Federal Register / Vol. 73, No. 158 / Thursday, August 14, 2008 / Rules and Regulations 47531 

contents for § 1.1366–2(a)(5)(i), (a)(5)(ii) 

and (a)(5)(iii) to read as follows: 

§ 1.1366–0 Table of contents. 

* * * * * 

§ 1.1366–2 Limitations on deduction of 

passthrough items of an S corporation to 

its shareholders. 

(a) * * * 

(5) * * * 

(i) In general. 

(ii) Exceptions for transfers of stock 

under section 1041(a). 

(iii) Examples. 

■ Par. 9. Section 1.1366–2(a)(5) is 

amended by: 

■ 1. Redesignating paragraph (a)(5) as 

(a)(5)(i). 

■ 2. Adding a heading and revising the 

first sentence of paragraph (a)(5)(i). 

■ 3. Adding paragraphs (a)(5)(ii) and 

(a)(5)(iii). 

The revisions and additions read as 

follows: 

§ 1.1366–2 Limitations on deduction of 

passthrough items of an S corporation to 

its shareholders. 

(a) In general. * * * 

(5) Nontransferability of losses and 

deductions—(i) In general. Except as 

provided in paragraph (a)(5)(ii) of this 

section, any loss or deduction 

disallowed under paragraph (a)(1) of 

this section is personal to the 

shareholder and cannot in any manner 

be transferred to another person. * * * 

(ii) Exceptions for transfers of stock 

under section 1041(a). If a shareholder 

transfers stock of an S corporation after 

December 31, 2004, in a transfer 

described in section 1041(a), any loss or 

deduction with respect to the 

transferred stock that is disallowed to 

the transferring shareholder under 

paragraph (a)(1) of this section shall be 

treated as incurred by the corporation in 

the following taxable year with respect 

to the transferee spouse or former 

spouse. The amount of any loss or 

deduction with respect to the stock 

transferred shall be determined by 

prorating any losses or deductions 

disallowed under paragraph (a)(1) of 

this section for the year of the transfer 

between the transferor and the spouse or 

former spouse based on the stock 

ownership at the beginning of the 

following taxable year. If a transferor 

claims a deduction for losses in the 

taxable year of transfer, then under 

paragraph (a)(4) of this section, if the 

transferor’s pro rata share of the losses 

and deductions in the year of transfer 

exceeds the transferor’s basis in stock 

and the indebtedness of the corporation 

to the transferor, then the limitation 

must be allocated among the transferor 

spouse’s pro rata share of each loss or 

deduction, including disallowed losses 

and deductions carried over from the 

prior year. 

(iii) Examples. The following 

examples illustrates the provisions of 

paragraph (a)(5)(ii) of this section: 

Example 1. A owns all 100 shares in X, a 

calendar year S corporation. For X’s taxable 

year ending December 31, 2006, A has zero 

basis in the shares and X does not have any 

indebtedness to A. For the 2006 taxable year, 

X had $100 in losses that A cannot use 

because of the basis limitation in section 

1366(d)(1) and that are treated as incurred by 

the corporation with respect to A in the 

following taxable year. Halfway through the 

2007 taxable year, A transfers 50 shares to B, 

A’s former spouse in a transfer to which 

section 1041(a) applies. In the 2007 taxable 

year, X has $80 in losses. On A’s 2007 

individual income tax return, A may use the 

entire $100 carryover loss from 2006, as well 

as A’s share of the $80 2007 loss determined 

under section 1377(a) ($60), assuming A 

acquires sufficient basis in the X stock. On 

B’s 2007 individual income tax return, B may 

use B’s share of the $80 2007 loss determined 

under section 1377(a) ($20), assuming B has 

sufficient basis in the X stock. If any 

disallowed 2006 loss is disallowed to A 

under section 1366(d)(1) in 2007, that loss is 

prorated between A and B based on their 

stock ownership at the beginning of 2008. On 

B’s 2008 individual income tax return, B may 

use that loss, assuming B acquires sufficient 

basis in the X stock. If neither A nor B 

acquires any basis during the 2007 taxable 

year, then as of the beginning of 2008, the 

corporation will be treated as incurring $50 

of loss with respect to A and $50 of loss with 

respect to B for the $100 of disallowed 2006 

loss, and the corporation will be treated as 

incurring $60 of loss with respect to A and 

$20 with respect to B for the $80 of 

disallowed 2007 loss. 

