A new EPOch of reduced fees for ‘micro entities’

At a glance

From 1 April 2024, the EPO are introducing a new fee reduction scheme for ‘micro-entities’ to make it easier for smaller and less experienced organisations to access the European patent system, and to therefore help support their growth and development. This is a new status for applicants in front of the EPO, applying to both European patent applications and Euro-PCT applications, and which allows eligible applicants to benefit from a 30% reduction in all of the EPO’s main patent prosecution fees. The new scheme will complement the existing support measures that are in place for ‘small entities’, though one key point of note is that the new ‘micro-entity’ status will be more widely usable – it is irrespective of the entity’s nationality or domicile. This comes into effect at a very welcome time, given the current economic climate, and the yearly fee increases that otherwise take place at the EPO on 1 April.

The details

What benefits are already in place?

The EPO currently offers various benefits for ‘small entities’, these ‘small entities’ including:

• natural persons;
• non-profit organisations, universities and public research organisations;
• microenterprises; and
• small and medium-sized enterprises (SMEs).

One main benefit is the language-related fee reductions that are in place for these persons/organisations, where they have their residence or principal place of business in an EPC contracting state, and file their European patent application and/or request for examination in an official language of that state that is not English, French or German. This entitles such persons/organisations to a 30% reduction of the filing and/or examination fees.

The current support measures also provide a reduced appeal fee for such persons/organisations, and a compensation lump sum for Unitary Patent related translation costs. However, these reductions relate to fees which are utilised relatively infrequently.

What additional benefits are coming into effect and who is eligible?

As of 1 April 2024, a new ‘micro entity’ status is being introduced at the EPO. This new status applies to the same above mentioned ‘small entities’, with the exception of SMEs. However, one important and beneficial change is that the ‘micro entity’ status will be irrespective of the person’s/organisation’s nationality or domicile.

Whilst the definitions of natural persons, non-profit organisations, universities and public research organisations are more apparent, alongside a number of other requirements, a microenterprise is defined as an enterprise that employs fewer than 10 persons and whose annual turnover does not exceed EUR 2 million Euros.

Whilst these ‘micro entities’ will benefit from the same 30% reduction in fees, more beneficially, this 30% reduction will apply to all of the more commonly utilised fees payable during patent prosecution (including the filing, search, examination, designation, grant and renewal fees), as long as the applicant has filed less than five patent applications in the last five years. The effect of these reductions is shown in the table below:

This will apply to both European patent applications and Euro-PCT applications that have entered the European regional phase. 

It therefore seems the new scheme will provide significant cost savings for a wide range of eligible applicants.

How does an applicant claim for these benefits?

Similar to the requirements for claiming ‘small entity’ status benefits, to benefit from the ‘micro entity’ status, applicants must make a declaration to this effect in front of the EPO. Reductions can then be applied to relevant fee payments made on or after 1 April 2024 (assuming the declaration is filed with/before any such fee payment is made).

Where there is more than one applicant for a given application, each one of the applicants must qualify, and where any European patent application is transferred, it is the status of the new applicant which will determine whether the application qualifies for the ‘micro entity’ reduction.

The EPO must also be informed where there is any change to the applicant’s ‘micro entity’ status; this is important. The EPO will carry out random checks regarding the status of applicants and will request appropriate evidence concerning the applicant’s status where their checks give rise to any reasonable doubts. If the EPO finds a declaration concerning the applicant’s status to be incorrect, any reduced fee will be deemed not validly paid and the application may thus be deemed withdrawn (whilst it may well be then possible to ‘revive’ the application, this will be even more costly for the applicant). 

It is therefore important to make sure that all applicants qualify for the ‘micro entity’ status when a declaration is filed, that they continue to qualify for said status, and that the EPO is readily informed if/when the applicant(s) no longer qualify.

A positive step for the EPO

Whilst the new scheme is perhaps not quite as favourable as the USPTO’s offering of an 80% reduction in various fees for ‘micro entities’, it is most certainly a positive step for the EPO, demonstrating their recognition of the value in supporting smaller persons/organisations. Which is more, the EPO has taken the step of ensuring that their support for these organisations applies regardless of the organisation’s location.

These changes also come into effect at a very welcome time, when operating costs are high, but significant developments are being made in breakthrough fields such as AI and machine learning and in their application across many business sectors. 

The EPO are also set to make their annual fee increases on 1 April 2024, although, pleasingly, this year the EPO have said they have at least taken high inflation costs into consideration when setting these increases.

Further information

Annabel Williams is a European Patent Attorney specialising in physics and engineering, and in the prosecution of European patent applications at the EPO. If you wish to have more information in relation to any of the above mentioned schemes or to any matters in front of the EPO more generally, please contact Annabel or your usual Marks & Clerk contact.