule (hereinafter ``the January 2013 Final
                Rule'') (78 FR 4212) and the January 2018 Setting and Adjusting Patent
                Fees in Fiscal Year 2017 Final Rule (hereinafter ``the January 2018
                Final Rule'') (82 FR 52780), the Office made considerable progress in
                reducing the patent application backlog and pendency.
                 Since the development of the USPTO fee schedule currently in
                effect, there have been changes to a number of the assumptions on which
                the cost and revenue projections supporting that rulemaking were based.
                Notably, since the January 2018 Final Rule was published, the USPTO's
                projected patent examination costs have increased, and (b) fee
                collections have been lower than anticipated due to a later than
                planned implementation of the January 2018 Final Rule. The higher fees
                set or adjusted in this rulemaking are needed as the Office continues
                its efforts towards accomplishing its mission and responding to the
                demands of both the domestic and international economies for robust and
                timely IP products and services. The USPTO must continually reinforce
                the predictability, reliability, and quality of those IP rights. Doing
                so fosters the utmost confidence in the legal durability of the USPTO's
                products and inspires greater innovation and further economic growth.
                 The Office's strategic goal to optimize patent quality and
                timeliness recognizes the importance of innovation as the foundation of
                American economic growth and national competitiveness. Through this
                goal, the Office diligently works to balance timely examination with
                improvements in patent quality, particularly the reliability of issued
                patents. One of these improvements was a comprehensive analysis of
                examination time, known as the examiner time analysis (ETA). The last
                comprehensive review of examination time was completed over 40 years
                ago. Since then, significant changes to the examination process have
                occurred, including the emergence of new, more complex technologies, an
                increase in available prior art that must be searched, the impact of
                new electronic tools on the examination process, the challenges of
                transitioning to a new patent classification system, and changes in the
                legal landscape. As the USPTO plans for the future, the Office
                considers how changes such as these impact the amount of time it takes
                to examine an application.
                 The USPTO is also working towards improving patent quality by
                providing increased clarity on patentable subject matter eligibility
                under 35 U.S.C. 101. The Office continues to strive to create
                consistency and increased clarity through this guidance. The Office is
                also focusing efforts on improving the initial search and availability
                of the best prior art to examiners. This aspect takes a variety of
                forms, and the Office is working on many possible approaches. Overall,
                presenting more comprehensive search results to the examiners initially
                will lead to more efficient examination, a decrease in the information
                gap between the examination phase and any potential later challenge or
                litigation phases during the life of a patent, and an increase in the
                reliability of the patent grant overall. Effecting the changes in the
                examination process needed to ensure the issuance of reliable patents,
                while also issuing those patents in a timely manner, means recognizing
                a potential increase in the core operating costs for future years.
                 Another major component of the overall patent process is the work
                carried out by the PTAB. On April 24, 2018, the U.S. Supreme Court
                issued its decision in SAS Institute Inc. v. Iancu, 138 S. Ct. 1348
                (2018). Changes related to the SAS decision, along with the
                implementation of other improvements, have increased the average cost
                to conduct each proceeding. These changes are discussed in detail in
                Part V: Individual Fee Rationale.
                [[Page 46934]]
                 In addition, as a production-oriented entity, the USPTO relies on
                IT as a mission-critical enabler for every aspect of its operation. The
                quality, efficiency, and productivity of patent operations correlate to
                the performance of the USPTO's IT systems. To accomplish its
                performance-based strategies, the USPTO continuously engages in multi-
                year efforts to stabilize and upgrade its business systems and the IT
                infrastructure supporting those systems in order to keep pace with
                emerging business, legislative, and court needs and technology
                standards. Since the last patent fee setting effort, the USPTO has made
                significant progress on IT tools, including continued development and
                implementation of the Patent End-to-End (PE2E) IT capability. For
                example, the Office continues to work on releasing systems such as
                Patent Center which will modernize the transaction systems by combining
                EFS Web and Patent Application Information Retrieval (PAIR) in a single
                interface. The Office has also made progress on the continued
                development and deployment of the PTAB End-to-End (PTAB E2E) IT
                capabilities, which will expand the use of intelligent data to support
                appeal decisions and process inter partes review (IPR) proceedings,
                post-grant review (PGR) proceedings, covered business method review
                (CBM) proceedings, and derivation (DER) proceedings. Other IT efforts
                are underway to stabilize, modernize, or replace the USPTO's legacy
                systems and aging infrastructure. To this end, in FY 2019, the USPTO
                performed an assessment of its IT systems, infrastructure, and
                processes and began stabilizing and modernizing IT. One of the first
                improvements was to move the critical Patent Application Location
                Monitoring (PALM) system from an aging server to new servers that are
                at least 10 times more reliable, 100 times faster, and use less than
                half of the power consumed by the prior server.
                 The FY 2021 Budget does not anticipate that investments in IT
                modernization and stabilization costs will increase beyond levels
                previously foreseen. However, given the assumptions and estimates of
                revenue and spending found in the FY 2021 Budget, this fee increase is
                needed to support continuing IT investments at previously planned
                levels. Without an increase in the USPTO's aggregate revenue, resources
                available for IT investment will inevitably be curtailed.
                 Lastly, the USPTO has taken steps to establish and maintain
                operating reserves to facilitate execution of multi-year plans. Using
                fee setting authority and other tools, the USPTO continuously refines
                its multi-year planning and budgeting. The fee setting authority
                prescribed in the AIA, as amended by the SUCCESS Act, allows the Office
                to effectively engage the stakeholder community on fee adjustments;
                fully recover the aggregate costs of its planned operations, including
                the development and maintenance of sufficient operating reserves;
                invest in strategic agency initiatives; and respond to changing market
                needs and other external factors.
                 Research has shown that large fee-funded, business-like agencies
                without an operating reserve are at risk of cash flow stress. The
                USPTO's operating reserves enable the Office to mitigate this risk. For
                instance, in FY 2019, certain federal government departments and
                agencies, including the Department of Commerce, shut down as a result
                of a lapse in appropriations. The USPTO was able to remain open using
                funds available from the operating reserves. This allowed the USPTO to
                continue operations, thus preventing a significant degradation in
                service levels, such as patent pendency time frames. This example
                provides an ongoing, compelling case for the operating reserves'
                significant value. Both external factors and internal decisions
                impacting the spending and revenue projections mentioned above have
                affected the Office's ability to grow the operating reserve to the
                levels anticipated in the January 2018 Final Rule. The USPTO assesses
                risk annually and determines the minimum level of reserves necessary to
                shield core operations against known financial risks. The Office also
                establishes optimal operating reserve targets, which are reviewed at
                least biennially, based on an assessment of the likelihood and severity
                of an array of risks. Based on the cost and revenue assumptions found
                in the FY 2021 Budget, the USPTO's patent operating reserve is
                projected to remain above the minimum level and gradually build toward
                the optimal level, due to the impact of this Final Rule. Absent this
                fee increase, the USPTO's patent operating reserve will fall below the
                minimum level in FY 2021 and be exhausted by the end of FY 2022, which
                will leave the Office vulnerable to changes in the economy that reduce
                annual revenue, government-wide fiscal events, unexpected cost
                increases, and a number of other financial risks.
                 The USPTO also acutely recognizes that fees cannot simply increase
                for every improvement the Office deems desirable. The USPTO has a
                responsibility to stakeholders to pursue strategic opportunities for
                improvement in an efficient, cost-conscious manner. The Office's
                financial advisory board (FAB) focuses on financial risk management and
                determining what expenses are truly necessary. Each year the FAB
                reviews multiple scenarios to determine what level of fee collections
                are expected and what the hiring and spending levels should be in order
                to effectively carry out the Office's mission. The FAB also regularly
                reviews USPTO activities to identify opportunities for cost savings and
                resources that can be redirected to higher-priority efforts. As a
                result of the USPTO's careful financial management and prudent use of
                fee setting authority, Congress recognized the Office as a good steward
                of fee setting authority and extended that authority through the
                SUCCESS Act.
                 In order to continue building on the progress made over the past
                several years, and consistent with the USPTO's biennial fee review
                policy, the final patent fee schedule detailed herein continues to
                focus on the fundamental purpose of the USPTO, which is to foster
                innovation, competitiveness, and job growth by recognizing and securing
                IP rights through the delivery of high-quality and timely patent
                examination and review proceedings in order to produce reliable and
                predictable IP rights. This Final Rule seeks to provide the USPTO
                sufficient financial resources to facilitate the effective
                administration of the U.S. IP system. This Final Rule includes targeted
                fee adjustments, and an approximately 5 percent across-the-board
                adjustment to all patent fees that are not covered by the targeted
                adjustments or that are discontinued. This Final Rule is needed because
                critical costs to the Office continue to increase. Based on the
                assumptions and estimates found in the FY 2021 Budget, the fees set
                forth in this Final Rule will help replenish and grow the patent
                operating reserve and maintain the USPTO's finances, enabling the
                Office to deliver reliable and predictable service levels, even in
                times of financial fluctuations. A more robust patent operating reserve
                will also position the Office to identify and continue to undertake
                capital improvements, such as adapting to an ever-increasing
                technological future. The operating reserve will be managed carefully;
                if the projected operating reserve were to exceed the targeted optimal
                level by 10 percent for two consecutive years, it is USPTO policy to
                examine the contributing factors and determine whether it would be
                advisable to lower fee rates. The fees set or adjusted in this Final
                Rule intend to position the Office well to deliver on
                [[Page 46935]]
                known commitments and address unknown risks in the future.
                C. Summary of Costs and Benefits of This Action
                 This Final Rule is economically significant and results in a need
                for a Regulatory Impact Analysis (RIA) under Executive Order 12866
                (Regulatory Planning and Review) (Sept. 30, 1993). The Office prepared
                a RIA to analyze the costs and benefits of the Final Rule over a five-
                year period, FY 2020-FY 2024. The RIA includes an analysis of four
                alternatives and shows how well they aligned with the Office's
                rulemaking strategies and goals, which include strategic priorities
                (goals, objectives, and initiatives) from the Strategic Plan and the
                Office's fee setting policy factors. From this conceptual framework,
                the Office assessed the absolute and relative qualitative costs and
                benefits of each alternative. Consistent with the Office of Management
                and Budget (OMB) Circular A-4, ``Regulatory Analysis,'' this rule
                involves a transfer payment from one group to another. The Office
                recognizes that it is very difficult to precisely monetize and quantify
                social costs and benefits resulting from deadweight loss of a transfer
                rule such as this Final Rule. The costs and benefits that the Office
                identifies and analyzes in the RIA are strictly qualitative.
                Qualitative costs and benefits have effects that are difficult to
                express in either dollar or numerical values. Monetized costs and
                benefits, on the other hand, have effects that can be expressed in
                dollar values. The Office did not identify any monetized costs and
                benefits of this Final Rule but found that this Final Rule has
                significant qualitative benefits with no identified costs.
                 The qualitative costs and benefits that the RIA assesses are: (1)
                Fee schedule design--a measure of how well the fee schedule aligns with
                the key fee setting policy factors; and (2) securing aggregate revenue
                to recover aggregate cost--a measure of whether the alternative
                provides adequate revenue to support the core mission and strategic
                priorities based on assumptions and estimates found in the FY 2021
                Budget and described in the Final Rule, Strategic Plan, and FY 2021
                Budget. Based on the costs and benefits identified and analyzed in the
                RIA, the fee schedule detailed in this Final Rule offers the highest
                net benefits. As described throughout this document, the final patent
                fee schedule maintains the existing balance of below-cost entry fees
                (e.g., filing, search, and examination) and above-cost maintenance fees
                as one approach to foster innovation. Further, as detailed in Part V:
                Individual Fee Rationale, the fee changes are targeted in support of
                one or more fee setting policy factors. Lastly, this Final Rule secures
                the aggregate revenue needed to achieve the strategic priorities
                encompassed in the rulemaking goals and strategies (see Part III:
                Rulemaking Goals and Strategies). The final patent fee schedule allows
                for optimizing patent quality and timeliness. This significantly
                increases the value of patents by advancing commercialization of new
                technologies sooner and reducing uncertainty regarding the scope of
                patent rights, which fosters innovation and has a positive effect on
                economic growth. The RIA explains the results in more detail at https://www.uspto.gov/FeeSettingAndAdjusting.
                II. Legal Framework
                A. Leahy-Smith America Invents Act--Section 10
                 The Leahy-Smith America Invents Act was enacted into law on
                September 16, 2011. See Public Law 112-29, 125 Stat. 284. Section 10(a)
                of the Act authorizes the director of the Office to set or adjust by
                rule any patent fee established, authorized, or charged under title 35,
                U.S.C., for any services performed by, or materials furnished by, the
                Office. Fees under title 35 of the U.S.C. may be set or adjusted only
                to recover the aggregate estimated cost to the Office for processing,
                activities, services, and materials related to patents, including
                administrative costs to the Office with respect to such patent
                operations. See 125 Stat. at 316. Provided that the fees in the
                aggregate achieve overall aggregate cost recovery, the director may set
                individual fees under section 10 at, below, or above their respective
                cost. Section 10(e) of the Act requires the director to publish the
                final fee rule in the Federal Register and the Official Gazette of the
                USPTO at least 45 days before the final fees become effective. Section
                10(i) terminates the director's authority to set or adjust any fee
                under section 10(a) upon the expiration of the seven-year period that
                began on September 16, 2011.
                B. The Study of Underrepresented Classes Chasing Engineering and
                Science Success Act of 2018
                 The Study of Underrepresented Classes Chasing Engineering and
                Science Success Act of 2018 (SUCCESS Act), was enacted into law on
                October 31, 2018. See Public Law 115-273, 132 Stat. 4158. Section 4 of
                the SUCCESS Act amended section 10(i)(2) of the AIA by striking ``7-
                year'' and inserting ``15-year'' in reference to the expiration of fee
                setting authority. Therefore, the updated section 10(i) of the AIA, as
                amended, terminates the director's authority to set or adjust any fee
                under section 10(a) upon the expiration of the 15-year period that
                began on September 16, 2011, and ends on September 16, 2026.
                C. Small Entity Fee Reduction
                 Section 10(b) of the AIA requires the Office to reduce by 50
                percent the fees for small entities that are set or adjusted under
                section 10(a) for filing, searching, examining, issuing, appealing, and
                maintaining patent applications and patents.
                D. Micro Entity Fee Reduction
                 Section 10(g) of the AIA amended 35 U.S.C. ch. 11 by adding section
                123 concerning micro entities. The Act provides that the Office must
                reduce by 75 percent the fees for micro entities for filing, searching,
                examining, issuing, appealing, and maintaining patent applications and
                patents. Micro entity fees were implemented through the January 2013
                Final Rule, and the Office will maintain this 75 percent micro entity
                discount for the appropriate fees and will implement micro entity fees
                for additional services as appropriate.
                E. Patent Public Advisory Committee Role
                 The Secretary of Commerce established the PPAC under the American
                Inventors Protection Act of 1999. 35 U.S.C. 5. The PPAC advises the
                Under Secretary of Commerce for Intellectual Property and Director of
                the USPTO on the management, policies, goals, performance, budget, and
                user fees of patent operations.
                 When adopting fees under section 10 of the Act, the director must
                provide the PPAC with the proposed fees at least 45 days prior to
                publishing the proposed fees in the Federal Register. The PPAC then has
                at least 30 days within which to deliberate, consider, and comment on
                the proposal, as well as hold public hearing(s) on the proposed fees.
                The PPAC must make available to the public a written report of the
                comments, advice, and recommendations of the committee regarding the
                proposed fees before the Office issues any final fees. The Office
                considers and analyzes any comments, advice, or recommendations
                received from the PPAC before finally setting or adjusting fees.
                 Consistent with this framework, on August 8, 2018, the director
                notified the PPAC of the Office's intent to set or adjust patent fees
                and submitted a
                [[Page 46936]]
                preliminary patent fee proposal with supporting materials. The
                preliminary patent fee proposal and associated materials are available
                at https://www.uspto.gov/FeeSettingAndAdjusting. The PPAC held a public
                hearing in Alexandria, Virginia, on September 6, 2018. Transcripts of
                the hearing are available for review at https://www.uspto.gov/sites/default/files/documents/PPAC_Hearing_Transcript_20180906.pdf. Members
                of the public were invited to the hearing and given the opportunity to
                submit written and/or oral testimony for the PPAC to consider. The PPAC
                considered such public comments from this hearing and made all comments
                available to the public via the Fee Setting and Adjusting section of
                the USPTO website, https://www.uspto.gov/FeeSettingAndAdjusting. The
                PPAC also provided a written report setting forth in detail the
                comments, advice, and recommendations of the committee regarding the
                preliminary proposed fees. The report regarding the preliminary
                proposed fees was released on October 29, 2018, and can be found online
                at https://www.uspto.gov/sites/default/files/documents/PPAC_Fee_Setting_Report_Oct2018_1.pdf.
                 The Office considered and analyzed all comments, advice, and
                recommendations received from the PPAC before publishing the notice of
                proposed rulemaking (NPRM) Setting and Adjusting Patent Fees during
                Fiscal Year 2020. The NPRM and associated materials are available at
                https://www.uspto.gov/FeeSettingAndAdjusting. Likewise, before issuing
                this Final Rule, the Office considered and analyzed all comments,
                advice, and recommendations received from the public during the 60-day
                comment period. The Office's response to comments received is available
                in Part VI: Discussion of Comments.
                III. Rulemaking Goals and Strategies
                A. Fee Setting Strategy
                 The overall strategy of this Final Rule is to establish a fee
                schedule that generates sufficient multi-year revenue to recover the
                aggregate cost of maintaining USPTO patent-related operations and
                accomplishing the USPTO's patent-related strategic goals in accordance
                with the authority granted to the USPTO by AIA section 10, as amended
                by the SUCCESS Act. The overriding principles behind this strategy are
                to operate within a sustainable funding model to avoid disruptions
                caused by fluctuations in financial operations and to enable the USPTO
                to continue strategic improvements, such as optimizing patent
                application pendency; issuing highly reliable patents; fostering
                innovation through business effectiveness; enhancing operations of the
                PTAB; and optimizing the speed, quality, and cost effectiveness of
                information technology delivery to achieve business value.
                 In addition to the overriding principles outlined above, as
                discussed earlier in this document the Office assesses its alignment
                with the four key fee setting policy factors: (1) Promoting innovation
                strategies, (2) aligning fees with the full cost of products and
                services, (3) facilitating the effective administration of the U.S.
                patent system, and (4) offering patent processing options to
                applicants. Each factor promotes a particular aspect of the U.S. patent
                system. Promoting innovation strategies seeks to ensure barriers to
                entry into the U.S. patent system remain low, and innovation is
                incentivized by granting inventors certain short-term exclusive rights
                to stimulate additional inventive activity. Aligning fees with the full
                cost of products and services recognizes that as a fully fee-funded
                entity, the Office must account for all of its costs, even as it elects
                to set certain fees below, at, or above cost. This factor also
                recognizes that some applicants may use particular services in a much
                more costly manner than other applicants (e.g., patent applications
                cost more to process when more claims are filed). Facilitating
                effective administration of the patent system seeks to encourage patent
                prosecution strategies that promote efficient patent prosecution,
                resulting in compact prosecution and a reduction in the time it takes
                to obtain a patent. Finally, the Office recognizes that patent
                prosecution is not a one-size-fits-all process; therefore, where
                feasible, the Office endeavors to fulfill its fourth policy factor of
                offering patent processing options to applicants.
                B. Fee Setting Considerations
                 The balance of this sub-section presents the specific fee setting
                considerations the Office reviewed in developing the final patent fee
                schedule. Specific considerations are: (1) Historical costs of patent
                operations and investments to date in meeting the Office's strategic
                goals; (2) the balance between projected costs to meet the Office's
                operational needs and strategic goals and the projected future year fee
                collections; (3) fee schedule design; (4) sustainable funding; and (5)
                the comments, advice, and recommendations offered by the PPAC on the
                Office's initial fee setting proposal and the public comments received
                in response to the July 2019 NPRM. The Office carefully considered the
                comments, advice, and recommendations offered by the PPAC and public.
                Collectively, these considerations informed the Office's chosen
                rulemaking strategy.
                 (1) Historical Cost. To ascertain how to best align fees with the
                full cost of products and services, the Office considers unit cost data
                provided by the USPTO's activity based information (ABI) program. Using
                historical cost data and forecasted application demands, the Office can
                align fees with the costs of specific patent products and services. The
                document entitled ``Setting and Adjusting Patent Fees during Fiscal
                Year 2020--Activity Based Information and Patent Fee Unit Expense
                Methodology,'' available at https://www.uspto.gov/FeeSettingAndAdjusting, provides details on the Office's costing
                methodology in addition to four years of historical cost data. Part IV
                of this Final Rule details the Office's methodology for establishing
                fees. Additionally, Part V describes the reasoning for setting some
                fees at cost, below cost, or above cost such that the Office recovers
                the aggregate cost of providing services through fees.
                 (2) Projected Costs and Revenue. In developing this Final Rule, the
                USPTO considered estimates of future year workload demands, fee
                collections, and costs to maintain core USPTO operations and meet the
                Office's strategic goals, all of which can be found in the FY 2021
                Budget. The FY 2021 Budget and the Strategic Plan highlight the
                priorities of: optimizing patent application pendency; issuing highly
                reliable patents; fostering innovation through business effectiveness;
                enhancing operations of the PTAB; optimizing the speed, quality, and
                cost effectiveness of IT delivery to achieve business value; and
                ensuring financial sustainability to facilitate effective USPTO
                operations. This also enables the USPTO to continue to leverage
                nationwide talent to build, retain, and effectively manage the highly
                educated and talented workforce it needs to properly serve its
                stakeholder community and the country.
                 (a) Updated Revenue Estimates. As is discussed in more detail in
                Part IV: Fee Setting Methodology, when setting fees at appropriate
                levels to recover aggregate costs, the USPTO must estimate future year
                demand for its products and services through a careful analysis of
                economic conditions, potential changes in the legal and policy
                [[Page 46937]]
                environment, and operational efficiency and productivity. Many of these
                factors fall outside the USPTO's control. Since the time that the USPTO
                published the January 2018 Final Rule, new information has become
                available that has resulted in adjustments to several of the
                assumptions underlying the Office's revenue projections. The result of
                this change is a lowering of revenue expectations under the existing
                fee schedule. This reduction is due to a number of factors, including a
                reduction in the estimates for request for continued examination (RCE)
                submissions over several years and maintenance fee collections. These
                assumptions and estimates are found in the FY 2021 Budget.
                 Despite increases in serialized filings in FYs 2017 through 2019,
                the rate of RCE submissions during that same time period was much less
                than expected. In particular, 2018 and 2019 saw a 10 percent decrease
                in the number of RCEs filed compared to the number projected, and RCE
                projections for FY 2020 and beyond have been reduced accordingly (as
                found in the FY 2021 Budget). This reduction of RCEs enables USPTO
                examining staff to re-allocate more of their time to examine an
                increased number of serialized filings, thereby reducing our unexamined
                inventory. While the USPTO considers the reduction in RCE submissions
                to be a generally positive development, it has resulted in the FY 2020
                and FY 2021 revenues being lower than expected when the January 2018
                Final Rule was published.
                 In FYs 2017 through 2019 maintenance fee collections, particularly
                the most expensive third stage collections, were lower than projected.
                As a result, the refreshed forecast included in the FY 2021 Budget has
                been lowered.
                 Absent the increase in fees or an unsustainable reduction in
                operating costs, the USPTO will be forced to draw down its operating
                reserves and take on higher levels of financial risk.
                 (b) Quality, Backlog, and Pendency. The strategic goal to
                ``optimize patent quality and timeliness'' recognizes the importance of
                innovation as the foundation of American economic growth and national
                competitiveness. Through this goal, the Office will continually improve
                patent quality, particularly the predictability and reliability of
                issued patents. The USPTO is also committed to improving pendency to
                better ensure the timely delivery of innovative goods and services to
                market and the related economic growth and creation of new or higher-
                paying jobs.
                 The Office will continue to diligently make progress toward
                pendency targets and quality expectations to issue predictable and
                reliable patents while also addressing the anticipated growth in
                application filings. The Office will work to optimize patent
                examination time frames within the framework of patent term adjustment
                (PTA) while continuing to monitor and report traditional pendency
                measures. This includes engaging customers to identify optimal pendency
                and examination time frames and making sure that the Office has the
                appropriate number of examiners to generate the level of production to
                meet those time frames. This Final Rule will produce revenues adequate
                to continue the USPTO's progress towards attaining its strategic goal
                to optimize patent quality and timeliness.
                 The Office recognizes the importance of issuing high-quality
                patents that provide reliable and predictable intellectual property
                protection. If the USPTO is to achieve its strategic objective of
                issuing highly reliable patents, patent examiners must be afforded
                sufficient time to conduct a thorough and complete examination of each
                application. In the time since fees were last adjusted, the USPTO has
                completed a comprehensive analysis of examination time, known as ETA,
                the result of which determined a need for updates to the allotment of
                examination time.
                 In the past, allotment of examination time for a particular
                application was determined by the most comprehensive claim and could
                not account for multi-disciplinary inventions. Sometimes, patent
                applications of similar technologies would receive disparate time for
                examination as a result. This, together with significant changes in
                patent prosecution that have occurred since examination time goals were
                established over 40 years ago--such as advancements in the
                technological complexities of applications, a growing volume of prior
                art, and a changing legal landscape--has brought about the need for
                updates to the allotment of examination time. The time examiners are
                given to examine applications is the critical link between pendency and
                quality. These updates reflect internal and external stakeholders'
                priorities and experiences as they relate to examination time, quality,
                and application complexity, and also enable optimal pendency and
                quality levels.
                 In addition to the changing legal landscape, increasing technical
                complexities of applications, and the growing volume of prior art to be
                searched during examination, updates to examination time will also take
                into account the full scope of technology recited in an application as
                well as the particular attributes of the application, such as the
                number of claims, the size of the specification, and the number of
                references cited in any filed information disclosure statement. Based
                on technology examined, examiners who currently receive the least
                amount of time for examination will generally see the largest increases
                in examination time, and conversely, examiners who currently receive
                the highest amount of time may see little, if any, increase in
                examination time. Further, all examiners will be provided additional
                examination time based on the specific attributes of the application.
                Together, these changes improve the calibration of the time needed to
                conduct a thorough examination, position the Office to better adjust
                time in the future as needed, and provide stakeholders increased
                confidence in the certainty of any resultant patent rights.
                 Separate from the ETA findings, analysis of the patent staffing
                model indicates an incremental decrease in examiners' average net
                output over time, resulting in higher core patent examination costs
                than in previous estimates. One possible explanation for this reduction
                in output may be that the percentage of examiners receiving production
                awards has dropped, and a larger number of examiners are forgoing
                promotions and staying at lower grades. Additionally, applicants'
                increased use of programs like the after final consideration pilot
                (AFCP) and interviews, along with increased training needs due to
                changes in the legal landscape and examination practices, has increased
                the amount of non-examination time used by examiners, also leading to
                productivity losses.
                 Another area where essential operating costs have increased is the
                PTAB. The PTAB, as it currently exists, was established by the AIA in
                September 2012. The PTAB manages pendency for three different
                activities: AIA trials, which, by statute, must be adjudicated within
                one year of filing; re-examination petitions, which, by statute, must
                be completed with ``special dispatch''; and ex parte appeals. The PTAB
                is committed to resolving appeals and inter partes matters within
                statutory or USPTO time frames, while streamlining processes and
                procedures throughout the PTAB. This entails retaining and leveraging
                nationwide talent. As the Office institutes operational changes at the
                PTAB to comply with the SAS decision and implements other improvements,
                as
                [[Page 46938]]
                detailed in Part V: Individual Fee Rationale, the average workload
                associated with each trial is increasing.
                 (c) Business Effectiveness. Given the estimates of costs and
                revenue found in the FY 2021 Budget and absent efforts to boost future
                revenue, funding for other USPTO and stakeholder priorities, like IT
                stabilization and modernization and other business improvement
                initiatives, will need to be reduced to well below planned levels in
                the coming years. To this end, revenue generated from the final patent
                fee schedule will enable the USPTO to focus on how the Patents
                organization operates to foster business effectiveness. In fulfilling
                this objective, the Office will listen to customers and employees and
                then take patent-specific actions that will position the Office to meet
                expectations.
                 The USPTO will provide the cutting-edge tools that employees and
                customers need to efficiently and effectively accomplish their tasks,
                particularly through the continued implementation of Patents End-to-
                End. For example, this could entail the use of artificial intelligence
                or machine-learning efforts. Another key initiative that will enhance
                the work capabilities of both employees and customers is to improve
                searchable (text) access to domestic and international patent
                applications, including access to non-patent literature and prior art,
                and Office actions.
                 (3) Fee Schedule Design. The final fee schedule was designed to set
                individual fees to further key policy considerations while taking into
                account the cost of the particular service. To encourage innovators to
                take advantage of patent protection, the Office continues its
                longstanding practice of setting basic ``front-end'' fees (e.g.,
                filing, search, and examination) below the actual cost of carrying out
                these activities. Additionally, new fees are set, and existing fees are
                adjusted, in order to facilitate the effective administration of the
                patent system. Part IV of this Final Rule details the Office's
                methodology for establishing fees, and Part V describes the reasoning
                for setting and adjusting individual fees, including fee schedule
                design benefits. The RIA, available at https://www.uspto.gov/FeeSettingAndAdjusting, also discusses fee schedule design benefits.
                 (4) Sustainable Funding. A major component of sustainable funding
                is the creation and maintenance of a viable patent operating reserve
                that allows for effective management of the U.S. patent system and
                responsiveness to changes in the economy, unanticipated production
                workload, and revenue changes. As a fee-funded agency, the USPTO uses
                its reserves to mitigate the variability in its spending and revenue
                streams that can create volatility in patent operations and threaten
                the Office's ability to support mission operations.
                 The USPTO aims to manage the operating reserve within a range of
                acceptable balances and evaluates its options when projected balances
                fall either below or above that range. Minimum planning targets are
                assessed annually and are intended to address immediate unplanned
                changes in the economic or operating environments as the Office builds
                its reserve to the optimal level. The optimal reserve target, which is
                reviewed at least biennially, is established based on an assessment of
                the likelihood and severity of an array of financial risks. A 2019
                evaluation of the patent operating reserve relative to the financial
                risk environment, revalidated the optimal reserve level of three
                months' operating expenses as the appropriate long-range target given
                various risk factors, such as the high percentage of fixed costs in the
                Patent business and recent and potential changes in the legal,
                judicial, and policy environments. For the Patent business line's
                operating reserve, a minimum planning level of approximately $300
                million--just over one month's operating expenses--has been
                established. The USPTO's annual budget delineates prospective spending
                levels (aggregate costs) to execute core mission activities and
                strategic initiatives. In the FY 2021 Budget, the USPTO estimated that
                its aggregate patent operating costs for FY 2021, including
                administrative costs, would be $3.3 billion, and aggregate estimated
                patent fee collections and other income would be $3.4 billion, with the
                difference being added to the operating reserve. The health of the
                operating reserve is a key consideration as the USPTO sets its fees.
                Aided by the increased fees detailed in this Final Rule, future year
                projections are anticipated to gradually build the operating reserve
                toward the optimal level of three months' operating requirements while
                maintaining the minimum operating reserve balance during the five-year
                period. The projections found in the FY 2021 Budget are based on point-
                in-time estimates and assumptions that are subject to change. For
                instance, the budget includes assumptions about filing levels, renewal
                rates, whether the president will authorize or Congress will mandate
                employee pay raises, the productivity of the workforce, and many other
                factors. A change in any of these factors could have a significant
                cumulative impact on reserve balances. For example, the legally
                mandated 2019 and 2020 pay raises added a cumulative cost of $445
                million (from FY 2020 to FY 2024) to patent operations. As seen in
                Table 2, set forth in Part IV: Fee Setting Methodology, over a five-
                year planning horizon the operating reserve balance can change
                significantly, underscoring the Office's financial vulnerability to
                various risk factors and the importance of fee setting authority.
                 The USPTO will continue to assess the patent operating reserve
                balance against its target balance annually, and at least every two
                years, the Office will evaluate whether the optimal target balance
                continues to be sufficient to provide the stable funding the Office
                needs. Per the Office's operating reserve policy, if the operating
                reserve balance is projected to exceed the optimal level by 10 percent
                for two consecutive years, the Office will consider fee reductions.
                Under the new fee structure, as in the past, the Office will continue
                to regularly review its operating budgets and long-range plans to
                ensure the USPTO uses patent fees prudently.
                 (5) Comments, Advice, and Recommendations from the PPAC and the
                Public. As detailed in the NPRM, in the report prepared in accordance
                with AIA fee setting authority, the PPAC conveyed support for the USPTO
                in seeking the revenues it needs to increase the reliability and
                certainty of patent rights, provide timely examination, improve and
                secure its IT infrastructure, and adequately fund its operating
                reserve. Specifically, the report stated, ``As a general matter, we
                believe that increased revenue for the USPTO will be important to
                fulfill its Strategic Plan and implement the recommendations of the
                PPAC.'' Patent Pub. Advisory Comm., Fee Setting Report (2018). The
                Office considered and analyzed the comments, advice, and
                recommendations received from the PPAC before publishing this Final
                Rule.
                 Likewise, the Office considered and analyzed the comments, advice,
                and recommendations received from the public during the 60-day comment
                period before publishing this Final Rule. The Office's response to
                comments received is available in Part VI: Discussion of Comments.
                C. Summary of Rationale and Purpose of the Final Rule
                 The Office estimates that the patent fee schedule in this Final
                Rule will produce aggregate revenues to recover the aggregate costs of
                patent operations, including the implementation of its strategic and
                mission support goals,
                [[Page 46939]]
                objectives, and initiatives in FY 2020 and beyond. Using the Strategic
                Plan as a foundation, the Final Rule will provide sufficient aggregate
                revenue to recover the aggregate cost of patent operations, including
                optimizing patent application pendency; issuing highly reliable
                patents; fostering innovation through business effectiveness; enhancing
                the operations of the PTAB; optimizing the speed, quality, and cost-
                effectiveness of information technology delivery to achieve business
                value; and ensuring financial sustainability to facilitate effective
                operations.
                IV. Fee Setting Methodology
                 The Office carried out three primary steps in developing the final
                patent fee schedule:
                 Step 1: Determine the prospective aggregate costs of patent
                operations over the five-year period, including the cost of
                implementing new initiatives to achieve strategic goals and objectives.
                 Step 2: Calculate the prospective revenue streams derived from the
                individual fee amounts (from Step 3) that will collectively recover the
                prospective aggregate costs over the five-year period.
                 Step 3: Set or adjust individual fee amounts to collectively
                (through executing Step 2) recover projected aggregate costs over the
                five-year period, while furthering key policy factors.
                 These three steps are iterative and interrelated. The following is
                a description of how the USPTO carries out these three steps.
                Step 1: Determine Prospective Aggregate Costs
                 Calculating prospective aggregate costs is accomplished primarily
                through the annual USPTO budget formulation process. The budget is a
                five-year plan (that the Office prepares annually) for carrying out
                base programs and new initiatives to implement the USPTO's strategic
                goals and objectives.
                 The first activity performed to determine prospective aggregate
                costs is to project the level of demand for patent products and
                services. Demand for products and services depends on many factors that
                are subject to change, including domestic and global economic activity.
                The USPTO also takes into account overseas patenting activities,
                policies and legislation, and known process efficiencies. Because
                filing, search, and examination costs are the largest share of the
                total patent operating costs, a primary production workload driver is
                the number of patent application filings (i.e., incoming work to the
                Office). The Office looks at indicators such as the expected growth in
                real gross domestic product (RGDP), the leading indicator of incoming
                patent applications, to estimate prospective workload. RGDP is reported
                by the Bureau of Economic Analysis (www.bea.gov) and is forecasted each
                February by the OMB (www.omb.gov) in the Economic and Budget Analyses
                section of the Analytical Perspectives and twice annually by the
                Congressional Budget Office (CBO) (www.cbo.gov) in the Budget and
                Economic Outlook. A description of the Office's methodology for using
                RGDP can be found in Appendix III: Multi-year Planning by Business
                Line, of the FY 2021 Budget. The expected change in the required
                production workload must then be compared to the current examination
                production capacity to determine any required staffing and operating
                cost (e.g., salaries, workload processing contracts, and publication)
                adjustments. The Office uses a patent pendency model that estimates
                patent production output based on actual historical data and input
                assumptions, such as incoming patent applications and overtime hours.
                An overview of the model, including a description of inputs, outputs,
                key data relationships, and a simulation tool is available at https://www.uspto.gov/patents/stats/patent_pend_model.jsp.
                 The second activity is to calculate the aggregate costs to execute
                the requirements. In developing its budget, the Office first looks at
                the cost of status quo operations (the base requirements). The base
                requirements are adjusted for OMB-directed pay increases and
                inflationary increases for the budget year and four out-years (detailed
                calculations and assumptions for this adjustment can be found in the FY
                2021 Budget). The Office then estimates the prospective cost of
                expected changes in production workload and new initiatives over the
                same period of time (refer to ``Program Changes by Sub-Program''
                sections of the FY 2021 Budget). The Office reduces cost estimates for
                completed initiatives and known cost savings expected over the same
                five-year horizon. Finally, the Office estimates its three-month target
                operating reserve level based on this aggregate cost calculation for
                the year to determine if operating reserve adjustments are necessary.
                 Based on the assumptions and estimates found in the FY 2021 Budget,
                during FY 2020, patent operations will cost $3.256 billion (see
                Appendix II of the FY 2021 Budget), including $2.221 billion for patent
                examining; $92 million for patent trial and appeals; $167 million for
                patent information resources; $28 million for activities related to IP
                protection, policy, and enforcement; and $754 million for general
                support costs necessary for patent operations (e.g., the patent share
                of rent; utilities; legal, financial, human resources, and other
                administrative services; and Office-wide IT infrastructure and support
                costs). In addition, the Office will transfer $2 million to the
                Department of Commerce Inspector General for audit support. The Office
                also estimates collecting $34 million in other income associated with
                recoveries and reimbursable agreements (offsets to spending).
                 A detailed description of the operating requirements and related
                aggregate costs is located in the FY 2021 Budget. Table 1 below
                provides key underlying production workload projections and assumptions
                from the FY 2021 Budget used to calculate aggregate costs. Table 2 (see
                Step 2) presents the total budgetary requirements (prospective
                aggregate costs) for FY 2020 through FY 2024 and the estimated
                collections and operating reserve balances that will result from the
                adjustments contained in this Final Rule. As the FY 2021 Budget notes,
                these projections are based on point-in-time estimates and assumptions
                that are subject to change. There is considerable uncertainty in out-
                year budgetary requirements. A number of risks could materialize over
                the next several years (e.g., those associated with the re-compete of
                major contracts, including property leases, changing assumptions about
                presidentially authorized or congressionally mandated employee pay
                raises, etc.) that could increase the USPTO's budgetary requirements in
                the short- to medium-term. These estimates are refreshed annually in
                the production of the USPTO's Budget.
                 Table 1--Patent Production Workload Projections--FY 2020-FY 2024
                --------------------------------------------------------------------------------------------------------------------------------------------------------
                 FY 2020 FY 2021 FY 2022 FY 2023 FY 2024
                --------------------------------------------------------------------------------------------------------------------------------------------------------
                Utility, Plant, and Reissue (UPR):
                 Applications *....................................... 632,400 632,100 642,700 652,900 662,500
                [[Page 46940]]
                