Example 2. Assume the same facts as 

Example 1, except that during the 2007 

taxable year, A acquires $10 of basis in A’s 

shares in X. For the 2007 taxable year, A may 

claim a $10 loss deduction, which represents 

$6.25 of the disallowed 2006 loss of $100 and 

$3.75 of A’s 2007 loss of $60. The disallowed 

2006 loss is reduced to $93.75. As of the 

beginning of 2008, the corporation will be 

treated as incurring half of the remaining 

$93.75 of loss with respect to A and half of 

that loss with respect to B for the remaining 

$93.75 of disallowed 2006 loss, and if B does 

not acquire any basis during 2007, the 

corporation will be treated as incurring 

$56.25 of loss with respect to A and $20 with 

respect to B for the remaining disallowed 

2007 loss. 

* * * * * 

■ Par. 10. Section 1.1366–5 is amended 

by adding a new sentence at the end to 

read as follows: 

§ 1.1366–5 Effective/applicability date. 

* * * Sections 1.1366–2(a)(5)(i), (ii) 

and (iii) are effective on August 14, 

2008. 

PART 602—OMB CONTROL NUMBERS 

UNDER THE PAPERWORK 

REDUCTION ACT 

■ Par. 11. The authority citation for part 

602 continues to read as follows: 

Authority: 26 U.S.C. 7805. 

■ Par. 12. Section 602.101, paragraph 

(b) is amended by adding the entry in 

numerical order to the table to read as 

follows: 

§ 602.101 OMB Control numbers. 

* * * * * 

(b) * * * 

CFR part or section where 

identified and described 

Current OMB 

control No. 

* * * * * 

1.1361–1 ............................... 1545–2114 

* * * * * 

Sherri L. Brown, 

Acting Deputy Commissioner for Services and 

Enforcement. 

Approved: August 5, 2008. 

Eric Solomon, 

Assistant Secretary of the Treasury (Tax 

Policy). 

[FR Doc. E8–18782 Filed 8–13–08; 8:45 am] 

BILLING CODE 4830–01–P 

DEPARTMENT OF HOMELAND 

SECURITY 

Coast Guard 

33 CFR Part 100 

[Docket No. USCG–2008–0789] 

RIN 1625–AA08 

Special Local Regulation; Cape Fear 

Dragon Boat Festival, Wilmington, NC 

AGENCY: Coast Guard, DHS. 

ACTION: Temporary final rule. 

SUMMARY: The Cape Fear Dragon Boat 

Festival will take place on the Cape Fear 

River in Wilmington, North Carolina on 

September 27, 2008. This event will 

consist of four 45 foot long Dragon boats 

racing a 250 meter course. 

DATES: This rule is effective from 8 a.m. 

to 6 p.m. on September 27, 2008. 

ADDRESSES: Documents indicated in this 

preamble as being available in the 

docket are part of docket USCG–2008–

0789 and are available online at 

www.regulations.gov. They are also 

available for inspection or copying at 

two locations: the Docket Management 

Facility (M–30), U.S. Department of 


rfrederick on PROD1PC67 with RULES
47532 Federal Register / Vol. 73, No. 158 / Thursday, August 14, 2008 / Rules and Regulations 

Transportation, West Building Ground 

Floor, Room W12–140, 1200 New Jersey 

Avenue, SE., Washington, DC 20590, 

between 9 a.m. and 5 p.m., Monday 

through Friday, except Federal holidays, 

and at Commander, Coast Guard Sector 

North Carolina, 2301 East Fort Macon 

Rd., Atlantic Beach, North Carolina 

28512 between 8 a.m. and 4 p.m., 

Monday through Friday, except Federal 

holidays. 

FOR FURTHER INFORMATION CONTACT: If 

you have questions on this temporary 

rule, call the Marine Event Coordinator 

at Coast Guard Sector North Carolina, C. 

D. Humphrey at (252) 247–4570. If you 

have questions on viewing the docket, 

call Renee V. Wright, Program Manager, 

Docket Operations, telephone (202) 

366–9826. 

