In order to encourage individuals, small businesses and universities to use the patent system, the Canadian Intellectual Property Office (CIPO) provides a 50% discount on certain government fees for qualifying “small entities”.
Eligibility for small entity status is determined at the time a patent application enters the patent system in Canada. Generally, this means the Canadian filing date. International or PCT patent applications designating Canada are already considered Canadian application; thus, the Canadian filing date is the PCT filing date for these types of applications.
If the applicant is either a university or a small business that employs 50 or fewer employees, they are eligible to file as a small entity. However, if the applicant is controlled by or under an obligation to license to an entity that employs more than 50 employees, then the applicant is not eligible to file as a small entity. The official criteria are set out in section 3.01 of the Patent Rules.
A declaration signed by the applicant or the applicant’s patent agent of entitlement to pay fees at the small entity rate must be submitted at the time of filing the application. Submission of a patent application with filing fees at the small entity rate and no signed small entity declaration will result in an invitation to either pay additional fees or submit a signed small entity declaration. Although it is often expedient to submit the signed declaration as requested, the filing date of the application then becomes the date on which the signed declaration is received by CIPO. In many cases, this is after the one-year Paris Convention priority claim period, resulting in a loss of entitlement to claim priority to an earlier application. In order to preserve the original Canadian filing date or PCT National Entry date, particularly for the purposes of maintaining a priority claim, the small entity basis must be dropped and the additional fees paid to bring the total filing fee up to the regular undiscounted rate.
If an applicant pays fees at the small entity rate and it is later found that it was not entitled to do so, the application or patent arising therefrom can be invalidated in the Canadian courts. There is no mechanism in place to correct such an error. It is therefore critical that entitlement to claim small entity status is done correctly and, if there is any doubt, we recommend filing at the regular undiscounted rate.
For additional information on paying fees at the small entity rate, please click on the CIPO link below or contact us with the specifics of your case.
CIPO small entity status: https://www.ic.gc.ca/eic/site/cipointernet-internetopic.nsf/eng/wr04203.html#payless
USPTO entity status discounts: https://www.uspto.gov/web/offices/pac/mpep/s2550.html