                 Application Growth Rate.............................. 1.9% 0.0% 1.7% 1.6% 1.5%
                 Production Units..................................... 604,300 589,500 607,700 626,400 642,600
                 Unexamined Patent Application Backlog................ 559,600 571,600 569,300 557,600 538,400
                 Examination Capacity **.............................. 8,451 8,780 9,094 9,395 9,684
                Performance Measures (UPR):
                 Avg. First Action Pendency (Months).................. 15.5 15.5 15.4 15.0 14.5
                 Avg. Total Pendency (Months)......................... 23.7 23.9 24.0 23.7 23.2
                --------------------------------------------------------------------------------------------------------------------------------------------------------
                * In this table, the patent application filing data includes requests for continued examination (RCEs).
                ** In this table, Examination Capacity is the UPR Examiners On-Board at End-of-Year, as described in the FY 2021 Budget.
                Step 2: Calculate Prospective Aggregate Revenue
                 As described above in Step 1, the USPTO's FY 2020 requirements in
                the FY 2021 Budget include the aggregate prospective costs of planned
                production, anticipated new initiatives, and a contribution to the
                patent operating reserve required for the Office to maintain patent
                operations and realize its strategic goals and objectives for the next
                five years. The aggregate prospective costs become the target aggregate
                revenue level that the new fee schedule must generate in a given year
                and over the five-year planning horizon. To calculate the aggregate
                revenue estimates, the Office first analyzes relevant factors and
                indicators to calculate or determine prospective fee workloads (e.g.,
                number of applications and requests for services and products), growth
                in those workloads, and resulting fee workload volumes (quantities) for
                the five-year planning horizon.
                 The Office considers economic activity when developing fee
                workloads and aggregate revenue forecasts for its products and
                services. Major economic indicators include the overall condition of
                the U.S. and global economies, spending on research and development
                activities, and investments that lead to the commercialization of new
                products and services. The most relevant economic indicator that the
                Office uses is the RGDP, which is the broadest measure of economic
                activity. At the time the FY 2021 Budget was developed, CBO anticipated
                RGDP to grow around 2.2 percent in FY 2020 and 1.9 percent in FY 2021.
                 These indicators correlate with patent application filings, which
                are key drivers of patent fees. Economic indicators also provide
                insight into market conditions and the management of IP portfolios,
                which influence application processing requests and post-issuance
                decisions to maintain patent protection. When developing fee workload
                forecasts, the Office considers other influential factors, including
                overseas activity, policies and legislation, court decisions, process
                efficiencies, and anticipated applicant behavior.
                 Anticipated applicant behavior in response to fee changes is
                measured using an economic principle known as elasticity, which, for
                the purpose of this Final Rule, measures how sensitive applicants and
                patentees are to changes in fee amounts. The higher the elasticity
                measure (in absolute value), the greater the applicant response to the
                relevant fee change. If elasticity is low enough (i.e., demand is
                inelastic, or the elasticity measure is less than one in absolute
                value), a fee increase will lead to only a relatively small decrease in
                patent activities, and overall revenues will still increase.
                Conversely, if elasticity is high enough (i.e., demand is elastic, or
                the elasticity measure is greater than one in absolute value), a fee
                increase will lead to a relatively large decrease in patenting
                activities such that overall revenues will decrease. When developing
                fee forecasts, the Office accounts for how applicant behavior will
                change at different fee amounts projected for the various patent
                services. The Office analyzed elasticity for nine broad patent fee
                categories: filing/search/examination fees, excess independent claims
                fees, excess total claims fees, application size (excess page) fees,
                issue fees, RCE fees, appeal fees, AIA trial fees, and maintenance
                fees, including distinctions by entity size where applicable.
                Additional details about the Office's elasticity estimates can be found
                in ``Setting and Adjusting Patent Fees during Fiscal Year 2020--
                Description of Elasticity Estimates,'' available at https://www.uspto.gov/FeeSettingAndAdjusting.
                Summary of Step 2
                 Patent fees are collected for patent-related services and products
                at different points in the patent application examination process and
                over the life of the pending patent application and granted patent.
                Approximately half of all patent fee collections are from maintenance
                fees, which subsidize the cost of filing, search, and examination
                activities. Changes in application filing levels immediately impact
                current year fee collections, because fewer patent application filings
                means the Office collects fewer fees to devote to production-related
                costs. The resulting reduction in production activities also creates an
                out-year revenue impact because less production output in one year
                results in fewer issue and maintenance fee payments in future years.
                 The USPTO's five-year estimated aggregate patent fee revenue, based
                on assumptions found in the FY 2021 Budget, (see Table 2) is based on
                the number of patent applications it expects to receive for a given
                fiscal year, work it expects to process in a given fiscal year (an
                indicator of future patent issue fee workload), expected examination
                and process requests for the fiscal year, and the expected number of
                post-issuance decisions to maintain patent protection over that same
                fiscal year. Within the iterative process for estimating aggregate
                revenue, the Office adjusts individual fee rates up or down based on
                cost and policy decisions (see Step 3: Set Specific Fee Amounts),
                estimates the effective dates of new fee rates, and then multiplies the
                resulting fee rates by appropriate workload volumes to calculate a
                revenue estimate for each fee. To calculate the aggregate revenue for
                the FY 2021 Budget, the Office assumed that all Final Rule fee rates
                would become effective on July 10, 2020, except for the new non-DOCX
                filing surcharge fee, which was assumed to become effective on January
                1, 2021. The effective dates of all Final Rule fee rates have since
                been delayed from those original assumptions as USPTO further assessed
                the impact of the
                [[Page 46941]]
                pandemic on the economy and stakeholders. Using these figures, the
                USPTO summed the individual fee revenue estimates, and the result is a
                total aggregate revenue estimate for a given year (see Table 2).
                Additional details about the Office's aggregate revenue, including
                projected workloads by fee, can be found in ``Aggregate Revenue Tables,
                Final Patent Rule Schedule'' available at https://www.uspto.gov/FeeSettingAndAdjusting.
                 Table 2 shows the available revenue and operating reserve balances
                by fiscal year, including the Final Rule fee rates in the projected fee
                collections. The estimates in the table can be found in the FY 2021
                Budget and were developed in late calendar year 2019, prior to the
                COVID-19 outbreak. Under current circumstances, it is difficult to
                predict what the actual numbers will be.
                 Table 2--Patent Financial Outlook--FY 2020-FY 2024
                --------------------------------------------------------------------------------------------------------------------------------------------------------
                 Dollars in millions
                 ----------------------------------------------------------------------------------------------
                 FY 2020 FY 2021* FY 2022 FY 2023 FY 2024
                --------------------------------------------------------------------------------------------------------------------------------------------------------
                Projected Fee Collections................................ 3,400 3,251 3,709 3,744 3,861
                Other Income............................................. 34 34 34 34 34
                Total Projected Fee Collections and Other Income......... 3,435 3,285 3,743 3,778 3,895
                Budgetary Requirements................................... 3,256 3,455 3,601 3,681 3,800
                Funding to (+) and from (-) Operating Reserve............ 179 (170) 141 97 95
                EOY Operating Reserve Balance............................ 587 417 558 656 751
                Over/(Under) $300M Minimum Level......................... 287 117 258 356 451
                Over/(Under) Optimal Level............................... (227) (447) (342) (265) (200)
                --------------------------------------------------------------------------------------------------------------------------------------------------------
                * The assumed effective date for the Final Patent Fee Schedule shifts some projected collections from FY 2021 to FY 2020, due to the expectation that
                 patentees who are eligible will submit maintenance fee payments prior to the effective date of the Final Rule.
                Step 3: Set Specific Fee Amounts
                 Once the Office finalizes the annual requirements and aggregate
                prospective costs through the budget formulation process, the Office
                determines specific fee amounts that, together, will derive the
                aggregate revenue required to recover the estimated aggregate
                prospective costs during the five-year budget horizon. Calculating
                individual fees is an iterative process that encompasses many variables
                and policy factors. These are discussed in greater detail in Part V:
                Individual Fee Rationale.
                 One of the variables the USPTO considers to inform fee setting is
                the historical cost estimates associated with individual fees. The
                Office's ABI provides historical costs for an organization's activities
                and outputs by individual fees using the activity based costing (ABC)
                methodology. ABC is commonly used for fee setting throughout the
                federal government. Additional information about the methodology,
                including the cost components related to respective fees, can be found
                in the document entitled ``Setting and Adjusting Patent Fees during
                Fiscal Year 2020--Activity Based Information and Patent Fee Unit
                Expense Methodology'' available at https://www.uspto.gov/FeeSettingAndAdjusting. The USPTO provides data for FY 2016-FY 2019
                because the Office finds that reviewing the trend of ABI historical
                cost information is the most useful way to inform fee setting. The
                underlying ABI data are available for public inspection at the USPTO
                upon request.
                 When the Office implements a new process or service, historical ABI
                data is typically not available. However, the Office will use the
                historical cost of a similar process or procedure as a starting point
                to estimate the full cost of a new activity or service.
                V. Individual Fee Rationale
                 Based on assumptions and estimates found in the FY 2021 Budget, the
                Office projects that the aggregate revenue generated from the new
                patent fees will recover the prospective aggregate cost of its patent
                operations including contributions to the operating reserve, per the
                strategic initiative to ensure financial sustainability to facilitate
                effective USPTO operations. As detailed previously, the PPAC supports
                this approach, stating that, ``The PPAC supports the USPTO in seeking
                the revenues it needs to increase the reliability and certainty of
                patent rights, provide timely examination, improve and secure its IT
                infrastructure and adequately fund its operating reserve'' Patent Pub.
                Advisory Comm., Fee Setting Report [2] (2018).
                 It is important to recognize that each individual fee is not
                necessarily set equal to the estimated cost of performing the
                activities related to the fee. Instead, as described in Part III:
                Rulemaking Goals and Strategies, some of the individual fees are set
                at, above, or below their unit costs to balance several key fee setting
                policy factors: Promoting innovation strategies, aligning fees with the
                full cost of products and services, facilitating effective
                administration of the patent system, and offering patent processing
                options to applicants. For example, many of the initial filing fees are
                intentionally set below unit costs in order to promote innovation
                strategies by removing barriers to entry for innovators. To balance the
                aggregate revenue loss of fees set below cost, other fees must be set
                above cost in areas where it is less likely to reduce inventorship
                (e.g., maintenance).
                 For some fees in this Final Rule, such as excess claims fees, the
                USPTO does not typically maintain individual historical cost data for
                the service provided. Instead, the Office considers the policy factors
                described in Part III to inform fee setting. For example, by setting
                fees at particular levels using the facilitating effective
                administration of the patent system policy factor, the USPTO aims to:
                (1) Foster an environment where examiners can provide and applicants
                can receive prompt, quality interim and final decisions; (2) encourage
                the prompt conclusion of prosecuting an application, resulting in
                pendency reduction and the faster dissemination of patented
                information; and (3) help recover costs for activities that strain the
                patent system.
                 The rationale for the fee changes are grouped into three major
                categories, discussed below: (A) Across-the-board adjustment to patent
                fees; (B) targeted fees; and (C) discontinued fees. The purpose of the
                categorization is to
                [[Page 46942]]
                identify large fee changes for the reader and provide an individual fee
                rationale for such changes. The categorization is based on changes in
                large entity fee amounts because percentage changes for small and micro
                entity fees that are in place today would be the same as the percentage
                change for the large entity, and the dollar change would be half or one
                quarter of the large entity change.
                 The Table of Patent Fees includes the current and Final Patent Fee
                Schedule fees for large, small, and micro entities as well as unit
                costs for the last four fiscal years. Part VII: Discussion of Specific
                Rules contains a complete listing of fees that are set or adjusted in
                the patent fee schedule in this Final Rule.
                A. Across-the-Board Adjustment to Patent Fees
                 In order to both keep the USPTO on a stable financial track and
                allow for the advancement of policies and practices that enhance the
                country's innovation ecosystem, the Office is adjusting all patent fees
                not covered by the targeted adjustments as discussed in section B, or
                to be discontinued as discussed in section C, by approximately 5
                percent. Given the time that has passed between the implementation date
                of the last fee adjustments and this Final Rule, a 5 percent increase
                is similar to fees increasing by 2 percent annually to help USPTO keep
                up with the cost of inflation and other cost increases, such as
                mandatory pay raises not planned for in previous budgets. Individual
                fees, above $50, are rounded to the nearest $10 \1\ by applying
                standard arithmetic rules. For fees that have small and micro entity
                fee reductions, the large entity fee is rounded up or down to the
                nearest 20 dollars by applying standard arithmetic rules. The resulting
                fee amounts are more convenient to patent users and permit the Office
                to set small and micro entity fees at whole dollar amounts when
                applying the applicable fee reduction. Therefore, some smaller fees
                will not be changing, since a 5 percent increase would round down to
                the current fee, while other fees would change by slightly more or less
                than 5 percent, depending on rounding. The fee adjustments in this
                category are listed in the Table of Patent Fees.
                ---------------------------------------------------------------------------
                 \1\ The description of the rounding rule in the NPRM incorrectly
                indicated that fees were rounded to the nearest $5, rather than to
                the nearest $10. This error has been corrected in this Final Rule.
                The fees proposed in the NPRM and implemented in this Final Rule
                were both rounded to the nearest $10 and are not affected by the
                error in the description.
                ---------------------------------------------------------------------------
                 The 5 percent across-the-board adjustment strikes an appropriate
                balance between projected aggregate revenue and aggregate costs based
                on the assumptions used to develop the point-in-time estimates that
                support this Final Rule. The underlying cost and revenue estimates in
                this Final Rule, which are supported by the FY 2021 Budget, show that
                fees are set at levels that secure aggregate cost recovery while
                ensuring a reasonable pace for operating reserve growth.
                B. Targeted Fees
                 For those fees targeted for specific adjustments in this Final
                Rule, the individual fee rationale discussion is divided into two
                categories: (1) Adjustments to existing fees, and (2) new fees.
                 Adjustments to existing fees are further divided into subcategories
                according to the function of the fees, including: (a) Maintenance fee
                surcharge, (b) request for the expedited examination of a design
                application fee, (c) utility and reissue issue and maintenance fees,
                and (d) AIA trial fees. New fees are further divided into subcategories
                according to the function of the fees, including: (a) Non-DOCX filing
                surcharge fee, and (b) pro hac vice. As discussed further below and in
                USPTO's responses to public comments, the USPTO has considered public
                feedback on the proposed (c) annual active patent practitioner fee and
                has decided not to proceed with implementing this fee at this time. The
                USPTO does plan to pursue procedures to allow patent practitioners to
                voluntarily certify whether they have completed a minimum amount of
                continuing legal education (CLE). The USPTO further expects that
                registered practitioners who certify that they have completed such CLE
                will be recognized in the online practitioner directory. In the near
                future, the USPTO plans to issue proposed guidelines regarding such
                voluntary CLE certification, with a request for public comments.
                 As discussed above, for purposes of comparing amounts in the
                individual fee rationale discussion, the Office has included the
                current fees as the baseline to calculate the dollar and percentage
                changes for new fees.
                (1) Adjustments to Existing Fees
                 The following fees are to be increased by an amount other than the
                5 percent across-the-board increase for most patent-related fees. These
                targeted adjustments are made for a variety of strategic reasons. A
                discussion of the rationale for each fee follows.
                (a) Maintenance Fee Surcharge
                 Table 3--Maintenance Fee Surcharge Fees--Fee Changes and Unit Cost
                --------------------------------------------------------------------------------------------------------------------------------------------------------
                 Final rule Percentage
                 Current fees fees large Dollar change change large FY 2018 FY 2019
                 Fee description large (small) (small) large (small) (small) unit cost unit cost
                 [micro] entity [micro] entity [micro] entity [micro] entity
                --------------------------------------------------------------------------------------------------------------------------------------------------------
                Surcharge--3.5 year--Late payment within 6 months............... $160 $500 +$340 +213 n/a n/a
                 ($80) ($250) (+$170) (+213)
                 [$40] [$125] [+$85] [+213]
                Surcharge--7.5 year--Late payment within 6 months............... $160 $500 +$340 +213 n/a n/a
                 ($80) ($250) (+$170) (+213)
                 [$40] [$125] [+$85] [+213]
                Surcharge--11.5 year--Late payment within 6 months.............. $160 $500 +$340 +213 n/a n/a
                 ($80) ($250) (+$170) (+213)
                 [$40] [$125] [+$85] [+213]
                --------------------------------------------------------------------------------------------------------------------------------------------------------
                [[Page 46943]]
                 The Office will set the surcharge for a late maintenance fee
                payment within six months following the due date at $500 for large
                entities. It is the responsibility of the patentee to ensure
                maintenance fees are paid timely to prevent expiration of a patent. If
                a maintenance fee is not paid within the first six months of the year
                in which it can be paid, a maintenance fee reminder notice is sent to
                the fee address or correspondence address on record. Failure to receive
                the notice does not shift the burden of monitoring the time for paying
                a maintenance fee from the patentee to the USPTO. At this point, a
                surcharge is required in addition to the maintenance fee in order to
                maintain a patent. If the maintenance fee and any applicable surcharge
                are not paid by the end of the 4th, 8th, or 12th years after the date
                of issue, the patent rights lapse, and a Notice of Patent Expiration is
                sent to the fee address or correspondence address on record. If a fee
                address has not been established, the notices are sent to the
                correspondence address. Over 95 percent of patent renewals are paid
                before the due date, but some patents are renewed during the six-month
                period following the due date.
                 While still below what other IP offices charge, increasing this
                surcharge brings the USPTO more in line with its global counterparts.
                The goal of increasing this surcharge is to encourage patent holders to
                renew by the due date. Encouraging on-time renewals will benefit the
                public by increasing the understanding of which patents remain in force
                and which patent rights have been allowed to lapse.
                 The USPTO provides tools to help patent owners monitor due dates,
                such as the Patent Maintenance Fees Storefront, https://fees.uspto.gov/MaintenanceFees, where anyone can see the payment windows for all
                patents. Additionally, customers with USPTO.gov accounts (i.e.,
                MyUSPTO) can create a ``patent docket'' and add patent or application
                numbers in order to keep track of due dates. Also, the weekly Official
                Gazette notices list the range of patents for which maintenance fees
                are now payable. In addition, with the availability of free calendar
                apps, individuals can easily set up their own reminders of when
                maintenance fee payments are eligible for renewal (3, 7, 11 years from
                issue) and when they are due (3.5, 7.5, 11.5 years from issue).
                (b) Request for Expedited Examination of a Design Application Fee
                 Table 4--Request for Expedited Examination of a Design Application Fee--Fee Changes and Unit Cost
                --------------------------------------------------------------------------------------------------------------------------------------------------------
                 Final rule Percentage
                 Current fees fees large Dollar change change large FY 2018 FY 2019
                 Fee description large (small) (small) large (small) (small) unit cost unit cost
                 [micro] entity [micro] entity [micro] entity [micro] entity
                --------------------------------------------------------------------------------------------------------------------------------------------------------
                Request for expedited examination of a design application....... $900 $1,600 +$700 +78 $125 $97
                 ($450) ($800) (+$350) (+78)
                 [$225] [$400] [+$175] [+78]
                --------------------------------------------------------------------------------------------------------------------------------------------------------
                 In the NPRM, the Office proposed increasing the fee to request
                expedited examination of a design application to $2,000. In this Final
                Rule, after carefully considering comments from the PPAC and the
                public, the Office is increasing the fee to request expedited
                examination of a design application to $1,600 for a large entity. This
                fee was introduced at a fee rate of $900 in November 2000. The Office
                is increasing the fee for the first time since its inception.
                 Expedited examination is available to all design applicants who
                first conduct a preliminary examination search and file a request for
                expedited treatment accompanied by a fee for the expedited treatment
                and handling (37 CFR 1.17(k)) in addition to the required filing,
                search, and examination fees. This cost-based expedited treatment
                fulfills a particular need by affording rapid design patent protection
                that may be especially important where marketplace conditions are such
                that new designs on articles are typically in vogue for limited periods
                of time. The Office notes that the unit cost presented for this service
                only accounts for the initial processing of the request and does not
                include additional resources expended. The applications are
                individually examined with priority, and the clerical processing is
                conducted and/or monitored by specially designated personnel to achieve
                expeditious processing through initial application processing and the
                design examining group. For a patentable design application, the
                expedited treatment is a streamlined filing-to-issuance procedure. This
                procedure further expedites design application processing by decreasing
                clerical processing time as well as the time spent routing the
                application between processing steps. Specially designated personnel
                are required to conduct and/or monitor the expedited clerical
                processing. Also, expedited design applications may be individually
                treated throughout the examination process where necessary for
                expedited treatment, whereas normally, the search phase of design
                application examination is conducted in groups.
                 For the first few years following the introduction of this program,
                requests for expedited examination of a design application were less
                than 1 percent of total design filings. In recent years, requests have
                increased to over 2 percent of total filings. As discussed in the NPRM,
                the increase in demand for this service forced the Office to choose to
                cap the program (i.e., impose limits on the number of expedited
                examinations it will undertake in a given fiscal year), end the
                program, or increase the fee. Increasing this optional fee will allow
                the USPTO to better manage staffing to match the demand for this
                service, while still keeping the service available as an option for
                those who may benefit from this program. The USPTO believes that this
                new fee amount, as well as the associated small and micro entity
                discounts, will provide the Office the ability to continue offering
                this service to applicants.
                (c) Utility and Reissue Patent Issue and Maintenance Fees
                [[Page 46944]]
                 Table 5--Utility and Reissue Patent Issue and Maintenance Fees--Fee Changes and Unit Cost
                --------------------------------------------------------------------------------------------------------------------------------------------------------
                 Final rule Percentage
                 Current fees fees large Dollar change change large FY 2018 FY 2019
                 Fee description large (small) (small) large (small) (small) unit cost unit cost
                 [micro] entity [micro] entity [micro] entity [micro] entity
                --------------------------------------------------------------------------------------------------------------------------------------------------------
                Utility issue fee............................................... $1,000 $1,200 +$200 +20 $325 $319
                 ($500) ($600) (+$100) (+20)
                 [$250] [$300] [+$50] [+20]
                Reissue issue fee............................................... $1,000 $1,200 +$200 +20 325 319
                 ($500) ($600) (+$100) (+20)
                 [$250] [$300] [+$50] [+20]
                For maintaining an original or any reissue patent, due at 3.5 $1,600 $2,000 +$400 +25 n/a n/a
                 years.......................................................... ($800) ($1,000) (+$200) (+25)
                 [$400] [$500] [+$100] [+25]
                For maintaining an original or any reissue patent, due at 7.5 $3,600 $3,760 +$160 +4 n/a n/a
                 years.......................................................... ($1,800) ($1,880) (+$80) (+4)
                 [$900] [$940] [+$40] [+4]
                For maintaining an original or any reissue patent, due at 11.5 $7,400 $7,700 +$300 +4 n/a n/a
                 years.......................................................... ($3,700) ($3,850) (+$150) (+4)
                 [$1,850 [$1,925] [+$75] [+4]
                --------------------------------------------------------------------------------------------------------------------------------------------------------
                 The Office is adjusting the issue fees by 20 percent and first
                stage maintenance fees by 25 percent. These adjustments will mark the
                first time maintenance fee rates have changed since 2013. The total
                package of fees in this Final Rule does not significantly impact the
                balance between front-end and back-end fees. The USPTO continues to set
                front-end fees below the cost to the Office to provide those services
                in order to encourage innovation. Front-end fees for a utility patent
                with one RCE and lifetime maintenance will continue to be about 18
                percent of the total fees paid over the life of a patent (see Table 6).
                However, as certain technology lifecycles grow shorter, it is important
                that the USPTO not rely too heavily on fees paid late in the life of a
                patent. Therefore, the Office is slightly rebalancing the back-end fees
                to recover the initial search and examination costs earlier in the life
                of the patent.
                 Table 6--Front-End and Back-End Fee Balance
                --------------------------------------------------------------------------------------------------------------------------------------------------------
                 Current Final rule
                 ------------------------------------------------------------------------------
                 Fee group Fee title Group's Group's
                 Large Percent of percent of Large Percent of percent of
                 entity fee total total entity fee total total
                --------------------------------------------------------------------------------------------------------------------------------------------------------
                Front-End Fees............................ Filing....................... $300 2 18 $320 2 18
                 Search....................... 660 4 700 4
                 Examination.................. 760 4 800 4
                 1st RCE...................... 1,300 8 1,360 8
                --------------------------------------------------------------------------------------------------------------------------------------------------------
                Back-End Fees............................. Issue........................ 1,000 6 16 1,200 7 18
                 1st Stage Maintenance........ 1,600 10 2,000 11
                 -------------------------------------------------------------------------------------------------------------
                 2nd Stage Maintenance........ 3,600 22 66 3,760 21 64
                 3rd Stage Maintenance........ 7,400 44 7,700 43
                 ------------------------------------------------------------------------------
                 Total................................. 16,620 100 100 17,840 100 100
                --------------------------------------------------------------------------------------------------------------------------------------------------------
                 The issue fee for utility and reissue patents is increasing from
                $1,000 to $1,200, and the first stage maintenance fee is increasing
                from $1,600 to $2,000. As a result, the combined fees paid for issue
                and first stage maintenance is increasing from 16 percent to 18 percent
                of the total fees paid for a utility patent with one RCE and lifetime
                maintenance.
                 However, second and third stage maintenance fees are only
                increasing by 4 percent--less than the across-the-board adjustment--
                with second stage increasing from $3,600 to $3,760 and third stage
                increasing from $7,400 to $7,700.
                 The Office determined elasticity estimates for the three
                maintenance payments for both large and small entities. For all point
                estimates and confidence intervals, maintenance fees were found to be
                inelastic, with the first stage being the least elastic of these fees.
                More detailed information on elasticity estimates can be found at
                https://www.uspto.gov/FeeSettingAndAdjusting in the document entitled
                ``Setting and Adjusting Patent Fees during Fiscal Year 2020--
                Description of Elasticity Estimates.''
                (d) AIA Trial Fees
                [[Page 46945]]
                 Table 7--AIA Trial Fees--Fee Changes and Unit Cost
                --------------------------------------------------------------------------------------------------------------------------------------------------------
                 Final rule Percentage
                 Current fees fees large Dollar change change large FY 2018 FY 2019
                 Fee description large (small) (small) large (small) (small) unit cost unit cost
                 [micro] entity [micro] entity [micro] entity [micro] entity
                --------------------------------------------------------------------------------------------------------------------------------------------------------
                Inter partes review request fee--Up to 20 claims................ $15,500 $19,000 +$3,500 +23 $15,016 $17,887
                Inter partes review post-institution fee--Up to 15 claims *..... 15,000 n/a n/a n/a 25,490 27,376
                Inter partes review post-institution fee--Up to 20 Claims *..... n/a 22,500 n/a n/a n/a n/a
                Inter partes review request of each claim in excess of 20....... 300 375 +75 +25 n/a n/a
                Inter partes post-institution request of each claim in excess of 600 n/a n/a n/a n/a n/a
                 15 *...........................................................
                Inter partes post-institution request of each claim in excess of n/a 750 n/a n/a n/a n/a
                 20 *...........................................................
                Post-grant or covered business method review request fee--Up to 16,000 20,000 +4,000 +25 21,465 26,296
                 20 claims......................................................
                Post-grant or covered business method review post-institution 22,000 n/a n/a n/a 29,842 40,791
                 fee--Up to 15 claims *.........................................
                Post-grant or covered business method review post-institution n/a 27,500 n/a n/a n/a n/a
                 fee--Up to 20 claims *.........................................
                Post-grant or covered business method review request of each 375 475 +100 +27 n/a n/a
                 claim in excess of 20..........................................
                Post-grant or covered business method review post-institution 825 n/a n/a n/a n/a n/a
                 request of each claim in excess of 15 *........................
                Post-grant or covered business method review post-institution n/a 1,050 n/a n/a n/a n/a
                 request of each claim in excess of 20 *........................
                --------------------------------------------------------------------------------------------------------------------------------------------------------
                * The post-institutional threshold for paying claims fees will increase from 15 to 20.
                 On April 24, 2018, the U.S. Supreme Court issued its decision in
                SAS Institute Inc. v. Iancu, 138 S. Ct. 1348 (2018). As required by the
                decision, the PTAB will institute a trial as to all claims or none.
                Previously, the PTAB instituted a trial on just some claims. This has
                increased the amount of time spent per case post-institution. The
                Office has also modified its pre-institution practice to take into
                account the impacts of the SAS decision. For example, prior to SAS, the
                PTAB did not generally address all arguments at institution. Post-SAS,
                for purposes of deciding whether to institute trial on a petition, the
                Office's policy is to provide details to the parties to the extent
                practicable, including responding to arguments in a patent owner's
                preliminary response that were not the basis for the decision whether
                or not to institute. This has increased the amount of time spent per
                case pre-institution. These changes related to the SAS decision have
                increased the average cost to conduct each proceeding.
                 Other implementations, such as providing automatic sur-replies and
                pre-hearing conferences, were made to help provide additional fairness
                and certainty to the parties and public while continuing the PTAB's
                practice of rendering high-quality decisions within the statutory time
                limits applicable to AIA trial proceedings; however, these changes,
                too, have increased the average cost of conducting each proceeding.
                 The post-institutional threshold for paying excess claim fees is
                increasing from 15 to 20 claims so as to match the PTAB's request
                threshold, reflecting the fact that, following the Supreme Court
                decision in SAS, the PTAB is required to institute all claims or none.
                The NPRM proposed fees based on the Office's best estimates at that
                time, taking into consideration the cost increases already experienced,
                plus future inflationary cost growth. Since then, the Office has
                collected and analyzed the additional cost data available through the
                end of FY 2019. In addition, the Office has taken into account
                uncertainties resulting from changes in the way in which AIA trials are
                conducted.
                 While the unit cost data (see Table 7) shows that post-institution
                costs have increased more than pre-institution costs, pre-institution
                costs have also increased. These costs have increased in response to
                the Supreme Court's SAS decision, as discussed above.
                 In addition, in response to feedback from stakeholders, the Office
                has modified its approach to concurrent petitions challenging the same
                patent or patents in the same family filed by the same petitioner.
                Specifically, the Board now considers whether to exercise its
                discretion to limit the number of these parallel petitions that may, if
                the threshold is met, be instituted. Similarly, the Board has
                undertaken a closer review of petitions to determine whether they raise
                issues that were considered by the examiner during ex parte prosecution
                or during other proceedings before the Office. To evaluate these
                requests the Board must make close comparisons between the challenges
                to determine whether it should exercise its discretion and institute a
                trial. Such comparisons require analyzing the prior art cited in the
                petitions and evaluating the reasons given by the petitioners for
                filing additional petitions. As this development in AIA trial practice
                is relatively recent (within the last 12 months), the Office does not
                yet have an accurate model to predict how many requests it will receive
                and how much additional effort will be necessary to evaluate them. To
                account for these uncertainties, it is necessary to set the pre-
                institution fees for inter partes reviews at $19,000. This 23 percent
                increase is less than the 25 percent increase proposed in the NPRM but
                above the FY 2019 unit cost. The pre-institution fee is set at more
                than the FY 2019 unit cost to take into account the uncertainties
                outlined above that arose
                [[Page 46946]]
                in that year and are expected to continue in FY 2020 and beyond.
                 The post-institution fee is set to $22,500 for inter partes review,
                which is above the increase proposed in the NPRM but considerably lower
                than the FY 2019 actual unit cost. As a result of the SAS and Arthrex
                Inc. v. Smith & Nephew, Inc., 941 F.3d 1320 (Fed. Cir. 2019) decisions,
                there has been an increase in the number of remands to the PTAB, which
                has increased the post-institution amount of work and costs. At this
                time, it remains unclear whether the post-institution costs will remain
                at the current level or decrease after the SAS and Arthrex remands have
                been fully addressed. Accordingly, the post-institution fee is set
                above the proposed NPRM fee, which is above the pre-SAS FY 2017 unit
                costs but below the post-SAS FY 2019 unit costs. The Office continues
                to evaluate the data as it becomes available to better understand the
                long-term impact of SAS on post-institution costs.
                 Post-grant review and covered business method review fees will be
                maintained at the rates proposed in the NPRM, at $20,000 for pre-
                institution and $27,500 for post-institution. These fee rates are above
                the respective inter partes review fees, due to the additional work
                involved with post-grant and covered business method reviews, but below
                the FY 2019 actual unit costs for post-grant reviews and covered
                business method reviews due to uncertainties about future costs.
                Specifically, post-grant reviews and covered business method reviews
                may raise additional issues beyond those raised in inter partes
                reviews, such as patent eligibility, written description, enablement,
                indefiniteness, and public use. Further, given the additional issues
                that may be raised, post-grant reviews and covered business method
                reviews provide 33 percent higher word limits for petitions, patent
                owner responses, and preliminary responses. While the actual unit costs
                for post-grant and covered business method reviews have typically been
                higher than the unit costs for inter partes reviews for these reasons,
                it is harder to determine the precise cost of post-grant and covered
                business method reviews. Due to a relatively small number of trials
                (approximately 60 post-grant reviews or covered business method reviews
                annually), the data on actual unit costs can vary from year to year.
                Therefore, it is unclear whether the post-SAS costs will remain at the
                current levels. The Office will continue to evaluate data as it becomes
                available to better understand the long-term impact of SAS on post-
                grant review and covered business method review costs.
                 This rulemaking will help the PTAB continue to maintain the
                appropriate level of judicial and administrative resources to continue
                to provide high-quality and timely decisions for AIA trials.
                (2) New Fees
                (a) Non-DOCX Filing Surcharge Fee
                 Table 8--Non-DOCX Filing Surcharge Fee--Fee Changes and Unit Cost
                --------------------------------------------------------------------------------------------------------------------------------------------------------
                 Final rule Percentage
                 Current fees fees large Dollar change change large FY 2018 FY 2019
                 Fee description large (small) (small) large (small) (small) unit cost unit cost
                 [micro] entity [micro] entity [micro] entity [micro] entity
                --------------------------------------------------------------------------------------------------------------------------------------------------------
                Surcharge--non-DOCX filing...................................... New $400 +$400 n/a n/a n/a
                 ($200) (+$200) (n/a)
                 [$100] [+$100] [n/a]
                --------------------------------------------------------------------------------------------------------------------------------------------------------
                 The Office is implementing a new fee for utility non-provisional
                applications filed under 35 U.S.C. 111 and submitted in a format other
                than DOCX (structured text). This surcharge applies to filings that are
                submitted in an electronic document, such as a PDF, that is not saved
                in the DOCX format. It also applies to filings that are submitted non-
                electronically, in addition to the existing paper filing surcharge. The
                surcharge is being introduced for specifications, claims, and
                abstracts. The submission in DOCX format will facilitate improvements
                in the efficiency of patent operations. After careful consideration of
                public comments, the Office has decided to delay the implementation of
                the non-DOCX filing surcharge, and it will become effective on January
                1, 2022. Over the next several months, the Office will continue with
                its outreach efforts, addressing customer concerns and providing ample
                time for applicants to transition to this new process.
                 Using EFS-Web, anyone with a web-enabled computer can file patent
                applications and documents without downloading special software or
                changing document preparation tools and processes. Registering as an
                EFS-Web eFiler allows enhanced filing, follow-on processing, saved
                submissions, and more. EFS-Web registered eFilers have been able to
                file specification, abstract, and claims in DOCX for utility non-
                provisional filings since August 2017.
                 Launched in 2015, the eCommerce Modernization (eMod) Project aims
                to improve the electronic application process for patent applicants by
                modernizing the USPTO's filing and viewing systems. Recent improvements
                include implementing structured text functionalities. Structured text
                allows applicants to more easily submit their documents as text-based
                documents rather than having to create PDF documents. This streamlines
                the application and publication processes. The Office tested the
                capabilities of structured text within EFS-Web and PAIR with the eMod
                Text Pilot Program, which ran from August 2016 until September 2017.
                The pilot was successful, and many improvements were made based on
                feedback from applicants, including independent inventors, law firms,
                and corporations. Structured text features are now available to all
                EFS-Web-registered and Private PAIR users and give applicants the
                ability to file structured text via EFS-Web and access structured text
                submissions, structured text Office actions, and Extensible Markup
                Language (XML) downloads via Private PAIR. Additional information can
                be found in the associated DOCX quick start guide available on the
                USPTO website, https://www.uspto.gov/patents-application-process/checking-application-status/quick-start-guides. For more information on
                filing in DOCX, please visit https://www.uspto.gov/patent/docx.
                 To encourage the filing of more applications in structured text,
                the required fee surcharge applies to application filings that do not
                include the specification, claims, and abstract in DOCX format. This
                will accelerate the
                [[Page 46947]]
                adoption of DOCX to realize a variety of benefits. Both the USPTO and
                applicants will see increased efficiencies, over the lifetime of an
                application, from encouraging DOCX filings. Based on a USPTO survey,
                over 80 percent of applicants author their patent applications in DOCX
                in the normal course of business. Filing in structured text allows
                applicants to submit their specifications, claims, and abstracts in
                text-based format and eliminates the need to convert structured text
                into a PDF for filing. Applicants can access examiner Office actions in
                text-based format, which makes it easy to copy and paste when drafting
                responses. The availability of structured text also improves
                accessibility for sight-impaired customers who use screen reading
                technology.
                 DOCX filing provides opportunities to increase efficiency in the
                Office. It enables the development of software to provide automated
                initial reviews of applicant submissions to help reduce the effort
                required by the Office. The automated reviews can tell applicants up
                front if potential problems exist and allow them to make changes prior
                to or at the time of submission. This also improves validation based on
                content, such as claims validation for missing claim numbering or
                abstract validation for word count and paragraph count.
                 Increased DOCX filing will also lead to higher data quality by
                reducing system conversion errors. It provides a flexible format with
                no template constraints. It also improves data quality by supporting
                original formats for chemical formulas, mathematical equations, and
                tables. DOCX filing also improves document identification by automatic
                detection, allows for greater reuse of content, and provides improved
                searching for patent applications and submissions. The originally
                submitted structured text document is available in Private PAIR,
                allowing easy retrieval of original DOCX files.
                 Structured text usage also helps streamline the application process
                and provides benefits for the USPTO. The Office converts image-based
                filings (e.g., PDF documents) into text-based format for internal
                processing. Text-based filings will allow the Office to skip this time-
                consuming and costly step. Optical character recognition (OCR) of
                image-based filings costs the Office approximately $3.15 per new
                submission. In addition to the initial submission, the use of image-
                based PDFs incurs many costs over the lifetime of an application. There
                are large costs associated with the USPTO's systems and personnel--from
                pre-examination, examination, and publication--due to the need to apply
                OCR to convert image-based PDFs into structured text that can be
                leveraged by downstream systems. The surcharge is applied not only to
                account for these inefficiencies, but also to address rising expenses.
                Encouraging text-based filings will decrease the Office's costs. If, in
                the future, the program were extended to additional application
                documents besides specifications, claims, and abstracts, the potential
                savings could reach as much as $9.0 million annually.
                 XML generated from DOCX files complies with the international World
                Intellectual Property Office (WIPO) Standard ST.96 from intake through
                display and use in examination tools. Receiving filings through
                structured text makes documents automatically available to examiners in
                almost real-time. DOCX filing also improves examination consistency by
                using automated tools to analyze text, increases the accuracy of
                examiner formalities reviews and tools (i.e., claims tree generators
                and document comparison), and improves results in automated pre-search
                and future analytics (i.e., section 112(b) and (f) evaluations) by
                using text supplied by applicants. DOCX submission contributes to the
                USPTO's plan to begin the automation of publication processes, which
                will lead to large cost reductions in the production of patent
                artifacts (grants and pre-grant publications), and contributes to the
                USPTO's plan to begin the automation of processes to assist in
                formalities reviews, classification, and routing, which leads to
                improved patent quality, reduced pendency, and greater consistency.
                (b) Pro Hac Vice Fee
                 Table 9--Pro Hac Vice Fee--Fee Changes and Unit Cost
                --------------------------------------------------------------------------------------------------------------------------------------------------------
                 Percentage
                 Current fees Final rule fees Dollar change change large FY 2018 FY 2019
                 Fee description large (small) large (small) large (small) (small) [micro] unit cost unit cost
                 [micro] entity [micro] entity [micro] entity entity
                --------------------------------------------------------------------------------------------------------------------------------------------------------
                Fee for non-registered practitioners to appear before the New $250 +$250 n/a n/a n/a
                 Patent Trial and Appeal Board............................
                --------------------------------------------------------------------------------------------------------------------------------------------------------
                 In this Final Rule, the Office is implementing a fee to appear pro
                hac vice in an AIA trial proceeding. The non-registered practitioner
                fee is for each proceeding that a non-registered practitioner requests
                admission to practice. If a non-registered practitioner requests
                admission to multiple AIA trial proceedings, multiple requests and fees
                will be required, one for each proceeding. Once a request is granted,
                the counsel is admitted for the entire duration of a proceeding, which
                may extend for several years, (e.g., when an inter partes review
                proceeds to final written decision, and, after appeal to the Federal
                Circuit, is remanded back to the PTAB for further proceedings). By
                instituting the pro hac vice fee, the Office will be able to shift the
                cost of the service of processing these requests from the overall AIA
                trial fees to the requesting, non-USPTO registered counsel.
                (c) Annual Active Patent Practitioner Fee
                 In the NPRM, the USPTO proposed a new fee called the annual active
                patent practitioner fee, and an associated fee structure, under 37 CFR
                1.21 and 11.8, so that patent practitioners, who directly benefit from
                registration, would bear the costs associated with maintaining the
                integrity of their profession, including the costs of OED's register
                maintenance and disciplinary functions. The fee collections were
                proposed to shift the costs of the services OED provides patent
                practitioners in administering the disciplinary system and register
                maintenance from patent applicants and owners to the patent
                practitioners. The annual active patent practitioner fee was proposed
                to be $340, with a $100 annual fee discount for those who certified
                completion of a certain number of CLE. In addition, the Office proposed
                that registered practitioners who are endorsed on the register as
                voluntarily
                [[Page 46948]]
                inactive would be liable for a fee of $70 per year to cover OED's
                administrative costs in maintaining the register and updating their
                information. Finally, a new emeritus status was proposed for active
                patent practitioners who have been registered for ten or more years to
                elect emeritus status, subject to certain conditions.
                 However, during the public comment period, the USPTO received a
                number of comments expressing concerns over the proposed new fee.
                Having further considered the public feedback on this proposal, the
                USPTO has determined that it will not at this time implement the annual
                active patent practitioner fee, the proposed new voluntarily inactive
                fee, or the proposed emeritus status. The Office continues to recognize
                the value of CLE in maintaining and enhancing patent practitioners'
                legal skills. In addition, the Office recognizes that it is beneficial
                to provide information regarding a registered practitioner's CLE status
                to the public. Thus, while completion of CLE remains voluntary, the
                USPTO intends to recognize patent practitioners who certify completion
                of six hours of CLE in the preceding 24 months, including five hours of
                patent law and practice and one hour of ethics credit, in the online
                practitioner directory. In the near future, the USPTO intends to issue
                proposed CLE guidelines, with a request for public comment on them. It
                is anticipated that the proposed guidelines will address the types of
                CLE courses that may qualify for recognition and the form of
                recognition for patent practitioners who certify that they have
                completed the CLE.
                Registration Statement
                 Although the USPTO is not implementing the annual active patent
                practitioner fee in this Final Rule, the Office intends to communicate
                with practitioners on a periodic basis for register maintenance. Thus,
                biennially, registered practitioners, as well as individuals granted
                limited recognition under 37 CFR 11.9(b), will be required to file a
                registration statement with the OED director. Notice will be provided
                to patent practitioners at least 120 days in advance of the due date
                for the filing of the registration statement, electronically, through
                the USPTO's online system. The registration statement takes the place
                of the practitioner survey, which is administered on paper. The USPTO
                anticipates that patent practitioners will first be required to submit
                a registration statement in the spring of 2022. Registered
                practitioners will not be required to pay any fee at the time the
                registration statement is filed.
                 Failure to file the registration statement by the due date may
                result in the registered practitioner being subject to a delinquency
                fee and possible administrative suspension, as was the case for a
                patent practitioner who failed to respond to the practitioner survey.
                Specifically, if a registered practitioner, or a person granted limited
                recognition pursuant to 37 CFR 11.9(b), fails to file the registration
                statement by the due date, the OED director will publish and send a
                notice to the registered practitioner advising them of the failure to
                file the registration statement, the consequence of being
                administratively suspended, and the requirements for reinstatement. The
                notice will request filing of the registration statement within 60 days
                after the date of such notice.
                 If a patent practitioner fails to comply with the notice within the
                time allowed, the OED director will then publish and send to the
                practitioner a Rule to Show Cause why his or her registration or
                recognition should not be administratively suspended. The OED director
                shall file a copy of the Rule to Show Cause with the USPTO director.
                The practitioner will be given 30 days from the date of the Rule to
                Show Cause to file a response with the USPTO director. The response
                should address any factual and legal bases why the practitioner should
                not be administratively suspended. Within 10 days of receiving a copy
                of the response, the OED director may file a reply with the USPTO
                director. The USPTO director will enter an order either dismissing the
                Rule to Show Cause or administratively suspending the practitioner. The
                aforementioned is the same procedure currently used when a registered
                practitioner fails to timely respond to the practitioner survey.
                Reinstatement
                 The sections referring to reinstatement from administratively
                inactive status remain unchanged from the current regulations. The
                reinstatement sections relating to other statuses are set forth below.
                Administratively Suspended
                 Under this Final Rule (37 CFR 11.11(f)(1)), any registered
                practitioner, or person granted limited recognition, who has been
                administratively suspended for less than five years may be reinstated
                on the register provided the patent practitioner is not a party to a
                disciplinary proceeding. Thus, the Final Rule eliminates the
                requirement that a registered practitioner who is administratively
                suspended for more than two years (but less than five years) take and
                pass the registration examination in order to be reinstated. To apply
                for reinstatement, the practitioner will need to submit an application
                form supplied by the OED, demonstrate compliance with the provisions of
                Sec. 11.7(a)(2)(i), submit a declaration or affidavit attesting to the
                fact that the practitioner has read the most recent revisions of the
                patent laws and the rules of practice before the Office, and pay the
                fees set forth in Sec. 1.21(a)(9)(i) and (ii).
                 However, under this Final Rule, any administratively suspended
                registered practitioner or person granted limited recognition who seeks
                reinstatement more than five years after the effective date of
                administrative suspension, also shall be required to file a petition to
                the OED director requesting reinstatement and providing objective
                evidence that they continue to possess the necessary legal
                qualifications to render valuable service to patent applicants. The
                objective evidence may include taking and passing the registration
                examination.
                Resigned
                 Any registered practitioner who has been resigned for less than
                five years may be reinstated on the register provided the practitioner
                is not the subject of a disciplinary investigation or a party to a
                disciplinary proceeding. Thus, the Final Rule eliminates the
                requirement that a registered practitioner who was resigned for more
                than two years (but less than five years) take and pass the
                registration examination in order to be reinstated. To apply for
                reinstatement, the practitioner will need to submit an application form
                supplied by the OED, demonstrate compliance with the provisions of
                Sec. 11.7(a)(2)(i), submit a declaration or affidavit attesting to the
                fact that the practitioner has read the most recent revisions of the
                patent laws and the rules of practice before the Office, and pay the
                fees set forth in Sec. 1.21(a)(9)(i) and (ii).
                 However, under this Final Rule any registered practitioner who
                seeks reinstatement after having been in resigned status for five years
                or more also shall be required to file a petition to the OED director
                requesting reinstatement and providing objective evidence that they
                continue to possess the necessary legal qualifications to render
                valuable service to patent applicants. The objective evidence may
                include taking and passing the registration examination.
                [[Page 46949]]
                C. Discontinued Fees
                 This section describes fees that are being discontinued. The
                purpose of this action is to help streamline the patent fee schedule
                while also focusing USPTO workforce efforts on producing products that
                benefit the general public rather than producing outputs for individual
                customers.
                 Table 10--Discontinued Fees
                --------------------------------------------------------------------------------------------------------------------------------------------------------
                 Final rule Percentage
                 Current fees fees large Dollar change change large FY 2018 FY 2019
                 Fee description large (small) (small) large (small) (small) unit cost unit cost
                 [micro] entity [micro] entity [micro] entity [micro] entity
                --------------------------------------------------------------------------------------------------------------------------------------------------------
                Copy of Patent Technology Monitoring Team (PTMT) patent $50 Discontinued -$50 n/a n/a n/a
                 bibliographic extract and other DVD (optical disc) (currently
                 at Sec. 1.19(j)).............................................
                Copy of U.S. patent custom data extracts (currently at Sec. 100 Discontinued -$100 n/a n/a n/a
                 1.19(k)).......................................................
                Copy of selected technology reports, miscellaneous technology 30 Discontinued -30 n/a n/a n/a
                 areas (currently at Sec. 1.19(l))............................
                For USPTO-assisted recovery of ID or reset of password for the 70 Discontinued -70 n/a 15 18
                 Office of Enrollment and Discipline Information System
                 (currently at Sec. 1.21(a)(6)(i))............................
                --------------------------------------------------------------------------------------------------------------------------------------------------------
                 In January 2018, to comply with Executive Order 13681 (Improving
                the Security of Consumer Financial Transactions), select computer
                service fees were discontinued and the services made free. The three
                changes to the fees at 37 CFR 1.19 follow that trend. The service fees
                in Sec. 1.19 will be eliminated, and the Office will instead provide
                these services in a slightly modified form (i.e., electronic) for free.
                 The first fee being discontinued is the current 37 CFR 1.19(j) fee
                for a copy of the Patent Technology Monitoring Team (PTMT) patent
                bibliographic extract and other DVDs. PTMT patent bibliographic data is
                currently available online for free, curtailing the need for the USPTO
                to send out extracts on disc.
                 The second fee being discontinued is the current 37 CFR 1.19(k) fee
                for a copy of U.S. patent custom data extracts. With the elimination of
                this service fee, the USPTO will create the common customizations and
                release them online, free to the public, at the same time the data is
                released. Further customizations will be discontinued. Additionally,
                PatentsView (http://www.patentsview.org), while not an official USPTO
                data source, meets many of the needs of those requesting custom data
                extracts at no charge to the consumer.
                 The third fee being discontinued is the current 37 CFR 1.19(l) fee
                for a copy of selected technology reports in miscellaneous technology
                areas. Selected technology reports are currently available online for
                free, curtailing the need for the USPTO to send out paper copies of the
                reports.
                 Upon consideration of public comments, a fourth fee being
                discontinued is the fee for the USPTO-assisted recovery of ID or reset
                of password for the Office of Enrollment and Discipline Information
                System. This fee is being removed, as it is unnecessary.
                VI. Discussion of Comments
                Comments and Responses
                 The USPTO published a proposed rule on July 31, 2019, soliciting
                comments on the proposed fee schedule. In response, the USPTO received
                comments from four intellectual property organizations and 40
                individuals, attorneys, law firms, corporations, and other
                associations. These comments are posted on the USPTO's website at
                https://www.uspto.gov/FeeSettingAndAdjusting.
                 The summaries of comments and the Office's responses to the written
                comments follow.
                General Fee Setting Approach
                 Comment 1: One commenter stated support for the proposed patent fee
                schedule. The commenter noted that the USPTO must continue to focus on
                reducing pendency and backlogged applications. Increased fees result in
                increased revenues, which allow for additional examiners to be hired.
                The commenter expressed that an increase in funding for examining
                allows applications to be processed faster and reduces the current
                backlog. Further, the focus on increasing up-front fees allows the
                USPTO to collect fees for the most cost-intensive operations.
                 Response: The USPTO appreciates the feedback from the commenter and
                is committed to achieving the goals developed in consultation with the
                stakeholder community as set forth in the Strategic Plan. The USPTO has
                carefully considered the balance of front-end and back-end fees. In
                this Final Rule, the balance between front-end and back-end fees is not
                significantly impacted. However, as certain technology lifecycles grow
                shorter, it is important that the USPTO not rely too heavily on fees
                paid late in the life of a patent. Therefore, the Office is slightly
                rebalancing the fees to recover the initial search and examination
                costs earlier in the life of the patent.
                 Comment 2: Several commenters expressed support for the Office's
                work to ensure adequate funding. They are supportive of the goals of
                this fee setting, especially recovering aggregate estimated costs of
                patent operations and optimizing patent timeliness and quality.
                 Response: The USPTO appreciates the feedback from the commenter and
                is committed to pursuing the goals in the Strategic Plan in a fiscally
                responsible manner.
                 Comment 3: One commenter expressed support for the operating
                reserve, its goals, and the detailed supporting information contained
                in the NPRM.
                 Response: The USPTO appreciates the feedback from the commenter.
                The operating reserve is an important tool that helps mitigate
                financial and operational risks and facilitate execution of multi-year
                plans in order to achieve the goals set forth in the Strategic Plan.
                The operating reserve also allowed the USPTO to remain open
                [[Page 46950]]
                and operational during the 35-day lapse in appropriations during FY
                2019.
                 Comment 4: One commenter stated that the USPTO should continue to
                prioritize patent quality, and if fee increases are needed, the
                increased resources should be devoted to ensuring examiners receive the
                time and resources they need to assess each application and all the
                relevant prior art. The commenter noted it is important that patent
                policy be crafted to limit the possibility that low-quality patents get
                in the way of technical and economic progress.
                 Response: The Office's strategic goal to optimize patent quality
                and timeliness recognizes the importance of innovation as the
                foundation of American economic growth and competitiveness. Through
                this goal, the Office diligently works to balance timely examination
                with improvements in patent quality, particularly the reliability of
                issued patents. Based on assumptions and estimates found in the FY 2021
                Budget, the fee schedule in this Final Rule will recover the aggregate
                estimated costs of patent operations, including achieving the Office's
                strategic goals.
                 Comment 5: One commenter suggested that the Office consider phasing
                in fee increases to provide patentees adequate time to prepare for and
                adapt to the increased costs.
                 Response: The Office realizes that higher fees will affect budgets.
                In the same way, the USPTO is experiencing an increase in aggregate
                costs, and the fee increases are necessary in order to deliver on the
                priorities listed in the Strategic Plan. The Office notes the time
                frame associated with the fee setting process inherently provides for
                the phasing in of fee changes. For example, this fee setting process
                began with a proposal presented to the PPAC in August 2018, and the fee
                schedule in this Final Rule will not take effect until fall 2020, with
                the non-DOCX filing surcharge effective January 2022. As part of the
                fee setting process, the public had two opportunities to review and
                comment on the fee proposals. The public and PPAC feedback allowed the
                USPTO to refine the fee proposal in both the NPRM and this Final Rule.
                 Comment 6: One commenter noted stakeholder concerns about the
                increasing uncertainty of patent rights and encouraged the USPTO to
                carefully consider whether excessive fee increases might have the
                unintended consequence of discouraging filings.
                 Response: The Office appreciates the commenter's concern and
                carefully considered the fee schedule in this Final Rule. The Office
                undertook an elasticity analysis (i.e., an assessment of the degree to
                which changes in fee rates may affect demand for services) as part of
                this rulemaking, and a description of elasticity estimates can be found
                at https://www.uspto.gov/FeeSettingAndAdjusting.
                 Comment 7: One commenter expressed support for the reduction in
                fees based on organization size.
                 Response: The USPTO appreciates the feedback from the commenter and
                is committed to providing, as allowed by statute, fee reductions for
                small and micro entity innovators to facilitate access to the patent
                system.
                 Comment 8: Multiple commenters noted the need for the USPTO to
                consider smaller entities when raising fees. Some noted that fee
                increases are prohibitive for pro se inventors, small entities, and
                micro entities and feel they will be disproportionately affected by
                these fee increases.
                 Response: The USPTO appreciates the concern about increasing fees.
                For small businesses and individual filers, the fees for small and
                micro entity rates are tiered, with small entities at a 50 percent
                discount and micro entities receiving a 75 percent discount on the fees
                for filing, searching, examining, issuing, appealing, and maintaining
                patent applications and patents. Small or micro entity discounts are
                available for those who are eligible in 86 of the 125 large entity fee
                rates being set or adjusted in this Final Rule.
                 Comment 9: One commenter requested that the USPTO carefully
                consider whether further reductions in the fees are possible for small
                entities, and especially micro entities, while maintaining the
                legitimate goals articulated in the fee proposal. Similarly, another
                commenter suggested that, instead of increasing the fees, the USPTO
                could provide more financial assistance to individual inventors who can
                prove their individual inventor status.
                 Response: The Office does not have the legal authority to provide
                further reductions in the fees for small and micro entities or to
                provide direct financial assistance. However, the USPTO notes that
                under the fee structure included in this Final Rule, an indirect
                financial assistance to small and micro entities is provided in the
                form of subsidizing the cost of patent application prosecution. For
                example, the costs to the Office, from filing through issue, exceed the
                fees paid by a micro entity who maintains a patent through the full
                term. Further, small entity fees only cover the costs to the Office if
                a patent is maintained for the full term. Therefore, maintenance fees
                paid by large entity patentees and small entity patentees who maintain
                their patent for a full term are used in part to subsidize the filing,
                search, and examination costs for all applicants, including small and
                micro entities.
                 Comment 10: One commenter questioned what the Office could do to
                encourage greater participation by small and micro entities in
                obtaining and maintaining patents.
                 Response: Helping small businesses and independent inventors with
                limited resources is important to the USPTO. It has several free or
                reduced fee programs to assist independent inventors and small
                businesses in securing patent protection for their inventions, such as
                the Patent Pro Bono Program, Pro Se Assistance Program, and Law School
                Clinic Certification Program. More information on these programs can be
                found on the USPTO website:
                 https://www.uspto.gov/ProBonoPatents
                 https://www.uspto.gov/ProSePatents
                 https://www.uspto.gov/LawSchoolClinic
                 Another advantage that the USPTO offers for small and micro
                entities is reduced fees. An applicant who meets the micro entity
                requirements is eligible for a 75 percent reduction on most fees, and
                small entity status offers a 50 percent fee reduction.
                 Comment 11: One commenter stated that it is important to keep
                barriers to entry (fees) low enough that startups can obtain patents
                (e.g., application and examination fees), maintain them (e.g.,
                maintenance fees), and challenge others' low-quality patents that
                should not have been issued in the first place (e.g., AIA trial fees).
                The commenter stated it is essential for startups to be able to reap
                the benefits at each stage.
                 Response: The USPTO agrees that it is important to keep front-end
                fees low enough so as not to prevent entry into the patent system. The
                USPTO also designs the fee structure so that fees to obtain and
                maintain a granted patent increase only as the age of the patent
                increases to minimize the financial impact early in the life of a
                patent application or patent. In this Final Rule, the balance between
                front-end and back-end fees is not significantly impacted. The USPTO
                continues to set front-end fees below the cost to the Office to provide
                those services, in order to encourage innovation. While this Final Rule
                increases the issue and first stage maintenance fees, the fee schedule
                continues to maintain those fees below second stage maintenance fees
                and keeps the balance of front-end and back-end fees substantially the
                same. The
                [[Page 46951]]
                USPTO also maintains small and micro entity discounts for the fees for
                filing, searching, examining, issuing, appealing, and maintaining
                patent applications and patents.
                 Comment 12: One commenter suggested that the Office should reduce
                the cost of filing certain patent applications by allowing an applicant
                to defer payment of some fees without penalty.
                 Response: In the future, the USPTO may consider changes to the
                timing of fee payments for search and examination. Currently, however,
                except for provisional applications, each application for a patent
                requires the appropriate search and examination fees in addition to the
                patent application filing fees. Deferring payment of some fees would
                require a large enough operating reserve to sustain operations during
                the period in which fee collections would be lower due to the delayed
                payment of fees. The adjusted fee schedule set forth in this rulemaking
                will help replenish and grow the patent operating reserve to position
                the USPTO for future changes, such as those suggested by the commenter.
                 Comment 13: One commenter noted the USPTO's tendency to follow or
                align with patent practices in other countries, in fee structure and
                other aspects of the patent system. The commenter hopes the leaders and
                government agencies of our country are aware of the long-term
                consequences of the actions they take.
                 Response: The Office and the administration carefully analyze all
                policy decisions before implementation. This includes considering best
                practices of other countries' IP systems. When appropriate, the Office
                may implement practices similar to other national IP offices.
                 Changes to policies are considered after public comments have been
                reviewed and a cost-benefit analysis has been performed (Regulatory
                Impact Analysis). Enactment of policy change occurs if generally
                supported by public comment and the corresponding cost-benefit analysis
                displays a positive, long-term impact.
                Across-the-Board Adjustment to Patent Fees
                 Comment 14: One commenter stated the fee increase should only
                reflect a cost-of-living increase to keep pace with inflation.
                 Response: The USPTO appreciates the concern about rising fees and
                continuously evaluates its processes and costs to ensure the Office is
                achieving the optimal value from the resources used to carry out
                operations. Despite that, the USPTO must adjust fees to recover the
                aggregate estimated cost to the Office for processing, activities,
                services, and materials relating to patents, including cost-of-living
                increases and administrative costs of the Office with respect to such
                patent fees over a multi-year period.
                 Comment 15: One commenter expressed that the fee for the USPTO-
                assisted change of address should be eliminated.
                 Response: The USPTO would like to remind customers that they are
                able to perform this process online as a self-service option free of
                charge. The change of address fee is only charged if it is requested
                that the USPTO perform this task instead of the customer utilizing the
                self-service options. The USPTO is not targeting this fee for a
                specific increase. Instead, this fee is increasing as part of the group
                of fees subject to the 5 percent across-the-board adjustment to patent
                fees. This fee was set in a previous rulemaking, and that structure is
                not changed in this Final Rule.
                 Comment 16: One commenter expressed that the fee for the USPTO-
                assisted recovery of ID or reset of password should be eliminated.
                 Response: The fee for USPTO-assisted recovery of ID or reset of
                password for registered practitioners has been removed as unnecessary.
                 Comment 17: One commenter noted that the NPRM does not state a
                rationale for the second and subsequent RCE fee to be different than
                the RCE fee for a first request.
                 Response: The individual RCE fees were set at different amounts in
                a previous rulemaking, the January 2013 Final Rule (which set forth the
                rationale for the difference in those fees), and that structure is not
                changed in this Final Rule. The USPTO is not targeting these fees for a
                specific increase. Instead, the fees for RCEs--both for the first
                request and for second and subsequent requests--are being adjusted by
                the across-the-board adjustment to patent fees.
                 Comment 18: One commenter wrote that the increase in the second and
                subsequent RCE fee would hurt small entity applicants and small entity
                law firms. The Initial Regulatory Flexibility Analysis offered no
                explanation justifying that differential effect on small entities.
                 Response: The USPTO is not targeting the RCE fees for a specific
                increase. Instead, the fees for RCEs--both for the first request and
                for the second and subsequent requests--are being adjusted by the
                across-the-board adjustment to patent fees. The USPTO would like to
                note that small and micro entity applicants will continue to receive
                the small and micro entity discounts, which set the fee rates
                significantly below cost to examine second and subsequent RCE filings.
                Additionally, the Regulatory Flexibility Analysis analyzed applicants'
                sensitivity to changes in fee rates by entity size, including RCE fees
                for small entities. This impact is also included in the RIA completed
                for this rulemaking, which is available at https://www.uspto.gov/FeeSettingAndAdjusting.
                 Comment 19: One commenter stated that the methodology for
                calculating the unit cost for second and subsequent RCE filings is not
                in the Activity Based Information and Patent Fee Unit Expense
                Methodology document.
                 Response: The commenter can find this information in the ``Setting
                and Adjusting Patent Fees during Fiscal Year 2020--Activity Based
                Information and Patent Fee Unit Expense Methodology'' document, on page
                22, before Table 2. ``Similarly, the same incremental approach is used
                to determine the expense of the second and subsequent RCE. The two
                scenarios presented to determine incremental expense for the second RCE
                are slightly different than for the first RCE, but the same basic
                method applies. The scenarios are: (1) The expense of a single
                application that has already performed one RCE, and (2) the expense of
                a single application that has completed a second RCE. All other
                calculation methods remain the same.'' Additionally, the detail on the
                exact calculations for FYs 2016, 2017, and 2018 can be found on page 41
                of the ``USPTO Fee Unit Expense Calculation Detail'' document under the
                heading ``Latest patent fee setting information.'' Both documents can
                be found at https://www.uspto.gov/FeeSettingAndAdjusting.
                 Comment 20: One commenter suggested that the proposed fee for
                submission of an information disclosure statement (IDS) is too high and
                may discourage prompt disclosure of material references. The commenter
                suggested that if the fee is increased, the Office could consider a
                tiered rate structure with a discounted IDS fee for submitting an IDS
                with fewer than five or 10 references, or below a certain page count
                for non-patent literature.
                 Response: There is no fee for filing of an IDS if it is filed
                before the mailing of a first Office action. The USPTO is not targeting
                these fees for a specific increase. Instead, the fee for submission of
                an IDS is increasing as part of the group of fees subject to the 5
                percent across-the-board adjustment to patent fees that is being set to
                help the USPTO
                [[Page 46952]]
                keep pace with inflationary cost increases. The single IDS fee was set
                in a previous rulemaking, and that structure is not changed in this
                Final Rule. The USPTO will consider the commenter's suggestions for
                changes to the structure and fee amount for IDS fees for future fee
                adjustments.
                 Comment 21: One commenter suggested the proposed increase to the
                fee for extension of time for response within the first month is too
                high. The commenter stated the increased fee makes it more difficult
                for practitioners to provide a thorough response, especially for
                complex issues where input and review may be required from multiple
                inventors, licensees, and/or owners. The commenter indicated that the
                need for extensions of time may be outside of the applicant's control
                when extensions are required to maintain pendency after a response to a
                final Office action.
                 Response: The Office recognizes that there are instances in which
                an applicant would need to extend the time period for responding to an
                Office action. However, an applicant may file a first after final reply
                within two months of the final rejection to avoid some of the costs
                associated with maintaining pendency after a reply to a final Office
                action. The USPTO is not targeting these fees for a specific increase.
                Instead, all fees for extensions of time for response are being
                increased as part of the 5 percent across-the-board adjustment to
                patent fees that are being set to help USPTO keep the pace with
                inflationary cost increases. Differences in the rate of increase result
                from rounding (the rounding rules are discussed in Part V: Individual
                Fee Rationale, A. Across-the-Board Adjustment to Patent Fees).
                 Comment 22: One commenter suggested that increases in fees for
                extensions of time for response will fall disproportionately on small
                firms and solo practitioners. The commenter noted that fees for
                extensions of time for response beyond the third month are greater than
                the filing fees for a new application. The commenter believes that,
                with essentially no cost to the USPTO, this appears to be a penalty,
                not a reasonable fee increase.
                 Response: These fees were set in a previous rulemaking, and the
                structure is not changed in this Final Rule. The USPTO is not targeting
                these fees for a specific increase. Instead, the increase in fees for
                extensions of time for response is part of the across-the-board
                adjustment to patent fees that is being set to help the USPTO keep pace
                with inflationary cost increases. Extension of time fees are intended
                to encourage early submission of an applicant's response to facilitate
                compact prosecution.
                 Comment 23: One commenter stated that the increases in the notice
                of appeal fee and fee for forwarding an appeal in an application or ex
                parte reexamination proceeding to the Board should take into account
                the rate of reversal, in that the applicant should not bear the
                entirety of the cost of what could be interpreted as an error made by
                the Office.
                 Response: The Office appreciates the feedback. Regardless of the
                outcome, the cost to render a decision on the appeal remains the same.
                The Office has limited the increase in both the notice of appeal fee
                and the fee for forwarding an appeal in an application or ex parte
                reexamination proceeding to the Board to the 5 percent across-the-board
                adjustment to patent fees. As a matter of policy, the Office has set
                the combined notice of appeal and fee for forwarding an appeal in an
                application or ex parte reexamination proceeding to the Board to less
                than half of the unit cost for deciding an appeal.
                Targeted Fee Adjustments
                Maintenance Fee Surcharge
                 Comment 24: One commenter asked what information the USPTO had
                about the use of the maintenance fee grace period and the consequences.
                The commenter was concerned that higher fees could lead to greater
                conflict possibilities between clients and attorneys. A commenter
                suggested that the Office initiate procedures to notify patentees, by
                United States Postal Service (USPS) mail and email to all registered
                email addresses, of both the due date for the maintenance fees to be
                paid and entrance into the grace period.
                 Response: The USPTO continuously monitors maintenance fee payments,
                including payments made during the grace period. While over 95 percent
                of maintenance fee payments are made in the six-month payment window
                prior to the grace period, the Office does recognize that a patentee
                may need the additional six-month grace period to make a decision on
                renewing their patent rights. Therefore, the Office lowered the
                proposed maintenance surcharge fee to $500 for large entities in the
                NPRM, compared to the initial proposal of $1,000.
                 It is the responsibility of the patentee to ensure that maintenance
                fees are paid in a timely manner to prevent the expiration of a patent.
                Patentees are expected to maintain their own record and docketing
                systems. The Office does provide some notices as reminders that
                maintenance fees are due, but the notices, errors in the notices or in
                their delivery, or the lack or tardiness of notices in no way relieve a
                patentee from the responsibility to make timely payment of each
                maintenance fee to prevent the patent from expiring by operation of
                law. The notices provided by the Office are courtesies in nature and
                intended to aid patentees. The Office's provision of notices in no way
                shifts the burden of monitoring the time for paying maintenance fees on
                patents from the patentee to the Office.
                 Comment 25: One commenter stated that those who delay payment of a
                maintenance fee include small entities, micro entities, and independent
                inventors, for whom the payment of a maintenance fee is often a
                significant investment. Forcing such entities to pay a higher surcharge
                fee does not appear to be justified in this circumstance.
                 Response: The Office recognizes that the maintenance fee surcharge
                during the grace period affects small and micro entities as well as
                independent inventors. The Office lowered the proposed maintenance fee
                surcharge to $500 for large entities in the NPRM, compared to the
                USPTO's initial proposal to PPAC of $1,000. Additionally, small and
                micro entity discounts apply to the maintenance fee surcharge as well
                as to the maintenance fees themselves.
                 Comment 26: One commenter noted that no cost to the public of the
                six-month grace period was identified in the NPRM. Additionally, the
                commenter noted that a competitor would still need to wait until the
                expiration of the grace period to know that the maintenance fee has not
                been paid.
                 Response: This rulemaking does not modify the maintenance fee grace
                period, nor does it change the timeline for submitting maintenance fee
                payments. The rulemaking simply adjusts the surcharge fee for
                submitting a maintenance fee payment during the six-month grace period,
                which provides patentees the option for an additional six months to
                submit maintenance fee payments. It is not anticipated that this fee
                adjustment will have a significant impact on patentees, since more than
                95 percent of patent holders submit maintenance fee payments prior to
                the grace period. The impact of the fee adjustment to the maintenance
                fee grace period is included in the cost-benefit analysis provided in
                the RIA, available at https://www.uspto.gov/FeeSettingAndAdjusting. The
                Office cannot provide individuals legal advice on the status of a
                patent. The Office's provision of notices of maintenance fee payments
                in no way shifts the burden of
                [[Page 46953]]
                monitoring the time for paying maintenance fees on patents from the
                patentee or other relevant stakeholders to the Office.
                 Comment 27: One commenter wanted to know what other IP offices have
                late payment surcharges for maintenance fees, along with more
                information on those offices' maintenance/annuity schedules.
                 Response: The USPTO allows for payment of maintenance fees up to
                six months prior to the payment due date and up to six months after the
                due date (grace period) if accompanied with a surcharge. This practice
                is similar to other national or regional IP offices like the European
                Patent Office and the Japan Patent Office. Both of these offices impose
                a substantial surcharge for late payment of such fees, which, in the
                case of Japan, is a 100 percent surcharge for late payment.
                 Each national or regional IP office has its own maintenance/annuity
                schedule, which can be found on its website. Below are links to two of
                the national/regional IP offices' fee schedules, which include
                maintenance/annuity fees:
                European Patent Office:
                 Fee Schedule: https://my.epoline.org/portal/classic/epoline.Scheduleoffees
                 About Renewal Fees: https://www.epo.org/law-practice/legal-texts/html/guidelines/e/a_x_5_2_4.htm
                Japan Patent Office:
                 Fee Schedule: https://www.jpo.go.jp/e/system/process/tesuryo/hyou.html
                 About Renewal Fees: https://www.jpo.go.jp/e/faq/yokuaru/fees.html#anchor4-3
                 Comment 28: One commenter stated that charging surcharge fees for
                late payments on patent maintenance filings and encouraging earlier
                payment defies Congress. In the commenter's opinion, Congress
                determined that the public should have clear notice of the expiration
                of a patent on the 4th, 8th, and 12th anniversaries of it being issued.
                The commenter believed the USPTO's proposal suggests the public should
                know on the 3\1/2\, 7\1/2\, and 11\1/2\ anniversaries. The commenter
                suggested there is no statutory delegation noted by the USPTO of the
                authority to hold such an opinion, let alone act on it.
                 Response: The USPTO has specific statutory authority to charge fees
                under title 35 of the U.S.C. and the Trademark Act of 1946. The USPTO
                also has specific authority to set and adjust those fees as in the
                current rulemaking under section 10 of the AIA. This Final Rule does
                not modify the maintenance fee grace period, which is set in 35 U.S.C.
                41(b)(2), nor does it change the timeline for submitting maintenance
                fee payments. The rulemaking simply adjusts the surcharge fee for
                submitting a maintenance fee payment during the six-month grace period.
                The Office cannot provide legal advice to individuals on the status of
                a patent, but a higher surcharge may encourage more patent holders to
                pay maintenance fees before the grace period begins.
                Request for Expedited Examination of a Design Application Fee
                 Comment 29: Several commenters stated that the increase has not
                been adequately justified as based on the cost of recovery or value to
                the recipient, noting that while the fee had not increased since
                November 2000, an increase of 1.6 percent annually would only put the
                fee at $1,256 in 2021. They further stated that the NPRM only opaquely
                describes the Office's need without any calculation or demonstration of
                burden hours and threatens to close the program without the full
                increase, improperly discouraging applicant behavior. Commenters asked
                for further justification from the Office for the amount of the
                proposed increase. One commenter also suggested the Office may consider
                removing the requirement of a pre-examination search, which would help
                applicants by alleviating some of the financial burden associated with
                filing a request for expedited examination.
                 Response: The Office received numerous comments that the fee
                increase to $2,000 was too great and would deter applicants from using
                the service. These comments were considered, and in response, the
                Office has chosen not to implement the proposed fee of $2,000. Instead,
                the non-discounted fee for an application will be set at $1,600.
                Discounts for small and micro entities will continue to be available.
                 Applicants who wish to have the examination of their design
                applications expedited must file a request for expedited examination
                and comply with the other requirements set forth in 37 CFR 1.155. The
                Office notes that the unit cost presented for this service only
                accounts for the initial processing of the request and does not include
                additional resources expended. From the time a request for expedited
                examination is filed in a design application, the application is
                expedited at every touch point during its prosecution. This includes
                initial processing, deciding the request to expedite, search and
                examination, publication, and any appeal that may be taken to the
                Board. The pendency for these applications, from granting of the
                request to expedite until first Office action, is currently just over
                one month. Expediting each step of the process for these applications
                causes the Office to expend resources that increase its costs with
                respect to these applications. Further, the Office needs to account not
                only for the increase in costs over the past twenty years, but also the
                anticipated costs of providing this service into the future, even with
                maintaining the requirement for a pre-examination search. Accordingly,
                the Office determined that the fee for this service needs to be
                increased if the service is to be continued. The USPTO believes that
                this new fee amount, as well as the associated small and micro entity
                discounts, will provide the Office the ability to continue offering
                this service to applicants. Further, the Office notes this is an
                optional fee paid only by those who wish to receive the benefit of a
                faster decision on their application.
                 Comment 30: A few commenters noted that design applications are
                limited to a single claim, meaning the proposed increase would cause
                applicants to pay roughly twice as much to expedite the examination of
                four design patent claims as they would to expedite the examination of
                four utility patent claims.
                 Response: The Office acknowledges that design applications are
                limited to a single claim. The process of examining a design
                application differs from the process of examining a utility
                application. Based on the lifetime costs of expediting a design
                application, the Office has determined that the fee for this service
                needs to be increased if the service is to be continued. However, the
                Office has carefully considered all of the comments and, in response,
                has chosen not to implement the proposed fee of $2,000. Instead, the
                non-discounted fee for an application will be set at $1,600. The USPTO
                believes that this new fee amount, as well as the associated small and
                micro entity discounts, will provide the Office the ability to continue
                offering this service to applicants.
                 Comment 31: Multiple commenters stated that the proposed increase
                in the request for expedited examination of a design application fee
                would disproportionately harm individual inventors and small entities.
                 Response: The Office has carefully considered all of the comments
                and, in response, has chosen not to implement the proposed fee of
                $2,000. Instead, the non-discounted fee for an application will be set
                at $1,600. The Office will continue to offer the 50 percent small
                entity discount and the 75 percent
                [[Page 46954]]
                micro entity discount, which should not disproportionately harm
                individual inventors and small entities. The fees set in this Final
                Rule make the fee for small entities $800 and the fee for a micro
                entity $400. Further, the Office notes this is an optional fee paid
                only by those who wish to receive the benefit of a faster decision on
                their application.
                 Comment 32: A few commenters noted that the process to obtain
                design protection in the U.S. is significantly longer than in many
                countries. Not all applicants and circumstances can wait for the normal
                lengthy U.S. examination process to be completed. The Office should not
                impose further barriers to obtaining timely design protection for those
                applicants who may need it.
                 Response: The process to obtain a design patent in the U.S. takes
                longer than in some other countries because, unlike some other patent
                systems, the USPTO performs an examination for design patent
                applications. The Office agrees that expedited examination can be a
                benefit to applicants in numerous situations. As a result, the Office
                will continue to offer expedited examination for design applications.
                Additionally, the Office has chosen not to raise the fee for expedited
                examination of design applications to $2,000. Instead, the large entity
                fee for an application is being raised to only $1,600. The Office will
                continue to offer the 50 percent small entity discount and the 75
                percent micro entity discount.
                 Comment 33: One commenter noted that some industrial designs can be
                protected through copyright law but stated that designs that do not
                qualify for copyright protection should have an affordable expedited
                procedure to obtain IP rights. The commenter also noted that copyright
                law might not always be effective for protection of designs.
                 Response: An applicant should determine what forms of IP protection
                are appropriate for each design. For those inventions where an
                applicant has determined that design patent protection is warranted,
                the applicant may expedite the examination of an application, when
                needed, as the Office will continue to offer the service. Based on
                comments received, the Office has chosen not to raise the fee for
                expedited examination of design applications to $2,000. Instead, the
                large entity fee for an application is being raised to only $1,600. The
                Office will continue to offer a discount for small and micro entities.
                Utility and Reissue Issue and Maintenance Fees
                 Comment 34: One commenter noted that a stated rationale for the
                proposed substantial increases to issue and first stage maintenance
                fees is that ``technology lifecycles [have grown] shorter,'' and,
                therefore, ``It is important that the USPTO not rely too heavily on
                fees paid late in the life of a patent.'' The commenter argued that in
                many industries, including telecommunications and pharmaceuticals, this
                is not necessarily true. Therefore, the commenter did not believe that
                shifting the burden of fee increases to the issue and first maintenance
                fees is warranted.
                 Response: In accordance with the Agreement on Trade-Related Aspects
                of Intellectual Property Rights (TRIPS), the USPTO cannot differentiate
                IP policy by technology. Therefore, the Office must structure its fee
                schedule to align with the technology lifecycles of all industries and
                cannot establish different fee schedules for different technologies.
                 While many technologies have not experienced a change in their
                lifecycle, for others there have been significant changes.
                Additionally, the aggregate average patent lifecycle is impacted by
                changes in the composition of patents granted by the USPTO. To account
                for these changes, the USPTO is increasing the issue and first stage
                maintenance fees. There has not been an adjustment to these fees since
                2013.
                 Comment 35: One commenter noted that it is important to set fees so
                that, during the entire lifecycle of a patent, a patentee can pay fees
                at points in time where sufficient information is available to make an
                appropriate decision about the commercial merits of obtaining/
                maintaining a patent.
                 Response: The fees over the life of a patent begin low and then
                gradually increase. The USPTO carefully considered the balance of
                front-end and back-end fees. In this Final Rule, the balance between
                front-end and back-end fees is not significantly impacted. The Office
                is slightly rebalancing the back-end fees to recover the initial search
                and examination costs earlier in the life of the patent.
                AIA Trial Fees
                 Comment 36: Several commenters stated that the Office should finish
                collecting and analyzing costs before increasing the AIA trial request
                fee and the post-institution fee. One commenter indicated that pre-
                institution costs may decrease due to higher settlement rates and lower
                institution rates. Other commenters indicated that most of the
                additional work after SAS Institute Inc. v. Iancu, 138 S. Ct. 1348
                (2018) (SAS) occurs post-institution. Accordingly, the commenters
                propose that the increase should be limited to the post-institution
                fee.
                 Response: The USPTO is committed to maintaining the PTAB's ability
                to provide fair, timely, and high-quality decisions. The SAS decision
                significantly affected the operations of the PTAB by increasing the
                amount of time spent per case and, thereby, increasing costs in both
                pre- and post-institution stages. The NPRM proposed fees based on the
                Office's best estimates, taking into consideration the cost increases
                already experienced, plus future inflationary cost growth. Since then,
                the Office has collected and analyzed the additional cost data
                available through the end of FY 2019. In addition, the Office has taken
                into account uncertainties resulting from changes in the way in which
                AIA trials are conducted. These uncertainties are discussed further
                below.
                 While the unit cost data shows that post-institution costs have
                increased more than pre-institution costs, pre-institution costs have
                also increased. The Office has modified its pre-institution practice to
                take into account the Supreme Court's SAS decision. For example, prior
                to SAS, the PTAB did not always address all arguments at institution.
                Post-SAS, for purposes of deciding whether to institute trial on a
                petition, the Office has committed to provide details to the parties to
                the largest extent practicable, including responding to arguments in a
                patent owner's preliminary response that were not the basis for the
                decision whether or not to institute.
                 In addition, in response to requests from stakeholders, the Office
                has modified its approach to concurrent petitions challenging the same
                patent or patents in the same family filed by the same petitioner.
                Specifically, the Board now considers whether to exercise its
                discretion to limit the number of these parallel petitions that may, if
                the threshold is met, be instituted. Similarly, the Board has
                undertaken a closer review of petitions to determine whether they raise
                issues that were considered by the examiner during ex parte prosecution
                or during other proceedings before the Office. To evaluate these
                requests, the Board must make close comparisons between the challenges
                to determine whether the Board should exercise its discretion and
                institute a trial. Such comparisons require analyzing the prior art
                cited in the petitions and evaluating the reasons given by the
                petitioners for filing additional petitions. As this development in AIA
                trial practice is relatively recent (within the last 12 months), the
                Office does not yet have an
                [[Page 46955]]
                accurate model to predict how many requests it will receive and how
                much additional effort will be necessary to evaluate them. To account
                for these uncertainties, it is necessary to set the pre-institution
                fees for inter partes reviews at $19,000. This 23 percent increase is
                less than the 25 percent increase proposed in the NPRM but above the FY
                2019 unit cost. The pre-institution fee is set at more than the FY 2019
                unit cost to take into account the uncertainties outlined above that
                arose in that year and are expected to continue in FY 2020 and beyond.
                 The post-institution fee has been set at $22,500 for inter partes
                review, which is above the increase proposed in the NPRM but
                considerably lower than the FY 2019 actual unit cost. As a result of
                the SAS decision, there has been an increase in the number of remands
                to the PTAB, which has increased the post-institution amount of work
                and costs. At this time, it is unclear whether the post-institution
                costs will remain at the current level or will decrease after the SAS
                remands have been fully addressed. Accordingly, the post-institution
                fee is set above the proposed NPRM fee, which is above the pre-SAS FY
                2017 unit costs but below the post-SAS FY 2019 unit costs. The Office
                continues to evaluate the data as it becomes available to better
                understand the long-term impact of SAS on post-institution costs.
                 Post-grant review and covered business method review fees will be
                maintained at the rates proposed in the NPRM, at $20,000 for pre-
                institution and $27,500 for post-institution. These fee rates are above
                the respective inter partes review fees, due to the additional work
                involved with post-grant and covered business method reviews, but below
                the FY 2019 actual unit costs for post-grant reviews and covered
                business method reviews due to uncertainties about future costs.
                Specifically, post-grant reviews and covered business method reviews
                may raise additional issues beyond those raised in inter partes
                reviews, such as patent eligibility, written description, enablement,
                indefiniteness, and public use. Further, given the additional issues
                that may be raised, post-grant reviews and covered business method
                reviews provide 33 percent higher word limits for petitions and patent
                owner responses and preliminary responses. While the actual unit costs
                for post-grant and covered business method review have typically been
                higher than the unit costs for inter partes reviews for these reasons,
                it is harder to determine the precise cost of post-grant and covered
                business method reviews. Due to a relatively small number of trials
                (approximately 60 post-grant reviews or covered business method reviews
                annually), the data on actual unit costs can vary from year to year.
                Therefore, it remains unclear whether the post-SAS costs will remain at
                the current levels. The rates proposed in the NPRM will be implemented,
                and the Office will continue to evaluate data as it becomes available
                to better understand the long-term impact of SAS on post-grant review
                and covered business method review costs.
                 Comment 37: One commenter stated that the USPTO's elasticity data
                fails to capture whether small entities react differently than large
                entities to changes in the AIA trial fees. The commenter suggested the
                USPTO should study this before instituting a significant increase in
                fees.
                 Response: AIA trial fees are not subject to small or micro entity
                discounts under section 10(b) of the AIA. Therefore, reliable data is
                not available to properly measure the impact of changes to AIA trial
                fees on small or micro entities. However, the AIA trial proceedings
                have been popular with some stakeholders because they provide a less
                expensive and faster alternative to district court litigation. As a
                result, the PTAB workload has increased significantly since the
                institution of AIA trials. The increase in AIA trial proceeding fees
                will help the PTAB maintain the level of judicial, legal, and
                administrative staff necessary to sustain the quality and timeliness of
                PTAB decisions.
                 Comment 38: One commenter stated that, for AIA trial fees, the
                Office should consider a fee reduction or waiver for small and micro
                entities sued for infringement.
                 Response: Under section 10(b) of the AIA, the Office is permitted
                to reduce fees for small and micro entities in six categories:
                ``filing, searching, examining, issuing, appealing, and maintaining
                patent applications and patents.'' AIA trial fees do not fall into any
                of those categories. Therefore, absent a change in statutory authority,
                AIA trial fees are not eligible for discounts or for waiver.
                 Comment 39: Two commenters stated that the Office should reduce the
                excess claim threshold for an AIA trial request fee from 20 claims to
                between three and six claims, and also increase the excess claims fee.
                The commenters make similar proposals for post-institution AIA trial
                fees.
                 Response: The fee increases are based on cost data collected and
                analyzed using current excess claims thresholds. The Office does not
                have sufficient data to evaluate the effect of reducing the excess
                claim threshold and increasing the excess claims fee. Additionally, the
                current excess claims fee threshold of 20 for the AIA trial request fee
                is the same as the threshold for excess claims for patent applications.
                 Comment 40: One commenter indicated that the Office should raise
                fees significantly higher and charge more if the petitioner has not
                been sued.
                 Response: 35 U.S.C. 311(a) and 321(a) require fees for AIA trial
                proceedings be ``reasonable, considering the aggregate costs of the
                review.'' Raising fees significantly higher for petitioners that have
                not been sued has been considered but, bearing in mind the aggregate
                costs of the review, has not been deemed reasonable at this time.
                 Comment 41: One commenter indicated that raising fees runs counter
                to Congress's intent to make cost-efficient proceedings.
                 Response: 35 U.S.C. 311(a) and 321(a) indicate that fees for AIA
                trial proceedings are to be ``reasonable, considering the aggregate
                costs of the review.'' The Office is always looking for, and open to
                considering, ways to make AIA trial proceedings more cost-efficient.
                Non-DOCX Filing Surcharge Fee
                 Comment 42: Several commenters expressed the opinion that the
                Office's DOCX submission tools are not ready for implementation for a
                number of reasons. The DOCX submission process is only available for
                some submissions. The publicly available DOCX submission process is
                cumbersome. It is too soon to require a penalty (fee surcharge) of $400
                for non-DOCX submissions. Before such a large penalty is enacted for
                failure to use DOCX submissions, applicants must be granted more time
                to adapt their processes to take advantage of the new capability.
                Commenters suggested an alternative approach of permitting submission
                of both a record copy and a searchable copy of an application that
                would provide a viable mechanism to help applicants transition to these
                new capabilities without prematurely penalizing them, especially in
                situations where the available tools may not be ready or able to
                accommodate special cases involving complicated submissions.
                 Response: These comments were considered, and the Office has chosen
                to delay implementation of the non-DOCX filing surcharge until January
                1, 2022. Over the next several months, the Office will continue with
                its outreach efforts, addressing customer concerns and
                [[Page 46956]]
                providing ample time for applicants to transition to this new process.
                 Comment 43: One commenter questioned the statement made by the
                USPTO Acting Deputy Director in the September 2018 PPAC Fee Setting
                Hearing that ``fees for search and examination are set below cost,''
                and wondered whether this was true when considering the paper filing
                surcharge and proposed non-DOCX filing surcharge.
                 Response: Under the adjusted fee schedule, the combined fees for
                filing, search, and examination will continue to be below the cost to
                the Office to provide those services, even for filers who pay both the
                paper filing and non-DOCX surcharges. A large entity that pays both
                surcharges would pay $2,620 for filing, search, and examination. A
                small entity would pay $1,310, and a micro entity would pay $755. The
                cost to the USPTO to provide these services was a combined $4,970 in FY
                2018.
                 Comment 44: One commenter wrote that they understand that a non-
                DOCX surcharge cannot be applied to PCT filings because copies of the
                PCT publication automatically route into the U.S. national stage
                application in PDF form. However, the commenter stated that this
                highlights the unwarranted nature of the non-DOCX surcharge. If a
                relatively moderate increase in price for PCT national stage entry
                applications is believed to be fiscally sustainable within the proposed
                fee structure, then the same should be true of regular non-provisional
                application filings, and the imposition of a new non-DOCX filing
                surcharge fee for one and not the other is thus inconsistent.
                 Response: Processing DOCX in national stage applications presents
                additional challenges and burdens on the Office and applicants that are
                not encountered with a standard utility application. Further
                investigation is needed as to the possibility of alternative means for
                obtaining text data (i.e., via the International Bureau) that would not
                burden applicants. This is being considered for the future.
                 Comment 45: One commenter stated that filing in DOCX is a wonderful
                idea in theory, but says that bugs have not been worked out of the
                process. The commenter writes that EFS-Web should stop removing ``text
                ornaments.'' Until it stops doing this, and until a DOCX filing will
                reliably result in an identical PDF document, there should be no
                penalty for filing PDF specifications or other application elements.
                 Response: ``Text ornaments,'' or text decorations, may not be
                presented in a form that allows direct reproduction of readily legible
                copies. See CFR 1.52. Therefore, they will continue to be automatically
                removed, and a warning will be provided.
                 To date, the Office has not received notifications of any issues
                resulting from the filing of applications in DOCX format. If there is
                an instance in which an error occurs, the Electronic Business Center
                (EBC) should be contacted for investigation at 1-866-217-9197 (toll-
                free), 571-272-4100 (local), or [email protected]. The EBC is open from
                6:00 a.m. to 12:00 midnight ET, Monday through Friday.
                 Comment 46: Multiple commenters opposed the $400 surcharge for
                filing in non-DOCX format, suggesting it was unreasonable given the
                USPTO's own cost figures, to apply optical character recognition (OCR)
                to convert a patent application submitted in PDF format. One commenter
                stated that the proposed benefits do not appear to justify the costs of
                the rule, and there does not appear to have been consideration of
                approaches that reduce burdens and maintain flexibility and freedom of
                choice for the public.
                 Response: The use of image-based PDFs incurs many costs over the
                lifetime of an application. There are large costs associated with the
                USPTO's systems and personnel, from pre-examination, examination, and
                publication, due to the need to apply OCR to convert image-based PDFs
                into structured text that can be leveraged by downstream systems. The
                surcharge is applied not only to account for these inefficiencies, but
                also to address rising expenses.
                 As a part of the DOCX intake process, preliminary validation is
                performed on DOCX documents at the time of upload. The system
                immediately detects and supplies the applicant with useful error and
                warning messages, allowing for adjustments to patent applications
                earlier in the process. This saves time, reduces potential costs, and
                prevents delays in processing by minimizing notices of missing parts or
                incomplete applications from the Office of Patent Application
                Processing (OPAP).
                 As patent applications have become increasingly complicated, the
                non-DOCX surcharge is an effective measure to recover the cost of
                converting PDFs to text. The text is essential for efficient
                examination and maintaining the quality of patents issued. According to
                surveys conducted by the USPTO, the majority of applicants use word-
                processing software, such as Microsoft Office and LibreOffice, to
                author applications in DOCX format. These applicants will now be able
                to submit applications in this same format to the USPTO, therefore
                avoiding the new non-DOCX surcharge. Furthermore, the fee is reduced by
                50 percent for small entities and 75 percent for applicants that
                qualify as micro entities.
                 The Office recognizes the need for freedom of choice to file in
                different formats. Therefore, image-based PDFs will continue to be
                accepted for customers who opt to continue to file in that format.
                 Comment 47: Two commenters requested that the Office continue to
                accept PDF filings at no charge.
                 Response: The use of image-based PDFs incurs many costs over the
                lifetime of an application. Receiving most applications in DOCX format
                will provide savings across USPTO systems, enabling efficient
                examination. Rising expenses make it prohibitive for the USPTO to
                continue allowing PDF filings with no associated fee to cover the costs
                of creating structured text that can be leveraged by downstream
                systems.
                 Comment 48: Many commenters have suggested the USPTO should make a
                provision for the practitioner to be able to provide a PDF version of
                the patent application being filed, along with the DOCX file. The PDF
                version would serve as the controlling version in the event of any
                discrepancy in the USPTO's rendering of the DOCX file.
                 Response: Many applications are originally created in DOCX and
                subsequently converted to PDF by applicants prior to submission. An
                advantage of submitting in DOCX format directly is that submitted files
                from all applicants are validated and converted to PDF by USPTO systems
                in a consistent manner. This eliminates the unnecessary step for
                applicants to generate and attach their own PDF documents. The
                generated PDF is available pre-submission to provide the applicant an
                opportunity to review the document before selecting the submit button.
                 As a part of the DOCX intake process, preliminary validation is
                performed on DOCX documents at the time of upload. The system
                immediately detects and supplies the applicant with useful error and
                warning messages, allowing for adjustments to patent applications early
                in the process. This saves time, reduces potential costs, and prevents
                delays in processing by minimizing notices of missing parts or
                incomplete applications from the Office. Furthermore, the USPTO
                continuously performs rigorous testing to ensure that document
                integrity is preserved.
                 Comment 49: One commenter asked whether the surcharge would be
                waived if an applicant filed on paper because the electronic filing
                system was not
                [[Page 46957]]
                functioning and a DOCX version was later filed within a certain time
                period.
                 Response: The current policy regarding significant unplanned
                electronic business system outages is available at: https://www.federalregister.gov/documents/2018/08/30/2018-18897/filing-patent-applications-electronically-during-designated-significant-outages-of-the-united-states. The USPTO will post a notice on its website in the
                event of a designated significant unplanned electronic business system
                outage and indicate the dates during which the alternative electronic
                filing means are available due to such an outage. An application filed
                via the alternative electronic means during a designated significant
                unplanned electronic business system outage will be considered to have
                been filed by the USPTO's electronic filing system and thus will not
                incur the non-DOCX surcharge or the fee required by section 10(h) of
                the AIA for a patent application not filed by the USPTO's electronic
                filing system.
                 Comment 50: One commenter stated that PDF format is the best and
                safest format for ensuring that no text becomes garbled or otherwise
                corrupted by the USPTO system.
                 Response: There have been cases where an applicant submitted PDF
                documents that have been corrupted or garbled that were traced back to
                specific PDF creation software. By submitting in text format, the extra
                step to convert to a PDF copy is no longer necessary, which eliminates
                issues associated with that conversion process.
                 Another advantage of submitting in DOCX format directly is that
                submitted files from applicants are validated and converted to PDF by
                USPTO systems in a consistent manner. The USPTO continuously performs
                rigorous testing to ensure that document integrity is preserved.
                 Comment 51: One commenter wrote that PDF files are easier to manage
                when filing, are better for long-term archival use, can be generated in
                text-searchable form, will not require fragmented filings using both
                PDF and DOCX files, carry fewer concerns with respect to malware and
                viruses, and carry no licensing concerns. The commenter expressed that
                the DOCX file format is intended for facile editing and by design is
                not suited for archival purposes, will require fragmented filing with
                different file formats, will require archiving of files in multiple
                file formats, carries increased risk of malware and viruses, is no
                better than other editable file formats, and carries some uncertainty
                regarding licensing status.
                 Response: DOCX is a word-processing file format that is part of
                Office Open XML (OOXML), an XML-based open standard approved by the
                Ecma International[supreg] consortium and subsequently by the ISO/IEC
                joint technical committee.
                 For more information about the OOXML standard, please see:
                 ECMA-376 at http://www.ecma-international.org/publications/standards/Ecma-376.htm
                 ISO/IEC 29500 at https://www.iso.org/committee/45374/x/catalogue/
                 NIST votes for US. Approval of OOXML at https://www.nist.gov/news-events/news/2008/03/nist-votes-us-approval-modified-office-open-xml-standard
                 The USPTO conducted a yearlong study of the feasibility of
                processing text in PDF documents. The results showed that searchable
                text data is available in some PDFs, but the order and accuracy of the
                content could not be preserved. With DOCX, the Office is able to use
                the text directly and pass it on to USPTO downstream systems, which
                results in increased data accuracy and a more streamlined patent
                process.
                 PDFs are not immune to viruses or hidden malware. However, the
                USPTO filing system is equipped with malware and virus detection.
                 DOCX is supported by many popular word-processing applications,
                such as Microsoft Word, Google Docs, Pages, and LibreOffice.
                 Comment 52: One commenter asked if the USPTO has facts to support
                the statement that the DOCX to PDF conversion process will work
                flawlessly 100 percent of the time. If not, the commenter asserted that
                moving to DOCX is simply not justifiable from a technical perspective.
                 Response: By submitting in DOCX format directly to USPTO systems,
                submitted files from all applicants are validated and converted to PDF
                by USPTO systems in a consistent manner. The USPTO continuously
                performs rigorous testing to ensure that document integrity is
                preserved. To date, the Office has not received notifications of any
                issues resulting from the filing of applications in DOCX format. If
                there is an instance in which an error occurs, the EBC should be
                contacted for investigation at 1-866-217-9197 (toll-free), 571-272-4100
                (local), or [email protected]. The EBC is open from 6:00 a.m. to 12:00
                midnight ET, Monday through Friday.
                 Comment 53: One commenter asked about a situation in which the
                USPTO's rendering engine has changed the result relative to what the
                practitioner saw on a word processor. The commenter expressed concerns
                about how to rectify such a situation and stated that knowing that
                there is a problem and being able to fix the problem in a timely manner
                may be two completely different things.
                 Response: If there is an instance in which an error occurs, the EBC
                should be contacted for investigation at 1-866-217-9197 (toll-free),
                571-272-4100 (local), or [email protected]. The EBC is open from 6:00 a.m.
                to 12:00 midnight ET, Monday through Friday.
                 Comment 54: A few commenters noted that the USPTO places the
                responsibility on the practitioner to check the generated PDF for
                accuracy. One commenter wanted to confirm that the authoritative
                document will be the USPTO-generated PDF rather than the DOCX that was
                submitted. Another commenter felt that USPTO-generated PDFs remove the
                applicant's ability to control accuracy, and applicants who choose to
                guarantee accuracy by filing a self-generated PDF should not be
                penalized with increased fees.
                 Response: The authoritative document will be the PDF that the USPTO
                systems generate from the DOCX. The filer has always been responsible
                for the accuracy of the documents being submitted. According to surveys
                conducted by the USPTO, the majority of applicants use word-processing
                software, such as Microsoft Office and LibreOffice, which can produce a
                DOCX file.
                 Currently, most applicants convert their DOCX documents to PDF and
                review the PDF documents before submission. Allowing applicants the
                ability to upload the specification, claims, and abstract in DOCX
                format reduces the applicants' burden to convert the document to PDF.
                With this new and improved process, applicants have the ability to
                upload DOCX documents directly to the USPTO filing system, which will
                automatically generate PDF documents for the uploaded DOCX files. At
                this time, applicants are encouraged to review the PDF documents before
                submission. The step of applicants reviewing their self-generated PDF
                is being replaced with their review of the USPTO-generated PDF
                document. The amount of time required by an applicant to review the
                self-generated PDF is comparable to the time to review the USPTO-
                generated PDF.
                 As a part of the DOCX intake process, preliminary validation is
                performed on DOCX documents at the time of upload. The system
                immediately detects and supplies the applicant with useful error and
                warning messages, allowing for adjustments to patent applications early
                [[Page 46958]]
                in the process. This saves time, reduces potential costs, and prevents
                delays in processing by minimizing notices from the Office of missing
                parts or incomplete applications.
                 The USPTO continuously performs rigorous testing to ensure that
                document integrity is preserved. To date, the USPTO has not received
                notifications of any issues resulting from the filing of applications
                in DOCX format. If there is an instance in which an error occurs, the
                EBC should be contacted for investigation at 1-866-217-9197 (toll-
                free), 571-272-4100 (local), or [email protected]. The EBC is open from
                6:00 a.m. to 12:00 midnight ET, Monday through Friday.
                 Comment 55: One commenter wrote that instead of DOCX, applicants
                could upload most of their submissions as text-based PDFs. The
                commenter further stated that, currently, the USPTO's computer systems
                degrade files to flatten them to unstructured bitmaps. The commenter
                contends the problem is caused by the USPTO.
                 Response: The USPTO conducted a yearlong study of the feasibility
                of processing text in PDF documents. The results showed that searchable
                text data is available in some PDFs, but the order and accuracy of the
                content could not be preserved. With DOCX, the Office is able to use
                the text directly and pass it on to USPTO downstream systems, which
                results in increased data accuracy and a more streamlined patent
                process.
                 Comment 56: One commenter stated that for lengthy, complex
                specifications, the 60-minute timeout in EFS-Web would preclude
                effective review. In the case of a timeout, the subsequent re-
                submission would still require the filer to review the entire
                conversion result from the beginning.
                 Response: This concern can be mitigated by keeping a session
                active. The timeout process complies with National Institute of
                Standards and Technology (NIST) guidelines.
                 Comment 57: One commenter recommended that no surcharge would be
                due if a substitute specification is filed after payment of a surcharge
                for filing a non-DOCX specification, claims, and/or abstract. Further,
                the commenter recommended only charging this fee once per application
                to avoid burdening those individuals who are unable to file DOCX
                documents.
                 Response: Substitute specifications are considered follow-on
                documents to an existing application and would not be assessed the non-
                DOCX surcharge. There will only be one fee per application because the
                surcharge only applies to initial filings of the non-provisional
                utility application filed under 35 U.S.C. 111.
                 Comment 58: One commenter suggested that this surcharge be limited
                to filing of utility applications and not be extended to the filings of
                additional documents (e.g., responses, amendments, etc.) to avoid it
                unduly burdening small businesses and independent inventors by charging
                this surcharge every time a non-DOCX document is filed.
                 Response: At this time, the surcharge only applies to initial
                filings of the non-provisional utility application filed under 35
                U.S.C. 111.
                 Comment 59: Two commenters stated that there is no single DOCX
                standard to which Microsoft Word and the other word processors are all
                compliant.
                 Response: DOCX is a word-processing file format that is part of
                Office Open XML (OOXML), an XML-based open standard approved by the
                Ecma International[supreg] consortium and subsequently by the ISO/IEC
                joint technical committee.
                 For more information about the OOXML standard, please see:
                 ECMA-376 at http://www.ecma-international.org/publications/standards/Ecma-376.htm
                 ISO/IEC 29500 at https://www.iso.org/committee/45374/x/catalogue/
                 NIST votes for U.S. Approval of OOXML at https://www.nist.gov/news-events/news/2008/03/nist-votes-us-approval-modified-office-open-xml-standard
                 Comment 60: A few commenters were concerned that DOCX files that
                contain mathematical equations, chemical formulas, tables, or special
                fonts would get corrupted by the USPTO system.
                 Response: When a DOCX file is uploaded to the USPTO filing system,
                a PDF equivalent document is generated for applicant review. The USPTO
                performs continuous testing of DOCX format files, including sample
                files that include mathematical equations, chemical formulas, tables,
                and special fonts. The past results have shown no issues with the
                conversion of these data types. The Office is working on advanced
                solutions so that complicated structures in chemical and biochemical
                patent applications are properly captured in DOCX format.
                 After submission, applicants have the opportunity to download the
                associated XML of the submission document, which contains mathematical
                markup language (MathML) of the mathematical formulas and the content
                and structure of tables. The USPTO continuously performs rigorous
                testing to ensure that document integrity is preserved.
                 To date, the Office has not received notifications of any issues
                resulting from the filing of applications in DOCX format. If there is
                an instance in which the mathematical formulas or tables are corrupted
                in the DOCX and PDF generated by USPTO systems, the EBC should be
                contacted for investigation at 1-866-217-9197 (toll-free), 571-272-4100
                (local), or [email protected]. The EBC is open from 6:00 a.m. to 12:00
                midnight ET, Monday through Friday. The USPTO's DOCX support web page
                located at https://www.uspto.gov/patent/docx contains a complete list
                of approved fonts. If there is a font that is not supported, the EBC
                should be contacted. Pending thorough analysis of the proposed font, it
                may be added to the supported font list as allowable.
                 Comment 61: A few commenters suggested that requiring a
                subscription to Microsoft Word to produce DOCX files or payment of a
                significant surcharge would especially impact individual inventors and
                start-ups, who are the least able to afford it.
                 Response: Microsoft Word is not required to file in DOCX format.
                Listed below are word-processing applications that can be used to file
                in DOCX format.
                 Microsoft Word 2007 or higher
                 Google Docs
                 Office Online
                 LibreOffice
                 Pages for Mac
                 Comment 62: One commenter stated that the USPTO's current DOCX
                system breaks page numbering and other automatic formatting features
                provided by Word because it splits a single document into three
                documents: The specification, claims, and abstract. The commenter
                further stated that the shift from PDF to DOCX will affect applicants'
                recordkeeping requirements and costs. The commenter contends the
                USPTO's Paperwork Reduction Act of 1995 (PRA) analysis fails to
                consider this and similar costs.
                 Response: The USPTO considered the impact of the conversion to
                DOCX, including the aspects raised by the commenter. Applicants can
                submit one single DOCX document for the specification, including the
                written description, claims, and abstract. Alternatively, they can
                submit three separate DOCX documents (specification, claims, abstract).
                Regardless, this will not affect page numbering or recordkeeping.
                Therefore, the Office does not believe that this will increase the
                overall burden and/or costs to applicants.
                 Comment 63: One commenter wrote that in the NPRM, the USPTO claims
                that over 80 percent of applicants draft
                [[Page 46959]]
                their patent applications in DOCX. The commenter wishes to understand
                where this data originated and submits that this does not eliminate
                document integrity issues with the USPTO receiving DOCX filings
                properly.
                 Response: A survey was conducted by the USPTO to obtain this data.
                An advantage of submitting in DOCX format directly is that submitted
                files from all applicants are validated and converted to PDF by USPTO
                systems in a consistent manner. The USPTO continuously performs
                rigorous testing to ensure that document integrity is preserved.
                 Comment 64: One commenter stated that no reliable process exists in
                which errors introduced by EFS-Web in its rendering of DOCX files into
                PDF files may be corrected without being subject to the risk of
                rejection for new matter.
                 Response: Applicants are encouraged to review the PDF documents
                generated by the USPTO filing system before submission. The step of
                applicants reviewing their self-generated PDF is being replaced with
                their review of the USPTO-generated PDF document. The amount of time
                required by the applicant to review the self-generated PDF is
                comparable to the time to review the USPTO-generated PDF.
                 To date, the Office has not received notifications of any issues
                resulting from the filing of applications in DOCX format. If there is
                an instance in which an error occurs, the EBC should be contacted for
                investigation at 1-866-217-9197 (toll-free), 571-272-4100 (local), or
                [email protected]. The EBC is open from 6:00 a.m. to 12:00 midnight ET,
                Monday through Friday.
                 Comment 65: One commenter suggested that the USPTO could extract
                the convenience text from PDF documents, which, as in current practice,
                are uploaded by filers without penalty and are intended to be the
                ``official'' filing artifacts. Almost all PDF files directly produced
                from word-processing software contain extractable text. (The USPTO
                states in the NPRM that more than 80 percent of filings use DOCX
                authoring tools; it is reasonable to extrapolate that a high fraction
                of non-drawing PDF files uploaded to EFS-Web could be directly produced
                by word-processing software and could contain extractable text.) Many
                PDF files created by other means also contain extractable text.
                 Response: The USPTO conducted a yearlong study of the feasibility
                of processing text in PDF documents. The results showed that searchable
                text data is available in some PDFs, but the order and accuracy of the
                content could not be preserved. With DOCX, the Office is able to use
                the text directly and pass it on to USPTO downstream systems, which
                results in increased data accuracy and a more streamlined patent
                process.
                 Comment 66: One commenter suggested modifying the filing system so
                that if a DOCX document contains a discrepancy, it can be corrected
                after the filing date without losing priority to the filing date.
                 Response: The ability for correction after the filing date depends
                on whether it was an applicant error or Office error. If the applicant
                makes an error, there is the potential to lose priority to the filing
                date depending on the type of correction. For example, for applications
                filed on or after September 16, 2012, if there is a discrepancy between
                the information submitted in an application data sheet and the
                information submitted elsewhere in the application, the application
                data sheet will control except for the naming of inventors. The naming
                of the inventorship is governed by 37 CFR 1.41, and changes to
                inventorship or the names of inventors is governed by 37 CFR 1.48. In
                addition, for applications filed on or after September 16, 2012, the
                most recent application data sheet in compliance with 37 CFR 1.76 will
                govern with respect to foreign priority claims or domestic benefit
                claims. See 37 CFR 1.76(d) and MPEP Sec. 601.05(a). If it is the
                Office's error, applicants are encouraged to contact the Patent
                Electronic Business Center ([email protected]) or file a petition.
                 Comment 67: One commenter suggested that the Office should reduce
                fees for those who file an ISO 19005-1-compliant PDF/A document, which
                is fully text searchable and accessible. The commenter also suggested
                that the Office could further reduce fees for those who file a DOCX
                version of the application with a certification of its accuracy in
                addition to their own PDF. The supplemental DOCX file would provide the
                Office with the structured text without jeopardizing the official
                application filed in PDF.
                 Response: The USPTO conducted a yearlong study of the feasibility
                of processing text in PDF documents. The results showed that searchable
                text data is available in some PDFs, but the order and accuracy of the
                content could not be preserved. The USPTO has determined that increased
                data accuracy and a more streamlined patent process will result from
                DOCX submissions.
                 Comment 68: One commenter suggested that the USPTO reduce the
                surcharge to reflect the true cost to the Office of processing non-DOCX
                applications (the current cost of OCR of approximately $3.15 per new
                submission) or offer a rebate for applicants filing in DOCX.
                 Response: The cited cost only covers the initial OCR. The use of
                image-based PDFs incurs many costs over the lifetime of an application.
                There are large costs associated with the USPTO's systems and
                personnel, from pre-examination, examination, and publication, due to
                the need to apply OCR to convert image-based PDFs to structured text
                that can be leveraged by downstream systems. The surcharge is applied
                not only to account for these inefficiencies, but also to address
                rising expenses. Alternatively, to achieve these goals, the filing fee
                could be increased by $400 and a $400 rebate could be offered for
                filing in DOCX, but a lower filing fee with a non-DOCX surcharge makes
                the fee schedule more streamlined than a higher fee with a rebate.
                 Comment 69: Several commenters asked how the Office will handle
                metadata retention to assure applicants' interests will not be harmed.
                A commenter wanted to know whether metadata would be irretrievably
                removed upon filing or if the Office would maintain multiple versions
                of an application.
                 Response: Generally, applicants remove metadata from their
                applications prior to submission. However, if metadata is still
                contained in the document when uploaded, EFS-Web (and the next
                generation Patent Center tool) will automatically remove unnecessary
                document properties such as author, last modified by, etc. The only
                metadata that remains part of the document is the size, number of
                pages, and word count. The pre-scrubbed document will not be stored by
                the USPTO. Only submitted documents are stored in the USPTO repository.
                 Comment 70: One commenter was concerned that the process for
                submitting a DOCX file is uncertain and unclear. When the user uploads
                a DOCX file, the USPTO system runs it through a rendering engine to
                yield a PDF file. Further, while the DOCX web page indicates that the
                submission of a DOCX file generates a unique hash based on the content
                of the file to ensure that the DOCX file cannot be changed post-
                submission, there is no indication as to when and how this hash is
                checked to determine whether a document has been modified or whether it
                would matter if it had been modified, as the converted PDF document is
                the official record. Because the converted PDF document is the official
                record, it appears that any discrepancies discovered after submission
                cannot be corrected.
                [[Page 46960]]
                 Response: The message digest (hash) is generated to ensure non-
                repudiation of the DOCX. The benefit of this generated message digest
                to the applicant is that they can verify that the submitted DOCX is
                identical to the file in their records. Additionally, the applicant is
                given an opportunity to review the generated PDF to verify that it is
                accurate prior to submission. If there is an instance in which an error
                occurs, the EBC should be contacted for investigation at 1-866-217-9197
                (toll-free), 571-272-4100 (local), or [email protected]. The EBC is open
                from 6:00 a.m. to 12:00 midnight ET, Monday through Friday.
                 Comment 71: One commenter wanted the USPTO to consider the effects
                of breaking up sections of a single-source document (this is presently
                required of applicants who submit DOCX files, but the USPTO will do it
                in the future when it allows a single specification/claims/abstract
                file to be uploaded).
                 Response: The next generation Patent Center tool will be available
                to the public before the non-DOCX surcharge is implemented and will
                support the ability to upload a single file that contains all three
                application parts: Specification, claims, and abstract.
                 Comment 72: One commenter wrote that the USPTO stated
                ``Applications filed using DOCX will be more accessible in future
                searches of publication materials.'' The commenter wanted to know what
                this statement meant, relative to OCR.
                 Response: Structured text coming directly from DOCX submissions can
                be used for future initiatives to help streamline the patent process.
                The current publication process involves human intervention and text
                OCR'ed from images, which may contain errors. The goal is to leverage
                the structured text submitted by applicants, which will be more
                accurate than OCR'ed text, in downstream business processes.
                 Comment 73: One commenter asked if the non-DOCX filing surcharge
                will apply to divisional and continuation applications.
                 Response: Yes, the surcharge applies to divisional and continuation
                applications.
                 Comment 74: One commenter wanted to know if the non-DOCX surcharge
                fee can be avoided in continuing applications by ``filing by
                reference,'' as provided in MPEP 601.01(a)(III).
                 Response: No, the surcharge cannot be avoided by filing by
                reference in a continuing application.
                 Comment 75: One commenter asked if the surcharge will apply to PCT
                applications at national stage entry.
                 Response: No, the surcharge does not apply to a PCT application at
                national stage entry.
                 Comment 76: One commenter wanted to know if the surcharge applies
                to any other filings beyond filing the initial application (such as:
                Office action responses, preliminary amendments, a response with a
                replacement specification, etc.).
                 Response: No, the surcharge will not apply at this time.
                 Comment 77: One commenter questioned whether the surcharge will
                apply if, at filing, the applicant included both a DOCX and a PDF
                version of the application.
                 Response: Applicants should not file both the DOCX and a PDF
                version of the application, as this may delay the processing of their
                application. The copy of the specification not filed in DOCX would
                require the surcharge, as the entire application capable of being filed
                in DOCX was not filed in DOCX.
                 Comment 78: One commenter wanted to know whether the non-DOCX
                surcharge would be imposed in addition to the paper-filing surcharge
                for an application filed on paper.
                 Response: Yes, both surcharges would be imposed.
                 Comment 79: One commenter noted that plant patent applications have
                been required to be filed on paper and wondered whether the non-DOCX
                surcharge would apply to all plant patent applications.
                 Response: No, the non-DOCX filing surcharge would not apply to
                plant patent applications. At this time, the surcharge only applies to
                initial filings of non-provisional utility applications filed under 35
                U.S.C. 111.
                Pro Hac Vice
                 Comment 80: One commenter requested that the Office clarify the
                specifics of the fee to request pro hac vice admission in an AIA trial
                proceeding.
                 Response: The pro hac vice admission fee is per attorney, per AIA
                trial proceeding. Once the request is granted, the attorney is admitted
                for the entire duration of the AIA trial proceeding, which may extend
                for several years. Individuals not seeking to be recognized as an
                attorney of record in the AIA trial proceeding, such as expert
                witnesses, are not required to pay the fee.
                Annual Active Patent Practitioner Fee
                 Comment 81: Multiple commenters oppose any practitioner fee. Three
                of the commenters stated that the USPTO should be able to fund itself,
                including the costs of OED, with other revenue sources such as patent
                fees, and not practitioner fees. One of the commenters suggested that
                the USPTO cut costs elsewhere to compensate for the costs to be covered
                by the proposed annual active patent practitioner fee. One other
                commenter opposed funding OED through an annual active patent
                practitioner fee as established in the NPRM. Another commenter asserted
                that the justification provided for the fee is inadequate.
                 Response: The USPTO received a number of comments on the proposed
                annual active patent practitioner fee. As discussed above, having
                further considered the public feedback on this proposal, the USPTO has
                determined that it will not implement the proposed annual active patent
                practitioner fee at this time.
                 Comment 82: One commenter suggested the materials provided by the
                USPTO identify no statutory authorization. The commenter contended
                Sec. 41(d)(2)(A) permits the director to ``establish fees for all
                other processing, services, or materials,'' but the USPTO has failed to
                identify a specific ``processing, service, or material'' that is
                provided. The commenter also contended Sec. 2(a)(2)(D) authorizes the
                director to ``govern recognition and conduct of agents [and]
                attorneys,'' but no fee is authorized as part of Sec. 2(a)(2)(D).
                 Response: As noted in response to Comment 81 above, the USPTO has
                elected not to implement the proposed annual active patent practitioner
                fee at this time.
                 Comment 83: Two commenters wanted the USPTO to remove the annual
                active patent practitioner fee and CLE discount from the NPRM and to
                issue one or more separate NPRMs for any proposed annual active patent
                practitioner and CLE discount or requirement. A commenter argued that
                as a new fee, the newly proposed practitioner fee (and rules) likely
                must be implemented, if at all, only after issuing a Federal Register
                notice under the Administrative Procedures Act (APA).
                 Response: As noted in response to Comment 81 above, the USPTO has
                elected not to implement the proposed annual active patent practitioner
                fee at this time.
                 Comment 84: One commenter stated that section 3(b)(1) of Executive
                Order (E.O.) 12866 (Regulatory Planning and Review) requires that the
                USPTO ``identify the problem that it intends to address (including,
                where applicable, the failures of private markets or public
                institutions that warrant new agency action) as well as assess the
                significance of that problem.'' The commenter
                [[Page 46961]]
                further stated that the APA requires a statement of rationale at the
                proposal stage.
                 Response: As noted in response to Comment 81 above, the USPTO has
                elected not to implement the proposed annual active patent practitioner
                fee at this time.
                 Comment 85: One commenter stated that the annual active patent
                practitioner fee is not in compliance with E.O. 12866, in part, because
                the NPRM did not include an estimate of either costs or benefits of the
                intended regulation and thus no balancing against the status quo.
                Another commenter similarly stated that the USPTO has not quantified
                and monetized the benefits and costs and evaluated non-quantified and
                non-monetized benefits and costs as required by OMB Circular A-4.
                 Response: As noted in response to Comment 81 above, the USPTO has
                elected not to implement the proposed annual active patent practitioner
                fee at this time.
                 Comment 86: One commenter wrote that the USPTO must analyze costs
                for all patent agents and patent attorneys who do not have an existing
                CLE requirement that would overlap with any USPTO requirement.
                 Response: As noted in response to Comment 81 above, the USPTO has
                elected not to implement the proposed annual active patent practitioner
                fee at this time. Under this Final Rule, completion of CLE remains
                voluntary. However, the Final Rule provides that patent practitioners
                who have completed six credits of CLE within the preceding 24 months
                may certify such completion to the OED director. The USPTO intends to
                issue proposed CLE guidelines, with a request for public comment on the
                proposed guidelines.
                 Comment 87: One commenter claimed the Regulatory Flexibility
                Analysis must analyze the effect of the annual active patent
                practitioner fee on small entities because a great number of
                practitioners work for small entities.
                 Response: As noted in response to Comment 81 above, the USPTO has
                elected not to implement the proposed annual active patent practitioner
                fee at this time.
                 Comment 88: One commenter stated the USPTO must be able to certify
                that the annual active patent practitioner fee requirement is
                ``necessary for the proper performance of the functions of the
                agency.'' 44 U.S.C. 3506(c)(3)(A).
                 Response: As noted in response to Comment 81 above, the USPTO has
                elected not to implement the proposed annual active patent practitioner
                fee at this time.
                 Comment 89: One commenter stated that the USPTO must be able to
                certify that the annual active patent practitioner fee requirement is
                implemented in ways ``consistent and compatible, to the maximum extent
                practicable, with the existing reporting and recordkeeping practices of
                those who are to respond,'' including those attorneys in states that do
                not have existing CLE requirements, and for all agents.
                 Response: As noted in response to Comment 81 above, the USPTO has
                elected not to implement the proposed annual active patent practitioner
                fee at this time. Under the Final Rule, completion of CLE remains
                voluntary.
                 Comment 90: One commenter argued the statement in 84 FR 37422 at
                col. 1 that, ``The USPTO proposes to add paragraph (d) to Sec. 11.8 to
                establish a new fee to be paid annually by practitioners'' and the
                statement in E.O. 13771 certification, at 84 FR 37430 that states
                ``this proposed rule is expected to involve a transfer payment'' cannot
                both be true. The commenter contended the annual active patent
                practitioner fee does not fit any of the applicable definitions of
                ``transfer payment.''
                 Response: As noted in response to Comment 81 above, the USPTO has
                elected not to implement the proposed annual active patent practitioner
                fee at this time.
                 Comment 91: One commenter claimed the USPTO's proposed $100 annual
                fee discount, as well as recognition on OED's public practitioner
                search page for completed CLE, are encouragements that make the annual
                active patent practitioner fee an unconstitutional tax.
                 Response: As noted in response to Comment 81 above, the USPTO has
                elected not to implement the proposed annual active patent practitioner
                fee at this time. In addition, under the Final Rule, completion of CLE
                remains voluntary. However, practitioners may be recognized in the
                online practitioner directory if they certify completion of six credit
                hours of CLE (five in patent law and practice; one in legal ethics) in
                the preceding 24 months.
                 Comment 92: One commenter stated that the USPTO needs to account
                for the costs of reporting and recordkeeping and other compliance costs
                for the annual active patent practitioner fee under the PRA, including
                a discussion of the lowest burden alternative, and that the public
                benefit is in the same range. The commenter suggested that the annual
                fee must be the least costly way to achieve the benefit.
                 Response: As noted in response to Comment 81 above, the USPTO has
                elected not to implement the proposed annual active patent practitioner
                fee at this time.
                 Comment 93: One commenter stated that the USPTO does not specify in
                the NPRM what the ``qualitative benefits'' are for the annual active
                patent practitioner fee.
                 Response: As noted in response to Comment 81 above, the USPTO has
                elected not to implement the proposed annual active patent practitioner
                fee at this time.
                 Comment 94: A few commenters requested that the USPTO identify the
                statutory authority allowing for defraying the patent-related costs of
                operating OED by imposition of an annual active patent practitioner fee
                and also for the CLE requirement. One of the commenters stated that the
                NPRM is not explicit about the basis for setting the fee but that it is
                suggested that it is being set under the ``Other fees'' provisions of
                35 U.S.C. 41(d)(2)(A). The commenter requested the USPTO explain how
                the proposed fees involve a service to the person being charged the fee
                in accordance with 31 U.S.C. 9701 (specifying that user fees must be
                set based on ``the value of the service or thing to the recipient'').
                One of the commenters stated that section 10 of the AIA prohibits the
                creation of new fees, such as the annual active patent practitioner
                fee.
                 Response: As noted in response to Comment 81 above, the USPTO has
                elected not to implement the proposed annual active patent practitioner
                fee at this time. Under the Final Rule, completion of CLE remains
                voluntary.
                 Comment 95: One commenter requested that the Office consider
                approving USPTO CLE courses for on-duty training of patent examiners.
                Another two commenters requested that the Office consider making the
                USPTO CLE courses required for Office employees, including patent
                examiners. One of these commenters requested that the USPTO have
                employees pay an annual employee fee as a pilot program prior to
                instituting the Final Rule to at least partially fund the USPTO.
                 Response: Patent examiners receive extensive on-duty training for
                the performance of their official duties on a continual basis. Patent
                examiner training is specifically tailored to the requirements of the
                position and includes examiner guidance based on changes in the law and
                regulations. However, CLE courses offered by the USPTO are generally
                available to employees, just as they are available to other members of
                the public. The USPTO is not requiring that any member of the patent
                bar complete CLE and will not be requiring CLE of USPTO
                [[Page 46962]]
                employees who happen to be members of the patent bar.
                 Comment 96: One commenter suggested that the first three to five
                years of the annual active patent practitioner fee be waived to
                alleviate the cost burden for those who become registered patent
                practitioners before attending law school.
                 Response: As noted in response to Comment 81 above, the USPTO has
                elected not to implement the proposed annual active patent practitioner
                fee at this time.
                 Comment 97: A few commenters suggested that the annual active
                patent practitioner fee is a tax, specifically a tax on innovation. Two
                of these commenters and three other commenters stated the annual active
                patent practitioner fee would particularly affect smaller law firms or
                part-time practitioners who represent smaller entities and independent
                inventors. The commenters further asserted that if individuals are
                deterred from patent practice, some patent applicants may be priced out
                of legal services. It is postured that this would increase the volume
                of pro se filings, inefficiency, cost, and use of USPTO resources.
                 Response: As noted in response to Comment 81 above, the USPTO has
                elected not to implement the proposed annual active patent practitioner
                fee at this time.
                 Comment 98: One commenter suggested that the annual active patent
                practitioner fees will be siphoned off to Treasury funds,
                disincentivizing innovation by misallocating funds. Another two
                commenters questioned what the funds collected from the annual active
                patent practitioner fee would be used for. One of these commenters
                requested that the funds collected be used to fund pro se services.
                 Response: As noted in response to Comment 81 above, the USPTO has
                elected not to implement the proposed annual active patent practitioner
                fee at this time.
                 Comment 99: Two commenters stated that the new annual active patent
                practitioner rules seem to require unneeded CLE where state bar
                associations already provide ample training. One commenter inquired
                whether the CLE reporting period would align with the reporting periods
                used by state bars.
                 Response: As noted in response to Comment 81 above, the USPTO has
                elected not to implement the proposed annual active patent practitioner
                fee at this time. In addition, under the Final Rule, completion of CLE
                remains voluntary. However, patent practitioners who certify completion
                of six credit hours of CLE in the preceding 24 months, including five
                hours of patent law and practice and one hour of ethics, may be
                recognized in the online practitioner directory. Generally, the same
                types of courses and activities that qualify for CLE credit for a state
                bar will qualify for credit for purposes of the CLE recognition in the
                online practitioner directory, so long as it covers the appropriate
                topics. It is expected that these CLE reporting periods will not align
                with all state bar reporting periods, as they vary from state to state.
                Each CLE certification for the purposes of recognition in USPTO's
                online practitioner directory should be supported by the completion of
                different CLE courses. In other words, practitioners may not use the
                same courses to certify to the USPTO more than once that they have
                completed the six credits of CLE.
                 Comment 100: One commenter stated that there was no explanation in
                the NPRM for the: (1) Manner of collecting the payment for the annual
                active patent practitioner fee, (2) different classes of practitioners
                having different fee requirements, (3) penalties for non-compliance,
                and (4) options for reinstatement. Another commenter inquired as to the
                process for reinstatement.
                 Response: As noted in response to Comment 81 above, the USPTO has
                elected not to implement the proposed annual active patent practitioner
                fee at this time.
                 Comment 101: One commenter stated that once the annual active
                patent practitioner fee is imposed, the fee will be increased over
                time, which will change the dynamics of practicing in patent matters
                before the USPTO.
                 Response: As noted in response to Comment 81 above, the USPTO has
                elected not to implement the proposed annual active patent practitioner
                fee at this time.
                 Comment 102: One commenter stated that, regarding the annual active
                patent practitioner fee, taxpayers, not patent practitioners, should
                pay for the Patent Pro Bono Program because taxpayers benefit from the
                program. Additionally, the commenter stated that there are already pro
                bono programs operated by law schools and non-governmental
                organizations that address this need.
                 Response: As noted in response to Comment 81 above, the USPTO has
                elected not to implement the proposed annual active patent practitioner
                fee at this time.
                 Comment 103: A few commenters stated that, regarding the annual
                active patent practitioner fee, as attorneys, they already pay state
                bar dues and attend CLE, and the USPTO needs to account for those costs
                when charging the fee. One additional commenter stated that the USPTO
                must analyze costs for all patent attorneys who are admitted to the
                bars of any state that does not impose an existing CLE requirement that
                would overlap with any USPTO CLE requirement.
                 Response: As noted in response to Comment 81 above, the USPTO has
                elected not to implement the proposed annual active patent practitioner
                fee at this time. The Office appreciates that CLE is required by other
                state bar organizations. Under this Final Rule, completion of CLE
                remains voluntary, but in taking six hours of CLE, practitioners may be
                recognized in the online practitioner directory. Additionally,
                practitioners may avoid duplicate expenses, as some or all of the CLE
                courses attended by practitioners as required by their state bar
                membership may count toward the six hours of CLE necessary to qualify
                for the USPTO CLE recognition.
                 Comment 104: One commenter inquired about the implications of an
                administratively suspended or voluntarily suspended practitioner giving
                advice on a patent matter versus signing documents before the Office,
                and whether giving advice on a patent matter would be considered
                practice before the Office.
                 Response: As noted in response to Comment 81 above, the USPTO has
                elected not to implement the proposed annual active patent practitioner
                fee at this time. However, the Final Rule requires patent practitioners
                to biennially file a registration statement. If a patent practitioner
                fails to timely file a registration statement, the patent practitioner
                may be administratively suspended, as is the case for patent
                practitioners who fail to respond to the practitioner survey. 37 CFR
                11.5(b)(1) states, in part, that, ``Practice before the Office in
                patent matters includes, but is not limited to . . . consulting with or
                giving advice to a client in contemplation of filing a patent
                application or other document with the Office.'' Thus, practice before
                the Office is not limited to signing documents. An administratively
                suspended practitioner is under the disciplinary jurisdiction of the
                Office. See 37 CFR 11.19(a). Those who engage in the practice of patent
                law before the Office without being in active status may be engaging in
                the unauthorized practice of law and can be subject to discipline. See
                37 CFR 11.10, 11.11(a)(6), and 11.505. Under this Final Rule, there is
                no ``voluntarily
                [[Page 46963]]
                suspended'' status. Voluntary inactive status, which is currently
                governed by 37 CFR 11.11(d), is unchanged by this Final Rule.
                 Comment 105: Two commenters inquired if an administratively
                suspended or voluntarily suspended patent agent will lose attorney-
                client privilege due to their suspended status.
                 Response: Under this Final Rule, there is no voluntary suspended
                status. All practitioners, including suspended patent agents, must
                comply with the USPTO Rules of Professional Conduct, including those
                pertaining to confidentiality of information. See 37 CFR 11.106.
                Attorney-client privilege is an evidentiary rule regarding
                communications. See e.g., Fed. R. Evid. 501. The right to assert
                attorney-client privilege belongs to the client, and the privilege
                exists for the client's benefit. See e.g., Magnetar Techs. Corp. v. Six
                Flags Theme Park Inc., 886 F.Supp.2d 466 (D. Del. 2012). Patent agents
                are not attorneys in that they are not active members in good standing
                of the bar of the highest court of any state. See 37 CFR 11.1. The
                scope of the privilege as it applies to communications between clients
                and patent agents has been discussed or determined by some tribunals.
                See e.g., In re Queen's Univ. at Kingston, 820 F.3d 1287 (Fed. Cir.
                2016); In re Silver, 540 SW3d 530 (Tex. 2018); and Privilege for Patent
                Practitioners, 37 CFR 42.57. The scope of the privilege as it applies
                to communications between a client and an administratively suspended
                attorney, in general, is a matter of state law and has been addressed
                by some courts. See, e.g., Gucci America, Inc. v. Guess?, Inc., No. 09
                Civ. 4373, 2011 WL 9375 (S.D.N.Y. Jan. 3, 2011); Safety Mgmt. Sys. v.
                Safety Software Ltd., No. 10 Civ. 1593, 2011 WL 4898085 (S.D.N.Y. Oct.
                5, 2011); Restatement (Third) of the Law Governing Lawyers Sec. 72,
                cmt. e, reporter's note cmt. e (2000) (citing cases).
                 Comment 106: Two commenters stated that the statuses for patent
                practitioners discussed in the NPRM, including administratively
                suspended, suspended due to discipline, voluntary inactive, emeritus,
                and resigned, are too numerous and complex for section 10 of the AIA
                fee setting authority and should be implemented in a separate rule
                package because each status has separate fee and reinstatement
                requirements.
                 Response: No new statuses for patent practitioners are created by
                this Final Rule.
                 Comment 107: Two commenters inquired why someone would opt for
                voluntary suspension status over emeritus status, as there are no fees
                for emeritus status and reactivation is easier.
                 Response: As noted in response to Comment 81 above, the USPTO has
                elected not to implement the proposed annual active patent practitioner
                this fee. Accordingly, emeritus status has been eliminated from the
                Final Rule. Furthermore, no ``voluntary suspension status'' was
                proposed by the NPRM or included in the Final Rule.
                 Comment 108: One commenter inquired if the Office considered that
                an inadvertently administratively suspended attorney may need to report
                the suspension to their state bar.
                 Response: If a patent practitioner is a member of a state bar, it
                is expected that the practitioner comply with the USPTO Rules of
                Professional Conduct, as well as any applicable state ethics rules,
                which may include any applicable reporting requirements in state bar
                rules.
                 Comment 109: A few commenters stated that the CLE discount is not
                much of an incentive, given the cost of CLE programs, including out-of-
                pocket expenses and lost productivity, and it is likely that
                practitioners will choose not to make the certification and instead pay
                the undiscounted annual active patent practitioner fee. One commenter
                concluded that the discount therefore seems to be a tax. Another
                commenter stated that if the proposed discount and online recognition
                are meant to encourage CLE, then the proposal constitutes a tax that is
                being used to set policy.
                 Response: As noted in response to Comment 81 above, the USPTO has
                elected not to implement the proposed annual active patent practitioner
                fee at this time, and thus, there is no CLE discount in this Final
                Rule. Under this Final Rule, completion of CLE remains voluntary.
                However, this rule provides that practitioners may be recognized in the
                online practitioner directory for completing six credits of CLE in the
                preceding 24 months, including five credits in patent law and practice
                and one credit in ethics. CLE comports with the goal and spirit of 37
                CFR 11.101: The USPTO requires the practitioner to be competent in the
                legal, scientific, and technical knowledge and skills reasonably
                necessary for client representation. This rule also provides that
                practitioners may obtain up to two of the five credits in patent law
                and practice by completing patent pro bono work.
                 Comment 110: A few commenters stated that the annual active patent
                practitioner fee would disproportionately affect patent agents because
                they do not currently have a CLE requirement, and they would therefore
                incur an extra expense as compared to patent attorneys. Two of these
                commenters additionally stated that publication of the CLE
                certification status of practitioners by the OED director may be
                equivalent to a public shaming of those patent practitioners who do not
                have a state CLE requirement or who opt to pay the full fee, resulting
                in unfair prejudice toward those who do not certify completion of CLE
                and essentially making CLE mandatory.
                 Response: In this Final Rule, there is no active patent
                practitioner fee, and thus there is no CLE discount. In addition, under
                the Final Rule completion of CLE remains voluntary. Separately, this
                rule provides for publication of a patent practitioner's CLE
                certification status, which is intended to encourage patent
                practitioners to participate in CLE and provide information to the
                public regarding the patent practitioner's CLE status. The USPTO also
                intends to provide additional free CLE courses to patent practitioners,
                thus alleviating the financial burden of obtaining CLE credits.
                 Comment 111: Two commenters stated that unless the USPTO, in
                advance, actively commits resources to providing free, regular, and
                frequent qualifying CLE courses in the required areas, some
                practitioners, particularly solo practitioners and patent agents, will
                bear an additional financial burden or cost of doing business. One
                commenter requested that the Office explain how the USPTO will
                alleviate future CLE burden and cost.
                 Response: The USPTO intends to provide additional free CLE courses
                for patent practitioners.
                 Comment 112: One commenter inquired if, in determining a proper fee
                amount for the projected number of registered practitioners expected to
                pay each type of fee, factors such as the historical trends of active
                practitioner populations by registration year, including both estimated
                new practitioner registration as well as likely attrition rates from
                older subsets, were taken into consideration.
                 Response: As noted in response to Comment 81 above, the USPTO has
                elected not to implement the proposed annual active patent practitioner
                fee at this time.
                 Comment 113: One commenter stated that there is currently no
                mechanism for CLE to be recorded for non-attorney patent agents. This
                commenter inquired how patent agents would be able to avoid paying the
                full fee in the first year
                [[Page 46964]]
                without procedures or a mechanism established well in advance for
                patent agents to secure qualifying CLE credits. This commenter further
                inquired whether practitioners would be able to reference a training or
                workshop they attended even if they were not able to receive CLE
                credits at the time of participation.
                 Response: As noted in response to Comment 81 above, the USPTO has
                elected not to implement the proposed annual active patent practitioner
                fee at this time, thus, there is no CLE discount. However, patent
                practitioners who wish to receive recognition in the online
                practitioner directory for the completion of CLE are responsible for
                tracking their own CLE course attendance and credits, regardless of the
                method in which such credits are recorded (or not recorded) by a state
                bar or other organization. In order for the CLE credit to count toward
                recognition in the online practitioner directory, the credit must be
                acquired in the 24 months preceding the certification. The USPTO
                intends to coordinate the delivery of CLE programs, and make the
                completion of CLE--whether offered by the USPTO or third parties--as
                convenient as possible for practitioners to complete, while enhancing
                practitioner access to, and opportunities for, the training necessary
                to stay up-to-date with current ethics and patent law and practice.
                 Comment 114: One commenter inquired how practitioners will be able
                to determine, in advance, which third-party CLE programs will be
                adequate for meeting the CLE requirement.
                 Response: Under this Final Rule, the completion of CLE is
                voluntary. For patent practitioners who wish to complete CLE and obtain
                recognition in the online practitioner directory, the USPTO intends to
                coordinate the delivery of CLE programs, and make the completion of
                CLE--whether offered by the USPTO or third parties--as convenient as
                possible for practitioners to complete, while enhancing practitioner
                access to, and opportunities for, the training necessary to stay up-to-
                date with current ethics and patent law and practice. Additionally, in
                the near future, the USPTO intends to issue proposed CLE guidelines,
                with a request for public comment, as to the types of CLE programs,
                including those offered by third parties, which may qualify for the CLE
                certification and the form of recognition in the online practitioner
                directory.
                 Comment 115: One commenter inquired if practitioners will be
                required to submit formal documentation of their CLE training on an
                annual basis or if each practitioner would have to maintain their own
                CLE documentation records to certify they have completed the CLE.
                Another commenter requested clarification on the recordkeeping
                requirements for CLE, including what type of proof is sufficient to
                demonstrate CLE completion. Another commenter requested clarification
                on what CLE would be tracked and how long it would be tracked.
                 Response: In the near future, the USPTO intends to issue proposed
                CLE guidelines, with a request for public comment on the proposed
                guidelines. The proposed CLE guidelines will address recordkeeping
                standards for practitioners who wish to certify completion of CLE and
                obtain recognition in the online practitioner directory. In general, it
                is contemplated that the proposed CLE guidelines will provide that
                practitioners are to retain their own CLE documentation records for a
                period of time.
                 Comment 116: Two commenters stated that they are supportive of the
                notion to incentivize active practitioners to enhance and maintain
                their ongoing legal education awareness and skills by providing a $100
                discount for registered practitioners who certify completion of CLE.
                 Response: As noted in response to Comment 81 above, the USPTO has
                elected not to implement the proposed annual active patent practitioner
                fee at this time. Thus, there is no discount associated with the
                completion of CLE. However, the Office may recognize patent
                practitioners in the online practitioner directory if they have
                completed six credits of CLE in the preceding 24 months. The Office
                believes that this will similarly incentivize active patent
                practitioners to enhance and maintain their skills.
                 Comment 117: Two commenters inquired if the Office considered that
                imposing the annual active patent practitioner fee may result in an
                increase in practitioner malpractice premiums, especially if the USPTO
                does not actively notify practitioners of their due dates by both USPS
                mail and email. One of these commenters suggested that notification by
                mail alone may be insufficient, and the Office should encourage
                practitioners to register multiple mailing and email addresses with
                OED. One other commenter encouraged OED to use both practitioners'
                addresses in the register and those in other USPTO databases to send
                out notices regarding payment, deadlines, and non-payment. The same
                commenter requested that OED telephone practitioners regarding non-
                payment of the annual active patent practitioner fee.
                 Response: As noted in response to Comment 81 above, the USPTO has
                elected not to implement the active patent practitioner fee at this
                time. Under the Final Rule, patent practitioners are required to submit
                an electronic registration statement, which takes the place of the
                practitioner survey. Prior to this Final Rule, patent practitioners
                were subject to administrative suspension for failure to respond to the
                practitioner survey. Likewise, under the Final Rule, patent
                practitioners who fail to submit a registration statement are subject
                to administrative suspension. The Office intends to notify patent
                practitioners of the due date of the registration statement at least
                120 days before such date. Additionally, 37 CFR 11.11(a) requires
                practitioners to provide OED with at least one and up to three email
                addresses where the practitioner receives email. Patent practitioners
                are encouraged to make updates in a timely manner to and ensure the
                accuracy of their contact information in accordance with 37 CFR
                11.11(a) so that OED may timely communicate with practitioners
                regarding any applicable deadline.
                 Comment 118: Multiple commenters stated the annual active patent
                practitioner fee is too high. One commenter stated that the fee will
                deter some practitioners and add a barrier to entry. One commenter
                suggested setting the fee to the CLE discount level and providing a
                discount to solo practitioners, or patent practitioners employed by a
                small law firm, non-profit, and/or the government because, otherwise,
                payment of the fee may become prohibitively expensive. Another
                commenter stated that instead of providing the CLE discount, the Office
                should provide a discount to practitioners who provide pro bono
                services via the Patent Pro Bono Program. The commenter also stated
                that the annual active patent practitioner fee is substantially higher
                than some state bar fees. One of these commenters concluded the fee was
                too high to just cover administrative costs and aiding the pro bono
                programs. Additionally, the commenter would like the CLE discount to be
                greater than $100. The other commenter stated that most practitioners
                do not work in large city firms and therefore cannot afford the fee.
                Another commenter stated that the annual active patent practitioner fee
                should only be high enough to maintain the roster and should not be
                used to administer CLE, pro bono activities, or outreach, such as
                speaking engagements, as there are already
                [[Page 46965]]
                mandatory fee schedules in place (i.e., small entity and micro entity)
                to aid financially under-resourced inventors. Other commenters
                questioned whether the annual active patent practitioner fee should be
                used to fund activities outside of practitioner discipline.
                 Response: As noted in response to Comment 81 above, the USPTO has
                elected not to implement the proposed annual active patent practitioner
                fee at this time.
                 Comment 119: A few commenters stated that the annual active patent
                practitioner fee will be passed on as overhead to applicants and that
                it is illusory to suggest that applicants will not eventually bear the
                cost of the fees.
                 Response: As noted in response to Comment 81 above, the USPTO has
                elected not to implement the proposed annual active patent practitioner
                fee at this time.
                 Comment 120: One commenter suggested that there should be no
                ``voluntary inactive'' or ``emeritus'' status because it seems to
                indicate that the USPTO is encouraging inactivity of practitioners who
                should always have a professional obligation to remain apprised of the
                current rules, case law, and filing procedures.
                 Response: As noted in response to Comment 81 above, the USPTO has
                elected not to implement the proposed annual active patent practitioner
                fee at this time. As a result, the USPTO is not implementing the
                proposed emeritus status. Voluntary inactive status, which is currently
                available to practitioners pursuant to 37 CFR 11.11(d), is not altered
                by this Final Rule.
                 Comment 121: Multiple commenters opposed offering a discount on the
                annual active patent practitioner fee for completion of CLE. One of the
                commenters asserted that by doing so, the USPTO is implying that it is
                permissible not to take CLE, as long as the USPTO gets paid more money.
                Commenters stated that any CLE requirement should be decoupled from the
                annual active patent practitioner fee.
                 Response: This comment has been adopted in part. As noted in
                response to Comment 81 above, the USPTO has elected not to implement
                the proposed annual active patent practitioner fee at this time. Under
                this Final Rule, patent practitioners are not required to complete any
                CLE. However, patent practitioners may be able to obtain recognition in
                the online practitioner directory by certifying that they completed six
                credits of CLE within the 24 months prior to the certification
                (including five credits of patent-related CLE and one credit of ethics
                CLE). The Office believes that CLE serves to enhance patent
                practitioners' legal skills and encourages patent practitioners to
                enhance their knowledge in the areas of patent and ethics legal skills.
                Competency in these areas is expected pursuant to the USPTO Rules of
                Professional Conduct.
                 Comment 122: Two commenters questioned the value of CLE. One of
                these commenters questioned the statement, ``CLE serves to enhance
                practitioners' legal skills.'' 84 FR 37415. One of these commenters
                stated that the present burden on attorneys of complying with CLE
                requirements is already onerous.
                 Response: At least 46 states have implemented mandatory CLE for
                attorneys. Consistent with USPTO's past statements regarding the
                completion of CLE, the primary purposes of CLE are to ensure lawyer
                competence, maintain public confidence in the legal profession, and
                support the fair administration of justice. See 78 FR 20188; Report of
                the Standing Committee on Continuing Legal Education of the American
                Bar Association (February 2017); and ABA Model Rule on Continuing Legal
                Education, February 2017, ``Purpose.'' Recognition in the online
                practitioner directory will also serve to provide information to the
                public regarding a patent practitioner's CLE status. The USPTO intends
                to coordinate the delivery of CLE programs and make the completion of
                CLE--whether offered by the USPTO or third parties--as convenient as
                possible for patent practitioners to complete, while enhancing patent
                practitioner access to, and opportunities for, the training necessary
                to stay up-to-date with current ethics and patent law and practice.
                Thus, completion of CLE for state bar purposes may also satisfy the
                requirements to receive recognition in the online practitioner
                directory.
                 Comment 123: One commenter stated that the proposed practitioner
                fee is not in compliance with E.O. 12866, in part, because the NPRM did
                not include an estimate of either costs or benefits of the intended
                regulation and thus no balancing against the status quo.
                 Response: As noted in response to Comment 81 above, the USPTO has
                elected not to implement the proposed annual active patent practitioner
                fee at this time.
                 Comment 124: One commenter stated that the USPTO needs to account
                for the costs of reporting and recordkeeping and other compliance costs
                for the annual active patent practitioner fee under the PRA, including
                a discussion of the lowest burden alternative and that the public
                benefit is in the same range. The commenters suggested that the annual
                active patent practitioner fee must be the least costly way to achieve
                the stated benefit.
                 Response: As noted in response to Comment 81 above, the USPTO has
                elected not to implement the proposed annual active patent practitioner
                fee at this time.
                 Comment 125: One commenter stated that the USPTO must be able to
                certify that the annual active practitioner fee requirement is
                implemented in ways ``consistent and compatible, to the maximum extent
                practicable, with the existing reporting and recordkeeping practices of
                those who are to respond,'' including for those attorneys in states
                that do not have existing CLE requirements, and for all agents.
                 Response: As noted in response to Comment 81 above, the USPTO has
                elected not to implement the proposed annual active patent practitioner
                fee at this time. Additionally, under the Final Rule, patent
                practitioners are not required to complete CLE.
                 Comment 126: One commenter stated that, regarding the annual active
                patent practitioner fee, the USPTO has not quantified and monetized the
                benefits and costs and evaluated non-quantified and non-monetized
                benefits and costs as required by OMB Circular A-4.
                 Response: As noted in response to Comment 81 above, the USPTO has
                elected not to implement the proposed annual active patent practitioner
                fee at this time.
                 Comment 127: Two commenters stated that the USPTO does not need to
                engage in activities similar to state bars because either there is no
                similar activity at the USPTO, or such activities would be redundant
                with what is provided by state bars. Another commenter stated that
                state bar associations provide more distinct services to member
                attorneys than OED provides to patent practitioners.
                 Response: As noted in response to Comment 81 above, the USPTO has
                elected not to implement the proposed annual active patent practitioner
                fee at this time. However, the USPTO engages in activities that are of
                concern to its stakeholders, who include patent practitioners.
                Activities provided by state bars are generally provided to attorneys
                registered with the state bar or to the clients of such attorneys. Most
                state bars do not provide patent agents access to such activities, as
                they are not registered with state bars. Thus, USPTO activities
                governed by this Final Rule address, in part, a gap in services to
                practitioners and their clients. Additionally, the USPTO provides free
                patent legal training to practitioners, a
                [[Page 46966]]
                service that is distinct to patent practitioners.
                 Comment 128: Two commenters inquired whether the USPTO should
                impose surcharges for pro se applicants due to the cost of examining
                pro se applications.
                 Response: As noted in response to Comment 81 above, the USPTO has
                elected not to implement the proposed annual active patent practitioner
                fee at this time.
                 Comment 129: Two commenters stated that the USPTO has not provided
                an accounting of the costs of the services provided for by the proposed
                annual active patent practitioner fee and needs to do so. The commenter
                stated that without a detailed cost accounting, the annual active
                patent practitioner fee seems excessive to fund the current services
                provided by the OED, especially when considered as an increase to
                existing fees collected pursuant to 37 CFR 1.21(a)(1)-(10).
                 Response: As noted in response to Comment 81 above, the USPTO has
                elected not to implement the proposed annual active patent practitioner
                fee at this time.
                 Comment 130: Two commenters stated that OED has been in existence
                without the annual active patent practitioner fee and has never needed
                the annual active patent practitioner fee, unlike state bars, which are
                only funded by fee revenue from practicing attorneys. One of the
                commenters stated the USPTO must be able to certify that the
                requirement is ``necessary for the proper performance of the functions
                of the agency.'' 44 U.S.C. 3506(c)(3)(A). One of the commenters
                additionally stated that it is not a valid reason to impose the fee
                because other jurisdictions do so. One commenter requested that the
                USPTO provide a justification or reasoning for why establishing an
                annual active patent practitioner fee is being implemented now, when a
                similar proposal was made and not adopted in the 2000s.
                 Response: As noted in response to Comment 81 above, the USPTO has
                elected not to implement the proposed annual active patent practitioner
                fee at this time.
                 Comment 131: Two commenters stated that ensuring the accuracy of
                OED's records can be accomplished by a periodic registration
                requirement that does not require a fee, and OED already has the
                authority under 37 CFR 11.11 to conduct periodic surveys of registered
                practitioners, which would accomplish that goal.
                 Response: As noted in response to Comment 81 above, the USPTO has
                elected not to implement the proposed annual active patent practitioner
                fee at this time. The USPTO must maintain accurate records regarding
                the patent practitioners who practice before it for the benefit and
                protection of the public. Patent practitioners are required under 37
                CFR 11.11(a) to update their contact information within 30 days of the
                date such information changed; however, many fail to do so. This
                provision was in effect prior to this Final Rule and continues to be in
                effect. Patent practitioner surveys have been conducted in the past,
                and many patent practitioners have failed to respond at great expense
                to the public and the USPTO. Thus, under this Final Rule, OED will be
                able to maintain accurate records by having patent practitioners
                electronically submit registration statements on which practitioners
                will indicate whether they are currently in active status and list
                their current contact information.
                 Comment 132: One commenter requested that, regarding the CLE
                option, the Office state (1) whether the Office feels that there exist
                major deficiencies in the corpus of practitioners in its practice
                before the Office, (2) how CLE will solve these deficiencies, and (3)
                any other justification for requiring CLE.
                 Response: This Final Rule does not require practitioners to
                complete any CLE.
                 Comment 133: One commenter requested that the Office allow the
                requirement to take CLE to expire after one or two years if the
                benefits and goals of CLE are not attained.
                 Response: This Final Rule does not require patent practitioners to
                complete CLE courses. Thus, it is left up to the individual patent
                practitioner to evaluate the relative costs and benefits of taking CLE
                courses to improve his or her patent legal skills and/or obtain
                recognition in the online practitioner directory for completing CLE.
                 Comment 134: One commenter requested that the Office offer its own
                free CLE programs in an electronically accessible format, such as a
                web-based presentation, and ensure that such CLE programs complied with
                each state bar's CLE requirements (for those states requiring CLE).
                 Response: The Office currently offers free CLE programs that
                qualify for state bar credit in electronically accessible format. At
                present, they are available under the ``Learning and Resources'' tab on
                the uspto.gov web page. The Office will endeavor, where feasible, to
                structure programs that would meet both the requirements for USPTO CLE
                credit and the traditional requirements for CLE credit in other
                jurisdictions.
                 Comment 135: Two commenters requested that, prior to instituting
                the annual active patent practitioner fee and CLE option, the Office
                analyze the option under the PRA. The commenters specifically requested
                that the Office analyze the technical, administrative, and paperwork
                burden imposed, as well as the justifications for such burdens, and
                that the cost of the burdens would at least equal the benefits, and
                that the practitioner fee is the least costly way to achieve those
                benefits. Additionally, the commenters noted that the NPRM states that
                the information collection requirements were reviewed under OMB control
                nos. 0651-0012, 0651-0016, 0651-0020, 0651-0021, 0651-0031, 0651-0032,
                0651-0033, 0651-0059, 0651-0063, 0651-0064, 0651-0069, and 0651-0075,
                but none of these appear to relate to annual active patent practitioner
                fees or CLE requirements. One of the commenters stated that such
                collection requirements should be reviewed under 0651-0012, ``Admission
                to Practice and Roster of Registered Patent Attorneys and Agents.''
                 Response: As noted in response to Comment 81 above, the USPTO has
                elected not to implement the proposed annual active patent practitioner
                fee at this time.
                 Comment 136: One commenter inquired whether OED is prepared to
                qualify seminars in the same manner that state bar associations qualify
                seminars for both substantive and ethics-based CLE credits. The
                commenter inquired whether OED will submit the materials to all 50
                states and the District of Columbia for certification. One commenter
                inquired as to whether, like state bars, the Office intends to charge
                institutions for offering CLE programs that are in compliance with the
                expectations and requirements of the Office for CLE certification.
                 Response: In the near future, the USPTO intends to issue proposed
                CLE guidelines, with a request for public comments on them. It is
                anticipated that the proposed guidelines will address issues including
                qualification of CLE programs. However, the Office will endeavor, where
                feasible, to structure programs it provides in accordance with the
                traditional requirements for CLE credit in other jurisdictions.
                 Comment 137: A few commenters requested that the Office identify
                the statutory authority allowing for defraying the patent-related costs
                of operating OED by imposition of an annual active patent practitioner
                fee, and also for the CLE requirement. One of the commenters states
                that the NPRM is not explicit about the basis for setting the fee but
                that it is suggested that it is
                [[Page 46967]]
                being set under the ``Other fees'' provisions of 35 U.S.C. 41(d)(2)(A).
                The commenter requested the USPTO explain how the proposed fees involve
                a service to the person being charged the fee in accordance with 31
                U.S.C. 9701 (specifying that user fees must be set based on ``the value
                of the service or thing to the recipient''). One of the commenters
                stated that section 10 of the AIA prohibits the creation of new fees,
                such as the annual active patent practitioner fee. One of the
                commenters opined that the annual active patent practitioner fee and
                CLE rules are not in compliance with E.O. 13771 (Reducing Regulation
                and Controlling Regulatory Costs) (January 30, 2017). One of the other
                commenters opined that the Independent Offices Appropriations Act of
                1952 (IOAA) prohibits fees for general operating costs and that the
                annual active patent practitioner fee does not meet the qualifications
                for a ``transfer payment.''
                 Response: As noted in response to Comment 81 above, the USPTO has
                elected not to implement the proposed annual active patent practitioner
                fee at this time.
                 Comment 138: Two commenters requested clarification of the scope of
                acceptable patent and ethics CLE topics. One of these commenters
                inquired as to where CLE credit could be obtained, and the projected
                costs of attaining CLE credit. One commenter specifically inquired as
                to whether patent law and practice courses could include courses on
                estates and trusts, corporate regulation, and litigation-related
                topics, and whether ethics courses could include those related to
                substance abuse.
                 Response: In the near future, the USPTO intends to issue proposed
                CLE guidelines, along with a request for public comment on them. It is
                anticipated that the proposed guidelines will address the types of CLE
                courses that may qualify for recognition in the online practitioner
                directory. Generally, it is anticipated that a patent practitioner may
                obtain eligible patent CLE credit for courses or activities on any
                topic covered under 37 CFR 11.5(b)(1), including legal training which
                relates to: Preparation and prosecution of patent applications,
                patentability determinations and opinions, and drafting documents to be
                presented for any patent-related proceeding before the USPTO. Other
                topics that a practitioner may count toward the five patent CLE credits
                include PTAB proceedings and patent litigation. Any course or activity
                that is counted for ethics credit by any U.S. state or territorial bar,
                including those of which the practitioner is not a member, may be
                applied toward meeting the one hour of ethics CLE required for CLE
                recognition in the online practitioner directory.
                 Comment 139: One commenter requested clarification on whether CLE
                credit can be earned for giving presentations or writing an article or
                paper on CLE topics.
                 Response: In the near future, the USPTO intends to issue proposed
                CLE guidelines, along with a request for public comment on them. It is
                anticipated that the proposed guidelines will address the specific
                types of presentations or scholarly writing that may qualify for CLE
                credit that counts toward recognition in the online practitioner
                directory.
                 Comment 140: One commenter requested clarification on what is
                considered pro bono work for the purposes of CLE certification. The
                commenter additionally stated that pro bono service should not count
                towards any CLE requirement because the pro bono patent client, unlike
                other types of pro bono clients, is not facing an unaffordable
                hardship; rather, the client is seeking an alternate form of venture
                funding, and as a part of CLE, pro bono work does not enhance a
                practitioner's legal skills any more than work for hire. Another
                commenter stated that it is unclear how pro bono activities increase
                legal acumen in order for it to justify those activities counting as
                CLE credit in the CLE discount.
                 Response: The Final Rule provides that a registered practitioner or
                person granted limited recognition may earn up to two of the five hours
                of CLE in patent law and practice by participating in the USPTO Patent
                Pro Bono Program. For every three hours of pro bono service, a patent
                practitioner may earn one hour of CLE credit toward the five credits in
                patent law and practice required for recognition in the online
                practitioner directory. Section 32 of the AIA calls on the USPTO to
                work with and support IP law associations to establish pro bono
                programs. A pro bono patent client is generally not accepted into the
                Patent Pro Bono Program unless their gross household income is less
                than three times the federal poverty level guidelines. Moreover, the
                Patent Pro Bono Program provides valuable learning opportunities for
                less experienced and experienced practitioners alike by providing
                volunteers the ability to obtain practical patent prosecution
                experience representing under-resourced inventors who would otherwise
                be unable to prosecute their patent applications. In addition, working
                with patent pro bono clients provides an opportunity to gain experience
                with clients who are less sophisticated in patent practice and
                procedure than typical corporate clients. Under the Final Rule, taking
                CLE courses or performing pro bono services as a part of the Patent Pro
                Bono Program by patent practitioners is not required. Information
                regarding the Patent Pro Bono Program is accessible at www.uspto.gov/probonopatents.
                 Comment 141: Two commenters questioned whether the Office will
                audit practitioners for CLE compliance if they certify they have
                completed CLE and, if so, what the statute of limitations on the audit
                will be. One commenter opined that there is no limitation specified in
                the NPRM, so a practitioner presumably must keep CLE records
                indefinitely until retirement.
                 Response: The Office does not plan to audit practitioners who
                certify they have completed CLE. If, however, a registered
                practitioner's CLE compliance comes into question as part of a
                grievance or a disciplinary investigation, then that practitioner may
                be called upon to provide records of CLE completion. In the near
                future, the USPTO intends to issue proposed CLE guidelines, with a
                request for public comment on them. The proposed CLE guidelines will
                address recommended standards of recordkeeping for practitioners who
                wish to certify completion of CLE and obtain recognition in the online
                practitioner directory.
                 Comment 142: One commenter requested clarification on whether the
                annual active patent practitioner fee would be due on different dates
                for each practitioner or by one date for all practitioners.
                 Response: As noted in response to Comment 81 above, the USPTO has
                elected not to implement the proposed annual active patent practitioner
                fee at this time.
                 Comment 143: One commenter inquired whether the annual active
                patent practitioner fee could be paid and forms filled out by
                administrative assistants or if each attorney would have to complete
                some yet-to-be-designed electronic certification form.
                 Response: As noted in response to Comment 81 above, the USPTO has
                elected not to implement the proposed annual active patent practitioner
                fee at this time. Correspondence with the Office must comply with the
                requirements of 37 CFR 1.4.
                 Comment 144: One commenter inquired as to whether administratively
                suspended practitioners would be locked out of accessing their files in
                the PAIR system or in EFS-Web or both.
                [[Page 46968]]
                Commenters also inquired whether a response or application filed during
                a period of non-compliance would be invalid and, if so, whether there
                would be a mechanism for retroactively validating the documents to
                prevent unintentional abandonment of applications or whether the remedy
                would be to file an expensive request for revival of an unintentionally
                abandoned application. Additionally, commenters questioned how
                administrative suspension of a practitioner would affect clients'
                rights and whether prosecution by an inadvertently suspended
                practitioner would cause a patent resulting from that prosecution to be
                invalid or unenforceable. The commenter further stated that any such
                corrections would be administratively burdensome on the Office and the
                practitioner.
                 Response: Administratively suspended practitioners would not be
                able to access their USPTO online accounts and would be advised to
                contact OED to resolve the suspension. Thus, if administratively
                suspended, a practitioner would not be able to file documents
                electronically. Filing documents while administratively suspended may
                indicate the practitioner has engaged in the unauthorized practice of
                law. If an application were to go abandoned due to a practitioner's
                inability to file documents while administratively suspended, then
                revival of the application may be necessary under 37 CFR 1.137.
                Invalidity and unenforceability of patents are matters determined by
                tribunals in particular litigations.
                 Comment 145: One commenter inquired as to what metrics indicate
                that the annual active patent practitioner fee would improve patent
                quality. Another commenter suggested that the USPTO's resources would
                be better spent in the interest of the patent community on issues that
                the USPTO is in the best position to address, such as assuring patent
                quality. Another commenter suggested that by practitioners passing the
                fee onto applicants, some applicants may reduce their reliance on
                patent practitioners, resulting in a decrease in patent quality.
                 Response: As noted in response to Comment 81 above, the USPTO has
                elected not to implement the proposed annual active patent practitioner
                fee at this time.
                 Comment 146: One commenter requested an explanation of how the
                annual active patent practitioner fee was calculated.
                 Response: As noted in response to Comment 81 above, the USPTO has
                elected not to implement the proposed annual active patent practitioner
                fee at this time.
                 Comment 147: Two commenters opined that the proposed $70 fee
                charged of practitioners in voluntary inactive status is too high for
                maintaining a database and updating it once a year and that
                practitioners would not get a benefit equal to the fee. Two commenters
                do not support charging a voluntary inactive fee. One commenter stated
                that imposing an inactive patent practitioner fee is bad public policy
                because many semi-retired practitioners volunteer to mentor younger
                attorneys or to advise small businesses, and the fee would discourage
                semi-retired practitioners from staying active in the profession.
                 Response: As noted in response to Comment 81 above, the USPTO has
                elected not to implement the proposed annual active patent practitioner
                fee at this time. Accordingly, the USPTO also will not implement the
                proposed fee for patent practitioners in voluntary inactive status.
                 Comment 148: One commenter stated that the beneficiaries of the OED
                disciplinary system are the Office and patent applicants, not the
                registered practitioners.
                 Response: As noted in response to Comment 81 above, the USPTO has
                elected not to implement the proposed annual active patent practitioner
                fee at this time.
                 Comment 149: One commenter stated that the USPTO argued to be an
                exception to the requirements of 5 U.S.C. 500(e), not because of the
                need for a second disciplinary authority to regulate conduct, but by
                reasoning that the USPTO and patent applicants would be better served
                by placing additional skill requirements on patent practitioners. H.R.
                Rep. No. 1141, 89th Cong., 1st Sess. (1965), reprinted in 1965
                U.S.C.C.A.N. 4170, 4172-74, 4176-77, 4179; William H. Sager & Leslie S.
                Shapiro, Administrative Practice Before Federal Agencies, 4 U. Rich. L.
                Rev. 76, 82 (1969).
                 Response: Pursuant to 35 U.S.C. 2(b) and 35 U.S.C. 32, the Office
                has statutory authority to promulgate regulations governing the conduct
                of patent practitioners and suspend or exclude them for misconduct.
                 Comment 150: One commenter stated that trademark attorneys should
                pay the same annual active patent practitioner fee that patent
                practitioners are being asked to pay because OED administers
                disciplinary proceedings against trademark attorneys.
                 Response: As noted in response to Comment 81 above, the USPTO has
                elected not to implement the annual active patent practitioner fee at
                this time.
                 Comment 151: One commenter strongly supports an adequately and
                properly funded OED.
                 Response: The Office appreciates the comment. The patent fee
                adjustments in this Final Rule are intended to provide the Office with
                a sufficient amount of aggregate revenue to recover the aggregate cost
                of patent operations, including the costs of OED services related to
                patent matters.
                 Comment 152: One commenter stated that the annual active patent
                practitioner fee would provide increased funding to OED and would like
                to know what issues OED intends to address with the increased funding.
                The commenter also indicated that funding from the annual active patent
                practitioner fee should not be used to expand the role of OED per se to
                include any active investigation of practitioners that is not linked to
                a complaint or to a notification from a state bar association. The
                commenter also stated that since the annual active patent practitioner
                fee eliminates the need for the Office to perform surveys of
                practitioners, the cost of conducting the survey should be reflected as
                a savings to the Office and should be reflected in any cost accounting
                justifying the annual active patent practitioner fee.
                 Response: As noted in response to Comment 81 above, the USPTO has
                elected not to implement the annual active patent practitioner fee at
                this time.
                 Comment 153: One commenter inquired whether OED could recover some
                of its funding by increasing the fees it already charges instead of
                charging the annual active patent practitioner fee. The commenter gave
                examples of an application fee for admission to the examination for
                registration, a fee for administering the registration examination, and
                a fee for recognition or registration after disbarment or suspension on
                ethical grounds.
                 Response: As noted in response to Comment 81 above, the USPTO has
                elected not to implement the annual active patent practitioner fee at
                this time. In addition, the fees cited by the commenter are enrollment
                fees, which are only being adjusted by the approximately 5 percent
                across-the-board adjustment to patent fees. A larger targeted
                adjustment of enrollment fees went into effect in the January 2018
                Final Rule.
                 Comment 154: One commenter requested that the USPTO address the
                specific OED services and other services that will be funded by the
                annual active
                [[Page 46969]]
                patent practitioner fee and how the collected funds will be applied to
                those services.
                 Response: As noted in response to Comment 81 above, the USPTO has
                elected not to implement the annual active patent practitioner fee at
                this time.
                 Comment 155: One commenter stated that the Office estimates that
                the annual active patent practitioner fee will raise $10-$11 million
                per year and that this amount seems excessive to fund the patent-
                related services provided by the OED, especially when considered as an
                increase to the existing fees collected pursuant to 37 CFR 1.21(a)(1)-
                (10).
                 Response: As noted in response to Comment 81 above, the USPTO has
                elected not to implement the annual active patent practitioner fee at
                this time.
                 Comment 156: Two commenters requested details on the expenses for
                the Law School Clinic Certification Program and the Patent Pro Bono
                Program and on how the funds from the annual active patent practitioner
                fee will be applied to these expenses.
                 Response: As noted in response to Comment 81 above, the USPTO has
                elected not to implement the annual active patent practitioner fee at
                this time.
                 Comment 157: One commenter stated that funds collected from the
                annual active patent practitioner fee will be used both for existing
                OED programs and to implement new programs and inquired to what extent
                would the expense of administrating the annual active patent
                practitioner fee take resources away from other programs.
                 Response: As noted in response to Comment 81 above, the USPTO has
                elected not to implement the annual active patent practitioner fee at
                this time.
                 Comment 158: Two commenters welcomed the provision in the NPRM that
                states that only practitioners who have been resigned for more than two
                years would need to retake the registration exam.
                 Response: As noted in the comment, the Final Rule eliminates the
                requirement that a registered practitioner who is administratively
                suspended for more than two years take and pass the registration
                examination in order to be reinstated. Under the Final Rule, resigned
                practitioners will only have to retake and pass the registration
                examination if they have been resigned for more than five years and
                cannot provide other objective evidence that they continue to possess
                the necessary legal qualifications to render valuable service to patent
                applicants.
                 Comment 159: One commenter stated that many practitioners will
                forego the CLE discount in order to avoid determining how to comply and
                document CLE compliance.
                 Response: As noted in response to Comment 81 above, the USPTO has
                elected not to implement the annual active patent practitioner fee at
                this time and thus, there is no CLE discount in this Final Rule.
                 Comment 160: One commenter questioned what the consequences would
                be for a CLE certification that does not meet OED's standards and how
                disagreements regarding the challenged certification would be resolved.
                 Response: Practitioners will self-certify their completion of six
                credits of CLE, including five credits of CLE in patent law and
                practice and one credit of CLE in ethics. In the near future, the
                Office plans to issue proposed CLE guidelines, with a request for
                public comment on them that will address what types of CLE may qualify
                for CLE recognition. OED does not intend to audit practitioners who
                certify completion of CLE or review whether courses completed by a
                practitioner who certified completion of CLE in fact qualify for the
                certification. It is anticipated that such review would only take place
                for cases in which OED receives a grievance alleging that a patent
                practitioner falsely or fraudulently certified completion of CLE or
                where the submission was obviously noncompliant. Registered patent
                practitioners and those granted limited recognition to practice before
                the Office in patent matters are subject to the USPTO Rules of
                Professional Conduct, including 37 CFR 11.804(c), which prohibits
                conduct that involves dishonesty, fraud, deceit, or misrepresentation.
                 Comment 161: One commenter questioned what effect an invalid CLE
                certification would have on patent validity or enforceability.
                 Response: It appears that the comment anticipates a scenario in
                which a patent practitioner claims the CLE credit but is subsequently
                found not to have satisfied the requirements for claiming the credit.
                Under the Final Rule, a practitioner may certify completion of CLE in
                order to obtain recognition in the online patent practitioner
                directory. No administrative suspension would result from an
                ``invalid'' or mistaken CLE certification. Thus, it is not anticipated
                that an ``invalid'' or mistaken CLE certification would affect patent
                validity or enforceability.
                 Comment 162: One commenter inquired how the regulatory and
                compliance costs of the CLE discount will affect the annual active
                patent practitioner fee. One commenter was concerned that the Office
                will use oversight of the CLE certification as justification for the
                annual active patent practitioner fee and any future increases thereto.
                 Response: As noted in response to Comment 81 above, the USPTO has
                elected not to implement the annual active patent practitioner fee at
                this time.
                 Comment 163: One commenter is concerned that the Office's proposed
                model of three hours of pro bono service to obtain one hour of CLE
                credit does not sufficiently reflect the importance and value of pro
                bono service and recommends providing one hour of CLE credit for each
                hour of pro bono service in the USPTO Patent Pro Bono Program.
                 Response: This comment has not been adopted. According to the
                Standing Committee on Pro Bono & Public Service of the American Bar
                Association, of the states that offer CLE credit for pro bono service,
                the most common rate that is used for earning such credits is five
                hours of service for each CLE credit. No state offers one hour of CLE
                credit for each hour of pro bono service. Thus, one hour of CLE credit
                for every three hours of pro bono service is generally above the amount
                of CLE credit that states offer for pro bono service. In the near
                future, the USPTO intends to issue proposed CLE guidelines, with a
                request for public comments on them.
                 Comment 164: One commenter stated that requiring a practitioner to
                retake the registration examination for failure to update their
                information with OED is equivalent to the penalty of disbarment and
                therefore grossly disproportionate to the offense. Instead, the
                commenter requests that the penalty for failing to update contact
                information be an extra charge to reinstate, based on the back fees
                missed and extra administration costs incurred.
                 Response: Administratively suspended practitioners will only have
                to retake the examination if they have been suspended for more than
                five years and cannot provide other objective evidence that they
                continue to possess the necessary legal qualifications to render
                valuable service to patent applicants.
                Legal Considerations
                 Comment 165: One commenter stated that RCE fees are governed by the
                IOAA, except for the one requirement that is carved out by section 10
                of the AIA. Thus, the USPTO may charge actual cost, plus a proportional
                share of
                [[Page 46970]]
                general administrative costs, reduced by a proportional share of issue
                and maintenance fees, but no more than that. The excess charge for
                second and subsequent RCEs is unlawful.
                 Response: The IOAA provides federal agencies the authority to
                charge user fees where the agencies do not have their own specific
                statutory authority to charge fees. Fees collected under the IOAA are
                deposited in the general fund of the U.S. Treasury and not available to
                the charging agency for its use. OMB Circular A-25, User Charges,
                provides guidance on IOAA authority. This has no relevance to the fee
                setting authority provided to the USPTO, as the USPTO has specific
                statutory authority to charge fees under title 35 of the U.S.C. and the
                Trademark Act of 1946. The USPTO further has specific authority to set
                and adjust those fees as in the current rulemaking under section 10 of
                the AIA. Fees collected by the USPTO are made available to the USPTO
                through annual appropriations and are available to use for the
                activities that generated the fee (patent and trademark examination and
                proportionate administrative expenses). The general authority described
                in the IOAA and OMB Circular A-25 is not relevant to the USPTO's
                specific fee setting authority.
                 Comment 166: One commenter disagreed with the RIA regarding the
                annual active patent practitioner fee and non-DOCX surcharge fee. The
                commenter stated that the point of the rule is to raise fees and
                disagreed with findings of ``No identified costs.'' The commenter
                suggested comment letters sent to PPAC identified substantial costs to
                the public for the annual active patent practitioner fee and non-DOCX
                surcharge fee. The commenter further wrote that the OMB's Implementing
                Guidance puts the annual active patent practitioner fee and non-DOCX
                surcharge fee within the scope of E.O. 13771, which states:
                ``Regulatory actions [that] impose requirements apart from transfers .
                . . need to be offset to the extent they impose more than de minimis
                costs.''
                 Response: Guidance in OMB Circular A-4, Regulatory Analysis, and
                concerning RIAs provides that fees to government agencies for goods or
                services are considered transfer payments. The fee adjustments concern
                increases of fees for USPTO services, which are transfers, not costs.
                The non-DOCX surcharge fee is based on the services provided by the
                USPTO to patent applicants and, consequently, qualifies as a transfer
                payment under OMB's guidance. As noted in response to Comment 81 above,
                the USPTO has elected not to implement the annual active patent
                practitioner fee at this time.
                 Comment 167: One commenter stated that the legislative history of
                the AIA makes abundantly clear that the USPTO may not use fee setting
                as a policy lever. Fee setting may only be used to recover aggregate
                costs. The commenter further stated that the U.S. Constitution denies
                agencies the authority to set fees for anything other than cost
                recovery--setting fee levels to ``encourage or discourage'' is a
                ``tax''; agencies do not have the authority to tax, and, therefore,
                fees being set to incentivize, disincentivize, and ``to facilitate the
                effective administration of the patent and trademark systems,'' are not
                within the statutory authority of the USPTO.
                 Response: The AIA permits individual patent fees to be set or
                adjusted to encourage or discourage particular services, so long as the
                aggregate revenues for all patent fees recover the aggregate costs of
                the patent operation. The comment would read into the AIA limitations
                that do not exist and that are inconsistent with the AIA.
                 Comment 168: One commenter wanted to know why the USPTO has never
                issued any legal analysis of the AIA's legislative history. The
                commenter cited two examples: The removal of ``notwithstanding the fee
                amounts established or charged'' from the AIA and the discussion in the
                House report (H.R. Rep. No. 112-98), and the effect of the word
                ``only'' in the phrase ``only to recover the aggregate estimated
                costs.'' The commenter believed the legislative history makes clear
                that Congress intended ``only'' to apply to purpose as well as amount.
                 Response: A legal analysis of legislative history is unnecessary in
                light of the plain language of the AIA, which permits individual patent
                fees to be set or adjusted to encourage or discourage particular
                services, so long as the aggregate revenues for all patent fees recover
                the aggregate costs of the patent operation.
                 Comment 169: One commenter expressed that the fee setting efforts
                of the USPTO are unconstitutional because the U.S. Constitution denies
                agencies the authority to set fees for anything other than cost
                recovery--setting fee levels to ``encourage or discourage'' behavior is
                a ``tax,'' and agencies do not have the authority to tax (see
                Sec. Sec. I.B.1 and I.C). Even with authority under the AIA, the USPTO
                may not ``adjust assessments to encourage or discourage a particular
                activity'' because the U.S. Constitution provides that the power to
                ``lay and collect taxes'' lies with the U.S. Congress, not the
                executive branch.
                 Response: Patent fees are paid for receiving and maintaining a
                patent grant. Courts have held that the payment of such fees should not
                be viewed as taxes but rather payments for a service.
                 Comment 170: One commenter wrote that the USPTO may not create new
                fees where no fees are ``established, authorized, or charged'' in title
                35 and there is no affirmative material, service, or processing
                provided. Similarly, the commenter wrote that the USPTO may not re-
                allocate fees among the categories specified in Sec. 41; new fees may
                be created only where the USPTO has a specific statutory authorization
                (see Sec. I.B.2).
                 Response: The AIA permits individual patent fees to be set or
                adjusted to encourage or discourage particular services, so long as the
                aggregate revenues for all patent fees recover the aggregate costs of
                the patent operation. The comment would read into the AIA limitations
                that do not exist and that are inconsistent with the AIA.
                 Comment 171: One commenter stated that this rulemaking exceeds the
                authority of the USPTO because it overrides a policy decision made by
                the U.S. Congress in favor of something the USPTO prefers. The
                commenter contended the U.S. Congress made a policy choice: Initial
                filings should be cross-subsidized by maintenance fees at approximately
                50 percent. The U.S. Congress (by inference) felt it important to
                encourage filing and allow successful patentees to cross-subsidize
                filing. The commenter also felt the USPTO is exceeding its authority
                because it is second-guessing the U.S. Congress's policy balances
                encoded in the appeal fee line. The commenter suggested this rulemaking
                relies on ``factors which Congress has not intended [the agency] to
                consider,'' making it an arbitrary and capricious agency action under
                the APA. The commenter believed the USPTO departed from the intent of
                the U.S. Congress in 2013 and should revert to the pre-2013 fee
                structure.
                 Response: The USPTO has specific statutory authority to charge fees
                under title 35 of the U.S.C. and the Trademark Act of 1946. The USPTO
                further has specific authority to set and adjust those fees as in this
                Final Rule under section 10 of the AIA. The AIA permits individual
                patent fees to be set or adjusted to encourage or discourage particular
                services, so long as the aggregate revenues for all patent fees recover
                the aggregate costs of the patent operation. However, the USPTO notes
                that the adjustments to the fee schedule
                [[Page 46971]]
                do not significantly impact the balance between front-end and back-end
                fees.
                 Comment 172: One commenter agreed in principle with the operating
                reserve of the USPTO but saw no statutory authorization for it. The
                commenter contended the operating reserve is not fairly within the text
                of section 10 of the AIA, which limits USPTO fee collections to
                ``only'' aggregate costs.
                 Response: The AIA permits individual patent fees to be set or
                adjusted to encourage or discourage particular services, so long as the
                aggregate revenues for all patent fees recover the aggregate costs of
                the patent operation. One of these aggregate costs is the growth of an
                operating reserve to allow effective management of the U.S. patent
                system and responsiveness to changes in the economy, unanticipated
                production workload, and revenue changes, while maintaining operations
                and effectuating long-term strategies.
                 Comment 173: One commenter stated that the NPRM for this rulemaking
                ignores the IOAA and OMB Circular A-25, which are the general framework
                statute and Presidential interpretation, respectively, for agencies
                that charge user fees. The commenter claimed the IOAA limits user fees
                to cover services to a specific ``identifiable recipient,'' at the cost
                of providing that service or the value to the recipient, but may not
                recover agency general operating costs. The commenter also stated that
                fees without statutory grounding are not within section 10 of the AIA
                and thus are either barred outright or are subject to the constraints
                of the IOAA. The commenter suggested that relevant Supreme Court and
                D.C. Circuit case law holdings--especially Seafarers International
                Union of North America v. U.S. Coast Guard, 81 F.3d 179, 183 (D.C. Cir.
                1996)--are opposite to the position the USPTO takes in the NPRM.
                 Response: The IOAA provides federal agencies the authority to
                charge user fees where the agencies do not have their own specific
                statutory authority to charge fees. Fees collected under the IOAA are
                deposited in the general fund of the U.S. Treasury and not available to
                the charging agency for its use. OMB Circular A-25 provides guidance on
                IOAA authority. This has no relevance to the fee setting authority of
                the USPTO, as the USPTO has specific statutory authority to charge fees
                under title 35 of the U.S.C. and the Trademark Act of 1946. The USPTO
                further has specific authority to set and adjust those fees as in this
                Final Rule under section 10 of the AIA. Fees collected by the USPTO are
                made available to the USPTO through annual appropriations and are
                available to use for the activities that generated the fee (patent and
                trademark services and proportionate administrative expenses). The
                general authority described in the IOAA and OMB Circular A-25 is not
                relevant to the USPTO's specific fee setting authority.
                 Comment 174: One commenter expressed that a change undertaken in a
                previous rulemaking, changing ``notice of appeal'' and ``filing a brief
                in support of an appeal'' of Sec. 41(a)(6), was unlawfully
                restructured into ``notice of appeal'' and ``forwarding an appeal to
                the Board'' as in 37 CFR 41.20(b)(1) and (4).
                 Response: The USPTO has specific authority to set and adjust fees,
                as in the current rulemaking, under section 10 of the AIA. The AIA
                permits individual patent fees to be set or adjusted so long as the
                aggregate revenues for all patent fees recover the aggregate costs of
                the patent operation.
                 Comment 175: One commenter wrote that section 1(b)(2) of E.O. 12866
                requires the USPTO to ``examine whether existing regulations (or other
                law) have created, or contributed to, the problem that a new regulation
                is intended to correct.'' Most of the policy goals of the fee schedule
                could be addressed by internal reforms to reduce costs, as an
                alternative to raised fees. For example, internal USPTO processes and
                incentives could be restructured to reduce costs to the USPTO and
                applicants. The commenter contends that the NPRM identifies no
                exemption from E.O. 12866 that permits the USPTO to forego this
                examination.
                 Response: The USPTO is in compliance with all procedural and
                analytical requirements of E.O. 12866. The USPTO identified no existing
                regulation that created or contributed to the need for this Final Rule.
                In this Final Rule, the USPTO is not creating any new regulation.
                Rather, the USPTO is setting and adjusting patent fees based on
                assumptions found in the FY 20201 Budget in order to recover the
                aggregate cost of patent operations in future years and to allow the
                Office to continue progress towards achieving strategic goals. Also,
                contrary to the assertion made in the comment, the Office is constantly
                considering its operations, policies, and processes to identify ways to
                improve its operations. As an example, the Office recently issued a
                Notice of Proposed Rulemaking, Removal of Regulations Governing
                Requests for Presidential Proclamations under the Semiconductor Chip
                Protection Act of 1984 and Certain Rules of Practice Relating to
                Registration to Practice and Discipline, 84 FR 64800 (November 25,
                2019), that eliminated unnecessary regulations. To support this
                regulatory reform effort, the Office assembled a working group
                consisting of subject-matter experts from each of the business units
                that implement the Office's regulations. The working group considered,
                reviewed, and recommended ways that the regulations could be improved,
                revised, and streamlined so as to improve the operation of the Office.
                The working group reviewed existing regulations, both discretionary
                rules and those required by statute or judicial order. The USPTO also
                solicited comments from stakeholders through a web page established to
                provide information on the USPTO's regulatory reform efforts. These
                efforts led to the development of candidate regulations for removal,
                based on the USPTO's assessment that these regulations were not needed
                and/or that elimination could improve the USPTO's body of regulations.
                As an additional example, the Office recently implemented adjustments
                to examination time to improve the examination process and examination
                quality. These time adjustments include increasing baseline examination
                time and providing additional examination time based on newly developed
                application attributes, such as the number of claims, size of the
                specification, number of pages of prior art citations submitted, etc.
                Additional examples of how the USPTO is constantly taking steps to
                improve processes, increase efficiency, and reduce costs, for both
                applicants and the USPTO, include our international cooperation
                programs, such as the Electronic Priority Document Exchange Program and
                the Global Dossier Program. Furthermore, efficiencies and cost savings
                have been realized as a result of the USPTO implementing ePetitions and
                the Access to Relevant Prior Art Initiative.
                 Comment 176: One commenter stated section 1(b)(2) of E.O. 12866
                directs agencies to ``examine whether existing regulations (or other
                law) have created, or contributed to, the problem that a new regulation
                is intended to correct.'' In 2012, the USPTO requested comment on RCE
                practice. Several of the comment letters noted that, at least in part,
                extended RCE practice was driven by a breakdown of ``compact
                prosecution''--Office actions were less complete, less careful, and
                less responsive to applicants' arguments. The commenter observed no
                effort by the USPTO to address its ``existing regulation'' half of the
                problem--for example, the USPTO has not recalibrated the count system
                to remove
                [[Page 46972]]
                incentives for gaming by examiners or provided sound supervision to
                ensure completeness of Office actions. E.O. 12866 suggests that it is
                inappropriate to shift costs to the public for a failure of the USPTO
                to implement its own self-regulatory obligations.
                 Response: In this Final Rule, the USPTO is not creating any new
                regulations; rather, the USPTO is setting and adjusting patent fees in
                order to recover its increasing aggregate costs. Contrary to the
                position set forth in the comments, the Office is not shifting costs to
                the public. Since 2012, the Office has made considerable efforts to
                improve patent quality, including establishing the Office of the Deputy
                Commissioner for Patent Quality (DCPQ) within the Patents organization.
                The DCPQ is responsible for optimizing the quality of patent products,
                processes, and services to build a culture of process improvement and
                enhanced patent quality for the Patents organization. In addition to
                establishing this new office within the Patents organization, patent
                examiners have received extensive training on how to improve the
                quality of their Office actions. These trainings include a three-part
                training on how to evaluate, analyze, and respond to arguments
                presented by applicants. They also include training on interpreting
                claims, establishing a clear prosecution record in an application, and
                writing proper reasons for allowance. Also, contrary to the comments,
                the Office recently implemented adjustments to examination time to
                improve the examination process and examination quality. These time
                adjustments include increasing baseline examination time and providing
                additional examination time based on newly developed application
                attributes, such as the number of claims, size of specification, number
                of pages of prior art citations submitted, etc.
                 Comment 177: One commenter stated that the USPTO did not meet its
                rulemaking obligation to disclose rationale. The commenter contended
                that even if there is a sound cause-and-effect relationship between the
                proposal and the asserted benefits, it is not explained in the NPRM,
                making it arbitrary and capricious under the APA.
                 Response: The Office disagrees that it failed to disclose the
                rationale for the rulemaking or that the rulemaking is arbitrary and
                capricious under the APA. The preamble and regulatory text clearly set
                forth the new costs and explain the rationale for each change in
                compliance with the requirements of the APA.
                 Comment 178: One commenter disagreed with the finding that this
                rulemaking is a ``transfer payment from one group to another.'' The
                commenter wrote that the definition of ``transfer payment'' is in OMB
                Circular A-4 and the original definition involved cash payments to
                private sector actors, and the definition has grown to cover other
                direct cash transfers among private sector entities. The commenter
                continued that the NPRM calls for funds to be paid from private sector
                persons to government for government consumption and discusses no
                monetary payout to any private sector party.
                 Response: Guidance in OMB Circular A-4 and concerning RIAs provides
                that fees to government agencies for goods or services are considered
                transfer payments. The fee adjustments concern increases of fees for
                USPTO services, which are transfers, not costs. Pursuant to the
                requirements of E.O. 12886, the USPTO submitted both the NPRM and RIA
                to the OMB for review prior to publication. The OMB determined that
                this rulemaking consisted entirely of transfer payments from one group
                to another, as defined in OMB Circular A-4.
                 Comment 179: One commenter wondered why there was not an analysis
                of raising all fees proportionally from the baseline set by Congress,
                with deviations only where the USPTO has specific data to support a
                deviation. The commenter contended that this analysis is required by
                statute and the U.S. Constitution.
                 Response: The alternatives considered in the RIA are reasonable
                alternatives that are consistent with guidance in OMB Circular A-4.
                Among the alternatives considered was an across-the-board adjustment to
                the current baseline fee schedule.
                 Comment 180: One commenter stated the RIA accompanying the NPRM
                only considers non-starter alternatives like not raising fees at all,
                setting all fees at actual cost, and applying only an inflation
                adjustment. The commenter contended these are unrealistic strawmen,
                against which the USPTO's preferred alternative appears favorable.
                Considering only unrealistic strawmen as ``alternatives'' is not
                compliant with the USPTO's obligations under the letter of the law and
                cannot be reconciled with the ``regulatory philosophy'' or spirit of
                the law. Artificially narrowing the options is arbitrary and capricious
                per se.
                 Response: The alternatives considered in the RIA are reasonable
                alternatives that are consistent with guidance in OMB Circular A-4.
                 Comment 181: One commenter questioned why there was no analysis of
                the proportional lockstep fee hike relative to Sec. 41 as a baseline.
                 Response: Among the alternatives considered in the RIA is a
                lockstep, across-the-board adjustment to the current baseline fee
                schedule.
                 Comment 182: One commenter stated that the USPTO may not set fees
                without a benefit-cost analysis under the PRA and E.O. 12866--for
                example, the USPTO may not reduce its own costs if that would increase
                costs on the public disproportionately (see Sec. I.F).
                 Response: The USPTO must comply with all rulemaking requirements
                when setting fees using the authority provided by section 10 of the
                AIA. As demonstrated in the Rulemaking Considerations section of this
                Final Rule, and in this rulemaking as a whole, the USPTO has complied
                with these requirements.
                 Comment 183: One commenter expressed that several components of
                this rulemaking implicate the PRA (e.g., the DOCX proposal and the
                annual active patent practitioner fee). The NPRM asserts that the USPTO
                has obtained PRA clearance, but the commenter contends this assertion
                is false, and the USPTO has never even applied for clearance.
                 Response: The USPTO must comply with the PRA in setting fees using
                the authority provided by section 10 of the AIA. The USPTO has filed
                with the OMB a worksheet addressing costs in compliance with the
                requirement of the statute.
                 Comment 184: One commenter claimed the USPTO has made no filing
                seeking any substantive change to 0651-0012 since 2014.
                 Response: The USPTO has complied with the PRA in considering the
                paperwork burdens associated with this Final Rule. The USPTO has
                previously received OMB approval for associated burdens and submitted
                additional statements to address revisions.
                VII. Discussion of Specific Rules
                 The following section shows the Code of Federal Regulations (CFR)
                for all fees set or adjusted in this Final Rule. The discussion below
                includes all fee amendments, all fee discontinuations, and all changes
                to the CFR text.
                 Title 37 of the CFR, parts 1, 11, 41, and 42, are amended as
                follows:
                 Section 1.16: Section 1.16 is amended by revising paragraphs (a)
                through (e), (h), (j), (k), and (m) through (s) and adding paragraph
                (u) to set forth the application filing, excess claims, search, and
                examination fees for patent applications filed as authorized under
                section 10 of the Act. The changes to the
                [[Page 46973]]
                fee amounts indicated in Sec. 1.16 are shown in Table 11.
                 Table 11--CFR Section 1.16 Fee Changes
                --------------------------------------------------------------------------------------------------------------------------------------------------------
                 Current fees (dollars) Final rule fees
                 --------------------------- (dollars)
                 CFR section Fee code Description --------------------------
                 Large Small Micro Large Small Micro
                --------------------------------------------------------------------------------------------------------------------------------------------------------
                1.16(a)........................... 1011/2011/3011...................... Basic filing fee-- 300 150 75 320 160 80
                 Utility (paper filing
                 also requires non-
                 electronic filing fee
                 under 1.16(t)).
                1.16(a)........................... 4011................................ Basic filing fee-- n/a 75 n/a n/a 80 n/a
                 Utility (electronic
                 filing for small
                 entities).
                1.16(b)........................... 1012/2012/3012...................... Basic filing fee--Design 200 100 50 220 110 55
                1.16(b)........................... 1017/2017/3017...................... Basic filing fee--Design 200 100 50 220 110 55
                 (CPA).
                1.16(c)........................... 1013/2013/3013...................... Basic filing fee--Plant. 200 100 50 220 110 55
                1.16(d)........................... 1005/2005/3005...................... Provisional application 280 140 70 300 150 75
                 filing fee.
                1.16(e)........................... 1014/2014/3014...................... Basic filing fee-- 300 150 75 320 160 80
                 Reissue.
                1.16(e)........................... 1019/2019/3019...................... Basic filing fee-- 300 150 75 320 160 80
                 Reissue (Design CPA).
                1.16(h)........................... 1201/2201/3201...................... Each independent claim 460 230 115 480 240 120
                 in excess of three.
                1.16(h)........................... 1204/2204/3204...................... Each reissue independent 460 230 115 480 240 120
                 claim in excess of
                 three.
                1.16(j)........................... 1203/2203/3203...................... Multiple dependent claim 820 410 205 860 430 215
                1.16(k)........................... 1111/2111/3111...................... Utility Search Fee...... 660 330 165 700 350 175
                1.16(m)........................... 1113/2113/3113...................... Plant Search Fee........ 420 210 105 440 220 110
                1.16(n)........................... 1114/2114/3114...................... Reissue Search Fee or 660 330 165 700 350 175
                 Reissue (Design CPA)
                 Search Fee.
                1.16(o)........................... 1311/2311/3311...................... Utility Examination Fee. 760 380 190 800 400 200
                1.16(p)........................... 1312/2312/3312...................... Design Examination Fee 600 300 150 640 320 160
                 or Design CPA
                 Examination Fee.
                1.16(q)........................... 1313/2313/3313...................... Plant Examination Fee... 620 310 155 660 330 165
                1.16(r)........................... 1314/2314/3314...................... Reissue Examination Fee 2,200 1,100 550 2,320 1,160 580
                 or Reissue (Design CPA)
                 Examination Fee.
                1.16(s)........................... 1081/2081/3081...................... Utility Application Size 400 200 100 420 210 105
                 Fee--for each
                 additional 50 sheets
                 that exceeds 100 sheets.
                1.16(s)........................... 1081/2081/3081...................... Design Application Size 400 200 100 420 210 105
                 Fee--for each
                 additional 50 sheets
                 that exceeds 100 sheets.
                1.16(s)........................... 1081/2081/3081...................... Plant Application Size 400 200 100 420 210 105
                 Fee--for each
                 additional 50 sheets
                 that exceeds 100 sheets.
                1.16(s)........................... 1081/2081/3081...................... Reissue Application Size 400 200 100 420 210 105
                 Fee--for each
                 additional 50 sheets
                 that exceeds 100 sheets.
                1.16(s)........................... 1081/2081/3081...................... Provisional Application 400 200 100 420 210 105
                 Size Fee--for each
                 additional 50 sheets
                 that exceeds 100 sheets.
                1.16(u)........................... NEW................................. Non-DOCX Filing n/a n/a n/a 400 200 100
                 Surcharge Fee.
                --------------------------------------------------------------------------------------------------------------------------------------------------------
                 Section 1.17: Section 1.17 is amended by revising paragraphs (a),
                (c) through (g), (i)(2), (k), (m), (p), (q), (r), and (s) to set forth
                the application processing fees as authorized under section 10 of the
                Act. The changes to the fee amounts indicated in Sec. 1.17 are shown
                in Table 12. In this Final Rule, an existing fee code has been added to
                Table 12 for the petition for the extension of the twelve-month (six-
                month for designs) period for filing a subsequent application. This is
                not a new fee code created in this rule; rather, it reflects existing
                practice. In this section, table headers were added to make formatting
                consistent.
                 Table 12--CFR Section 1.17 Fee Changes
                --------------------------------------------------------------------------------------------------------------------------------------------------------
                 Current fees (dollars) Final rule fees
                 --------------------------- (dollars)
                 CFR section Fee code Description --------------------------
                 Large Small Micro Large Small Micro
                --------------------------------------------------------------------------------------------------------------------------------------------------------
                1.17(a)(1)........................ 1251/2251/3251...................... Extension for response 200 100 50 220 110 55
                 within first month.
                1.17(a)(2)........................ 1252/2252/3252...................... Extension for response 600 300 150 640 320 160
                 within second month.
                1.17(a)(3)........................ 1253/2253/3253...................... Extension for response 1,400 700 350 1,480 740 370
                 within third month.
                1.17(a)(4)........................ 1254/2254/3254...................... Extension for response 2,200 1,100 550 2,320 1,160 580
                 within fourth month.
                1.17(a)(5)........................ 1255/2255/3255...................... Extension for response 3,000 1,500 750 3,160 1,580 790
                 within fifth month.
                1.17(c)........................... 1817/2817/3817...................... Request for prioritized 4,000 2,000 1,000 4,200 2,100 1,050
                 examination.
                1.17(d)........................... 1819/2819/3819...................... Correction of 600 300 150 640 320 160
                 inventorship after
                 first action on merits.
                1.17(e)(1)........................ 1801/2801/3801...................... Request for continued 1,300 650 325 1,360 680 340
                 examination (RCE)--1st
                 request (see 37 CFR
                 1.114).
                1.17(e)(2)........................ 1820/2820/3820...................... Request for continued 1,900 950 475 2,000 1,000 500
                 examination (RCE)--2nd
                 and subsequent requests
                 (see 37 CFR 1.114).
                1.17(f)........................... 1462/2462/3462...................... Petitions requiring the 400 200 100 420 210 105
                 petition fee set forth
                 in 37 CFR 1.17(f)
                 (Group I).
                1.17(g)........................... 1463/2463/3463...................... Petitions requiring the 200 100 50 220 110 55
                 petition fee set forth
                 in 37 CFR 1.17(g)
                 (Group II).
                1.17(i)(2)........................ 1803/2803/3803...................... Request for voluntary 130 130 130 140 140 140
                 publication or
                 republication.
                1.17(i)(2)........................ 1808/2808/3808...................... Other publication 130 130 130 140 140 140
                 processing fee.
                1.17(k)........................... 1802/2802/3802...................... Request for expedited 900 450 225 1,600 800 400
                 examination of a design
                 application.
                [[Page 46974]]
                