SUPPLEMENTARY INFORMATION: 

Regulatory Information 

The Coast Guard is issuing this 

temporary final rule without prior 

notice and opportunity to comment 

pursuant to authority under section 4(a) 

of the Administrative Procedure Act 

(APA) (5 U.S.C. 553(b)). This provision 

authorizes an agency to issue a rule 

without prior notice and opportunity to 

comment when the agency for good 

cause finds that those procedures are 

‘‘impracticable, unnecessary, or contrary 

to the public interest.’’ Under 5 U.S.C. 

553(b)(B), the Coast Guard finds that 

good cause exists for not publishing a 

notice of proposed rulemaking (NPRM) 

with respect to this rule because a delay 

in publication would be contrary to the 

public interest since immediate action is 

needed to protect the maritime public 

during the event. In order to ensure the 

safety of life on navigable waters during 

this event, the Coast Guard is 

establishing a special local regulation. 

The Coast Guard will issue a broadcast 

notice to mariners to advise mariners of 

the restriction and on scene Coast Guard 

and Coast Guard Auxiliary vessels will 

also provide additional notice to 

mariners. 

Background and Purpose 

On September 27, 2008, the Cape Fear 

Dragon Boat Club will sponsor the 

‘‘Cape Fear River Dragon Boat Festival.’’

This festival will include four 45 foot 

long Dragon Boats racing a straight line 

course 250 meters in length. The races 

will take place on the Cape Fear River 

in front of the Wilmington River Walk, 

approximately 0.5 nautical miles north 

of the Cape Fear River Memorial Bridge. 

To provide for the safety of participants, 

spectators and other transiting vessels, 

the Coast Guard will temporarily restrict 

vessel traffic in the event area during 

the races. 

Discussion of Rule 

The Coast Guard is establishing a 

special local regulation on specified 

waters of the Cape Fear River, 

Wilmington, North Carolina. The 

special local regulation includes all 

waters from shoreline to shoreline, 

bound by the following position latitude 

34°14′24′′ N, longitude 77°57′08′′ W 

thence south along the east bank of the 

river to latitude 34°14′00′′ N, longitude 

77°56′58′′ W, thence west to latitude 

34°14′00′′ N, longitude 77°57′05′′ W, 

thence north along the west bank to 

latitude 34°14′24′′ N, longitude 

77°57′21′′ W, thence east back to the 

point of origin. All coordinates 

reference Datum NAD 1983. The special 

local regulation will be in effect from 8 

a.m. to 6 p.m. on September 27, 2008. 

The effect will be to restrict general 

navigation in the regulated area during 

the races. Except for persons or vessels 

authorized by the Coast Guard Patrol 

Commander, no person or vessel may 

enter or remain in the regulated area 

during the enforcement period. The 

Patrol Commander will notify the public 

of specific enforcement times by Marine 

Radio Safety Broadcast. These 

regulations are needed to control vessel 

traffic during the event to enhance the 

safety of participants, spectators and 

transiting vessels. 

Regulatory Analyses 

We developed this rule after 

considering numerous statutes and 

executive orders related to rulemaking. 

Below we summarize our analyses 

based on 13 of these statutes or 

executive orders. 

Regulatory Planning and Review 

This rule is not a significant 

regulatory action under section 3(f) of 

Executive Order 12866, Regulatory 

Planning and Review, and does not 

require an assessment of potential costs 

and benefits under section 6(a)(3) of that 

Order. The Office of Management and 

Budget has not reviewed it under that 

Order. 

We expect the economic impact of 

this proposed rule to be so minimal that 

a full Regulatory Evaluation is 

unnecessary. Although this regulation 

prevents traffic from transiting a portion 

of the Cape Fear River during the event, 

the effect of this regulation will not be 

significant due to the limited duration 

that the regulated area will be in effect. 

Extensive advance notification will be 

made to the maritime community via 

marine information broadcasts, local 

radio stations and area newspapers so 

mariners can adjust their plans 

accordingly. Additionally, the regulated 

area has been narrowly tailored to 

impose the least impact on the maritime 

public yet provide the level of safety 

deemed necessary. Vessel traffic will be 

able to transit the regulated area 

between races, when the Coast Guard 

Patrol Commander deems it is safe to do 

so. 

