SECTION 1. SHORT TITLE.

    This Act may be cited as the ``SBIR and STTR Foreign Patent 
Protection Act of 2001''.

SEC. 2. FINDINGS.

    The Congress finds that--
            (1) small business concerns represent approximately 96 
        percent of all exporters of goods;
            (2) there has been dynamic growth in the number of small 
        business concerns exporting goods, and the dollar value of 
        their exports;
            (3) despite such growth, small business concerns encounter 
        problems in obtaining financing for exports;
            (4) growth in United States exports will depend primarily 
        on technology innovation, making the protection of intellectual 
        property in the global market of special national interest;
            (5) the costs of filing for initial patent protection in 
        foreign markets can be prohibitive for small business concerns 
        involved in the Small Business Innovation Research Program 
        (referred to in this section as ``SBIR'') and the Small 
        Business Technology Transfer Program (referred to in this 
        section as ``STTR''), representing an insurmountable barrier to 
        obtaining the protection needed to pursue the international 
        markets;
            (6) to overcome such barriers and to maximize the Federal 
        investment in the SBIR and STTR programs, the Small Business 
        Administration should be authorized to provide grants to be 
        used to underwrite the costs of initial foreign patent 
        applications by SBIR and STTR awardees; and
            (7) a program established to provide such grants should, 
        over time, become self funding.

SEC. 3. ESTABLISHMENT OF GRANT PILOT PROGRAM.

    Section 9 of the Small Business Act (15 U.S.C. 638) is amended by 
adding at the end the following:
    ``(w) Foreign Patent Protection Grant Pilot Program.--
            ``(1) Grants authorized.--The Administrator shall make 
        grants from the Fund established under paragraph (6) for the 
        purpose of assisting SBIR and STTR awardees in seeking foreign 
        patent protection in accordance with this subsection.
            ``(2) Number of grants.--The Administrator shall make 
        grants under this subsection to not more than--
                    ``(A) a total of 100 SBIR and STTR awardees in 
                fiscal year 2003;
                    ``(B) a total of 200 SBIR and STTR awardees in 
                fiscal year 2004;
                    ``(C) a total of 300 SBIR and STTR awardees in 
                fiscal year 2005; and
                    ``(D) a total of 400 SBIR and STTR awardees in each 
                of fiscal years 2006 and 2007.
            ``(3) Grant purposes.--Grants made under this subsection 
        shall be used by awardees to underwrite costs associated with 
        initial foreign patent applications for technologies or 
        products developed under the SBIR or STTR program, and for 
        which an application for United States patent protection has 
        already been filed.
            ``(4) Considerations.--In awarding grants under this 
        subsection, the Administrator shall consider--
                    ``(A) the size and financial need of the applicant;
                    ``(B) the potential foreign market for the 
                technology;
                    ``(C) the time frames for filing foreign patent 
                applications; and
                    ``(D) such other factors as the Administrator deems 
                relevant.
            ``(5) Grant amounts.--The amount of a grant made to any 
        SBIR or STTR awardee under this subsection may not exceed 
        $25,000, and no awardee may receive more than 1 grant under 
        this subsection.
            ``(6) Establishment of revolving fund.--There is 
        established in the Treasury of the United States a revolving 
        fund, which shall be--
                    ``(A) known as the `SBIR and STTR Foreign Patent 
                Protection Grant Fund' (referred to in this subsection 
                as the `Fund');
                    ``(B) administered by the Office of Technology of 
                the Administration; and
                    ``(C) used solely to fund grants under this 
                subsection and to pay the costs to the Administration 
                of administering those grants.
            ``(7) Royalty fees.--
                    ``(A) In general.--Each recipient of a grant under 
                this subsection shall pay a fee to the Administration, 
                to be deposited into the Fund, based on the export 
                sales receipts or licensing fees, if any, from the 
                product or technology that is the subject of the 
                foreign patent petition.
                    ``(B) Annual installments based on receipts.--The 
                fee required under subparagraph (A)--
                            ``(i) shall be paid to the Administration 
                        in annual installments, based on the export 
                        sales receipts or licensing fees described in 
                        subparagraph (A) that are collected by the 
                        grant recipient in that calendar year;
                            ``(ii) shall not be required to be paid in 
                        any calendar year in which no export sales 
                        receipts or licensing fees described in 
                        subparagraph (A) are collected by the grant 
                        recipient; and
                            ``(iii) shall not exceed, in total, the 
                        lesser of--
                                    ``(I) an amount between 3 percent 
                                and 5 percent, as determined by the 
                                Administrator, of the total export 
                                sales receipts and licensing fees 
                                referred to in subparagraph (A); or
                                    ``(II) 4 times the amount of the 
                                grant received.
            ``(8) Administrative provisions.--Not later than 180 days 
        after the date of enactment of this subsection, the 
        Administrator shall--
                    ``(A) issue such regulations as are necessary to 
                carry out this subsection; and
                    ``(B) establish appropriate application and other 
                administrative procedures, as the Administrator deems 
                necessary.
            ``(9) Report.--The Administrator shall, on January 31, 
        2006, submit a report to the Congress on the grants authorized 
        by this subsection, which report shall include--
                    ``(A) the number of grant recipients under this 
                subsection since the date of enactment of this 
                subsection;
                    ``(B) the number of such grant recipients that have 
                made foreign sales (or granted licenses to make foreign 
                sales) of technologies or products developed under the 
                SBIR or STTR program;
                    ``(C) the total amount of fees paid into the Fund 
                by recipients of grants under this subsection in 
                accordance with paragraph (7);
                    ``(D) recommendations for any adjustment in the 
                percentages specified in paragraph (7)(B)(iii)(I) or 
                the amount specified in paragraph (7)(B)(iii)(II) 
                necessary to reduce to zero the cost to the 
                Administration of making grants under this subsection; 
                and
                    ``(E) any recommendations of the Administrator 
                regarding whether authorization for grants under this 
                subsection should be extended, and any necessary 
                legislation related to such an extension.
            ``(10) Authorization of appropriations.--There is 
        authorized to be appropriated to the Fund, to remain available 
        until expended--
                    ``(A) $2,500,000 for fiscal years 2003;
                    ``(B) $5,000,000 for fiscal year 2004;
                    ``(C) $7,500,000 for fiscal year 2005; and
                    ``(D) $10,000,000 for each of fiscal years 2006 and 
                2007.''.
Output: SBIR and STTR Foreign Patent Protection Act of 2001 - Amends the Small Business Act to require the Administrator of the Small Business Administration (SBA) to make one grant of up to $25,000, from the SBIR and STTR Foreign Patent Protection Fund (established under this Act) to any Small Business Innovation Research Program (SBIR) or Small Business Technology Transfer Program (STTR) to underwrite costs associated with initial foreign patent applications for technologies or products developed under the SBIR or STTR, and for which an application for U.S. patent protection has already been filed.Establishes the SBIR and STTR Foreign Patent Protection Fund in the Treasury to be used solely to fund such grants and to pay SBA costs of administering them.Requires each grant recipient to pay annual royalty fees to the Administration, for deposit into the Fund, based on the export sales receipts or licensing fees, if any, from the product or technology that is the subject of the foreign patent petition.