                1.17(m)........................... 1453/2453/3453...................... Petition for revival of 2,000 1,000 500 2,100 1,050 525
                 an abandoned
                 application for a
                 patent, for the delayed
                 payment of the fee for
                 issuing each patent, or
                 for the delayed
                 response by the patent
                 owner in any
                 reexamination
                 proceeding.
                1.17(m)........................... 1454/2454/3454...................... Petition for the delayed 2,000 1,000 500 2,100 1,050 525
                 submission of a
                 priority or benefit
                 claim.
                1.17(m)........................... 1784/2784/3784...................... Petition to excuse 2,000 1,000 500 2,100 1,050 525
                 applicant's failure to
                 act within prescribed
                 time limits in an
                 international design
                 application.
                1.17(m)........................... 1558/2558/3558...................... Petition for the delayed 2,000 1,000 500 2,100 1,050 525
                 payment of the fee for
                 maintaining a patent in
                 force.
                1.17(m)........................... 1628/2628/3628...................... Petition for the 2,000 1,000 500 2,100 1,050 525
                 extension of the twelve-
                 month (six-month for
                 designs) period for
                 filing a subsequent
                 application.
                1.17(p)........................... 1806/2806/3806...................... Submission of an 240 120 60 260 130 65
                 Information Disclosure
                 Statement.
                1.17(r)........................... 1809/2809/3809...................... Filing a submission 840 420 210 880 440 220
                 after final rejection
                 (see 37 CFR 1.129(a)).
                1.17(s)........................... 1810/2810/3810...................... For each additional 840 420 210 880 440 220
                 invention to be
                 examined (see 37 CFR
                 1.129(b)).
                --------------------------------------------------------------------------------------------------------------------------------------------------------
                 Section 1.18: Section 1.18 is amended by revising paragraphs (a)
                through (f) to set forth the patent issue fees as authorized under
                section 10 of the Act. The changes to the fee amounts indicated in
                Sec. 1.18 are shown in Table 13.
                 Table 13--CFR Section 1.18 Fee Changes
                --------------------------------------------------------------------------------------------------------------------------------------------------------
                 Current fees (dollars) Final rule fees
                 --------------------------- (dollars)
                 CFR section Fee code Description --------------------------
                 Large Small Micro Large Small Micro
                --------------------------------------------------------------------------------------------------------------------------------------------------------
                1.18(a)(1)........................ 1501/2501/3501...................... Utility issue Fee....... 1,000 500 250 1,200 600 300
                1.18(a)(1)........................ 1511/2511/3511...................... Reissue issue Fee....... 1,000 500 250 1,200 600 300
                1.18(b)(1)........................ 1502/2502/3502...................... Design issue Fee........ 700 350 175 740 370 185
                1.18(c)(1)........................ 1503/2503/3503...................... Plant Issue Fee......... 800 400 200 840 420 210
                1.18(d)(3)........................ 1505/2505/3505...................... Publication fee for 300 300 300 320 320 320
                 republication.
                1.18(e)........................... 1455/2455/3455...................... Filing an application 200 200 200 210 210 210
                 for patent term
                 adjustment.
                1.18(f)........................... 1456/2456/3456...................... Request for 400 400 400 420 420 420
                 reinstatement of term
                 reduced.
                --------------------------------------------------------------------------------------------------------------------------------------------------------
                 Section 1.19: Section 1.19 is amended by revising paragraphs
                (b)(1)(i)(B) and (b)(1)(ii)(B) and by removing and reserving paragraphs
                (j) through (l) to set forth the patent document supply fees as
                authorized under section 10 of the Act. The changes to the fee amounts
                indicated in Sec. 1.19 are shown in Table 14.
                 Table 14--CFR Section 1.19 Fee Changes
                --------------------------------------------------------------------------------------------------------------------------------------------------------
                 Current fees (dollars) Final rule fees (dollars)
                 CFR section Fee code Description --------------------------------------------------------------------------
                 Large Small Micro Large Small Micro
                --------------------------------------------------------------------------------------------------------------------------------------------------------
                1.19(b)(1) (i)(B).......... 8051......................... Copy patent file 280 280 280 290 290 290
                 wrapper, paper
                 medium, any
                 number of sheets.
                1.19(b)(1) (ii)(B)......... 8052......................... Copy patent file 55 55 55 60 60 60
                 wrapper,
                 electronic
                 medium, any size
                 or provided
                 electronically.
                1.19(j).................... 8057......................... Copy of Patent 50 50 50 discontinued discontinued discontinued
                 Technology
                 Monitoring Team
                 (PTMT) patent
                 bibliographic
                 extract and
                 other DVD
                 (optical disc).
                1.19(k).................... 8058......................... Copy of U.S. 100 100 100 discontinued discontinued discontinued
                 patent custom
                 data extracts.
                1.19(l).................... 8059......................... Copy of selected 30 30 30 discontinued discontinued discontinued
                 technology
                 reports,
                 miscellaneous
                 technology areas.
                --------------------------------------------------------------------------------------------------------------------------------------------------------
                 Section 1.20: Section 1.20 is revised to set forth post-issuance
                fees as authorized under section 10 of the Act. In this section, (c)(5)
                through (7) are being reinstated due to an inadvertent deletion. The
                changes to the fee amounts indicated in Sec. 1.20 are shown in Table
                15.
                [[Page 46975]]
                 Table 15--CFR Section 1.20 Fee Changes
                --------------------------------------------------------------------------------------------------------------------------------------------------------
                 Current fees (dollars) Final rule fees (dollars)
                 CFR section Fee code Description -----------------------------------------------------
                 Large Small Micro Large Small Micro
                --------------------------------------------------------------------------------------------------------------------------------------------------------
                1.20(a)........................... 1811/2811/3811...................... Certificate of 150 150 150 160 160 160
                 correction.
                1.20(b)........................... 1816/2816/3816...................... Processing fee for 150 150 150 160 160 160
                 correcting inventorship
                 in a patent.
                1.20(c)(1)........................ 1831/2831/3831...................... Ex parte reexamination 6,000 3,000 1,500 6,300 3,150 1,575
                 (Sec. 1.510(a))
                 Streamlined.
                1.20(c)(2)........................ 1812/2812/3812...................... Ex parte reexamination 12,000 6,000 3,000 12,600 6,300 3,150
                 (Sec. 1.510(a)) Non-
                 streamlined.
                1.20(c)(7)........................ 1812/2812/3812...................... Refused request for ex 3,600 1,800 900 3,780 1,890 945
                 parte reexamination.
                1.20(c)(3)........................ 1821/2821/3821...................... Each reexamination 460 230 115 480 240 120
                 independent claim in
                 excess of three and
                 also in excess of the
                 number of such claims
                 in the patent under
                 reexamination.
                1.20(c)(6)........................ 1824/2824/3824...................... Petitions in a 1,940 970 485 2,040 1,020 510
                 reexamination
                 proceeding, except for
                 those specifically
                 enumerated in 37 CFR
                 1.550(i) and 1.937(d).
                1.20(d)........................... 1814/2814/3814...................... Statutory disclaimer, 160 160 160 170 170 170
                 including terminal
                 disclaimer.
                1.20(e)........................... 1551/2551/3551...................... For maintaining an 1,600 800 400 2,000 1,000 500
                 original or any reissue
                 patent, due at 3.5
                 years.
                1.20(f)........................... 1552/2552/3552...................... For maintaining an 3,600 1,800 900 3,760 1,880 940
                 original or any reissue
                 patent, due at 7.5
                 years.
                1.20(g)........................... 1553/2553/3553...................... For maintaining an 7,400 3,700 1,850 7,700 3,850 1,925
                 original or any reissue
                 patent, due at 11.5
                 years.
                1.20(h)........................... 1554/2554/3554...................... Surcharge--3.5 year-- 160 80 40 500 250 125
                 Late payment within 6
                 months.
                1.20(h)........................... 1555/2555/3555...................... Surcharge--7.5 year-- 160 80 40 500 250 125
                 Late payment within 6
                 months.
                1.20(h)........................... 1556/2556/3556...................... Surcharge--11.5 year-- 160 80 40 500 250 125
                 Late payment within 6
                 months.
                1.20(j)(1)........................ 1457/2457/3457...................... Extension of term of 1,120 1,120 1,120 1,180 1,180 1,180
                 patent.
                1.20(j)(2)........................ 1458/2458/3458...................... Initial application for 420 420 420 440 440 440
                 interim extension (see
                 37 CFR 1.790).
                1.20(j)(3)........................ 1459/2459/3459...................... Subsequent application 220 220 220 230 230 230
                 for interim extension
                 (see 37 CFR 1.790).
                1.20(k)(1)........................ 1826/2826/3826...................... Request for supplemental 4,400 2,200 1,100 4,620 2,310 1,155
                 examination.
                1.20(k)(2)........................ 1827/2827/3827...................... Reexamination ordered as 12,100 6,050 3,025 12,700 6,350 3,175
                 a result of
                 supplemental
                 examination.
                1.20(k)(3)(ii).................... 1829/2829/3829...................... Supplemental Examination 280 140 70 300 150 75
                 Document Size Fee--for
                 each additional 50
                 sheets or a fraction
                 thereof in a nonpatent
                 document.
                --------------------------------------------------------------------------------------------------------------------------------------------------------
                 Section 1.21: Section 1.21 is amended by adding paragraph (a)(8)
                and revising paragraphs (a)(1), (2), and (5), (9)(ii), (10); (k); (n);
                (o); and (q) to set forth miscellaneous fees and charges as authorized
                under section 10 of the Act. Section 1.21(a)(6)(i) is being revised to
                remove and reserve the fee for the USPTO-assisted recovery of ID or
                reset of password for the Office of Enrollment and Discipline
                Information System. The changes to the fee amounts indicated in Sec.
                1.21 are shown in Table 16.
                 The USPTO amends paragraph (o) of Sec. 1.21 to clarify the
                applicability of its provisions. The USPTO specifies that the mega-
                sequence listing fee applies to an application filed under 35 U.S.C.
                111 or 371 to clarify that the fee applies to both provisional and
                nonprovisional applications filed under 35 U.S.C. 111, as well as to
                national stage applications under 35 U.S.C. 371. The fee does not apply
                to international applications filed with the U.S. Receiving Office (RO/
                US) that do not enter the U.S. national stage under 35 U.S.C. 371.
                Furthermore, the rule clarifies that it is the receipt by the Office of
                a mega-sequence listing in an application that is subject to the fee. A
                sequence listing in a national stage application may be received by the
                USPTO from the International Bureau in accordance with PCT Article 20
                rather than directly submitted to the USPTO by the applicant. Thus, the
                clarification makes clear that the mega-sequence listing fee applies to
                such receipt. The USPTO further clarifies that the fee applies to only
                the first receipt of a sequence listing in electronic form having a
                size ranging from 300MB to 800MB and to the first receipt of a sequence
                listing in electronic form having a size over 800MB. Thus, an applicant
                will not be charged the mega-sequence listing fee for the submission of
                a substitute or replacement electronic form of the sequence listing
                (see 37 CFR 1.825) unless the size of the substitute or replacement
                electronic form sequence listing is subject to the provisions of a
                different paragraph of Sec. 1.21(o) (e.g., the first sequence listing
                in an application is between 300MB and 800MB and a replacement sequence
                listing is greater than 800MB). Finally, the USPTO specifies that for
                purposes of determining the fee required under Sec. 1.21(o), the size
                of the electronic form of the sequence listing is measured without file
                compression.
                 Table 16--CFR Section 1.21 Fee Changes
                --------------------------------------------------------------------------------------------------------------------------------------------------------
                 Current fees (dollars) Final rule fees (dollars)
                 CFR section Fee code Description --------------------------------------------------------------------------
                 Large Small Micro Large Small Micro
                --------------------------------------------------------------------------------------------------------------------------------------------------------
                1.21(a)(1)(i).............. 9001......................... Application fee 100 100 100 110 110 110
                 (non-refundable).
                1.21(a)(1)(ii)(A).......... 9010......................... For test 200 200 200 210 210 210
                 administration
                 by commercial
                 entity.
                1.21(a)(1)(ii)(B).......... 9011......................... For test 450 450 450 470 470 470
                 administration
                 by the USPTO.
                [[Page 46976]]
                