Small Entities 

Under the Regulatory Flexibility Act 

(5 U.S.C. 601–612), we have considered 

whether this rule would have a 

significant economic impact on a 

substantial number of small entities. 

The term ‘‘small entities’’ comprises 

small businesses, not-for-profit 

organizations that are independently 

owned and operated and are not 

dominant in their fields, and 

governmental jurisdictions with 

populations of less than 50,000. 

The Coast Guard certifies under 5 

U.S.C. 605(b) that this rule will not have 

a significant economic impact on a 

substantial number of small entities. 

This rule will affect the following 

entities, some of which may be small 

entities: The owners or operators of 

vessels intending to transit this section 

of the Cape Fear River from 8 a.m. to 6 

p.m. on September 27, 2008. This rule 

will not have a significant economic 

impact on a substantial number of small 

entities for the following reasons: 

(i) Although the regulated area will 

apply to the section of the Cape Fear 

River approximately 0.5 nautical miles 

north of the Cape Fear Memorial Bridge, 

traffic may be allowed to pass through 

the regulated area with the permission 

of the Coast Guard Patrol Commander; 

(ii) the Patrol Commander will allow 

non-participating vessels to transit the 

event area between races; 

(iii) the minimal size of the zone; and 

(iv) before the enforcement period, the 

Coast Guard will issue maritime 

advisories so mariners can adjust their 

plans accordingly. 

Assistance for Small Entities 

Under section 213(a) of the Small 

Business Regulatory Enforcement 

Fairness Act of 1996 (Pub. L. 104–121), 

we offer to assist small entities in 

understanding the rule so that they can 

better evaluate its effects on them and 

participate in the rulemaking process. 

Small businesses may send comments 

on the actions of Federal employees 

who enforce, or otherwise determine 

compliance with, Federal regulations to 

the Small Business and Agriculture 

Regulatory Enforcement Ombudsman 

and the Regional Small Business 

Regulatory Fairness Boards. The 


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Federal Register / Vol. 73, No. 158 / Thursday, August 14, 2008 / Rules and Regulations 47533 

Ombudsman evaluates these actions 

annually and rates each agency’s 

responsiveness to small business. If you 

wish to comment on actions by 

employees of the Coast Guard, call 1–

888–REG–FAIR (1–888–734–3247). The 

Coast Guard will not retaliate against 

small entities that question or complain 

about this rule or any policy or action 

of the Coast Guard. 

Collection of Information 

This rule calls for no new collection 

of information under the Paperwork 

Reduction Act of 1995 (44 U.S.C. 3501–

3520). 

Federalism 

A rule has implications for federalism 

under Executive Order 13132, 

Federalism, if it has a substantial direct 

effect on State or local governments and 

would either preempt State law or 

impose a substantial direct cost of 

compliance on them. We have analyzed 

this rule under that Order and have 

determined that it does not have 

implications for federalism. 

Unfunded Mandates Reform Act 

The Unfunded Mandates Reform Act 

of 1995 (2 U.S.C. 1531–1538) requires 

Federal agencies to assess the effects of 

their discretionary regulatory actions. In 

particular, the Act addresses actions 

that may result in the expenditure by a 

State, local, or tribal government, in the 

aggregate, or by the private sector of 

$100,000,000 or more in any one year. 

Though this rule will not result in such 

an expenditure, we do discuss the 

effects of this rule elsewhere in this 

preamble. 

Taking of Private Property 

This rule will not effect a taking of 

private property or otherwise have 

taking implications under Executive 

Order 12630, Governmental Actions and 

Interference with Constitutionally 

Protected Property Rights. 

Civil Justice Reform 

This rule meets applicable standards 

in sections 3(a) and 3(b)(2) of Executive 

Order 12988, Civil Justice Reform, to 

minimize litigation, eliminate 

ambiguity, and reduce burden. 

Protection of Children 

We have analyzed this rule under 

Executive Order 13045, Protection of 

Children from Environmental Health 

Risks and Safety Risks. This rule is not 

an economically significant rule and 

does not create an environmental risk to 

health or risk to safety that may 

disproportionately affect children. 

