IP Law Daily, PATENT NEWS: USPTO finalizes patent fee increases for 2025 but drops proposal for higher fees, (Nov 22, 2024)

By Brian Craig, J.D.

The USPTO announced across-the-board fee increases of 7.5% with most filing, search, and examination fees increasing by 10%.

The USPTO has announced the finalized fee schedule for fiscal 2025, including across-the-board fee increases of 7.5% with most filing, search, and examination fees increasing by 10%. The USPTO declined, however, to implement more controversial proposed fee increases in the final rule based on comments. The new rule, which takes effect on January 19, 2025, implements discounts for small businesses, independent inventors, and others who qualify as “small entities” or “micro entities” (Setting and Adjusting Patent Fees During Fiscal Year 2025, 89 Fed. Reg. 91898 (Nov. 20, 2024)).

Across-the-board increase. The effective date of the final rule on January 19, 2025, is more than four years after the agency’s last fee adjustment in October 2020. The 7.5% across-the-board increase in 2025 will be equivalent to a 1.7% annual increase, well below the prevailing inflation rate since October 2020, according to the USPTO. The USTPO says that fee adjustments are needed to provide the agency with sufficient aggregate revenue to recover the aggregate estimated costs of patent operations in future years. The 7.5% 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 the final rule, according to the USPTO.

Front-end patent fees. The USPTO is adjusting most filing, search, and examination fees for 2025 by 10%, which includes the 7.5% across-the-board increase. This total is consistent with the fee increases proposed in the notice of proposed rulemaking. The current fee schedule sets filing, search, and examination fees below the costs of performing these services to achieve low barriers to entry into the innovation ecosystem. These front-end fees are subsidized by other fee collections, primarily maintenance fees. For example, the basic filing fee will increase from $320 to $350, reflecting a 10% increase.

Small entity reductions. The new rule implements discounts or targeted adjustments enacted under the Unleashing American Innovators Act of 2022 for small businesses, independent inventors, and others who qualify as “small entities” or “micro entities.” Small and micro entity fees are set as 40% and 20%, respectively, of the undiscounted fees. The UPSTO states that the patent fee structure is designed to encourage innovation by maintaining low barriers to entry into the patent system. The USPTO accomplishes this goal by keeping initial filing fees for utility, plant, and design applications below the agency’s costs for preexamination, search, and examination, and by reducing most patent fees by 60% for small entities and by 80% for micro entities. More than half of design applicants pay discounted fees. For example, in Fiscal Year 2023, 26% of design applications paid the micro entity fee amount and 37% paid the small entity fee amount.

Declined proposal. The USPTO decided not to implement a plan for even higher patent fees announced on April 3, 2024, in a notice of proposed rulemaking. During the public comment period, the USPTO received a number of comments expressing concerns. By way of illustration, the proposed fee for a patent term extension in the proposed rule was $6,700, but the final rule sets the fee at $2,500. After considering public feedback, the USPTO has adjusted the timing thresholds for the continuing application fees. The USPTO will not impose fee changes in the targeted proposals for: (1) a new fee for After Final Consideration Pilot (AFCP) 2.0 requests; (2) a targeted increase to the patent term adjustment fee; and (3) a terminal disclaimer tiered fees. The agency considered public feedback on AFCP 2.0 and opted to allow the program to expire on December 14, 2024.

“Our updated patent fees will allow us to enhance patent examination quality, achieve patent pendency goals, and continue investing in modern information technology systems and architecture,” said Under Secretary of Commerce for Intellectual Property and Director of the USPTO Kathi Vidal. “We appreciate all the public feedback we received as we continue to work to serve America’s innovators and drive our nation’s competitiveness.”

News: Patent USPTO GCNNews