                1.21(a)(1)(iii)............ 9029......................... For USPTO- 450 450 450 470 470 470
                 administered
                 review of
                 registration
                 examination.
                1.21(a)(2)(i).............. 9003......................... On registration 200 200 200 210 210 210
                 to practice
                 under Sec.
                 11.6.
                1.21(a)(2)(ii)............. 9026......................... On grant of 200 200 200 210 210 210
                 limited
                 recognition
                 under Sec.
                 11.9(b).
                1.21(a)(2)(iii)............ 9025......................... On change of 100 100 100 110 110 110
                 registration
                 from agent to
                 attorney.
                1.21(a)(5)(i).............. 9012......................... Review of 400 400 400 420 420 420
                 decision by the
                 Director of
                 Enrollment and
                 Discipline under
                 Sec. 11.2(c).
                1.21(a)(5)(ii)............. 9013......................... Review of 400 400 400 420 420 420
                 decision of the
                 Director of
                 Enrollment and
                 Discipline under
                 Sec. 11.2(d).
                1.21(a)(6)(i).............. 9027......................... For USPTO- 70 70 70 discontinued discontinued discontinued
                 assisted
                 recovery of ID
                 or reset of
                 password for the
                 Office of
                 Enrollment and
                 Discipline
                 Information
                 System.
                1.21(a)(9)(ii)............. 9004......................... Administrative 200 200 200 210 210 210
                 reinstatement
                 fee.
                1.21(a)(10)................ 9014......................... On petition for 1,600 1,600 1,600 1,680 1,680 1,680
                 reinstatement by
                 a person
                 excluded or
                 suspended on
                 ethical grounds,
                 or excluded on
                 consent from
                 practice before
                 the Office.
                1.21(k).................... 9024......................... Unspecified other AT COST AT COST AT COST AT COST AT COST AT COST
                 services,
                 excluding labor.
                1.21(n).................... 8026......................... Handling fee for 130 130 130 140 140 140
                 incomplete or
                 improper
                 application.
                1.21(o)(1)................. 1091/2091/3091............... Submission of 1,000 500 250 1,060 530 265
                 sequence
                 listings of
                 300MB to 800MB.
                1.21(o)(2)................. 1092/2092/3092............... Submission of 10,000 5,000 2,500 10,500 5,250 2,625
                 sequence
                 listings of more
                 than 800MB.
                1.21(q).................... 8054......................... Additional fee 160 160 160 170 170 170
                 for expedited
                 service.
                --------------------------------------------------------------------------------------------------------------------------------------------------------
                 Section 1.27: Section 1.27 is amended by revising the introductory
                text of paragraph (c)(3) to provide that the payment, by any party, of
                the exact amount of the small entity transmittal fee set forth in Sec.
                1.1031(a) will be treated as a written assertion of entitlement to
                small entity status. The change to Sec. 1.27(c)(3) will make it easier
                for applicants filing an international design application through the
                USPTO as an office of indirect filing to establish small entity status.
                 Section 1.431: Section 1.431 is amended by revising paragraph (c)
                to remove the reference to the late payment fee calculation under PCT
                Rule 16bis.2. The late payment fee pursuant to PCT Rule 16bis.2 is
                added to Sec. 1.445, as that provision concerns international
                application filing, processing, and search fees.
                 Section 1.445: Section 1.445 is amended by revising paragraph (a)
                to set forth international filing, processing, and search fees and
                charges as authorized under section 10 of the Act. The changes to the
                fee amounts indicated in 37 CFR 1.445 are shown in Table 17. Section
                1.445(a) is also amended to include the late payment fee pursuant to
                PCT Rule 16bis.2. See discussion of Sec. 1.431, supra.
                 Table 17--CFR Section 1.445 Fee Changes
                --------------------------------------------------------------------------------------------------------------------------------------------------------
                 Current fees (dollars) Final rule fees (dollars)
                 CFR section Fee code Description -----------------------------------------------------
                 Large Small Micro Large Small Micro
                --------------------------------------------------------------------------------------------------------------------------------------------------------
                1.445(a)(1) (i)(A)................ 1601/2601/3601...................... Transmittal fee......... 240 120 60 260 130 65
                1.445(a)(2) (i)................... 1602/2602/3602...................... Search fee--regardless 2,080 1,040 520 2,180 1,090 545
                 of whether there is a
                 corresponding
                 application (see 35
                 U.S.C. 361(d) and PCT
                 Rule 16).
                1.445(a)(3) (i)................... 1604/2604/3604...................... Supplemental search fee 2,080 1,040 520 2,180 1,090 545
                 when required, per
                 additional invention.
                1.445(a)(4)....................... 1621/2621/3621...................... Transmitting application 240 120 60 260 130 65
                 to Intl. Bureau to act
                 as receiving office.
                1.445(a)(5)....................... 1627/2627/3627...................... Late furnishing fee for 300 150 75 320 160 80
                 providing a sequence
                 listing in response to
                 an invitation under PCT
                 rule 13ter.
                --------------------------------------------------------------------------------------------------------------------------------------------------------
                 Section 1.482: Section 1.482 is amended by revising paragraphs (a)
                through (c) to read as set out in the regulatory text at the end of
                this document. The changes to the fee
                [[Page 46977]]
                amounts indicated in Sec. 1.482 are shown in Table 18.
                 Table 18--CFR Section 1.482 Fee Changes
                --------------------------------------------------------------------------------------------------------------------------------------------------------
                 Current fees (dollars) Final rule fees (dollars)
                 CFR section Fee code Description -----------------------------------------------------
                 Large Small Micro Large Small Micro
                --------------------------------------------------------------------------------------------------------------------------------------------------------
                1.482(a)(1)(i).................... 1605/2605/3605...................... Preliminary examination 600 300 150 640 320 160
                 fee--U.S. was the ISA.
                1.482(a)(1)(ii)................... 1606/2606/3606...................... Preliminary examination 760 380 190 800 400 200
                 fee--U.S. was not the
                 ISA.
                1.482(a)(2)....................... 1607/2607/3607...................... Supplemental examination 600 300 150 640 320 160
                 fee per additional
                 invention.
                1.482(c).......................... 1627/2627/3627...................... Late furnishing fee for 300 150 75 320 160 80
                 providing a sequence
                 listing in response to
                 an invitation under PCT
                 rule 13ter.
                --------------------------------------------------------------------------------------------------------------------------------------------------------
                 Section 1.492: Section 1.492 is amended by revising paragraphs (a),
                (b)(3) and (4), (c)(2), (d), (f), (h), and (j) to set forth the
                application filing, excess claims, search, and examination fees for
                international patent applications entering the national stage as
                authorized under section 10 of the Act. The changes to the fee amounts
                indicated in Sec. 1.492 are shown in Table 19. In this section, table
                headers were added to make formatting consistent.
                 Table 19--CFR Section 1.492 Fee Changes
                --------------------------------------------------------------------------------------------------------------------------------------------------------
                 Current fees (dollars) Final rule fees (dollars)
                 CFR section Fee code Description -----------------------------------------------------
                 Large Small Micro Large Small Micro
                --------------------------------------------------------------------------------------------------------------------------------------------------------
                1.492(a).......................... 1631/2631/3631...................... Basic National Stage Fee 300 150 75 320 160 80
                1.492(b)(3)....................... 1642/2642/3642...................... National Stage Search 520 260 130 540 270 135
                 Fee--search report
                 prepared and provided
                 to USPTO.
                1.492(b)(4)....................... 1632/2632/3632...................... National Stage Search 660 330 165 700 350 175
                 Fee--all other
                 situations.
                1.492(c)(2)....................... 1633/2633/3633...................... National Stage 760 380 190 800 400 200
                 Examination Fee--all
                 other situations.
                1.492(d).......................... 1614/2614/3614...................... Each independent claim 460 230 115 480 240 120
                 in excess of three.
                1.492(f).......................... 1616/2616/3616...................... Multiple dependent claim 820 410 205 860 430 215
                1.492(h).......................... 1617/2617/3617...................... Search fee, examination 140 70 35 160 80 40
                 fee or oath or
                 declaration after the
                 date of commencement of
                 the national stage.
                1.492(j).......................... 1681/2681/3681...................... National Stage 400 200 100 420 210 105
                 Application Size Fee--
                 for each additional 50
                 sheets that exceeds 100
                 sheets.
                --------------------------------------------------------------------------------------------------------------------------------------------------------
                 Section 11.11: The USPTO amends paragraph (a)(1) to provide that
                the OED director may publish a practitioner's CLE certification status.
                Paragraph (a)(1) has also been amended to require that persons granted
                limited recognition pursuant to Sec. 11.9 provide the contact
                information listed in Sec. 11.11(a)(1).
                 The USPTO amends paragraph (a)(2) to provide that registered
                practitioners and persons granted limited recognition under Sec.
                11.9(b) are required to biennially file a registration statement. It
                further provides that failure to file the mandatory registration
                statement may result in administrative suspension as set forth in Sec.
                11.11(b).
                 The USPTO adds paragraph (a)(3) to Sec. 11.11 to provide that
                registered practitioners and persons granted limited recognition under
                Sec. 11.9(b) may certify to the OED director that they have completed
                six credits of CLE in the preceding 24 months, with five of the credits
                in patent law and practice and one of the credits in ethics.
                 The USPTO amends paragraph (b)(1) in Sec. 11.11 to apply to those
                failing to comply with Sec. 11.11(a)(2), which refers to the
                registration statement.
                 The USPTO amends paragraph (e) in Sec. 11.11 to provide that
                resigned practitioners are subject to investigation for their conduct
                that occurred prior to, during, or after the period of their
                resignation.
                 The USPTO amends paragraph (f)(1) in Sec. 11.11 to remove any
                references to resigned practitioners, remove the requirement that a
                practitioner who was administratively suspended for two or more years
                before the date the Office receives a completed application from the
                person must also pass the registration examination under Sec.
                11.7(b)(1)(ii), and add the requirement that any practitioner who
                remains administratively suspended for more than five years shall be
                required to file a petition to the OED director requesting
                reinstatement and providing objective evidence that the practitioner
                continues to possess the necessary legal qualifications to render
                valuable service to patent applicants.
                 The USPTO adds paragraph (f)(3) to Sec. 11.11, which sets forth
                the process by which a practitioner who has resigned may apply to be
                reinstated to the register in active status.
                 Section 41.20: Section 41.20 is amended by revising paragraphs (a),
                (b)(1), (b)(2)(ii), and (b)(3) and (4) to set forth the appeal fees as
                authorized under section 10 of the Act. The changes to the fee amounts
                indicated in Sec. 41.20 are shown in Table 20.
                 Table 20--CFR Section 41.20 Fee Changes
                --------------------------------------------------------------------------------------------------------------------------------------------------------
                 Current fees (dollars) Final rule fees (dollars)
                 CFR section Fee code Description -----------------------------------------------------
                 Large Small Micro Large Small Micro
                --------------------------------------------------------------------------------------------------------------------------------------------------------
                41.20(a).......................... 1405/2405/3405...................... Petitions to the Chief 400 400 400 420 420 420
                 Administrative Patent
                 Judge under 37 CFR 41.3.
                [[Page 46978]]
                