Indian Tribal Governments 

This rule does not have tribal 

implications under Executive Order 

13175, Consultation and Coordination 

with Indian Tribal Governments, 

because it does not have a substantial 

direct effect on one or more Indian 

tribes, on the relationship between the 

Federal Government and Indian tribes, 

or on the distribution of power and 

responsibilities between the Federal 

Government and Indian tribes. 

Energy Effects 

We have analyzed this rule under 

Executive Order 13211, Actions 

Concerning Regulations That 

Significantly Affect Energy Supply, 

Distribution, or Use. We have 

determined that it is not a ‘‘significant 

energy action’’ under that order because 

it is not a ‘‘significant regulatory action’’

under Executive Order 12866 and is not 

likely to have a significant adverse effect 

on the supply, distribution, or use of 

energy. The Administrator of the Office 

of Information and Regulatory Affairs 

has not designated it as a significant 

energy action. Therefore, it does not 

require a Statement of Energy Effects 

under Executive Order 13211. 

Technical Standards 

The National Technology Transfer 

and Advancement Act (NTTAA) (15 

U.S.C. 272 note) directs agencies to use 

voluntary consensus standards in their 

regulatory activities unless the agency 

provides Congress, through the Office of 

Management and Budget, with an 

explanation of why using these 

standards would be inconsistent with 

applicable law or otherwise impractical. 

Voluntary consensus standards are 

technical standards (e.g., specifications 

of materials, performance, design, or 

operation; test methods; sampling 

procedures; and related management 

systems practices) that are developed or 

adopted by voluntary consensus 

standards bodies. 

This rule does not use technical 

standards. Therefore, we did not 

consider the use of voluntary consensus 

standards. 

Environment 

We have analyzed this rule under 

Department of Homeland Security 

Management Directive 5100.1 and 

Commandant Instruction M16475.lD, 

which guide the Coast Guard in 

complying with the National 

Environmental Policy Act of 1969 

(NEPA) (42 U.S.C. 4321–4370f), and 

have concluded under the Instruction 

that there are no factors in this case that 

would limit the use of a categorical 

exclusion under section 2.B.2 of the 

Instruction. Therefore, this rule is 

categorically excluded, under figure 2–

1, paragraph (34)(h), of the Instruction, 

from further environmental 

documentation. 

Under figure 2–1, paragraph (34)(h), 

of the Instruction, an ‘‘Environmental 

Analysis Checklist’’ and a ‘‘Categorical 

Exclusion Determination’’ are available 

in the docket where indicated under 

ADDRESSES. 

List of Subjects in 33 CFR Part 100 

Marine safety, Navigation (water), 

Reporting and recordkeeping 

requirements, and Waterways. 

■ Accordingly, the Coast Guard 

temporarily amends 33 CFR part 100 as 

follows: 

PART 100—SAFETY OF LIFE ON 

NAVIGABLE WATERS 

■ 1. The authority citation for part 100 

continues to read as follows: 

Authority: 33 U.S.C. 1233. 

■ 2. Add a temporary § 100.35T–05–

0789 to read as follows: 

§ 100.35T–05–0789 Special Local 

Regulation, Cape Fear Dragon Boat 

Festival. 

(a) Regulated area. All waters of the 

Cape Fear River, adjacent to 

Wilmington, North Carolina, 

approximately 0.5 nautical miles north 

of the Cape Fear Memorial Bridge, 

starting from position latitude 34°14′24′′ 

N, longitude 77°57′08′′ W thence south 

along the east bank of the river to 

latitude 34°14′00′′ N, longitude 

77°56′58′′ W, thence west to latitude 

34°14′00′′ N, longitude 77°57′05′′ W, 

thence north along the west bank to 

latitude 34°14′24′′ N, longitude 

77°57′21′′ W, thence east back to the 

point of origin. All coordinates 

reference Datum NAD 1983. 

(b) Definitions. (1) Coast Guard Patrol 

Commander means a commissioned, 

warrant, or petty officer of the Coast 

Guard who has been designated by the 

Commander, Coast Guard Sector North 

Carolina. 

(2) Official Patrol means any person 

or vessel assigned or approved by 

Commander, Coast Guard Sector North 

Carolina with a commissioned, warrant, 

or petty officer on board and displaying 

a Coast Guard ensign. 

