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115th Congress        }                         {              Report
                                 SENATE
 2d Session           }                         {              115-435

======================================================================



 
            SMALL BUSINESS INNOVATION PROTECTION ACT OF 2017

                                _______
                                

               December 19, 2018.--Ordered to be printed

                                _______
                                

 Mr. Risch, from the Committee on Small Business and Entrepreneurship, 
                        submitted the following

                              R E P O R T

                         [To accompany S. 791]

      [Including cost estimate of the Congressional Budget Office]

    The Committee on Small Business and Entrepreneurship, to 
which was referred the bill (S. 791) to amend the Small 
Business Act to expand intellectual property education and 
training for small businesses, and for other purposes, having 
considered the same, reports favorably thereon without 
amendment and recommends that the bill do pass.

                            I. INTRODUCTION

    Small Business Innovation Protection Act of 2017, (S. 791), 
was introduced by Senator Gary C. Peters, for himself, and 
Senator James E. Risch, the Committee's Chairman, on March 30, 
2017.
    This bill provides for in-person and online training and 
resources for small businesses related to domestic and 
international protection of intellectual property through Small 
Business Development Centers (SBDCs) and the U.S. Patent and 
Trademark Office (USPTO).
    During the markup of the bill, the bill was approved 
unanimously by a roll call vote as part of a manager's package.

              II. HISTORY (PURPOSE & NEED FOR LEGISLATION)

    America's intellectual property-intensive industries employ 
nearly 19 million workers at all education and skill levels and 
represent forty percent of the country's economic growth. The 
value of U.S. intellectual property is estimated at over $5 
trillion, and sixty percent of U.S. exports come from 
intellectual property-intensive industries. Patent protection 
helps innovators recoup the cost of research and development, 
capitalize on their inventions, create jobs, and grow the 
economy. In 2012, Detroit became home to the first-ever 
satellite office for the United States Patent and Trademark 
outside of Washington, DC.
    Obtaining a patent from the USPTO protects against 
infringement in the U.S. However, if a small business does not 
register in a foreign market, such as China, it has no 
protection there. Patent protection is necessary to ensure the 
ability to enforce businesses' rights both at home and abroad. 
Additionally, patents help defend American inventors against 
lawsuits. This Act is designed to help ensure small businesses 
are aware of the need and mechanisms available to accurately 
and effectively pursue an international patent.
    The language in this bill was developed to increase access 
to USPTO training and materials for entrepreneurs and small 
business owners across the country. In the 114th Congress 
Senator Gary C. Peters and the Committee's Chairman, Senator 
David Vitter introduced similar legislation, the Small Business 
Innovation Protection Act of 2016. The bill was reported 
favorably by the Committee with an 18-1 vote, but did not 
receive consideration by the full Senate.

                      III. HEARINGS & ROUNDTABLES

    In the 115th Congress, the Committee held a hearing on 
April 26, 2017 entitled, ``The Challenges and Opportunities of 
Running a Small Business in Rural America'' on the needs of 
small businesses in rural areas. From this hearing and from 
conversations with constituents in Senators' Peters' and 
Risch's districts, a need for more information on patent 
protection was clearly needed where would-be small business 
owners live--not just near the U.S. Patent and Trademark 
Office.
    In the 114th Congress, the Committee held a hearing on 
February 25, 2016 entitled ``An Examination of Changes to the 
U.S. Patent System and Impacts on America's Small Businesses,'' 
and a hearing on March 19, 2015 entitled, ``Patent Reform: 
Protecting Innovation and Entrepreneurship.'' These hearings 
both highlighted the importance of patent protection for small 
businesses and the need for the Committee to take steps to 
educate entrepreneurs about guarding their innovations as part 
of their business plan.

                        IV. DESCRIPTION OF BILL

    The bill amends the Small Business Act by requiring the 
Small Business Administration (SBA) to develop partnership 
agreements that develop training for small businesses related 
to protecting domestic and international intellectual property 
and leveraging training materials already developed for 
inventors. These agreements must provide training through 
electronic resources at SBDCs and USPTO locations. This bill 
requires SBDCs to include in-person or online training on 
intellectual property protection as part of a business plan and 
growth strategy.