                41.20(b)(1)....................... 1401/2401/3401...................... Notice of appeal........ 800 400 200 840 420 210
                41.20(b)(2)(ii)................... 1404/2404/3404...................... Filing a brief in 2,000 1,000 500 2,100 1,050 525
                 support of an appeal in
                 an inter partes
                 reexamination
                 proceeding.
                41.20(b)(3)....................... 1403/2403/3403...................... Request for oral hearing 1,300 650 325 1,360 680 340
                41.20(b)(4)....................... 1413/2413/3413...................... Forwarding an appeal in 2,240 1,120 560 2,360 1,180 590
                 an application or ex
                 parte reexamination
                 proceeding to the Board.
                --------------------------------------------------------------------------------------------------------------------------------------------------------
                 Section 42.15: Section 42.15 is amended by revising paragraphs (a)
                through (e) to set forth the inter partes review and post-grant review
                or covered business method patent review fees as authorized under
                section 10 of the Act. The changes to the fee amounts indicated in
                Sec. 42.15 are shown in Table 21.
                 Table 21--CFR Section 42.15 Fee Changes
                --------------------------------------------------------------------------------------------------------------------------------------------------------
                 Current fees (dollars) Final rule fees (dollars)
                 CFR section Fee code Description -----------------------------------------------------
                 Large Small Micro Large Small Micro
                --------------------------------------------------------------------------------------------------------------------------------------------------------
                42.15(a)(1)....................... 1406................................ Inter partes review 15,500 15,500 15,500 19,000 19,000 19,000
                 request fee--Up to 20
                 Claims.
                42.15(a)(2)....................... 1414................................ Inter partes review post- 15,000 15,000 15,000 n/a n/a n/a
                 institution fee--Up to
                 15 Claims.
                42.15(a)(2)....................... 1414................................ Inter partes review post- n/a n/a n/a 22,500 22,500 22,500
                 institution fee--Up to
                 20 Claims.
                42.15(a)(3)....................... 1407................................ Inter partes review 300 300 300 375 375 375
                 request of each claim
                 in excess of 20.
                42.15(a)(4)....................... 1415................................ Inter partes post- 600 600 600 750 750 750
                 institution request of
                 each claim in excess of
                 20.
                42.15(b)(1)....................... 1408................................ Post-grant or covered 16,000 16,000 16,000 20,000 20,000 20,000
                 business method patent
                 review request fee--Up
                 to 20 Claims.
                42.15(b)(2)....................... 1416................................ Post-grant or covered 22,000 22,000 22,000 n/a n/a n/a
                 business method patent
                 review post-institution
                 fee--Up to 15 Claims.
                42.15(b)(2)....................... 1416................................ Post-grant or covered n/a n/a n/a 27,500 27,500 27,500
                 business method patent
                 review post-institution
                 fee--Up to 20 Claims.
                42.15(b)(3)....................... 1409................................ Post-grant or covered 375 375 375 475 475 475
                 business method review
                 request of each claim
                 in excess of 20.
                42.15(b)(4)....................... 1417................................ Post-grant or covered 825 825 825 1,050 1,050 1,050
                 business method review
                 post-institution
                 request of each claim
                 in excess of 20.
                42.15(c)(1)....................... 1412................................ Petition for a 400 400 400 420 420 420
                 derivation proceeding.
                42.15(d).......................... 1411................................ Request to make a 400 400 400 420 420 420
                 settlement agreement
                 available and other
                 requests filed in a
                 patent trial proceeding.
                42.15(e).......................... NEW................................. Pro hac vice admission n/a n/a n/a 250 250 250
                 fee.
                --------------------------------------------------------------------------------------------------------------------------------------------------------
                VIII. Rulemaking Considerations
                A. AIA: America Invents Act
                 This Final Rule sets and adjusts fees under section 10(a) of the
                AIA as amended by the SUCCESS Act, Public Law 115-273, 132 Stat. 4158.
                Section 10(a) of the AIA authorizes the director of the USPTO to set or
                adjust by rule any patent fee established, authorized, or charged under
                title 35 of the U.S.C. for any services performed, or materials
                furnished, by the Office. The SUCCESS Act extends the USPTO fee setting
                authority until September 2026. Section 10 of the AIA prescribes that
                fees may be set or adjusted only to recover the aggregate estimated
                cost to the Office for processing, activities, services, and materials
                relating to patents, including administrative costs of the Office with
                respect to such patent fees. Section 10 authority includes flexibility
                to set individual fees in a way that furthers key policy factors, while
                taking into account the cost of the respective services. Section 10(e)
                of the AIA sets forth the general requirements for rulemakings that set
                or adjust fees under this authority. In particular, section 10(e)(1)
                requires the director to publish in the Federal Register any proposed
                fee change under section 10 and include in such publication the
                specific rationale and purpose for the proposal, including the possible
                expectations or benefits resulting from the proposed change. For such
                rulemakings, the AIA requires that the Office provide a public comment
                period of no less than 45 days.
                 The PPAC advises the Under Secretary of Commerce for Intellectual
                Property and Director of the USPTO on the management, policies, goals,
                performance, budget, and user fees of patent operations. When proposing
                fees under section 10 of the Act, the director must provide the PPAC
                with the proposed fees at least 45 days prior to publishing them in the
                Federal Register. The PPAC then has at least 30 days within which to
                deliberate, consider, and comment on the proposal, as well as hold
                public hearing(s) on the proposed fees. The PPAC must make a written
                report available to the public of the comments, advice, and
                recommendations of the committee regarding the proposed fees before the
                Office issues any final fees. The Office considers and analyzes any
                comments, advice, or recommendations received from the PPAC before
                finally setting or adjusting fees.
                 Consistent with this framework, on August 8, 2018, the director
                notified the PPAC of the Office's intent to set or adjust patent fees
                and submitted a preliminary patent fee proposal with supporting
                materials. The preliminary patent fee proposal and associated materials
                are available at https://www.uspto.gov/FeeSettingAndAdjusting. The PPAC
                held a public hearing in Alexandria, Virginia, on
                [[Page 46979]]
                September 6, 2018. Transcripts of the hearing are available for review
                at https://www.uspto.gov/sites/default/files/documents/PPAC_Hearing_Transcript_20180906.pdf. Members of the public were
                invited to the hearing and given the opportunity to submit written and/
                or oral testimony for the PPAC to consider. The PPAC considered such
                public comments from the hearing and made all comments available to the
                public via the Fee Setting website, https://www.uspto.gov/FeeSettingAndAdjusting. The PPAC also provided a written report setting
                forth in detail the comments, advice, and recommendations of the
                committee regarding the preliminary proposed fees. The report regarding
                the preliminary proposed fees was released on October 29, 2018, and can
                be found online at https://www.uspto.gov/sites/default/files/documents/PPAC_Fee_Setting_Report_Oct2018_1.pdf. The Office considered and
                analyzed all comments, advice, and recommendations received from the
                PPAC before publishing the NPRM on July 31, 2019 (84 FR 37398). The
                NPRM comment period closed on September 30, 2019. Section 10(e) of the
                Act requires the director to publish the final fee rule in the Federal
                Register and the Official Gazette of the USPTO at least 45 days before
                the final fees become effective. Pursuant to this requirement, this
                rule is effective on [INSERT DATE 60 DAYS AFTER DATE OF PUBLICATION IN
                THE Federal Register], except for the amendment to Sec. 1.16(u), which
                is effective on January 1, 2022.
                B. Regulatory Flexibility Act
                 The USPTO publishes this Final Regulatory Flexibility Analysis
                (FRFA) as required by the Regulatory Flexibility Act (RFA) (5 U.S.C.
                601, et seq.) to examine the impact of the Office's rule to implement
                the fee setting provisions of the Leahy-Smith America Invents Act (Pub.
                L. 112-29, 125 Stat. 284) (AIA or the Act) on small entities. Under the
                RFA, whenever an agency is required by 5 U.S.C. 553 (or any other law)
                to publish an NPRM, the agency must prepare and make available for
                public comment an Initial Regulatory Flexibility Analysis (IRFA),
                unless the agency certifies under 5 U.S.C. 605(b) that the rule, if
                implemented, will not have a significant impact on a substantial number
                of small entities (5 U.S.C. 603, 605). The Office published an IRFA,
                along with the NPRM, on July 31, 2019 (84 FR 37398). Given that the
                final patent fee schedule, based on the assumptions found in the FY
                2021 Budget, is projected to result in $1.2 billion in additional
                aggregate revenue over the current fee schedule (baseline) for the
                period including FY 2020 to FY 2024, the Office acknowledges that the
                fee adjustments will impact all entities seeking patent protection. The
                $1,205.1 million in additional aggregate revenue results from an
                additional $267.9 million in FY 2020, $39.1 million in FY 2021, $293.7
                million in FY 2022, $297.8 million in FY 2023, and $306.7 million in FY
                2024.
                 Items 1-6 below discuss the five items specified in 5 U.S.C.
                604(a)(1)-(6) to be addressed in an FRFA. Item 6 below discusses
                alternatives to this proposal that the Office considered.
                1. A Statement of the Need for, and Objectives of, the Rule
                 Section 10 of the AIA, as amended by the SUCCESS Act, authorizes
                the director of the USPTO to set or adjust by rule any patent fee
                established, authorized, or charged under title 35, U.S.C., for any
                services performed, or materials furnished, by the Office. The
                objective of the final patent fee schedule is for patent fees to
                recover the aggregate cost of patent operations, including
                administrative costs, while facilitating effective administration of
                the U.S. patent system. Since its inception, the Act strengthened the
                patent system by affording the USPTO the ``resources it requires to
                clear the still sizeable backlog of patent applications and move
                forward to deliver to all American inventors the first rate service
                they deserve.'' H.R. Rep. No. 112-98(I), at 163 (2011). In setting and
                adjusting fees under the Act, the Office will secure a sufficient
                amount of aggregate revenue to recover the aggregate cost of patent
                operations, including revenue needed to achieve strategic and
                operational goals. Additional information on the Office's strategic
                goals may be found in the Strategic Plan, available at www.uspto.gov/strategicplan. Additional information on the Office's operating
                requirements to achieve the strategic goals may be found in the ``USPTO
                FY 2021 President's Budget Request,'' available at https://www.uspto.gov/about-us/performance-and-planning/budget-and-financial-information.
                2. A Statement of the Significant Issues Raised by the Public Comments
                in Response to the Initial Regulatory Flexibility Analysis, a Statement
                of the Assessment of the Agency of Such Issues, and a Statement of Any
                Changes Made in the Final Rule as a Result of Such Comments
                 The Office received two public comments in response to the IRFA.
                Details of those comments are discussed and analyzed above in Part VI:
                Discussion of Comments and are summarized here.
                 Comment: One commenter wrote that the increase in the second and
                subsequent RCE fee would hurt small entity applicants and small entity
                law firms. The Initial Regulatory Flexibility Analysis offered no
                explanation justifying that differential effect on small entities.
                 Response: The USPTO is not targeting the RCE fees for a specific
                increase. Instead, the fees for RCEs--both for the first request and
                for second and subsequent requests--are being adjusted by the across-
                the-board adjustment to patent fees. The USPTO would like to note that
                small and micro entity applicants will continue to receive the small
                and micro entity discounts, which set the fee rates significantly below
                cost to examine second and subsequent RCE filings. Additionally, the
                Regulatory Flexibility Analysis analyzed applicants' sensitivity to
                changes in fee rates by entity size, including RCE fees for small
                entities. This impact is also included in the RIA completed for this
                rulemaking, which is available at https://www.uspto.gov/FeeSettingAndAdjusting.
                 Comment: One commenter claimed the Regulatory Flexibility Analysis
                must analyze the effect of the annual active patent practitioner fee on
                small entities because a great number of practitioners work for small
                entities.
                 Response: As noted in response to Comment 81 above, the USPTO has
                elected not to implement the annual active patent practitioner fee at
                this time.
                3. The Response of the Agency to Any Comments Filed by the Chief
                Counsel for Advocacy of the Small Business Administration in Response
                to the Proposed Rule, and a Detailed Statement of Any Change Made to
                the Proposed Rule in the Final Rule as a Result of the Comments
                 The Office did not receive any comments filed by the Chief Counsel
                for Advocacy of the Small Business Administration in response to the
                proposed rule.
                4. A Description of and, Where Feasible, an Estimate of the Number of
                Small Entities To Which the Rule Will Apply or an Explanation of Why No
                Such Estimate Is Available
                (a) SBA Size Standard
                 The Small Business Act (SBA) size standards applicable to most
                analyses conducted to comply with the RFA are set forth in 13 CFR
                121.201. These
                [[Page 46980]]
                regulations generally define small businesses as those with less than a
                specified maximum number of employees or less than a specified level of
                annual receipts for the entity's industrial sector or North American
                Industry Classification System (NAICS) code. As provided by the RFA,
                and after consulting with the Small Business Administration, the Office
                formally adopted an alternate size standard for the purpose of
                conducting an analysis or making a certification under the RFA for
                patent-related regulations. See Business Size Standard for Purposes of
                United States Patent and Trademark Office Regulatory Flexibility
                Analysis for Patent-Related Regulations, 71 FR 67109, 67109 (Nov. 20,
                2006), 1313 Off. Gaz. Pat. Office 37, 60 (Dec. 12, 2006). The Office's
                alternate small business size standard consists of the SBA's previously
                established size standard for entities entitled to pay reduced patent
                fees. See 13 CFR 121.802.
                 Unlike the SBA's generally applicable small business size
                standards, the size standard for the USPTO is not industry-specific.
                The Office's definition of a small business concern for RFA purposes is
                a business or other concern that: (1) Meets the SBA's definition of a
                ``business concern or concern'' set forth in 13 CFR 121.105, and (2)
                meets the size standards set forth in 13 CFR 121.802 for the purpose of
                paying reduced patent fees, namely, an entity: (a) Whose number of
                employees, including affiliates, does not exceed 500 persons, and (b)
                that has not assigned, granted, conveyed, or licensed (and is under no
                obligation to do so) any rights in the invention to any person who made
                it and could not be classified as an independent inventor, or to any
                concern that would not qualify as a nonprofit organization or a small
                business concern under this definition. See 71 FR at 67109, 1313 Off.
                Gaz. Pat. Office 60.
                 If a patent applicant self-identifies on a patent application as
                qualifying as a small entity or provides certification of micro entity
                status for reduced patent fees under the Office's alternative size
                standard, the Office captures this data in the Patent Application
                Location and Monitoring (PALM) database system, which tracks
                information on each patent application submitted to the Office.
                Small Entity Defined
                 The Act provides that fees set or adjusted under section 10(a)
                ``for filing, searching, examining, issuing, appealing, and maintaining
                patent applications and patents shall be reduced by 50 percent'' with
                respect to the application of such fees to any ``small entity'' (as
                defined in 37 CFR 1.27) that qualifies for reduced fees under 35 U.S.C.
                41(h)(1). In turn, 125 Stat. at 316-17. 35 U.S.C. 41(h)(1) provides
                that certain patent fees ``shall be reduced by 50 percent'' for a small
                business concern as defined by section 3 of the SBA, and to any
                independent inventor or nonprofit organization as defined in
                regulations described by the director.
                Micro Entity Defined
                 Section 10(g) of the Act created a new category of entity called a
                ``micro entity.'' 35 U.S.C. 123; see also 125 Stat. at 318-19. Section
                10(b) of the Act provides that the fees set or adjusted under section
                10(a) ``for filing, searching, examining, issuing, appealing, and
                maintaining patent applications and patents shall be reduced by 75
                percent with respect to the application of such fees to any micro
                entity as defined by 35 U.S. Code 123.'' 125 Stat. at 315-17. 35 U.S.C.
                123(a) defines a ``micro entity'' as an applicant that makes a
                certification that the applicant: (1) Qualifies as a small entity as
                defined in 37 CFR 1.27; (2) has not been named as an inventor on more
                than four previously filed patent applications, other than applications
                filed in another country, provisional applications under 35 U.S.C.
                111(b), or PCT applications for which the basic national fee under 35
                U.S.C. 41(a) was not paid; (3) did not, in the calendar year preceding
                the calendar year in which the applicable fee is being paid, have a
                gross income, as defined in section 61(a) of the Internal Revenue Code
                of 1986 (26 U.S.C. 61(a)), exceeding three times the median household
                income for that preceding calendar year, as most recently reported by
                the Bureau of the Census; \2\ and (4) has not assigned, granted, or
                conveyed, and is not under an obligation by contract or law to assign,
                grant, or convey, a license or other ownership interest in the
                application concerned to an entity exceeding the income limit set forth
                in (3) above. See 125 Stat. at 318. 35 U.S.C. 123(d) also defines a
                ``micro entity'' as an applicant that certifies that: (1) The
                applicant's employer, from which the applicant obtains the majority of
                the applicant's income, is an institution of higher education as
                defined in section 101(a) of the Higher Education Act of 1965 (20
                U.S.C. 1001(a)); or (2) the applicant has assigned, granted, conveyed,
                or is under an obligation by contract or law to assign, grant, or
                convey, a license or other ownership interest in the particular
                applications to such an institution of higher education.
                ---------------------------------------------------------------------------
                 \2\ For more information, see https://www.uspto.gov/PatentMicroentity.
                ---------------------------------------------------------------------------
                Estimate of Number of Small Entities Affected
                 The changes in this Final Rule will apply to any entity, including
                small and micro entities, that pays any patent fee set forth in this
                Final Rule. The reduced fee rates (50 percent for small entities and 75
                percent for micro entities) will continue to 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.
                 The Office reviews historical data to estimate the percentages of
                application filings asserting small entity status. Table 22 presents a
                summary of such small entity filings by type of application (utility,
                reissue, plant, design) over the last five years.
                 Table 22--Number of Patent Applications Filed In Last Five Years *
                ----------------------------------------------------------------------------------------------------------------
                 FY 2019 ** FY 2018 FY 2017 FY 2016 FY 2015 Average
                ----------------------------------------------------------------------------------------------------------------
                Utility:
                 All........................... 619,186 597,952 604,655 609,063 579,358 602,043
                 Small......................... 140,097 135,307 134,393 131,617 125,991 133,481
                 % Small....................... 22.6 22.6 22.2 21.6 21.7 22.2
                 Micro......................... 19,844 20,314 20,359 20,652 19,119 20,058
                 % Micro....................... 3.2 3.4 3.4 3.4 3.3 3.3
                Reissue:
                 All........................... 1,131 1,023 1,086 1,123 1,154 1,103
                [[Page 46981]]
                