(3) Participant includes all vessels 

participating in the ‘‘Cape Fear Dragon 

Boat Festival’’ under the auspices of the 

Marine Event Permit issued to the event 

sponsor and approved by Commander, 

Coast Guard Sector North Carolina. 

(c) Special local regulations. (1) 

Except for persons or vessels authorized 


rfrederick on PROD1PC67 with RULES
47534 Federal Register / Vol. 73, No. 158 / Thursday, August 14, 2008 / Rules and Regulations 

by the Coast Guard Patrol Commander, 

no person or vessel may enter or remain 

in the regulated area. 

(2) The operator of any vessel in the 

regulated area must: 

(i) Stop the vessel immediately when 

instructed to do so by the Official Patrol 

and then proceed as directed. 

(ii) All persons and vessels shall 

comply with the instructions of the 

Official Patrol. 

(iii) When authorized to transit the 

regulated area, all vessels shall proceed 

at the minimum speed necessary to 

maintain a safe course that minimizes 

wake near the race course. 

(d) Enforcement period. This section 

will be effective from 8 a.m. to 6 p.m. 

on September 27, 2008. 

Dated: August 4, 2008. 

F.M. Rosa, Jr., 

Rear Admiral, U.S. Coast Guard, District Five 

Commander. 

[FR Doc. E8–18789 Filed 8–13–08; 8:45 am] 

BILLING CODE 4910–15–P 

DEPARTMENT OF COMMERCE 

Patent and Trademark Office 

37 CFR Parts 1 and 41 

[Docket No. PTO–C02008–0004] 

RIN 0651–AC21 

Revision of Patent Fees for Fiscal Year 

2009 

AGENCY: United States Patent and 

Trademark Office, Commerce. 

ACTION: Final rule. 

SUMMARY: The United States Patent and 

Trademark Office (Office) is adjusting 

certain patent fee amounts for fiscal year 

2009 to reflect fluctuations in the 

Consumer Price Index (CPI). The patent 

statute provides for the annual CPI 

adjustment of patent fees set by statute 

to recover the higher costs associated 

with doing business. In addition, the 

Office is correcting the addresses for 

maintenance fee payments and 

correspondence, and deposit account 

replenishments. 

DATES: Effective Date: October 2, 2008. 

FOR FURTHER INFORMATION CONTACT: 

Walter Schlueter by e-mail at 

Walter.Schlueter@uspto.gov, by 

telephone at (571) 272–6299, or by fax 

at (571) 273–6299. 

SUPPLEMENTARY INFORMATION: The Office 

is adjusting certain patent fee amounts 

in accordance with the applicable 

provisions of title 35, United States 

Code, as amended by the Consolidated 

Appropriations Act (Pub. L. 108–447, 

118 Stat. 2809 (2004)). In addition, this 

final rule changes the addresses for 

maintenance fee payments and 

correspondence, and deposit account 

replenishments. The addresses are being 

changed to reflect the current addresses 

that should be used. 

Background: 

Statutory Provisions: Patent fees are 

set by or under the authority provided 

in 35 U.S.C. 41, 119, 120, 132(b), 156, 

157(a), 255, 302, 311, 376, section 

532(a)(2) of the Uruguay Round 

Agreements Act (URAA) (Pub. L. 103–

465, § 532(a)(2), 108 Stat. 4809, 4985 

(1994)), and section 4506 of the 

American Inventors Protection Act of 

1999 (AIPA) (Pub. L. 106–113, 113 Stat. 

1501, 1501A–565 (1999)). For fees paid 

under 35 U.S.C. 41(a) and (b) and 

132(b), independent inventors, small 

business concerns, and nonprofit 

organizations who meet the 

requirements of 35 U.S.C. 41(h)(1) are 

entitled to a fifty-percent reduction. 

Section 41(d) of title 35, United States 

Code, authorizes the Director to 

establish fees for all other processing, 

services, or materials related to patents 

to recover the average cost of providing 

these services or materials, except for 

the fees for recording a document 

affecting title, for each photocopy, for 

each black and white copy of a patent, 

and for standard library service. 

