The USPTO has defined four (4) types of patent applicants that qualify as a “small entity”: a university, a nonprofit organization, an individual inventor, or a small business concern. The definitions for a “university,” “nonprofit organization,” and “individual inventor” are defined in the patent rules. Notably, a wholly owned subsidiary of a nonprofit organization or of a university is considered a part of the nonprofit organization or university and may claim small-entity status.

A “small business concern” may pay half the filing fees, issue fees, and other fees that are charged to large entities. The term “small business concern” is not defined in the patent regulations. The Small Business Administration (SBA) has sole jurisdiction over determinations of “small business concerns” and the USPTO will not accept petitions for size determinations. The SBA has defined “small business concern” as, generally, a “concern, including its affiliates, that:

  • is independently owned and operated
  • is not dominant in the field in which it is bidding on government contracts, and
  • meets any applicable criteria for a particular industry concerning number of employees (usually less than 500) or annual receipts (usually less than $7 million) or annual profits (usually more than $2 million).