                 Small......................... 241 219 237 237 217 230
                 % Small....................... 21.3 21.4 21.8 21.1 18.8 20.9
                 Micro......................... 33 20 23 21 12 22
                 % Micro....................... 2.9 2.0 2.1 1.9 1.0 2.0
                Plant:
                 All........................... 1,168 1,043 1,076 1,181 1,095 1,113
                 Small......................... 594 467 536 563 577 547
                 % Small....................... 50.9 44.8 49.8 47.7 52.7 49.2
                 Micro......................... 7 7 18 10 6 10
                 % Micro....................... 0.6 0.7 1.7 0.8 0.5 0.9
                Design:
                 All........................... 45,945 46,433 44,048 42,298 38,183 43,381
                 Small......................... 18,628 18,992 18,014 16,723 14,709 17,413
                 % Small....................... 40.5 40.9 40.9 39.5 38.5 40.1
                 Micro......................... 6,464 5,459 4,983 4,289 3,879 5,015
                 % Micro....................... 14.1 11.8 11.3 10.1 10.2 11.6
                ----------------------------------------------------------------------------------------------------------------
                * The patent application filing data in this table includes RCEs.
                ** FY 2019 application filing data are preliminary and will be finalized in the FY 2020 Performance and
                 Accountability Report (PAR).
                 Because the percentage of small entity filings varies widely
                between application types, the Office has averaged the small entity
                filing rates over the past five years for those application types in
                order to estimate future filing rates by small and micro entities.
                Those average rates appear in the last column of Table 22.
                 The USPTO continuously updates both patent fee collections
                projections and workload projections based on the latest data. The
                estimated number of patent applications has been updated since the NPRM
                was published in July 2019. UPR filings growth projections were revised
                upward during the FY 2021 budget formulation process due to revised
                RGDP estimates and historical trends. As found in the FY 2021 Budget,
                the Office estimates that serialized UPR patent application growth
                rates will be 2.5 percent in FY 2020, 2.0 percent in FY 2021, 1.5
                percent in FY 2022, and 1.0 percent in FYs 2023 and 2024. The Office
                forecasts design patent applications independently of UPR applications
                because they exhibit different behavior.
                 Using the estimated filings for the next five years and the average
                historic rates of small entity filings, Table 23 presents the Office's
                estimates of the number of patent application filings by all
                applicants, including small and micro entities, over the next five
                fiscal years by application type.
                 Table 23--Estimated Numbers of Patent Applications in FY 2020-FY 2024
                ----------------------------------------------------------------------------------------------------------------
                 FY 2020 FY 2021 FY 2022 FY 2023 FY 2024
                ----------------------------------------------------------------------------------------------------------------
                Utility........................................ 632,402 632,105 642,729 652,922 662,489
                Reissue........................................ 899 899 899 899 899
                Plant.......................................... 1,300 1,300 1,300 1,300 1,300
                Design......................................... 45,751 47,581 49,484 51,464 53,521
                 ----------------------------------------------------------------
                 Total...................................... 680,352 681,885 694,412 706,585 718,209
                ----------------------------------------------------------------------------------------------------------------
                 The Office has undertaken an elasticity analysis to examine if fee
                adjustments may impact small entities and, in particular, whether
                increases in fees would result in some such entities not submitting
                applications. Elasticity measures how sensitive demand for services by
                patent applicants and patentees is to fee changes. If elasticity is low
                enough (demand is inelastic), then fee increases will not reduce
                patenting activity enough to negatively impact overall revenues. If
                elasticity is high enough (demand is elastic), then increasing fees
                will decrease patenting activity enough to decrease revenue. The Office
                analyzed elasticity at the overall filing level across all patent
                applicants with regard to entity size and estimated the potential
                impact to patent application filings across entities. Additional
                information about elasticity estimates is available at https://www.uspto.gov/FeeSettingAndAdjusting in the document entitled ``Setting
                and Adjusting Patent Fees during Fiscal Year 2020--Description of
                Elasticity Estimates.''
                5. A Description of the Projected Reporting, Recordkeeping, and Other
                Compliance Requirements of the Rule, Including an Estimate of the
                Classes of Small Entities Which Will be Subject to the Requirement and
                Type of Professional Skills Necessary for Preparation of the Report or
                Record
                 When implemented, this rule will not change the burden of existing
                reporting and recordkeeping requirements for payment of fees. The
                current requirements for small and micro entities will continue to
                apply. Therefore, the professional skills necessary to file and
                prosecute an application through issue and maintenance remain unchanged
                under this rule. This action only adjusts patent fees and does not set
                procedures for asserting small entity status or certifying micro entity
                status, as previously discussed. There are no new compliance
                requirements in this rule.
                 The full fee schedule (see Part VII: Discussion of Specific Rules)
                is set forth in this Final Rule. The fee schedule sets or adjusts 296
                patent fees in total. This includes four fees that will be discontinued
                and five new fees.
                [[Page 46982]]
                6. A Description of the Steps the Agency Has Taken To Minimize the
                Significant Economic Impact on Small Entities Consistent With the
                Stated Objectives of Applicable Statutes, Including a Statement of the
                Factual, Policy, and Legal Reasons for Selecting the Alternative
                Adopted in the Final Rule and Why Each One of the Other Significant
                Alternatives to the Rule Considered by the Agency Which Affect the
                Impact on Small Entities Was Rejected
                 The USPTO considered several alternative approaches to this Final
                Rule, discussed below, including full cost recovery for individual
                services, an across-the-board adjustment to fees, and a baseline
                (current fee rates). The discussion begins with Alternative 1, a
                description of the fee schedule adopted in this Final Rule. A full
                discussion of the costs and benefits of all four alternatives and the
                methodology used for that analysis is contained in the RIA, available
                at https://www.uspto.gov/FeeSettingAndAdjusting.
                (a) Alternative 1: Final Patent Fee Schedule--Setting and Adjusting
                Patent Fees During Fiscal Year 2020
                 The USPTO chose the patent fee schedule in this Final Rule because
                it achieves the aggregate revenue needed for the Office to offset
                aggregate costs, based on the assumptions found in the FY 2021 Budget,
                and is therefore beneficial to all entities that seek patent
                protection. Also, the alternative selected here benefits from
                improvements in the design of the fee schedule. The final patent fee
                schedule herein secures the Office's required revenue to recover its
                aggregate costs, while progressing towards high-quality and timely
                patent examination and review proceedings in order to produce reliable
                and predictable IP rights. This will benefit all applicants, including
                small and micro entities, without undue burden to patent applicants and
                holders, barriers to entry, or reduced incentives to innovate. This
                alternative maintains small and micro entity discounts. Compared to the
                current fee schedule, there are no new small or micro entity fee codes
                being extended to existing large entity fee rates, and none are being
                eliminated. All entities will benefit from the Office's proposal to
                discontinue four fees. Three patent service fees are being eliminated
                in order to focus USPTO workforce efforts on producing products that
                benefit the general public rather than producing outputs for individual
                customers that can be obtained through other, more efficient means.
                Additionally, the Office is eliminating the fee for assisting with the
                recovery of identification or reset of a password for the Office of
                Enrollment and Discipline Information System. This fee is being removed
                because it is unnecessary.
                 As discussed throughout this document, the fee changes in this
                alternative are moderate compared to other alternatives. Given that the
                final patent fee schedule will result in increased aggregate revenue,
                small and micro entities will pay some higher fees when compared to the
                current fee schedule (Alternative 4).
                 In summary, the fees to obtain a patent will increase. All patent
                fees not covered by the targeted adjustments as discussed in section B
                of Part V, or to be discontinued, as discussed in section C of Part V,
                are subject to the approximately 5 percent across the board increase.
                In addition to the across the board increase, some fees will be subject
                to a larger increase. For example, the issue fee and first stage
                maintenance fee rate will increase by 20 and 25 percent, respectively.
                However, second and third stage maintenance fees will only increase by
                4 percent, less than the across-the-board increase. This alternative
                includes a new surcharge fee for applications not filed in DOCX format,
                which aims to improve the electronic application process for patent
                applicants by modernizing the USPTO's filing and viewing systems. This
                streamlines the application and publication processes, which benefits
                both the applicants and examiners. In an effort to enable the PTAB to
                continue high-quality, timely, and efficient proceedings with the
                expected increase in work following the Supreme Court decision in SAS
                Institute Inc. v. Iancu, 138 S. Ct. 1348 (2018), AIA trial fees will
                increase by at least 23.0 percent. Finally, in response to feedback
                from members of the public, the fee for a request for the expedited
                examination of a design application has been reduced to $1,600. Under
                the NPRM, the fee was proposed to be $2,000.
                 Adjusting the patent fee schedule as prescribed in this alternative
                allows the Office to implement the patent-related strategic goals and
                objectives documented in the Strategic Plan and to carry out
                requirements as described in the FY 2021 Budget. Specifically, this
                final patent fee schedule is estimated to generate sufficient revenue
                to support increases in core examination costs that are necessary to
                implement strategic initiatives to issue highly reliable patents, such
                as increasing the time examiners are provided to work on each
                application. This final patent fee schedule also supports the Strategic
                Plan's mission support goal to deliver organizational excellence (which
                includes optimizing the speed, quality, and cost-effectiveness of IT
                delivery to achieve business value and ensuring financial
                sustainability to facilitate effective USPTO operations) by allowing
                the Office to continue to make necessary business improvements. While
                all of the other alternatives discussed facilitate progress toward some
                of the Office's goals, the final patent fee schedule is the only one
                that does so in a way that does not impose undue costs on patent
                applicants and holders.
                 A comparison between the final patent fee schedule for this rule
                and existing fees (labeled Alternative 1--Final Patent Fee Schedule--
                Setting and Adjusting Patent Fees during Fiscal Year 2020) is available
                at https://www.uspto.gov/FeeSettingAndAdjusting in the document
                entitled ``Final Regulatory Flexibility Analysis Tables.'' Fee changes
                for small and micro entities are included in the tables. For the
                comparison between the fees in the final patent fee schedule and
                current fees, as noted above, the ``current fees'' column displays the
                fees that were in effect as of January 2018.
                (b) Other Alternatives Considered
                 In addition to the final patent fee schedule set forth in
                Alternative 1, above, the Office considered several other alternative
                approaches. For each alternative considered, the Office calculated fee
                rates and the resulting revenue derived by each alternative scenario.
                The fees and their corresponding revenue tables are available at
                https://www.uspto.gov/FeeSettingAndAdjusting. Please note, only the
                fees outlined in Alternative 1 are being implemented in the Final Rule;
                other scenarios are discussed only to present the Office's analysis of
                other options.
                Alternative 2: Unit Cost Recovery
                 It is common practice in the federal government to set individual
                fees at a level sufficient to recover the cost of that single service.
                In fact, official guidance on user fees, as cited in OMB Circular A-25:
                User Charges, states that user charges (fees) should be sufficient to
                recover the full cost to the federal government of providing the
                particular service, resource, or good when the government is acting in
                its capacity as sovereign.
                 As such, the USPTO considered setting most individual large entity
                fees at the historical cost of performing the activities related to the
                particular service in FY 2018. (While more recent FY 2019 cost data is
                now available, for
                [[Page 46983]]
                consistency with information presented in the NPRM, the Office
                continues to base the fee rates displayed under Alternative 2 in the
                IRFA and the RIA on FY 2018 unit cost data). There are several
                complexities in achieving individual fee unit cost recovery for the
                patent fee schedule. The most significant is the AIA requirement to
                provide a 50 percent discount on fees to small entities and a 75
                percent discount on fees to micro entities. To account for this
                requirement, this alternative continues existing small and micro entity
                discounts where eligible under AIA authority. Thus, in order to
                continue the small and micro entity discounts and generate sufficient
                revenue to recover the Office's anticipated budgetary requirements over
                the five-year period with the assumptions found in the FY 2021 Budget,
                for this alternative, maintenance fees must be set significantly above
                unit cost.
                 With the exception of maintenance fees, fees for which there is no
                FY 2018 cost data would be set at current rates under this alternative.
                The Office no longer collects activity-based information for
                maintenance fees, and previous year unit costs were negligible. For the
                small number of services that have a variable fee, the aggregate
                revenue table does not list a fee. Instead, for those services with an
                estimated workload, the workload is listed in dollars rather than units
                to develop revenue estimates. Fees without either a fixed fee rate or a
                workload estimate are assumed to provide zero revenue to the Office.
                Note, this alternative bases fee rates for FY 2020 through FY 2024 on
                FY 2018 historical costs. The Office recognizes that this approach does
                not account for inflationary factors that would likely increase costs
                and necessitate higher fees in the out-years.
                 Alternative 2 could present significant barriers to those seeking
                patent protection because front-end fees would increase significantly
                for all applicants, even with small and micro entity fee reductions.
                Further, this alternative is counter to the Office's general philosophy
                to charge applicants and holders lower fees when they have less
                information about the relative value of their innovation. This
                alternative does not align well with the strategic and policy goals of
                this Final Rule. Both the current and final patent fee schedule are
                structured to collect more fees further along in the process (i.e.,
                issue fees and maintenance fees), when the patent owner has better
                information about a patent's value, rather than up front (i.e., filing
                fees, search fees, and examination fees), when applicants are less
                certain about the value of their innovation, even though the front-end
                services are costlier to the Office. This alternative presents
                significant barriers to those seeking patent protection because if the
                Office were to immediately shift from the current front-end/back-end
                balance to a unit cost recovery structure, front-end fees would
                increase significantly, nearly tripling in some cases (e.g., search
                fees).
                 The Office has estimated the potential quantitative elasticity
                impacts for application filings (e.g., filing, search, and examination
                fees), maintenance renewals (all stages), and other major fee
                categories. Results of this analysis indicate that a high cost of entry
                into the patent system could lead to a significant decrease in the
                incentives to invest in innovative activities among all entities,
                especially for small and micro entities. Under the current fee
                schedule, maintenance fees subsidize all applications, including those
                applications for which no claims are allowed. By insisting on unit cost
                payment at each point in the application process, the Office is
                effectively charging high fees for every attempted patent, meaning
                those applicants who have less information about the patentability of
                their claims or the market value of their invention may be less likely
                to pursue initial prosecution (e.g., filing, search, and examination)
                or subsequent actions to continue prosecution (e.g., RCE). The ultimate
                effect of these changes in behavior is likely to stifle innovation. In
                sum, this alternative is inadequate to accomplish the goals and
                strategies as stated in Part III of this Final Rule.
                 The Office theorizes that the high costs of entry into the patent
                system could lead to a decrease in the incentives to invest in
                innovative activities among all entities, and especially small and
                micro entities. There is a strong possibility that funds previously
                used for issue and maintenance fee payments could offset the higher
                front-end costs for some users, but the front-end costs could prove
                insurmountable for other innovators.
                 The fee schedule for Alternative 2: Unit Cost Recovery is available
                at https://www.uspto.gov/FeeSettingAndAdjusting in the document
                entitled ``Final Regulatory Flexibility Analysis Tables.'' For the
                comparison between unit cost recovery fees and current fees, the
                ``current fees'' column displays the fees that are in effect as of
                January 2018. This column is used to calculate dollar and percent fee
                change compared to unit cost recovery fees.
                Alternative 3: Across-the Board-Adjustment
                 In years past, the USPTO used its authority to adjust statutory
                fees annually according to increases in the consumer price index (CPI),
                which is a commonly used measure of inflation. Building on this prior
                approach and incorporating the additional authority under the AIA to
                set small and micro entity fees, Alternative 3 would set fees by
                applying a one-time 10 percent, across the board inflationary increase
                to the baseline (current fees) beginning in July 2020. Ten percent
                represents the change in revenue needed to achieve the aggregate
                revenue needed to cover future budgetary requirements based on the
                assumptions found in the FY 2021 Budget. All entities (large, small,
                and micro) would pay 10 percent higher fees for every product and
                service.
                 As estimated by the CBO in 2019, projected CPI rates by fiscal year
                are: 2.3 percent in FY 2020, 2.5 percent in FY 2021 through FY 2023,
                and 2.4 percent in FY 2024. The Office elected not to apply the
                estimated cumulative inflationary adjustment (12.8 percent), from FY
                2020 through FY 2024 because doing so would result in significantly
                greater fee revenue than needed to meet the Office's core mission and
                strategic priorities. Under this alternative, nearly every existing fee
                would be increased, and no fees would be discontinued or reduced. But
                this alternative maintains the status quo ratio of front-end and back-
                end fees, given that all fees would be adjusted by the same escalation
                factor, thereby promoting innovation strategies and allowing applicants
                to gain access to the patent system through fees set below cost while
                patent holders pay issue and maintenance fees above cost to subsidize
                the below cost front-end fees. Alternative 3 nevertheless fails to
                implement policy factors and deliver benefits beyond what exists in the
                baseline fee schedule (e.g., no fee adjustments to offer new patent
                prosecution options or facilitate more effective administration of the
                patent system). Given that all entities (large, small, and micro) would
                pay 10.0 percent higher fees for every product and service, especially
                the fees due at the time of filing, this alternative does not
                adequately support the Office's policy factor to promote innovation
                strategies.
                 The fee schedule for Alternative 3: Across-the-Board Adjustment is
                available at https://www.uspto.gov/FeeSettingAndAdjusting in the
                document entitled ``Final Regulatory Flexibility Analysis Tables.'' For
                the comparison between the across-the-
                [[Page 46984]]
                board adjustment fees and current fees, the ``current fees'' column
                displays the fees that are in effect as of January 2018.
                Alternative 4: Baseline (Current Fee Schedule)
                 The Office considered a no-action alternative. This alternative
                would retain the status quo, meaning that the Office would continue the
                small and micro entity discounts that Congress provided in section 10
                of the Act and maintain fees as of January 2018.
                 This approach would not provide sufficient aggregate revenue, based
                on the assumptions found in the FY 2021 Budget, to accomplish the
                Office's rulemaking goals as set forth in Part III of this Final Rule
                or the Strategic Plan. IT improvement, progress on backlog and
                pendency, and other improvement activities would continue, but at a
                significantly slower rate, as increases in core patent examination
                costs that are necessary to implement the strategic objective to issue
                highly reliable patents--such as increasing the time examiners are
                provided to work on each application--crowd out funding for other
                improvements. Likewise, without a fee increase, the USPTO would deplete
                its operating reserves, leaving the Office vulnerable to fiscal and
                economic events. This would expose core operations to unacceptable
                levels of financial risk and would position the Office to have to
                return to making inefficient, short-term funding decisions.
                 The fee schedule for Alternative 4: Baseline (Current Fee Schedule)
                is available at https://www.uspto.gov/FeeSettingAndAdjusting in the
                document entitled ``Final Regulatory Flexibility Analysis Tables.''
                Alternatives Specified by the RFA
                 The RFA provides that an agency should also consider four specified
                ``alternatives'' or approaches, namely: (1) Establishing different
                compliance or reporting requirements or timetables that take into
                account the resources available to small entities; (2) clarifying,
                consolidating, or simplifying compliance and reporting requirements
                under the rule for small entities; (3) using performance rather than
                design standards; and (4) exempting small entities from coverage of the
                rule, or any part thereof (5 U.S.C. 604(c)). The USPTO discusses each
                of these specified alternatives or approaches below and describes how
                this Final Rule is adopting these approaches.
                Differing Requirements
                 As discussed above, the changes in this Final Rule would continue
                existing fee discounts for small and micro entities that take into
                account the reduced resources available to them as well as offer new
                discounts when applicable under AIA authority. Specifically, micro
                entities would continue to receive a 75 percent reduction in patent
                fees under this proposal and non-micro, small entities would continue
                to pay 50 percent of the fee.
                 This Final Rule sets fee levels but does not set or alter
                procedural requirements for asserting small or micro entity status. To
                pay reduced patent fees, small entities must merely assert small entity
                status to pay reduced patent fees. The small entity may make this
                assertion by either checking a box on the transmittal form, ``Applicant
                claims small entity status,'' or by paying the basic filing or basic
                national small entity fee exactly. The process to claim micro entity
                status is similar in that eligible entities need only submit a written
                certification of their status prior to or at the time a reduced fee is
                paid. This Final Rule does not change any reporting requirements for
                any small or micro entity. For both small and micro entities, the
                burden to establish their status is nominal (making an assertion or
                submitting a certification), and the benefit of the fee reductions (50
                percent for small entities and 75 percent for micro entities) is
                significant.
                 This Final Rule makes the best use of differing requirements for
                small and micro entities. It also makes the best use of the redesigned
                fee structure, as discussed further below.
                Clarification, Consolidation, or Simplification of Requirements
                 This Final Rule pertains to setting or adjusting patent fees. Any
                compliance or reporting requirements in this rule are de minimis and
                necessary to implement lower fees. Therefore, any clarifications,
                consolidations, or simplifications to compliance and reporting
                requirements for small entities are not applicable or would not achieve
                the objectives of this rulemaking.
                Performance Standards
                 Performance standards do not apply to the Final Rule.
                Exemption for Small and Micro Entities
                 The final patent fee schedule maintains a 50 percent reduction in
                fees for small entities and a 75 percent reduction in fees for micro
                entities. The Office considered exempting small and micro entities from
                paying increased patent fees but determined that the USPTO would lack
                statutory authority for this approach. Section 10(b) of the Act
                provides that ``fees set or adjusted under subsection (a) for filing,
                searching, examining, issuing, appealing, and maintaining patent
                applications and patents shall be reduced by 50 percent [for small
                entities] and shall be reduced by 75 percent [for micro entities]''
                (emphasis added). Neither the AIA nor any other statute authorizes the
                USPTO simply to exempt small or micro entities, as a class of
                applicants, from paying increased patent fees.
                C. Executive Order 12866 (Regulatory Planning and Review)
                 This Final Rule has been determined to be economically significant
                for purposes of Executive Order 12866 (Sept. 30, 1993). The Office has
                developed an RIA as required for rulemakings deemed to be economically
                significant. The complete RIA is available at https://www.uspto.gov/FeeSettingAndAdjusting.
                D. Executive Order 13563 (Improving Regulation and Regulatory Review)
                 The Office has complied with Executive Order 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 13771 (Reducing Regulation and Controlling
                Regulatory Costs)
                 This Final Rule is not subject to the requirements of Executive
                Order 13771 (Jan. 30, 2017) because this Final Rule involves a transfer
                payment.
                [[Page 46985]]
                F. Executive Order 13132 (Federalism)
                 This rulemaking does not contain policies with federalism
                implications sufficient to warrant preparation of a Federalism
                Assessment under Executive Order 13132 (Aug. 4, 1999).
                G. 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
                Executive Order 13175 (Nov. 6, 2000).
                H. Executive Order 13211 (Energy Effects)
                 This rulemaking is not a significant energy action under Executive
                Order 13211 (May 18, 2001) because this final 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 Executive Order 13211.
                I. 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 Executive Order 12988 (Feb. 5, 1996).
                J. Executive Order 13045 (Protection of Children)
                 This rulemaking does not concern an environmental risk to health or
                safety that may disproportionately affect children under Executive
                Order 13045 (Apr. 21, 1997).
                K. Executive Order 12630 (Taking of Private Property)
                 This rulemaking will not affect a taking of private property or
                otherwise have taking implications under Executive Order 12630 (Mar.
                15, 1988).
                L. 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.),
                prior to issuing any final rule, the United States Patent and Trademark
                Office will submit a report containing the 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 Final Rule are 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 Final
                Rule is a ``major rule'' as defined in 5 U.S.C. 804(2).
                M. 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. See 2 U.S.C. 1501 et seq.
                N. 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. See 42 U.S.C. 4321 et seq.
                O. 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.
                P. 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
                0651-0012, 0651-0016, 0651-0020, 0651-0021, 0651-0031, 0651-0032, 0651-
                0033, 0651-0059, 0651-0063, 0651-0064, 0651-0069, and 0651-0075. 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
                has a currently valid OMB control number.
                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 11
                 Administrative practice and procedure, Inventions and patents,
                Lawyers, Reporting and recordkeeping requirements.
                37 CFR Part 41
                 Administrative practice and procedure, Inventions and patents,
                Lawyers, Reporting and recordkeeping requirements.
                37 CFR Part 42
                 Administrative practice and procedure, Inventions and patents,
                Lawyers.
                 For the reasons set forth in the preamble, 37 CFR parts 1, 11, 41,
                and 42 are amended as follows:
                PART 1--RULES OF PRACTICE IN PATENT CASES
                0
                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.
                0
                2. Section 1.16 is amended by:
                0
                a. Revising paragraphs (a) through (e);
                0
                b. Adding table headings to the tables in paragraphs (f) and (g);
                0
                c. Revising paragraph (h);
                0
                d. Adding a heading to the table in paragraph (i);
                0
                e. Revising paragraphs (j) and (k);
                0
                f. Adding a heading to the table in paragraph (l);
                0
                g. Revising paragraphs (m) through (s);
                0
                h. Adding a heading to the table in paragraph (t); and
                0
                i. Adding paragraph (u).
                 The revisions and additions read as follows:
                Sec. 1.16 National application filing, search, and examination fees.
                 (a) Basic fee for filing each application under 35 U.S.C. 111 for
                an original patent, except design, plant, or provisional applications:
                [[Page 46986]]
                 Table 1 to Paragraph (a)
                ------------------------------------------------------------------------
                