Section 41(f) of title 35, United States 

Code, provides that fee amounts 

established under 35 U.S.C. 41(a) and 

(b) may be adjusted on October 1, 1992, 

and every year thereafter, to reflect 

fluctuations in the CPI over the previous 

twelve months. 

Section 41(g) of title 35, United States 

Code, provides that new fee amounts 

established by the Director under 35 

U.S.C. 41 may take effect thirty days 

after notice in the Federal Register and 

the Official Gazette of the United States 

Patent and Trademark Office. 

The fiscal year 2005 Consolidated 

Appropriations Act (section 801 of 

Division B) provided that 35 U.S.C. 

41(a), (b), and (d) shall be administered 

in a manner that revises patent 

application fees (35 U.S.C. 41(a)) and 

patent maintenance fees (35 U.S.C. 

41(b)), and provides for a separate filing 

fee (35 U.S.C. 41(a)), search fee (35 

U.S.C. 41(d)(1)), and examination fee 

(35 U.S.C. 41(a)(3)) during fiscal years 

2005 and 2006. See Public Law 108–

447, 118 Stat. 2809, 2924–30 (2004). The 

patent and trademark fee provisions of 

the fiscal year 2005 Consolidated 

Appropriations Act were extended 

through September 30, 2008, by 

subsequent legislation. See Public Law 

110–161, 121 Stat. 1844 (2007), Public 

Law 110–149, 121 Stat. 1819 (2007), 

Public Law 110–137, 121 Stat. 1454 

(2007), Public Law 110–116, 121 Stat. 

1295 (2007), Public Law 110–92, 121 

Stat. 989 (2007), Public Law 110–5, 121 

Stat. 8 (2007), Public Law 109–383, 120 

Stat. 2678 (2006), Public Law 109–369, 

120 Stat. 2642 (2006), and Public Law 

109–289, 120 Stat. 1257 (2006). 

Legislation is pending before Congress 

which, if enacted, would extend the 

patent and trademark fee provisions of 

the fiscal year 2005 Consolidated 

Appropriations Act through fiscal year 

2009 (through September 30, 2009). See 

S. 3182, 110th Cong. (2008). 

Fee Adjustment Level: The patent 

statutory fee amounts established by 35 

U.S.C. 41(a) and (b) are adjusted to 

reflect fluctuations occurring during the 

twelve-month period from October 1, 

2007, through September 30, 2008, 

correspondingly, in the Consumer Price 

Index for All Urban Consumers (CPI–U). 

The Office of Management and Budget 

has advised that in calculating these 

fluctuations, the Office should use CPI–

U data as determined by the Secretary 

of Labor. In accordance with previous 

fee-setting methodology, the Office 

bases this fee adjustment on the 

Administration’s CPI–U for the twelvemonth period ending September 30, 

2008. 

The Office published a notice 

proposing to adjust the patent fees 

charged under 35 U.S.C. 41(a), (b), and 

(d)(1) for fiscal year 2009 to reflect 

fluctuations in the CPI. See Revision of 

Patent Fees for Fiscal Year 2009, 73 FR 

31655 (June 3, 2008), 1331 Off. Gaz. Pat. 

Office 97 (June 24, 2008) (proposed 

rule). While the proposed rule specified 

fee amounts based upon a projected 

CPI–U of 4.0 percent, the proposed rule 

indicated that the fee amounts adopted 

in a final rule may be based upon the 

actual fluctuations in the CPI–U as 

determined by the Secretary of Labor. 

See Revision of Patent Fees for Fiscal 

Year 2009, 73 FR at 31656, 1331–4 Off. 

Gaz. Pat. Office at 98. After the date the 

proposed rule was published, the 

projected CPI–U for the twelve-month 

period prior to the enactment of the fee 

amount adjustments has increased from 

4.0 percent to 5.0 percent. Thus, this 

final rule adjusts the patent fees charged 

under 35 U.S.C. 41(a), (b), and (d)(1) by 

5.0 percent based upon the current 

projected fluctuation in the CPI–U. 

The fee amounts were rounded by 

applying standard arithmetic rules so 

that the amounts rounded will be 

convenient to the user. Fees for other 

than a small entity of $100 or more were 

rounded to the nearest $10. Fees of less 

than $100 were rounded to an even 


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