Assistance to Small Business Owners in Obtaining International Patent Protection

Congress recently directed the United States Patent and Trademark Office (“USPTO”) to study international patent protection for small businesses in consultation with the U.S. Department of Commerce and the Small Business Administration. The study examined how the USPTO and other Federal agencies could help small businesses obtain international patent protection. One of the major considerations was to determine whether a loan or grant program should be established to help small businesses cover the costs associated with obtaining protection.

Since 1982, the U.S. government helped small entities obtain patent protection through USPTO fee discounts of around 50%. The discount is applied to independent inventors, small businesses, and non-profit organizations through a “small entity” status designation. The America Invents Act now includes a 75% discount for smaller “micro entities.”

In one section of its report, the USPTO compares the U.S. policy of neutrally applied fee discounts to China’s policy of direct subsidization. In 2006, China outlined a 14 year national development plan to develop China into of the most innovative countries in the world. China’s aggressive initiatives included intent to invest 2.5% GDP in R&D, reduce dependence on foreign technology by 30%, and increase the number of granted indigenous invention patents. China goes so far as to award of money to its citizens in exchange for filing patents in foreign countries. Two examples include, for each foreign patent: (a) 1000 CNY from the Beijing municipal government; and (b) 5000 CNY from the Tianjin municipal government.

More time is needed, before similar support will begin in the U.S. The USPTO has stated that further study is needed before instituting any sort of pilot program of support for international patenting. Further study will avoid any additional burden on taxpayers until more information is gathered. The USPTO acknowledges that, as a general matter, the U.S. is stronger when it invests in building the analytical capacity necessary to study the innovation economy.

Some more immediate help, however, may be available. Many respondents to the study supported a plan to provide more education to small businesses, start-up firms, and independent inventors on the importance of international patents and ways to obtain them. One multinational U.S. law firm with a significant intellectual property practice sent a letter to Mr. Saurabh Vishnubhakat (RIPL author) of the USPTO Office of Chief Economist. The law firm stated:

“[w]e believe that the key to spurring competitiveness in small business is education about the role international patent protection can play. Rather than fund particular industries/companies, we believe that the [USPTO] should continue to provide educational workshops/seminars in addition to information on its website. Those should be held through regional small business organizations in order to provide the most direct impact.”

For now, small business owners will have to be patient.

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