                ------------------------------------------------------------------------
                By a micro entity (Sec. 1.29)............................ $80.00
                By a small entity (Sec. 1.27(a))......................... 160.00
                By a small entity (Sec. 1.27(a)) if the application is 80.00
                 submitted in compliance with the Office electronic filing
                 system (Sec. 1.27(b)(2))................................
                By other than a small or micro entity...................... 320.00
                ------------------------------------------------------------------------
                 (b) Basic fee for filing each application under 35 U.S.C. 111 for
                an original design patent:
                 Table 2 to Paragraph (b)
                ------------------------------------------------------------------------
                
                ------------------------------------------------------------------------
                By a micro entity (Sec. 1.29)............................ $55.00
                By a small entity (Sec. 1.27(a))......................... 110.00
                By other than a small or micro entity...................... 220.00
                ------------------------------------------------------------------------
                 (c) Basic fee for filing each application for an original plant
                patent:
                 Table 3 to Paragraph (c)
                ------------------------------------------------------------------------
                
                ------------------------------------------------------------------------
                By a micro entity (Sec. 1.29)............................ $55.00
                By a small entity (Sec. 1.27(a))......................... 110.00
                By other than a small or micro entity...................... 220.00
                ------------------------------------------------------------------------
                 (d) Basic fee for filing each provisional application:
                 Table 4 to Paragraph (d)
                ------------------------------------------------------------------------
                
                ------------------------------------------------------------------------
                By a micro entity (Sec. 1.29)............................ $75.00
                By a small entity (Sec. 1.27(a))......................... 150.00
                By other than a small or micro entity...................... 300.00
                ------------------------------------------------------------------------
                 (e) Basic fee for filing each application for the reissue of a
                patent:
                 Table 5 to Paragraph (e)
                ------------------------------------------------------------------------
                
                ------------------------------------------------------------------------
                By a micro entity (Sec. 1.29)............................ $80.00
                By a small entity (Sec. 1.27(a))......................... 160.00
                By other than a small or micro entity...................... 320.00
                ------------------------------------------------------------------------
                 (f) * * *
                 Table 6 to Paragraph (f)
                ------------------------------------------------------------------------
                
                -------------------------------------------------------------------------
                
                 * * * * *
                ------------------------------------------------------------------------
                 (g) * * *
                 Table 7 to Paragraph (g)
                ------------------------------------------------------------------------
                
                -------------------------------------------------------------------------
                
                 * * * * *
                ------------------------------------------------------------------------
                 (h) In addition to the basic filing fee in an application, other
                than a provisional application, for filing or later presentation at any
                other time of each claim in independent form in excess of three:
                 Table 8 to Paragraph (h)
                ------------------------------------------------------------------------
                
                ------------------------------------------------------------------------
                By a micro entity (Sec. 1.29)............................ $120.00
                By a small entity (Sec. 1.27(a))......................... 240.00
                By other than a small or micro entity...................... 480.00
                ------------------------------------------------------------------------
                 (i) * * *
                 Table 9 to Paragraph (i)
                ------------------------------------------------------------------------
                
                -------------------------------------------------------------------------
                
                 * * * * *
                ------------------------------------------------------------------------
                 (j) In addition to the basic filing fee in an application, other
                than a provisional application, that contains, or is amended to
                contain, a multiple dependent claim, per application:
                 Table 10 to Paragraph (j)
                ------------------------------------------------------------------------
                
                ------------------------------------------------------------------------
                By a micro entity (Sec. 1.29)............................ $215.00
                By a small entity (Sec. 1.27(a))......................... 430.00
                By other than a small or micro entity...................... 860.00
                ------------------------------------------------------------------------
                 (k) Search fee for each application filed under 35 U.S.C. 111 for
                an original patent, except design, plant, or provisional applications:
                 Table 11 to Paragraph (k)
                ------------------------------------------------------------------------
                
                ------------------------------------------------------------------------
                By a micro entity (Sec. 1.29)............................ $175.00
                By a small entity (Sec. 1.27(a))......................... 350.00
                By other than a small or micro entity...................... 700.00
                ------------------------------------------------------------------------
                 (l) * * *
                 Table 12 to Paragraph (l)
                ------------------------------------------------------------------------
                
                -------------------------------------------------------------------------
                
                 * * * * *
                ------------------------------------------------------------------------
                 (m) Search fee for each application for an original plant patent:
                 Table 13 to Paragraph (m)
                ------------------------------------------------------------------------
                
                ------------------------------------------------------------------------
                By a micro entity (Sec. 1.29)............................ $110.00
                By a small entity (Sec. 1.27(a))......................... 220.00
                By other than a small or micro entity...................... 440.00
                ------------------------------------------------------------------------
                 (n) Search fee for each application for the reissue of a patent:
                 Table 14 to Paragraph (n)
                ------------------------------------------------------------------------
                
                ------------------------------------------------------------------------
                By a micro entity (Sec. 1.29)............................ $175.00
                By a small entity (Sec. 1.27(a))......................... 350.00
                By other than a small or micro entity...................... 700.00
                ------------------------------------------------------------------------
                 (o) Examination fee for each application filed under 35 U.S.C. 111
                for an original patent, except design, plant, or provisional
                applications:
                 Table 15 to Paragraph (o)
                ------------------------------------------------------------------------
                
                ------------------------------------------------------------------------
                By a micro entity (Sec. 1.29)............................ $200.00
                By a small entity (Sec. 1.27(a))......................... 400.00
                By other than a small or micro entity...................... 800.00
                ------------------------------------------------------------------------
                 (p) Examination fee for each application under 35 U.S.C. 111 for an
                original design patent:
                 Table 16 to Paragraph (p)
                ------------------------------------------------------------------------
                
                ------------------------------------------------------------------------
                By a micro entity (Sec. 1.29)............................ $160.00
                By a small entity (Sec. 1.27(a))......................... 320.00
                By other than a small or micro entity...................... 640.00
                ------------------------------------------------------------------------
                 (q) Examination fee for each application for an original plant
                patent:
                 Table 17 to Paragraph (q)
                ------------------------------------------------------------------------
                
                ------------------------------------------------------------------------
                By a micro entity (Sec. 1.29)............................ $165.00
                By a small entity (Sec. 1.27(a))......................... 330.00
                By other than a small or micro entit....................... 660.00
                ------------------------------------------------------------------------
                 (r) Examination fee for each application for the reissue of a
                patent:
                 Table 18 to Paragraph (r)
                ------------------------------------------------------------------------
                
                ------------------------------------------------------------------------
                By a micro entity (Sec. 1.29)............................ $580.00
                By a small entity (Sec. 1.27(a))......................... 1,160.00
                By other than a small or micro entity...................... 2,320.00
                ------------------------------------------------------------------------
                 (s) Application size fee for any application filed under 35
                U.S.C.111 for the specification and drawings which exceed 100 sheets of
                paper, for each additional 50 sheets or fraction thereof:
                 Table 19 to Paragraph (s)
                ------------------------------------------------------------------------
                
                ------------------------------------------------------------------------
                By a micro entity (Sec. 1.29)............................ $105.00
                By a small entity (Sec. 1.27(a))......................... 210.00
                By other than a small or micro entity...................... 420.00
                ------------------------------------------------------------------------
                 (t) * * *
                 Table 20 to Paragraph (t)
                ------------------------------------------------------------------------
                
                -------------------------------------------------------------------------
                
                 * * * * *
                ------------------------------------------------------------------------
                 (u) Additional fee for any application filed on or after January 1,
                2022 under 35 U.S.C.111 for an original patent, except design, plant,
                or provisional applications, where the specification, claims, and/or
                abstract does not conform to the USPTO requirements for submission in
                DOCX format:
                 Table 21 to Paragraph (u)
                ------------------------------------------------------------------------
                
                ------------------------------------------------------------------------
                By a micro entity (Sec. 1.29)............................ $100.00
                By a small entity (Sec. 1.27(a))......................... 200.00
                By a small entity (Sec. 1.27(a)) if the application is 200.00
                 submitted in compliance with the Office electronic filing
                 system (Sec. 1.27(b)(2))................................
                By other than a small or micro entity...................... 400.00
                ------------------------------------------------------------------------
                0
                3. Section 1.17 is amended by:
                0
                a. Revising paragraph (a) and (c) through (g);
                0
                c. Revising paragraph (h) introductory text and adding heading to the
                table in paragraph (h);
                0
                d. Revising paragraph (i)(1) introductory text and adding a heading to
                the table in paragraph (i)(1);
                0
                e. Revising paragraphs (i)(2) and (k);
                0
                f. Revising paragraph (m);
                0
                g. Adding a heading to the table in paragraph (o);
                [[Page 46987]]
                0
                h. Revising paragraphs (p) through (s); and
                0
                i. Adding a heading to the table in paragraph (t).
                 The revisions and additions read as follows:
                Sec. 1.17 Patent application and reexamination processing fees.
                 (a) Extension fees pursuant to Sec. 1.136(a):
                 (1) For reply within first month:
                 Table 1 to Paragraph (a)(1)
                ------------------------------------------------------------------------
                
                ------------------------------------------------------------------------
                By a micro entity (Sec. 1.29)............................ $55.00
                By a small entity (Sec. 1.27(a))......................... 110.00
                By other than a small or micro entity...................... 220.00
                ------------------------------------------------------------------------
                 (2) For reply within second month:
                 Table 2 to Paragraph (a)(2)
                ------------------------------------------------------------------------
                
                ------------------------------------------------------------------------
                By a micro entity (Sec. 1.29)............................ $160.00
                By a small entity (Sec. 1.27(a))......................... 320.0
                By other than a small or micro entity...................... 640.00
                ------------------------------------------------------------------------
                 (3) For reply within third month:
                 Table 3 to Paragraph (a)(3)
                ------------------------------------------------------------------------
                
                ------------------------------------------------------------------------
                By a micro entity (Sec. 1.29)............................ $370.00
                By a small entity (Sec. 1.27(a))......................... 740.00
                By other than a small or micro entity...................... 1,480.00
                ------------------------------------------------------------------------
                 (4) For reply within fourth month:
                 Table 4 to Paragraph (a)(4)
                ------------------------------------------------------------------------
                
                ------------------------------------------------------------------------
                By a micro entity (Sec. 1.29)............................ $580.00
                By a small entity (Sec. 1.27(a))......................... 1,160.00
                By other than a small or micro entity...................... $2,320.00
                ------------------------------------------------------------------------
                 (5) For reply within fifth month:
                 Table 5 to Paragraph (a)(5)
                ------------------------------------------------------------------------
                
                ------------------------------------------------------------------------
                By a micro entity (Sec. 1.29)............................ $790.00
                By a small entity (Sec. 1.27(a))......................... 1,580.00
                By other than a small or micro entity...................... 3,160.00
                ------------------------------------------------------------------------
                * * * * *
                 (c) For filing a request for prioritized examination under Sec.
                1.102(e):
                 Table 6 to Paragraph (c)
                ------------------------------------------------------------------------
                
                ------------------------------------------------------------------------
                By a micro entity (Sec. 1.29)............................ $1,050.00
                By a small entity (Sec. 1.27(a))......................... 2,100.00
                By other than a small or micro entity...................... 4,200.00
                ------------------------------------------------------------------------
                 (d) For correction of inventorship in an application after the
                first action on the merits:
                 Table 7 to Paragraph (d)
                ------------------------------------------------------------------------
                
                ------------------------------------------------------------------------
                By a micro entity (Sec. 1.29)............................ $160.00
                By a small entity (Sec. 1.27(a))......................... 320.00
                By other than a small or micro entity...................... 640.00
                ------------------------------------------------------------------------
                 (e) To request continued examination pursuant to Sec. 1.114:
                 (1) For filing a first request for continued examination pursuant
                to Sec. 1.114 in an application:
                 Table 8 to Paragraph (e)(1)
                ------------------------------------------------------------------------
                
                ------------------------------------------------------------------------
                By a micro entity (Sec. 1.29)............................ $340.00
                By a small entity (Sec. 1.27(a))......................... 680.00
                By other than a small or micro entity...................... 1,360.00
                ------------------------------------------------------------------------
                 (2) For filing a second or subsequent request for continued
                examination pursuant to Sec. 1.114 in an application:
                 Table 9 to Paragraph (e)(2)
                ------------------------------------------------------------------------
                
                ------------------------------------------------------------------------
                By a micro entity (Sec. 1.29)............................ $500.00
                By a small entity (Sec. 1.27(a))......................... 1,000.00
                By other than a small or micro entity...................... 2,000.00
                ------------------------------------------------------------------------
                 (f) For filing a petition under one of the sections in paragraphs
                (f)(1) through (6) of this section that refers to this paragraph (f):
                 Table 10 to Paragraph (f)
                ------------------------------------------------------------------------
                
                ------------------------------------------------------------------------
                By a micro entity (Sec. 1.29)............................ $105.00
                By a small entity (Sec. 1.27(a))......................... 210.00
                By other than a small or micro entity...................... 420.00
                ------------------------------------------------------------------------
                Sec. 1.36(a)--for revocation of a power of attorney by fewer than all
                of the applicants
                Sec. 1.53(e)--to accord a filing date
                Sec. 1.182--for a decision on a question not specifically provided for
                in an application for a patent
                Sec. 1.183--to suspend the rules in an application for a patent
                Sec. 1.741(b)--to accord a filing date to an application under Sec.
                1.740 for an extension of a patent term
                Sec. 1.1023--to review the filing date of an international design
                application
                 (g) For filing a petition under one of the following sections that
                refers to this paragraph (g):
                 Table 11 to Paragraph (g)
                ------------------------------------------------------------------------
                
                ------------------------------------------------------------------------
                By a micro entity (Sec. 1.29)............................ $55.00
                By a small entity (Sec. 1.27(a))......................... 110.00
                By other than a small or micro entity...................... 220.00
                ------------------------------------------------------------------------
                Sec. 1.12--for access to an assignment record
                Sec. 1.14--for access to an application
                Sec. 1.46--for filing an application on behalf of an inventor by a
                person who otherwise shows sufficient proprietary interest in the
                matter
                Sec. 1.55(f)--for filing a belated certified copy of a foreign
                application
                Sec. 1.55(g)--for filing a belated certified copy of a foreign
                application
                Sec. 1.57(a)--for filing a belated certified copy of a foreign
                application
                Sec. 1.59--for expungement of information
                Sec. 1.103(a)--to suspend action in an application
                Sec. 1.136(b)--for review of a request for an extension of time when
                the provisions of Sec. 1.136(a) are not available
                Sec. 1.377--for review of a decision refusing to accept and record
                payment of a maintenance fee filed prior to the expiration of a patent
                Sec. 1.550(c)--for patent owner requests for an extension of time in
                ex parte reexamination proceedings
                Sec. 1.956--for patent owner requests for an extension of time in
                inter partes reexamination proceedings
                Sec. 5.12 of this chapter--for expedited handling of a foreign filing
                license
                Sec. 5.15 of this chapter--for changing the scope of a license
                Sec. 5.25 of this chapter--for a retroactive license
                 (h) For filing a petition under one of the following sections that
                refers to this paragraph (h):
                 Table 12 to Paragraph (h)
                ------------------------------------------------------------------------
                
