Small Entity vs. Micro Entity

The United States Patent and Trademark Office (USPTO) requires patent holders to pay filing, application, and maintenance fees. In order to encourage smaller firms to apply and hold patents, the USPTO provides for discounts on required fees to small and micro entities, as defined by the Code of Federal Regulations. Definitions are provided by the USPTO. Small or micro-entity status must be verified and asserted prior to paying reduced fees.

Small Entity Status

Under Title 37, Code of Federal Regulations: Patents, Trademarks, and Copyrights, a small entity can be considered a person, a small business concern, or a nonprofit organization. Certain standards must be met to be considered any of the three. For exact definitions see the full text of Title 37 CFR 1.27.

Person

A person refers to the inventor of a patent or anyone with rights to the patent that has no obligation to nor has previously shared rights to the patent. A person who has shared or is under obligation to share rights to the patent may still qualify for small-entity status if those who will or have received rights also qualify as small entities.

Small Business Concern

A small business concern has not nor will not share rights to its patent with a company that is not also a small entity. Additionally, a business can have no more than 500 employees. Size status is reviewed by Small Business Administration officials, and questions regarding size standards can be addressed to: Small Business Administration, Size Standards Staff, 409 Third Street, SW., Washington, DC 20416.

Nonprofit Organization

To be considered a small entity, a nonprofit organization will not nor has previously shared rights to their patents with a company or person that does not qualify as a small entity as well.