The widely anticipated "right to repair" legislation is drawing increasingly closer to becoming law in Canada. If it receives royal assent, the law is expected to critically impact the agricultural and automotive industries. Other industries that could be heavily impacted include the consumer electronics industry.
On May 31st, 2023, Bill C-244—An Act to amend the Copyright Act (diagnosis, maintenance and repair)—passed its second reading in the House of Commons, and was prepared for its third and final reading.1 If it passes the final reading, the bill will continue on to the Senate for review before receiving royal assent. This legislation is what is commonly referred to as the "right to repair" legislation. Bill C-244 follows similar movements for rights to repair in the United States and Europe.
Unlocking Software-Embedded Products & Equipment
The right to repair legislation is expected to reduce the ability of original equipment manufacturers (OEMs) to lock access to in-built, and embedded software, where such access is necessary for diagnosis, maintenance and repair of products and equipment.
Many OEMs—e.g., manufacturers of agricultural equipment, vehicles and consumer electronic products—rely on sophisticated embedded-software to control various features of their products and equipment. The software is often "locked" such that it is only accessible by licensed service providers/technicians, who otherwise have the ability to access and/or "unlock" the software. From the OEM perspective, these software "locks" are an important means of product control.
OEM software locks are currently protected under the Copyright Act in the form of "technological protection measures" (TPMs). Section 41 of the Copyright Act prohibits the unauthorized circumvention of TPMs, which control access to digital content and prevent unauthorized access, reproduction or distribution of digital products.2
Impact of Right to Repair Legislation
If passed into law, the right to repair legislation would amend section 41 of the Copyright Act to permit circumvention of TPM protections, and for the sole purpose of diagnosing, maintaining and repairing software-enabled products and equipment.
In effect, end users (e.g., farmers, vehicle owners and consumers) will no longer always be required to approach an OEM licensed technician to repair products and equipment. Rather, end users can now solicit the services of the aftermarket repair industry.
The federal government says right to repair addresses a focal concern of providing greater empowerment and flexibility for consumers to fix and repair purchased products and equipment, as well as to advance greater corporate responsibility.3
From the OEM perspective, right to repair presents contentious issues as to whether circumventing TPMs can lead to unauthorized or inappropriate modifications to key software functionalities. This can raise liability concerns regarding whether third parties can manipulate or modify software, with consequences in degradation to the performance and/or safety standards of equipment and products. Protection of OEM intellectual property (IP), is also a forefront concern.
Agriculture (Ag) Industry
The impact of right to repair legislation, both on OEMs of Ag equipment and users (e.g., farmers) alike, is not be understated.
Ag equipment (e.g., tractors) increasingly rely on complex embedded-computer programs to control various features and functionalities. OEMs can require farmers to seeks licensed personnel to repair Ag equipment, whereby such personnel are exclusively authorized by the OEMs to access the back-end software for diagnosis and repair. In many cases, warranties on Ag equipment are voided by the use of third party technicians.
If right to repair becomes law, OEMs may no longer be able to mandate repair of Ag equipment via authorized persons. This means that farmers can self-repair, or otherwise approach aftermarket repair companies.
Automotive Industry
The automotive industry is another critical industry expected to be impacted by right to repair legislation. More generally, as vehicles become more digitized—the diagnosis and repair of vehicles can require access to back-end software by exclusively authorized personnel.
To that end, the automotive industry has made prior efforts to work with the aftermarket industry. This came in the form of The Canadian Automotive Service Information Standard (CASIS) agreement—a voluntary agreement signed in 2009 to ensure that OEMs share service and repair information with the automotive aftermarket industry "on a level equivalent to that of authorized dealers".4
Only recently in the United States, in response to similar right to repair legislation, a “memorandum of understanding” was signed between three industry organizations representing the major automakers, and thousands of repair shops.5
Consumer Electronics Industry
Akin to the agricultural and automotive industries, right to repair legislation will allow consumers an option to use third party repair shops to repair consumer electronic devices (e.g., phones, laptops, etc.). This is a practice that is often prohibited by many OEMs of consumer electronic products, and can also void warranties on these products.
Patent Infringement Considerations
While the right to repair legislation is drawn up in view of copyright law considerations—it is important to note that right to repair also touches on key aspects of Canadian patent law.
In accordance with Canadian patent law jurisprudence, repairing a patented invention does not amount to infringement, however, a process which results in a new merchantable article is not considered a repair and therefore may indeed amount to patent infringement.6
Preparing for Bill C-244—An IP Strategy
As Bill C-244 continues to wind through Parliament, it also continues to evolve. In the interim, businesses (e.g., OEMs or aftermarket) should begin preparing for the implications of this legislation, if made into law. OEM's should review their current patent monopolies and strategies to ensure that their proprietary hardware and software are covered adequately as third parties could now have direct access to their intellectual property. Businesses should also consider developing and updating policing strategies to ensure that third parties are only repairing and not copying proprietary assets. Finally, Bill C-244 could be the impetus to pursue creative collaborations with the aftermarket industry, similar to CASIS, which would increase goodwill and be a unique branding opportunity for OEMs.