                -------------------------------------------------------------------------
                
                 * * * * *
                ------------------------------------------------------------------------
                 (i) * * *
                 (1) For taking action under one of the following sections that
                refers to this paragraph (i)(1):
                 Table 13 to Paragraph (i)(1)
                ------------------------------------------------------------------------
                
                -------------------------------------------------------------------------
                
                 * * * * *
                ------------------------------------------------------------------------
                 (2) For taking action under one of the sections in paragraphs
                (i)(2)(i) and (ii) of this section that refers to this paragraph
                (i)(2):
                 Table 14 to Paragraph (i)(2)
                ------------------------------------------------------------------------
                
                ------------------------------------------------------------------------
                By a micro entity (Sec. 1.29)............................ $140.00
                By a small entity (Sec. 1.27(a))......................... 140.00
                By other than a small or micro entity...................... 140.00
                ------------------------------------------------------------------------
                Sec. 1.217--for processing a redacted copy of a paper submitted in the
                file of an application in which a redacted copy was submitted for the
                patent application publication
                Sec. 1.221--for requesting voluntary publication or republication of
                an application
                * * * * *
                 (k) For filing a request for expedited examination under Sec.
                1.155(a):
                 Table 15 to Paragraph (k)
                ------------------------------------------------------------------------
                
                ------------------------------------------------------------------------
                By a micro entity (Sec. 1.29)............................ $400.00
                By a small entity (Sec. 1.27(a))......................... 800.00
                By other than a small or micro entity...................... 1,600.00
                ------------------------------------------------------------------------
                * * * * *
                 (m) For filing a petition for the revival of an abandoned
                application for a
                [[Page 46988]]
                patent, for the delayed payment of the fee for issuing each patent, for
                the delayed response by the patent owner in any reexamination
                proceeding, for the delayed payment of the fee for maintaining a patent
                in force, for the delayed submission of a priority or benefit claim,
                for the extension of the 12-month (six-month for designs) period for
                filing a subsequent application (Sec. Sec. 1.55(c) and (e); 1.78(b),
                (c), and (e); 1.137; 1.378; and 1.452), or for filing a petition to
                excuse an applicant's failure to act within prescribed time limits in
                an international design application (Sec. 1.1051):
                 Table 16 to Paragraph (m)
                ------------------------------------------------------------------------
                
                ------------------------------------------------------------------------
                By a micro entity (Sec. 1.29)............................ $525.00
                By a small entity (Sec. 1.27(a))......................... 1,050.00
                By other than a small or micro entity...................... 2,100.00
                ------------------------------------------------------------------------
                * * * * *
                 (o) * * *
                 Table 17 to Paragraph (o)
                ------------------------------------------------------------------------
                
                -------------------------------------------------------------------------
                
                 * * * * *
                ------------------------------------------------------------------------
                 (p) For an information disclosure statement under Sec. 1.97(c) or
                (d):
                 Table 18 to Paragraph (p)
                ------------------------------------------------------------------------
                
                ------------------------------------------------------------------------
                By a micro entity (Sec. 1.29)............................ $65.00
                By a small entity (Sec. 1.27(a))......................... 130.00
                By other than a small or micro entity...................... 260.00
                ------------------------------------------------------------------------
                 (q) Processing fee for taking action under one of the sections in
                paragraphs (q)(1) through (3) of this section that refers to this
                paragraph (q): $50.00
                Sec. 1.41--to supply the name or names of the inventor or inventors
                after the filing date without a cover sheet as prescribed by Sec.
                1.51(c)(1) in a provisional application
                Sec. 1.48--for correction of inventorship in a provisional application
                Sec. 1.53(c)(2)--to convert a nonprovisional application filed under
                Sec. 1.53(b) to a provisional application under Sec. 1.53(c)
                 (r) For entry of a submission after final rejection under Sec.
                1.129(a):
                 Table 19 to Paragraph (r)
                ------------------------------------------------------------------------
                
                ------------------------------------------------------------------------
                By a micro entity (Sec. 1.29)............................ $220.00
                By a small entity (Sec. 1.27(a))......................... 440.00
                By other than a small or micro entity...................... 880.00
                ------------------------------------------------------------------------
                 (s) For each additional invention requested to be examined under
                Sec. 1.129(b):
                 Table 20 to Paragraph (s)
                ------------------------------------------------------------------------
                
                ------------------------------------------------------------------------
                By a micro entity (Sec. 1.29)............................ $220.00
                By a small entity (Sec. 1.27(a))......................... 440.00
                By other than a small or micro entity...................... 880.00
                ------------------------------------------------------------------------
                 (t) * * *
                 Table 21 to Paragraph (t)
                ------------------------------------------------------------------------
                
                -------------------------------------------------------------------------
                
                 * * * * *
                ------------------------------------------------------------------------
                0
                4. Section 1.18 is amended by revising paragraphs (a), (b)(1), (c),
                (d)(3), (e), and (f) to read as follows:
                Sec. 1.18 Patent post allowance (including issue) fees.
                 (a) Issue fee for issuing each original patent, except a design or
                plant patent, or for issuing each reissue patent:
                 Table 1 to Paragraph (a)
                ------------------------------------------------------------------------
                
                ------------------------------------------------------------------------
                By a micro entity (Sec. 1.29)............................ $300.00
                By a small entity (Sec. 1.27(a))......................... 600.00
                By other than a small or micro entity...................... 1,200.00
                ------------------------------------------------------------------------
                 (b)(1) Issue fee for issuing an original design patent:
                 Table 2 to Paragraph (b)(1)
                ------------------------------------------------------------------------
                
                ------------------------------------------------------------------------
                By a micro entity (Sec. 1.29)............................ $185.00
                By a small entity (Sec. 1.27(a))......................... 370.00
                By other than a small or micro entity...................... 740.00
                ------------------------------------------------------------------------
                * * * * *
                 (c) Issue fee for issuing an original plant patent:
                 Table 3 to Paragraph (c)
                ------------------------------------------------------------------------
                
                ------------------------------------------------------------------------
                By a micro entity (Sec. 1.29)............................ $210.00
                By a small entity (Sec. 1.27(a))......................... 420.00
                By other than a small or micro entity...................... 840.00
                ------------------------------------------------------------------------
                ------------------------------------------------------------------------
                
                ------------------------------------------------------------------------
                (d) * * *
                (3) Republication fee (Sec. 1.221(a)).................... $320.00
                (e) For filing an application for patent term adjustment 210.00
                 under Sec. 1.705........................................
                (f) For filing a request for reinstatement of all or part 420.00
                 of the term reduced pursuant to Sec. 1.704(b) in an
                 application for a patent term adjustment under Sec.
                 1.705.....................................................
                ------------------------------------------------------------------------
                0
                5. Section 1.19 is amended by revising paragraphs (b)(1)(i)(B) and
                (b)(1)(ii)(B) and removing paragraphs (j) through (l).
                 The revisions read as follows:
                Sec. 1.19 Document supply fees.
                * * * * *
                 (b) * * *
                 (1) * * *
                 (i) * * *
                 (B) Copy Patent File Wrapper, Any Number of Sheets: $290.00
                * * * * *
                 (ii) * * *
                 (B) Copy Patent File Wrapper, Electronic, Any Size: $60.00
                * * * * *
                0
                6. Section 1.20 is revised to read as follows:
                Sec. 1.20 Post-issuance fees.
                 (a) For providing a certificate of correction for an applicant's
                mistake (Sec. 1.323): $160.00
                 (b) Processing fee for correcting inventorship in a patent (Sec.
                1.324): $160.00
                 (c) In reexamination proceedings:
                 (1)(i) For filing a request for ex parte reexamination (Sec.
                1.510(a)) having:
                 (A) 40 or fewer pages
                 (B) Lines that are double-spaced or one-and-a-half spaced
                 (C) Text written in a non-script type font such as Arial, Times New
                Roman, or Courier
                 (D) A font size no smaller than 12 point
                 (E) Margins that conform to the requirements of Sec.
                1.52(a)(1)(ii)
                 (F) Sufficient clarity and contrast to permit direct reproduction
                and electronic capture by use of digital imaging and optical character
                recognition
                 Table 1 to Paragraph (c)(1)(i)
                ------------------------------------------------------------------------
                
                ------------------------------------------------------------------------
                By a micro entity (Sec. 1.29)............................ $1,575.00
                By a small entity (Sec. 1.27(a))......................... 3,150.00
                By other than a small or micro entity...................... 6,300.00
                ------------------------------------------------------------------------
                 (ii) The following parts of an ex parte reexamination request are
                excluded from paragraphs (c)(1)(i)(A) through (F) of this section:
                 (A) The copies of every patent or printed publication relied upon
                in the request pursuant to Sec. 1.510(b)(3)
                 (B) The copy of the entire patent for which reexamination is
                requested pursuant to Sec. 1.510(b)(4)
                 (C) The certifications required pursuant to Sec. 1.510(b)(5) and
                (6)
                 (2) For filing a request for ex parte reexamination (Sec.
                1.510(b)) that has sufficient clarity and contrast to permit direct
                reproduction and electronic capture by use of digital imaging and
                optical character recognition, and which otherwise does not comply with
                the provisions of paragraph (c)(1) of this section:
                 Table 2 to Paragraph (c)(2)
                ------------------------------------------------------------------------
                
                ------------------------------------------------------------------------
                By a micro entity (Sec. 1.29)............................ $3,150.00
                By a small entity (Sec. 1.27(a))......................... 6,300.00
                By other than a small or micro entity...................... 12,600.00
                ------------------------------------------------------------------------
                 (3) For filing with a request for reexamination or later
                presentation at any other time of each claim in independent form in
                excess of three and
                [[Page 46989]]
                also in excess of the number of claims in independent form in the
                patent under reexamination:
                 Table 3 to Paragraph (c)(3)
                ------------------------------------------------------------------------
                
                ------------------------------------------------------------------------
                By a micro entity (Sec. 1.29)............................ $120.00
                By a small entity (Sec. 1.27(a))......................... 240.00
                By other than a small or micro entity...................... 480.00
                ------------------------------------------------------------------------
                 (4) For filing with a request for reexamination or later
                presentation at any other time of each claim (whether dependent or
                independent) in excess of 20 and also in excess of the number of claims
                in the patent under reexamination (note that Sec. 1.75(c) indicates
                how multiple dependent claims are considered for fee calculation
                purposes):
                 Table 4 to Paragraph (c)(4)
                ------------------------------------------------------------------------
                
                ------------------------------------------------------------------------
                By a micro entity (Sec. 1.29)............................ $25.00
                By a small entity (Sec. 1.27(a))......................... 50.00
                By other than a small or micro entity...................... 100.00
                ------------------------------------------------------------------------
                 (5) If the excess claims fees required by paragraphs (c)(3) and (4)
                of this section are not paid with the request for reexamination or on
                later presentation of the claims for which the excess claims fees are
                due, the fees required by paragraphs (c)(3) and (4) must be paid or the
                claims canceled by amendment prior to the expiration of the time period
                set for reply by the Office in any notice of fee deficiency in order to
                avoid abandonment.
                 (6) For filing a petition in a reexamination proceeding, except for
                those specifically enumerated in Sec. Sec. 1.550(i) and 1.937(d):
                 Table 5 to Paragraph (c)(6)
                ------------------------------------------------------------------------
                
                ------------------------------------------------------------------------
                By a micro entity (Sec. 1.29)............................ $510.00
                By a small entity (Sec. 1.27(a))......................... 1,020.00
                By other than a small or micro entity...................... 2,040.00
                ------------------------------------------------------------------------
                 (7) For a refused request for ex parte reexamination under Sec.
                1.510 (included in the request for ex parte reexamination fee at Sec.
                1.20(c)(1) or (2)):
                 Table 6 to Paragraph (c)(7)
                ------------------------------------------------------------------------
                
                ------------------------------------------------------------------------
                By a micro entity (Sec. 1.29)............................ $1,890.00
                By a small entity (Sec. 1.27(a))......................... 945.00
                By other than a small or micro entity...................... 3,780.00
                ------------------------------------------------------------------------
                 (d) For filing each statutory disclaimer (Sec. 1.321): $170.00
                 (e) For maintaining an original or any reissue patent, except a
                design or plant patent, based on an application filed on or after
                December 12, 1980, in force beyond four years, the fee being due by
                three years and six months after the original grant:
                 Table 7 to Paragraph (e)
                ------------------------------------------------------------------------
                
                ------------------------------------------------------------------------
                By a micro entity (Sec. 1.29)............................ $500.00
                By a small entity (Sec. 1.27(a))......................... 1,000.00
                By other than a small or micro entity...................... 2,000.00
                ------------------------------------------------------------------------
                 (f) For maintaining an original or any reissue patent, except a
                design or plant patent, based on an application filed on or after
                December 12, 1980, in force beyond eight years, the fee being due by
                seven years and six months after the original grant:
                 Table 8 to Paragraph (f)
                ------------------------------------------------------------------------
                
                ------------------------------------------------------------------------
                By a micro entity (Sec. 1.29)............................ $940.00
                By a small entity (Sec. 1.27(a))......................... 1,880.00
                By other than a small or micro entity...................... 3,760.00
                ------------------------------------------------------------------------
                 (g) For maintaining an original or any reissue patent, except a
                design or plant patent, based on an application filed on or after
                December 12, 1980, in force beyond twelve years, the fee being due by
                eleven years and six months after the original grant:
                 Table 9 to Paragraph (g)
                ------------------------------------------------------------------------
                
                ------------------------------------------------------------------------
                By a micro entity (Sec. 1.29)............................ $1,925.00
                By a small entity (Sec. 1.27(a))......................... 3,850.00
                By other than a small or micro entity...................... 7,700.00
                ------------------------------------------------------------------------
                 (h) Surcharge for paying a maintenance fee during the six-month
                grace period following the expiration of three years and six months,
                seven years and six months, and eleven years and six months after the
                date of the original grant of a patent based on an application filed on
                or after December 12, 1980:
                 Table 10 to Paragraph (h)
                ------------------------------------------------------------------------
                
                ------------------------------------------------------------------------
                By a micro entity (Sec. 1.29)............................ $125.00
                By a small entity (Sec. 1.27(a))......................... 250.00
                By other than a small or micro entity...................... 500.00
                ------------------------------------------------------------------------
                 (i) [Reserved]
                 (j) For filing an application for extension of the term of a
                patent:
                 Table 11 to Paragraph (j)
                ------------------------------------------------------------------------
                
                ------------------------------------------------------------------------
                (1) Application for extension under Sec. 1.740........... $1,180.00
                (2) Initial application for interim extension under Sec. 440.00
                 1.790.....................................................
                (3) Subsequent application for interim extension under Sec. 230.00
                 1.790...................................................
                ------------------------------------------------------------------------
                 (k) In supplemental examination proceedings:
                 (1) For processing and treating a request for supplemental
                examination:
                 Table 12 to Paragraph (k)(1)
                ------------------------------------------------------------------------
                
                ------------------------------------------------------------------------
                By a micro entity (Sec. 1.29)............................ $1,155.00
                By a small entity (Sec. 1.27(a))......................... 2,310.00
                By other than a small or micro entity...................... 4,620.00
                ------------------------------------------------------------------------
                 (2) For ex parte reexamination ordered as a result of a
                supplemental examination proceeding:
                 Table 13 to Paragraph (k)(2)
                ------------------------------------------------------------------------
                
                ------------------------------------------------------------------------
                By a micro entity (Sec. 1.29)............................ $3,175.00
                By a small entity (Sec. 1.27(a))......................... 6,350.00
                By other than a small or micro entity...................... 12,700.00
                ------------------------------------------------------------------------
                 (3) For processing and treating, in a supplemental examination
                proceeding, a non-patent document over 20 sheets in length, per
                document:
                 (i) Between 21 and 50 sheets:
                 Table 14 to Paragraph (k)(3)(i)
                ------------------------------------------------------------------------
                
                ------------------------------------------------------------------------
                By a micro entity (Sec. 1.29)............................ $45.00
                By a small entity (Sec. 1.27(a))......................... 90.00
                By other than a small or micro entity...................... 180.00
                ------------------------------------------------------------------------
                 (ii) For each additional 50 sheets or a fraction thereof:
                 Table 15 to Paragraph (k)(3)(ii)
                ------------------------------------------------------------------------
                
                ------------------------------------------------------------------------
                By a micro entity (Sec. 1.29)............................ $75.00
                By a small entity (Sec. 1.27(a))......................... 150.00
                By other than a small or micro entity...................... 300.00
                ------------------------------------------------------------------------
                0
                7. Section 1.21 is amended by:
                0
                a. Revising paragraphs (a)(1), (2), and (5);
                0
                b. Removing and reserving paragraph (a)(6)(i);
                0
                c. Adding paragraph (a)(8);
                0
                d. Revising paragraphs (a)(9)(ii) and (a)(10);
                0
                e. Adding paragraph (k); and
                0
                f. Revising paragraphs (n), (o), and (q).
                 The revisions and addition read as follows:
                Sec. 1.21 Miscellaneous fees and charges.
                * * * * *
                 (a) * * *
                 (1) For admission to examination for registration to practice:
                 (i) Application fee (non-refundable): $110.00
                 (ii) Registration examination fee
                 (A) For test administration by commercial entity: $210.00
                 (B) For test administration by the USPTO: $470.00
                 (iii) For USPTO-administered review of registration examination:
                $470.00
                 (2) On registration to practice or grant of limited recognition:
                 (i) On registration to practice under Sec. 11.6 of this chapter:
                $210.00
                 (ii) On grant of limited recognition under Sec. 11.9(b) of this
                chapter: $210.00
                 (iii) On change of registration from agent to attorney: $110.00
                * * * * *
                 (5) For review of decision:
                 (i) By the Director of Enrollment and Discipline under Sec.
                11.2(c) of this chapter: $420.00
                [[Page 46990]]
                 (ii) Of the Director of Enrollment and Discipline under Sec.
                11.2(d) of this chapter: $420.00
                * * * * *
                 (9) * * *
                 (ii) Administrative reinstatement fee: $210.00
                 (10) On application by a person for recognition or registration
                after disbarment or suspension on ethical grounds, or resignation
                pending disciplinary proceedings in any other jurisdiction; on
                application by a person for recognition or registration who is
                asserting rehabilitation from prior conduct that resulted in an adverse
                decision in the Office regarding the person's moral character; on
                application by a person for recognition or registration after being
                convicted of a felony or crime involving moral turpitude or breach of
                fiduciary duty; and on petition for reinstatement by a person excluded
                or suspended on ethical grounds, or excluded on consent from practice
                before the Office: $1,680.00
                * * * * *
                 (k) For items and services that the director finds may be supplied,
                for which fees are not specified by statute or by this part, such
                charges as may be determined by the director with respect to each such
                item or service: Actual cost
                * * * * *
                 (n) For handling an application in which proceedings are terminated
                pursuant to Sec. 1.53(e): $140.00
                 (o) The receipt of a very lengthy sequence listing (mega-sequence
                listing) in an application under 35 U.S.C. 111 or 371 is subject to the
                following fee:
                 (1) First receipt by the Office of a sequence listing in electronic
                form ranging in size from 300MB to 800MB (without file compression):
                 Table 1 to Paragraph (o)(1)
                ------------------------------------------------------------------------
                
                ------------------------------------------------------------------------
                By a micro entity (Sec. 1.29)............................ $265.00
                By a small entity (Sec. 1.27(a))......................... 530.00
                By other than a small or micro entity...................... 1,060.00
                ------------------------------------------------------------------------
                 (2) First receipt by the Office of a sequence listing in electronic
                form exceeding 800MB in size (without file compression):
                 Table 2 to Paragraph (o)(2)
                ------------------------------------------------------------------------
                
                ------------------------------------------------------------------------
                By a micro entity (Sec. 1.29)............................ $2,625.00
                By a small entity (Sec. 1.27(a))......................... 5,250.00
                By other than a small or micro entity...................... 10,500.00
                ------------------------------------------------------------------------
                * * * * *
                 (q) Additional fee for expedited service: $170.00.
                0
                8. Section 1.27 is amended by revising paragraph (c)(3) introductory
                text as follows:
                Sec. 1.27 Definition of small entities and establishing status as a
                small entity to permit payment of small entity fees; when a
                determination of entitlement to small entity status and notification of
                loss of entitlement to small entity status are required; fraud on the
                Office.
                * * * * *
                 (c) * * *
                 (3) Assertion by payment of the small entity basic filing, basic
                transmittal, basic national fee, international search fee, or
                individual designation fee in an international design application. The
                payment, by any party, of the exact amount of one of the small entity
                basic filing fees set forth in Sec. 1.16(a), (b), (c), (d), or (e),
                the small entity transmittal fee set forth in Sec. 1.445(a)(1) or
                Sec. 1.1031(a), the small entity international search fee set forth in
                Sec. 1.445(a)(2) to a Receiving Office other than the United States
                Receiving Office in the exact amount established for that Receiving
                Office pursuant to PCT Rule 16, or the small entity basic national fee
                set forth in Sec. 1.492(a), will be treated as a written assertion of
                entitlement to small entity status even if the type of basic filing,
                basic transmittal, or basic national fee is inadvertently selected in
                error. The payment, by any party, of the small entity first part of the
                individual designation fee for the United States to the International
                Bureau (Sec. 1.1031) will be treated as a written assertion of
                entitlement to small entity status.
                * * * * *
                0
                9. Section 1.431 is amended by revising paragraph (c) to read as
                follows:
                Sec. 1.431 International application requirements.
                * * * * *
                 (c) Payment of the international filing fee (PCT Rule 15.2) and the
                transmittal and search fees (Sec. 1.445) may be made in full at the
                time the international application papers required by paragraph (b) of
                this section are deposited or within one month thereafter. The
                international filing, transmittal, and search fee payable is the
                international filing, transmittal, and search fee in effect on the
                receipt date of the international application. If the international
                filing, transmittal, and search fees are not paid within one month from
                the date of receipt of the international application and prior to the
                sending of a notice of deficiency, which imposes a late payment fee
                (Sec. 1.445(a)(6)), the applicant will be notified and given a one-
                month non-extendable time limit within which to pay the deficient fees
                plus the late payment fee.
                * * * * *
                0
                10. Section 1.445 is amended by revising paragraph (a) to read as
                follows:
                Sec. 1.445 International application filing, processing and search
                fees.
                 (a) The following fees and charges for international applications
                are established by law or by the director under the authority of 35
                U.S.C. 376:
                 (1) A transmittal fee (see 35 U.S.C. 361(d) and PCT Rule 14)
                consisting of:
                 (i) A basic portion:
                 (A) For an international application having a receipt date that is
                on or after October 2, 2020:
                 Table 1 to Paragraph (a)(1)(i)(A)
                ------------------------------------------------------------------------
                
                ------------------------------------------------------------------------
                By a micro entity (Sec. 1.29)............................ $65.00
                By a small entity (Sec. 1.27(a))......................... 130.00
                By other than a small or micro entity...................... 260.00
                ------------------------------------------------------------------------
                 (B) For an international application having a receipt date that is
                on or after January 1, 2014, and before October 2, 2020:
                 Table 2 to Paragraph (a)(1)(i)(B)
                ------------------------------------------------------------------------
                
                ------------------------------------------------------------------------
                By a micro entity (Sec. 1.29)............................ $60.00
                By a small entity (Sec. 1.27(a))......................... 120.00
                By other than a small or micro entity...................... 240.00
                ------------------------------------------------------------------------
                 (C) For an international application having a receipt date that is
                before January 1, 2014: $240.00.
                 (ii) A non-electronic filing fee portion for any international
                application designating the United States of America that is filed on
                or after November 15, 2011, other than by the Office electronic filing
                system, except for a plant application:
                 Table 3 to Paragraph (a)(1)(ii)
                ------------------------------------------------------------------------
                
                ------------------------------------------------------------------------
                By a small entity (Sec. 1.27(a))......................... $200.00
                By other than a small entity............................... 400.00
                ------------------------------------------------------------------------
                 (2) A search fee (see 35 U.S.C. 361(d) and PCT Rule 16):
                 (i) For an international application having a receipt date that is
                on or after October 2, 2020:
                 Table 4 to Paragraph (a)(2)(i)
                ------------------------------------------------------------------------
                
                ------------------------------------------------------------------------
                By a micro entity (Sec. 1.29)............................ $545.00
                By a small entity (Sec. 1.27(a))......................... 1,090.00
                By other than a small or micro entity...................... 2,180.00
                ------------------------------------------------------------------------
                 (ii) For an international application having a receipt date that is
                on or after January 1, 2014, and before October 2, 2020:
                 Table 5 to Paragraph (a)(2)(ii)
                ------------------------------------------------------------------------
                
                ------------------------------------------------------------------------
                By a micro entity (Sec. 1.29)............................ $520.00
                By a small entity (Sec. 1.27(a))......................... 1,040.00
                By other than a small or micro entity...................... 2,080.00
                ------------------------------------------------------------------------
                [[Page 46991]]
                 (iii) For an international application having a receipt date that
                is before January 1, 2014: $2,080.00.
                 (3) A supplemental search fee when required, per additional
                invention:
                 (i) For an international application having a receipt date that is
                on or after October 2, 2020:
                 Table 6 to Paragraph (a)(3)(i)
                ------------------------------------------------------------------------
                
                ------------------------------------------------------------------------
                By a micro entity (Sec. 1.29)............................ $545.00
                By a small entity (Sec. 1.27(a))......................... 1,090.00
                By other than a small or micro entity...................... 2,180.00
                ------------------------------------------------------------------------
                 (ii) For an international application having a receipt date that is
                on or after January 1, 2014, and before October 2, 2020:
                 Table 7 to Paragraph (a)(3)(ii)
                ------------------------------------------------------------------------
                
                ------------------------------------------------------------------------
                By a micro entity (Sec. 1.29)............................ $520.00
                By a small entity (Sec. 1.27(a))......................... 1,040.00
                By other than a small or micro entity...................... 2,080.00
                ------------------------------------------------------------------------
                 (iii) For an international application having a receipt date that
                is before January 1, 2014: $2,080.00.
                 (4) A fee equivalent to the transmittal fee in paragraph (a)(1) of
                this section that would apply if the USPTO was the Receiving Office for
                transmittal of an international application to the International Bureau
                for processing in its capacity as a Receiving Office (PCT Rule 19.4).
                 (5) Late furnishing fee for providing a sequence listing in
                response to an invitation under PCT Rule 13ter:
                 Table 8 to Paragraph (a)(5)
                ------------------------------------------------------------------------
                
                ------------------------------------------------------------------------
                By a micro entity (Sec. 1.29)............................ $80.00
                By a small entity (Sec. 1.27(a))......................... 160.00
                By other than a small or micro entity...................... 320.00
                ------------------------------------------------------------------------
                 (6) Late payment fee pursuant to PCT Rule 16bis.2
                0
                11. Section 1.482 is revised to read as follows:
                Sec. 1.482 International preliminary examination and processing
                fees.
                 (a) The following fees and charges for international preliminary
                examination are established by the director under the authority of 35
                U.S.C. 376:
                 (1) The following preliminary examination fee is due on filing the
                demand:
                 (i) If an international search fee as set forth in Sec.
                1.445(a)(2) has been paid on the international application to the
                United States Patent and Trademark Office as an International Searching
                Authority:
                 Table 1 to Paragraph (a)(1)(i)
                ------------------------------------------------------------------------
                
                ------------------------------------------------------------------------
                By a micro entity (Sec. 1.29)............................ $160.00
                By a small entity (Sec. 1.27(a))......................... 320.00
                By other than a small or micro entity...................... 640.00
                ------------------------------------------------------------------------
                 (ii) If the International Searching Authority for the international
                application was an authority other than the United States Patent and
                Trademark Office:
                 Table 2 to Paragraph (a)(1)(ii)
                ------------------------------------------------------------------------
                
                ------------------------------------------------------------------------
                By a micro entity (Sec. 1.29)............................ $200.00
                By a small entity (Sec. 1.27(a))......................... 400.00
                By other than a small or micro entity...................... 800.00
                ------------------------------------------------------------------------
                 (2) An additional preliminary examination fee when required, per
                additional invention:
                 Table 3 to Paragraph (a)(2)
                ------------------------------------------------------------------------
                
                ------------------------------------------------------------------------
                By a micro entity (Sec. 1.29)............................ $160.00
                By a small entity (Sec. 1.27(a))......................... 320.00
                By other than a small or micro entity...................... 640.00
                ------------------------------------------------------------------------
                 (b) The handling fee is due on filing the demand and shall be as
                prescribed in PCT Rule 57.
                 (c) Late furnishing fee for providing a sequence listing in
                response to an invitation under PCT Rule 13ter:
                 Table 4 to Paragraph (c)
                ------------------------------------------------------------------------
                
                ------------------------------------------------------------------------
                By a micro entity (Sec. 1.29)............................ $80.00
                By a small entity (Sec. 1.27(a))......................... 160.00
                By other than a small or micro entity...................... 320.00
                ------------------------------------------------------------------------
                0
                12. Section 1.492 is amended by:
                0
                a. Revising paragraph (a);
                0
                b. Adding headings to the tables in paragraphs (b)(1) and (2);
                0
                c. Revising paragraphs (b)(3) and (4);
                0
                d. Adding a heading to the table in paragraph (c)(1);
                0
                e. Revising paragraphs (c)(2) and (d);
                0
                f. Adding a heading to the table in paragraph (e);
                0
                g. Revising paragraphs (f) and (h);
                0
                h. Adding a heading to the table in paragraph (i); and
                0
                i. Revising paragraph (j).
                 The revisions and additions read as follows:
                Sec. 1.492 National stage fees.
                * * * * *
                 (a) The basic national fee for an international application
                entering the national stage under 35 U.S.C. 371:
                 Table 1 to Paragraph (a)
                ------------------------------------------------------------------------
                
                ------------------------------------------------------------------------
                By a micro entity (Sec. 1.29)............................ $80.00
                By a small entity (Sec. 1.27(a))......................... 160.00
                By other than a small or micro entity...................... 320.00
                ------------------------------------------------------------------------
                 (b) * * *
                 (1) * * *
                 Table 2 to Paragraph (b)(1)
                ------------------------------------------------------------------------
                
                -------------------------------------------------------------------------
                
                 * * * * *
                ------------------------------------------------------------------------
                 (2) * * *
                 Table 3 to Paragraph (b)(2)
                ------------------------------------------------------------------------
                
                -------------------------------------------------------------------------
                
                 * * * * *
                ------------------------------------------------------------------------
                 (3) If an international search report on the international
                application has been prepared by an International Searching Authority
                other than the United States International Searching Authority and is
                provided, or has been previously communicated by the International
                Bureau, to the Office:
                 Table 4 to Paragraph (b)(3)
                ------------------------------------------------------------------------
                
                ------------------------------------------------------------------------
                By a micro entity (Sec. 1.29)............................ $135.00
                By a small entity (Sec. 1.27(a))......................... 270.00
                By other than a small or micro entity...................... 540.00
                ------------------------------------------------------------------------
                 (4) In all situations not provided for in paragraph (b)(1), (2), or
                (3) of this section:
                 Table 5 to Paragraph (b)(4)
                ------------------------------------------------------------------------
                
                ------------------------------------------------------------------------
                By a micro entity (Sec. 1.29)............................ $175.00
                By a small entity (Sec. 1.27(a))......................... 350.00
                By other than a small or micro entity...................... 700.00
                ------------------------------------------------------------------------
                 (c) * * *
                 (1) * * *
                 Table 6 to Paragraph (c)(1)
                ------------------------------------------------------------------------
                
                -------------------------------------------------------------------------
                
                 * * * * *
                ------------------------------------------------------------------------
                 (2) In all situations not provided for in paragraph (c)(1) of this
                section:
                 Table 7 to Paragraph (c)(2)
                ------------------------------------------------------------------------
                
                ------------------------------------------------------------------------
                By a micro entity (Sec. 1.29)............................ $200.00
                By a small entity (Sec. 1.27(a))......................... 400.00
                By other than a small or micro entity...................... 800.00
                ------------------------------------------------------------------------
                 (d) In addition to the basic national fee, for filing or on later
                presentation at any other time of each claim in independent form in
                excess of three:
                 Table 8 to Paragraph (d)
                ------------------------------------------------------------------------
                
                ------------------------------------------------------------------------
                By a micro entity (Sec. 1.29)............................ $120.00
                By a small entity (Sec. 1.27(a))......................... 240.00
                By other than a small or micro entity...................... 480.00
                ------------------------------------------------------------------------
                 (e) * * *
                 Table 9 to Paragraph (e)
                ------------------------------------------------------------------------
                
                -------------------------------------------------------------------------
                
                 * * * * *
                ------------------------------------------------------------------------
                 (f) In addition to the basic national fee, if the application
                contains, or is
                [[Page 46992]]
                amended to contain, a multiple dependent claim, per application:
                 Table 10 to Paragraph (f)
                ------------------------------------------------------------------------
                
                ------------------------------------------------------------------------
                By a micro entity (Sec. 1.29)............................ $215.00
                By a small entity (Sec. 1.27(a))......................... 430.00
                By other than a small or micro entity...................... 860.00
                ------------------------------------------------------------------------
                * * * * *
                 (h) Surcharge for filing the search fee, the examination fee, or
                the oath or declaration after the date of the commencement of the
                national stage (Sec. 1.491(a)) pursuant to Sec. 1.495(c):
                 Table 11 to Paragraph (h)
                ------------------------------------------------------------------------
                
                ------------------------------------------------------------------------
                By a micro entity (Sec. 1.29)............................ $40.00
                By a small entity (Sec. 1.27(a))......................... 80.00
                By other than a small or micro entity...................... 160.00
                ------------------------------------------------------------------------
                 (i) * * *
                 Table 12 to Paragraph (i)
                ------------------------------------------------------------------------
                
                -------------------------------------------------------------------------
                
                 * * * * *
                ------------------------------------------------------------------------
                 (j) Application size fee for any international application, the
                specification and drawings of which exceed 100 sheets of paper, for
                each additional 50 sheets or fraction thereof:
                 Table 13 to Paragraph (j)
                ------------------------------------------------------------------------
                
                ------------------------------------------------------------------------
                By a micro entity (Sec. 1.29)............................ $105.00
                By a small entity (Sec. 1.27(a))......................... 210.00
                By other than a small or micro entity...................... 420.00
                ------------------------------------------------------------------------
                PART 11--REPRESENTATION OF OTHERS BEFORE THE UNITED STATES PATENT
                AND TRADEMARK OFFICE
                0
                13. The authority citation for 37 CFR part 11 continues to read as
                follows:
                 Authority: 5 U.S.C. 500; 15 U.S.C. 1123; 35 U.S.C. 2(b)(2), 32,
                41; sec. 1, Pub. L. 113-227, 128 Stat. 2114.
                0
                14. Section 11.11 is amended by revising the section heading and
                paragraphs (a)(1) and (2), adding paragraph (a)(3), revising paragraphs
                (b)(1), (e), and (f)(1), and adding paragraph (f)(3) to read as
                follows:
                Sec. 11.11 Administrative suspension, inactivation, resignation,
                reinstatement, and revocation.
                 (a) * * *
                 (1) A registered practitioner, or person granted limited
                recognition under Sec. 11.9(b), must notify the OED director of the
                postal address for their office, at least one and up to three email
                addresses where they receive email, and a business telephone number, as
                well as every change to each of said addresses and telephone number
                within thirty days of the date of the change. A registered
                practitioner, or person granted limited recognition under Sec.
                11.9(b), shall, in addition to any notice of change of address and
                telephone number filed in individual patent applications, separately
                file written notice of the change of address or telephone number with
                the OED director. A registered practitioner, or person granted limited
                recognition under Sec. 11.9(b), who is an attorney in good standing
                with the bar of the highest court of one or more states shall provide
                the OED director with the identification number associated with each
                bar membership. The OED director shall publish a list containing the
                name, postal business addresses, business telephone number,
                registration number or limited recognition number, and registration
                status as an attorney or agent of each registered practitioner, or
                person granted limited recognition under 11.9(b), recognized to
                practice before the Office in patent matters. The OED director may also
                publish the continuing legal education certification status of each
                registered practitioner, or person granted limited recognition under
                Sec. 11.9(b).
                 (2) Biennially, registered practitioners and persons granted
                limited recognition may be required to file a registration statement
                with the OED director for the purpose of ascertaining whether such
                practitioner desires to remain in an active status. Any registered
                practitioner, or person granted limited recognition under Sec.
                11.9(b), failing to file the registration statement or give any
                information requested by the OED director within a time limit specified
                shall be subject to administrative suspension under paragraph (b) of
                this section.
                 (3)(i) A registered practitioner, or person granted limited
                recognition under Sec. 11.9(b), who has completed, in the past 24
                months, five hours of continuing legal education credits in patent law
                and practice and one hour of continuing legal education credit in
                ethics, may certify such completion to the OED director.
                 (ii) A registered practitioner, or person granted limited
                recognition under Sec. 11.9(b), may earn up to two of the five hours
                of continuing legal education credit in patent law and practice by
                providing patent pro bono legal services through the USPTO Patent Pro
                Bono Program. One hour of continuing legal education credit in patent
                law and practice may be earned for every three hours of patent pro bono
                legal service.
                 (b) * * *
                 (1) Whenever it appears that a registered practitioner, or person
                granted limited recognition under Sec. 11.9(b), has failed to comply
                with paragraph (a)(2) of this section, the OED director shall publish
                and send a notice to the registered practitioner, or person granted
                limited recognition, advising of the noncompliance, the consequence of
                being administratively suspended set forth in paragraph (b)(6) of this
                section if noncompliance is not timely remedied, and the requirements
                for reinstatement under paragraph (f) of this section. The notice shall
                be published and sent to the registered practitioner, or person granted
                limited recognition, by mail to the last postal address furnished under
                paragraph (a) of this section or by email addressed to the last email
                address furnished under paragraph (a) of this section. The notice shall
                demand compliance and payment of a delinquency fee set forth in Sec.
                1.21(a)(9)(i) of this chapter within 60 days after the date of such
                notice.
                * * * * *
                 (e) Resignation. A registered practitioner who is not under
                investigation under Sec. 11.22 for a possible violation of the USPTO
                Rules of Professional Conduct, is not subject to discipline under Sec.
                11.24 or Sec. 11.25, or against whom probable cause has not been found
                by a panel of the Committee on Discipline under Sec. 11.23(b), may
                resign by notifying the OED director in writing that they desire to
                resign. Upon acceptance in writing by the OED director of such notice,
                that registered practitioner shall no longer be eligible to practice
                before the Office in patent matters but shall continue to file a change
                of address for five years thereafter in order that they may be located
                in the event information regarding the practitioner's conduct comes to
                the attention of the OED director or any grievance is made about their
                conduct while they engaged in practice before the Office. The name of
                any registered practitioner whose resignation is accepted shall be
                removed from active status, endorsed as resigned, and notice thereof
                published in the Official Gazette. Upon acceptance of the resignation
                by the OED director, the resigned practitioner must comply with the
                provisions of Sec. 11.116. A resigned practitioner is subject to
                investigation and discipline for their conduct that occurred prior to,
                during, or after the period of their resignation.
                 (f) * * *
                 (1)(i) Any administratively suspended registered practitioner, or
                person granted limited recognition under
                [[Page 46993]]
                Sec. 11.9(b), may be reinstated provided the practitioner:
                 (A) Is not the subject of a disciplinary investigation or a party
                to a disciplinary proceeding;
                 (B) Has applied for reinstatement on an application form supplied
                by the OED director;
                 (C) Has demonstrated good moral character and reputation and
                competence in advising and assisting patent applicants in the
                presentation and prosecution of their applications before the Office;
                 (D) Has submitted a declaration or affidavit attesting to the fact
                that the practitioner has read the most recent revisions of the patent
                laws and the rules of practice before the Office;
                 (E) Has paid the fees set forth in Sec. 1.21(a)(9)(ii) of this
                chapter; and
                 (F) Has paid all applicable delinquency fees as set forth in Sec.
                1.21(a)(9)(i) of this chapter.
                 (ii) Any administratively suspended registered practitioner, or
                person granted limited recognition, who applies for reinstatement more
                than five years after the effective date of the administrative
                suspension, additionally shall be required to file a petition to the
                OED director requesting reinstatement and providing objective evidence
                that they continue to possess the necessary legal qualifications to
                render valuable service to patent applicants.
                * * * * *
                 (3)(i) Any registered practitioner who has been endorsed as
                resigned pursuant to paragraph (e) of this section may be reinstated on
                the register provided the practitioner:
                 (A) Is not the subject of a disciplinary investigation or a party
                to a disciplinary proceeding;
                 (B) Has applied for reinstatement on an application form supplied
                by the OED director;
                 (C) Has demonstrated good moral character and reputation and
                competence in advising and assisting patent applicants in the
                presentation and prosecution of their applications before the Office;
                 (D) Has submitted a declaration or affidavit attesting to the fact
                that the practitioner has read the most recent revisions of the patent
                laws and the rules of practice before the Office;
                 (E) Has paid the fees set forth in Sec. 1.21(a)(9)(ii) of this
                chapter; and
                 (F) Has paid all applicable delinquency fees as set forth in Sec.
                1.21(a)(9)(i) of this chapter.
                 (ii) Any resigned registered practitioner who applies for
                reinstatement more than five years after the effective date of the
                resignation additionally shall be required to file a petition to the
                OED director requesting reinstatement and providing objective evidence
                that they continue to possess the necessary legal qualifications to
                render valuable service to patent applicants.
                PART 41--PRACTICE BEFORE THE PATENT TRIAL AND APPEAL BOARD
                0
                15. The authority citation for 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.
                0
                16. Section 41.20 is amended by revising paragraphs (a), (b)(1),
                (b)(2)(ii), and (b)(3) and (4) to read as follows:
                Sec. 41.20 Fees.
                 (a) Petition fee. The fee for filing a petition under this part is:
                $420.00.
                 (b) * * *
                 (1) For filing a notice of appeal from the examiner to the Patent
                Trial and Appeal Board:
                 Table 1 to Paragraph (b)(1)
                ------------------------------------------------------------------------
                
                ------------------------------------------------------------------------
                By a micro entity (Sec. 1.29)............................ $210.00
                By a small entity (Sec. 1.27(a))......................... 420.00
                By other than a small or micro entity...................... 840.00
                ------------------------------------------------------------------------
                 (2) * * *
                 (ii) In addition to the fee for filing a notice of appeal, for
                filing a brief in support of an appeal in an inter partes reexamination
                proceeding:
                 Table 2 to Paragraph (b)(2)(ii)
                ------------------------------------------------------------------------
                
                ------------------------------------------------------------------------
                By a micro entity (Sec. 1.29)............................ $525.00
                By a small entity (Sec. 1.27(a))......................... 1,050.00
                By other than a small or micro entity...................... 2,100.00
                ------------------------------------------------------------------------
                 (3) For filing a request for an oral hearing before the Board in an
                appeal under 35 U.S.C. 134:
                 Table 3 to Paragraph (b)(3)
                ------------------------------------------------------------------------
                
                ------------------------------------------------------------------------
                By a micro entity (Sec. 1.29)............................ $340.00
                By a small entity (Sec. 1.27(a))......................... 680.00
                By other than a small or micro entity...................... 1,360.00
                ------------------------------------------------------------------------
                 (4) In addition to the fee for filing a notice of appeal, for
                forwarding an appeal in an application or ex parte reexamination
                proceeding to the Board:
                 Table 4 to Paragraph (b)(4)
                ------------------------------------------------------------------------
                
                ------------------------------------------------------------------------
                By a micro entity (Sec. 1.29)............................ $590.00
                By a small entity (Sec. 1.27(a))......................... 1,180.00
                By other than a small or micro entity...................... 2,360.00
                ------------------------------------------------------------------------
                PART 42--TRIAL PRACTICE BEFORE THE PATENT TRIAL AND APPEAL BOARD
                0
                17. The authority citation for 37 CFR part 42 continues to read as
                follows:
                 Authority: 35 U.S.C. 2(b)(2), 6, 21, 23, 41, 135, 311, 312,
                316, 321-326; Pub. L. 112-29, 125 Stat. 284; and Pub. L. 112-274,
                126 Stat. 2456.
                0
                18. Section 42.15 is revised to read as follows:
                Sec. 42.15 Fees.
                 (a) On filing a petition for inter partes review of a patent,
                payment of the following fees are due:
                 (1) Inter Partes Review request fee: $19,000.00
                 (2) Inter Partes Review Post-Institution fee: $22,500.00
                 (3) In addition to the Inter Partes Review request fee, for
                requesting a review of each claim in excess of 20: $375.00
                 (4) In addition to the Inter Partes Post-Institution request fee,
                for requesting a review of each claim in excess of 20: $750.00
                 (b) On filing a petition for post-grant review or covered business
                method patent review of a patent, payment of the following fees are
                due:
                 (1) Post-Grant or Covered Business Method Patent Review request
                fee: $20,000.00
                 (2) Post-Grant or Covered Business Method Patent Review Post-
                Institution fee: $27,500.00
                 (3) In addition to the Post-Grant or Covered Business Method Patent
                Review request fee, for requesting a review of each claim in excess of
                20: $475.00
                 (4) In addition to the Post-Grant or Covered Business Method Patent
                Review Post-Institution fee, for requesting a review of each claim in
                excess of 20: $1,050.00
                 (c) On the filing of a petition for a derivation proceeding,
                payment of the following fee is due:
                 (1) Derivation petition fee: $420.00.
                 (2) [Reserved]
                 (d) Any request requiring payment of a fee under this part,
                including a written request to make a settlement agreement available:
                $420.00.
                 (e) Fee for non-registered practitioners to appear pro hac vice
                before the Patent Trial and Appeal Board: $250.00.
                Andrei Iancu,
                Under Secretary of Commerce for Intellectual Property and Director of
                the United States Patent and Trademark Office.
                [FR Doc. 2020-16559 Filed 7-31-20; 8:45 am]
                BILLING CODE 3510-16-P
                

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