“America’s thinkers and creators are at the heart of technological-based economic growth—they are the engine that runs the American economic machine.” This statement, from the 1994 strategic plan of the Patent and Trademark Office (PTO), effectively summarizes the importance of advancing, regulating, and administering patents, trademarks, and copyrights—collectively referred to as intellectual property. The administration has made intellectual property reform a part of its plan to “reinvent” government. The Congress has also recently considered legislation that would affect how intellectual property rights are administered. Some of these proposals would affect the organization and funding of PTO and the Copyright Office. In this regard, the Chairman of the Senate Committee on the Judiciary asked us to review various issues relating to intellectual property fees. In this country, the federal government is the primary regulator of intellectual property through the grant of patents and the registration of trademarks and copyrights. In this regard—and because federal statutes and regulations provide various economic and procedural benefits concomitant with the grant or registration—these three types of intellectual property are much alike. In other ways, however, they are different. Registering copyrights, for example, takes less time than granting patents or registering trademarks, yet copyrights generally have a much longer life. Trademarks have the shortest original term; however, they can be renewed indefinitely while patents and copyrights cannot. Patents for inventions never brought to market and copyrights for materials never published nevertheless are protected for their entire terms, while a trademark can be lost if it is not used. Similarly, the roles of the agencies regulating and administering intellectual property differ. Generally, PTO examines patent and trademark applications in great detail to ensure that others have not already applied for a patent on the invention or are not using the trademark in question. The Copyright Office essentially registers any materials that appear to be copyrightable and for which the application is complete. Unlike PTO, the Copyright Office generally does not determine whether some other person has a similar copyright or whether the materials are in the public domain. The differences in the complexities of the procedures followed by the agencies are mirrored by differences in the fees and related expenses. A patent is a grant given by a government to an inventor of the right to exclude others for a limited time from making, using, or selling his or her invention. In the United States, the sole granting authority for patents is PTO. The patent process is totally funded through user fees. In fiscal year 1995, PTO issued 114,642 patents. PTO typically classifies patents as one of four types: • Over 90 percent of all patent applications are for “utility” patents for inventions that are either a process, machine, manufactured article, or composition of matter, or an improvement to one of these. A second type of patent is the “plant” patent—constituting less than 1 percent of all applications—which is granted for asexually propagated plants. Previously, utility and plant patents had a term of 17 years from the date the patents were issued. For those applications filed after June 7, 1995, however, utility and plant patents will have a nonrenewable term of 20 years from the date the earliest application is filed. • The third type of patent is the “design” patent, available for a new, original, and ornamental design for an article of manufacture. In fiscal year 1995, design patent applications accounted for about 6.5 percent of all applications filed. Design patents have a nonrenewable term of 14 years from the date of issuance. • The fourth type of patent is the “reissue” patent, which is granted as a replacement for a patent that was in some way defective. The reissue patent is granted for the unexpired term of the patent it replaced. Reissue patents typically account for less than 1 percent of all applications. Prior to issuing a patent, PTO examines the application to verify that the patent is indeed new, useful, and non-obvious. In this regard, PTO requires that every patent application include (1) a specification that describes the manner and process of making and using the invention as well as the claim or claims that make the invention patentable; (2) an oath or declaration that the applicant is the original inventor; (3) drawings, where necessary for understanding the nature of the invention; and (4) a filing fee. Additional fees may be necessary during examination, when the patent is issued, and during the term of the patent. Within PTO, the patent application examination process consists of several progressive phases. An applicant files a patent application with PTO, which reviews the application for accuracy and completeness during a preexamination phase. Following preexamination, the application is assigned, or “docketed,” to an examiner within an examination group that has expertise in a specific field, such as computer systems or biotechnology. At this point, the examiner begins the process of determining whether the invention is a new and useful process or product that should receive a patent. Usually early in the process, the examiner makes a preliminary decision, or “first action,” which may be followed by contacts with the applicant to resolve questions and/or obtain additional information. If PTO decides to issue a patent, termed an “allowance,” it informs the applicant and, upon the payment of the necessary fees, issues a patent. The application may be abandoned during any of these stages. The examination process can be lengthy. During fiscal year 1995, for example, the average “patent pendency”—the period from the date an application is filed until the date it is abandoned by the applicant or a patent is issued by PTO—was 19.8 months. While not required, most inventors use the services of an attorney to help prepare the application and to assist them throughout the examination process, according to PTO. A trademark is a word, name, symbol, or design used to distinguish or identify the goods or services of a particular merchant or manufacturer from those of others. As with patents, the federal authority for registering trademarks in the United States is PTO, and the trademark process is funded through user fees. In fiscal year 1995, PTO issued 65,662 certificates of registration. Federal registration does not create a trademark because a trademark can only be acquired by actually using it in association with particular goods or services. However, federal registration does offer the registrant substantial procedural advantages should the trademark owner be faced with an infringement. Once registration has been obtained, the trademark must remain in substantially continuous use in order to be preserved. Trademark registrations have a term of 10 years but can be renewed indefinitely for additional 10-year terms. An applicant seeking to register a trademark must file an application accompanied by a fee, specimens of the trademark as it is actually used, a drawing of the mark, and various statements describing when the mark was first used and the types of goods and services on which it is used. Trademarks are categorized into various classes, such as toys or clothing, and, if registration for more than one class is sought, the applicant must pay an additional fee for each class. Once filed, the application is examined by an examining attorney within the Trademark Office of PTO. The attorney verifies that the trademark for which registration is sought is not “confusingly similar” to trademarks for other goods or services. If there is no such similarity and there are no other statutory bars to registration, PTO publishes the trademark and gives members of the public the right to oppose registration if they feel it is confusingly similar to another trademark, even if this other trademark is not already registered. If no problems are identified at this stage, the trademark is registered. Even then, however, it can be challenged at some later date if it is not used properly or if a prior user comes forward. The trademark process can also be lengthy. In fiscal year 1995, for example, PTO reported that the time between the filing of an application and the registration of the trademark averaged 16.4 to 16.7 months. While applicants may use attorneys in the application process, attorney involvement is not as extensive as with patents, according to PTO officials. A copyright is a type of intellectual property that protects literary and artistic expression as well as the media where these are displayed. Thus, copyrights are available for works such as books, periodicals, speeches, printed and recorded music, plays, computer software, paintings, sculpture, and motion pictures. Copyright registration in the United States is the exclusive province of the Copyright Office in the Library of Congress. In fiscal year 1995, the Copyright Office registered 609,195 copyrights. As with trademarks, a copyright is not gained through registration but rather when the work itself is created and reduced to some tangible form of expression. It is the expression of an idea that is copyrightable, not the idea itself. Registration does offer advantages, however, because the copyright owner has better evidence regarding the priority of the claim and is entitled to certain statutory benefits and damages upon infringement that would not otherwise be available. A copyright generally lasts for the (1) author’s lifetime plus 50 years for personal works or (2) shorter of 75 years from publication or 100 years from creation for works for hire, anonymous works, or pseudonymous works. The copyright registration process is simpler than for patents and trademarks. The copyright owner submits an application accompanied by a filing fee and one or two copies of the work, depending on the type. Most applicants, according to Copyright Office officials, do not use an attorney. The examination process is also relatively simple, taking an average of 38 to 83 days in fiscal year 1995 to complete, depending on the type of application. The examiner ensures the application is complete and accurate, that the materials appear to be copyrightable, that the fee is proper, and that the required copies are provided. The Copyright Office does not attempt to verify that others have not already copyrighted the materials or that the materials are in use, have use, or have value.