                           V. COMMITTEE VOTE

    In compliance with rule XXVI (7)(b) of the Standing Rules 
of the Senate, the following vote was recorded on March 14, 
2018.
    A motion to adopt the Small Business Innovation Protection 
Act of 2017, a bill to amend the Small Business Act to expand 
intellectual property education and training for small 
businesses, and for other purposes, was approved unanimously by 
a roll call vote as part of a manager's package. Senators 
Risch, Rubio, Paul, Scott, Ernst, Inhofe, Young, Enzi, Rounds, 
Kennedy, Cardin, Cantwell, Shaheen, Heitkamp, Markey, Booker, 
Coons, Hirono, and Duckworth voted for the bill.

                           VI. COST ESTIMATE

    In compliance with rule XXVI (11)(a)(1) of the Standing 
Rules of the Senate, the Committee estimates the cost of the 
legislation will be equal to the amounts discussed in the 
following letter from the Congressional Budget Office:

                                     U.S. Congress,
                               Congressional Budget Office,
                                    Washington, DC, April 18, 2018.
Hon. James E. Risch,
Chairman, Committee on Small Business and Entrepreneurship,
U.S. Senate, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
prepared the enclosed cost estimate for S. 791, the Small 
Business Innovation Protection Act of 2017.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contact is Stephen 
Rabent.
            Sincerely,
                                                Keith Hall,
                                                          Director.
    Enclosure.

S. 791--the Small Business Innovation Protection Act of 2017

    S. 791 would require the Small Business Administration 
(SBA) and United States Patent and Trademark Office (PTO) to 
develop training materials for small businesses on domestic and 
international protection of intellectual property. The bill 
would require Small Business Development Centers, in 
conjunction with PTO, to provide this training either 
electronically or at a physical location. The SBA funds a 
portion of the operations of Small Business Development 
Centers, which provide counseling, training, and technical 
assistance to small businesses.
    Using information from PTO and the SBA about the resources 
needed to conduct such training, CBO estimates that the costs 
to implement S. 791 would not be significant. Enacting S. 791 
would not affect direct spending or revenues; therefore, pay-
as-you-go procedures do not apply.
    CBO estimates that enacting S. 791 would not increase net 
direct spending or on-budget deficits in any of the four 
consecutive 10-year periods beginning in 2029.
    S. 791 contains no intergovernmental or private-sector 
mandates as defined in the Unfunded Mandates Reform Act.
    On April 18, 2018, CBO transmitted a cost estimate for H.R. 
2655, the Small Business Innovation Protection Act of 2017, as 
ordered reported by the House Committee on Small Business on 
March 14, 2018. The bills are similar, and CBO's estimates of 
their budgetary effects are the same.
    The CBO staff contact for this estimate is Stephen Rabent. 
The estimate was reviewed by H. Samuel Papenfuss, Deputy 
Assistant Director for Budget Analysis.

                  VII. EVALUATION OF REGULATORY IMPACT

    In compliance with rule XXVI (11)(b) of the Standing Rules 
of the Senate, it is the opinion of the Committee that no 
significant additional regulatory impact will be incurred in 
carrying out the provisions of this legislation. There will be 
no additional impact on the personal privacy of companies or 
individuals who utilize the services provided.

                   VIII. SECTION-BY-SECTION ANALYSIS

Section 1. Short title

    This section provides the short title: ``Small Business 
Innovation Protection Act of 2017.''

Sec. 2. Definitions

    This section defines the meaning of ``Administrator,'' 
``Director,'' ``SBA,'' ``small business concern,'' ``small 
business development center,'' and ``USPTO.''

Sec. 3. Findings

    This section finds that the USPTO and SBA are positioned to 
increase the availability of Intellectual Property (IP) 
education programs aimed at small businesses, and that these 
programs should be scalable to reach more small businesses.

Sec. 4. SBA and USPTO partnerships

    This section directs the SBA and the USPTO to enter into a 
partnership agreement within 180 days of enactment to develop 
in-person or modular training sessions for small businesses on 
domestic and international IP law. These entities may work with 
nongovernmental organizations and use already-existing training 
materials. Sessions may be conducted through webinars and at 
SBDCs and regional USPTO offices.

Sec. 5. Small Business Development Centers

    This section requires SBDCs, in partnership with USPTO, to 
provide domestic and international IP education training to 
small businesses either in-person or through a website.

                                  [all]