Bill C-273 (Historical)

An Act to amend the Competition Act and the Canadian Environmental Protection Act, 1999 (right to repair)

This enactment adds a definition of “product” in section 75 of the Competition Act to make it clear that that term includes technical information that is required by a person in order to provide a service to a customer. This ensures that the Competition Tribunal is able to require a supplier to provide this information to a customer in accordance with section 75 in cases where the supplier has previously refused to do so.
The enactment also amends the Canadian Environmental Protection Act, 1999 to provide that companies that manufacture motor vehicles in Canada or that import motor vehicles into Canada are required to make available to Canadian motor vehicle owners and repair facilities the information and diagnostic tools and capabilities necessary to diagnose, service and repair those motor vehicles.

[Dale Finch, Executive Vice-President, National Automotive Trades Association]

Thank you, Chair.

I'd like to begin by thanking all the members of the committee for inviting the National Automotive Trades Association to express its views with respect to Bill C-273.

I would also like to commend Mr. Masse for bringing this issue to the forefront. It has brought us to this position today.

NATA is an association of associations. It is made up of major provincial and regional automotive associations across Canada. Collectively, our group represents some 5,000 grassroots repair and service facilities that employ approximately 50,000 Canadians. Our membership has a high contingent of collision repairers.

NATA has been involved in the search for a solution to information access, commonly known as right to repair, since 2001. Our preference, which has always been an industry-led voluntary process rather than legislation, has been proven successful in the United States.

For clarity, I would like a moment to describe the issue from our perspective and why it is important that a solution be achieved.

Back in 2001, a technical instructor working with our Ontario affiliate, the Automotive Aftermarket Retailers of Ontario, discovered that Canadians were unable to subscribe to a number of the OEM technical information websites that were set up to address the same issue in the United States. I'm referring to the websites overseen by the National Automotive Service Task Force, commonly known as NASTF.

Obviously, if an independent repair facility cannot access tools, training, and repair information, it cannot complete services and repairs to a vehicle. Instead, it must send the customer to the nearest dealership for those repairs. In many parts of Canada, particularly in rural areas, not all manufacturers have a franchise dealership close by, so our members are the ones Canadian consumers turn to for automotive service. Even in urban centres Canadians want freedom of choice when it's time to take their vehicles for service or repair. The number of dealerships with collision repair facilities is even smaller.

Public safety is an important factor in collision repair. Vehicles must be repaired properly so they're returned to original specifications that can be counted on to react to a subsequent collision impact the way the manufacturer intended. This requires the proper tools, training, and repair information.

To address this issue, NATA decided to emulate the work done by its counterpart, the Automotive Service Association in the U.S. Representing the automotive aftermarket service and repair industry, the ASA worked with U.S. car companies to reach a voluntary agreement. NASTF was formed to oversee the system and resolve any identified gaps in information. This system has been operating successfully for nearly a decade.

I will now explain why a voluntary agreement can do the job much better than legislation.

We see the legislation as an imperfect last resort, only to be used if a satisfactory voluntary agreement could not be achieved. NATA believes that, due to its technical complexity, the issue cannot easily be addressed by a legislative solution. Because of its rigidity, legislation would likely lead to interpretation or compliance issues. This would lead to litigation, which is an expensive and lengthy process.

The flow of information from automakers to the independent repair facilities would stop while awaiting the outcome. This would not serve the interests of the automotive aftermarket industry or the consumer because vehicles would still have to be taken to authorized dealerships for certain types of repairs.

This is the route of the issue Bill C-273 seeks to remedy, but if passed, the bill could inadvertently cause information access issues to become protracted. The industry-led voluntary agreement is flexible and could be amended quickly and easily to changes in technology, stakeholder concerns, and government policy. A voluntary agreement anticipates and circumvents foreseeable issues that could affect its implementation and execution.

NATA's specific concerns regarding Bill C-273, as written, are outlined in our prepared brief. I will not go into them at this time unless the committee has an appetite to hear them.

An agreement between Canadian automotive manufacturers and the aftermarket service and repair industry, called the Canadian Automotive Service Information Standard, CASIS, was signed on September 29, with the endorsement of the Minister of Industry, the Honourable Tony Clement. The CASIS will be fully implemented by May 2010. It provides all automotive service professionals with access to the information and tools required to diagnose and repair today's vehicles. This allows independent repair shops to compete in a fair marketplace and it provides consumers with freedom of choice.

In conclusion, NATA would like to suggest that the voluntary agreement now in place, Bill C-273, is redundant and therefore unnecessary. NATA recommends that the committee not proceed any further with Bill C-273.

On behalf of our members, I thank you again for allowing us to present our views to this committee.

I would also like to thank Mark Nantais, from the CVMA, David Adams, from AIAMC, Mathew Wilson, from CBMA, and Jason Vanderheyden, from AIMC.

It has been a long five months. We have worked tremendously hard to get to this position and present this agreement to this committee.

Thank you.

[Marc Brazeau, President, Automotive Industries Association of Canada]

Thank you, Mr. Chair.

I am grateful for the opportunity to address the committee this afternoon concerning Bill C-273.

My name is Marc Brazeau, and I am the president of the Automotive Industries Association of Canada. With me is Scott Smith, our director of government and industry relations.

AIA is a national commercial association that represents the automotive aftermarket industry of Canada, a $16.7 billion industry that employs more than 410,000 Canadians. The industry is comprised of companies that produce, distribute and install parts, accessories, tools and equipment for the automotive sector. In addition to its members that are spread out among 18,000 establishments and subsidiaries, AIA Canada encompasses more than 7,000 service and auto repair shops that are directly affiliated to our members.

I am here to present AIA Canada's position on the matter of access to maintenance information, training and tools by the automotive aftermarket in Canada, in other words by the people who do the maintenance and repair work on your vehicles.

I am also here to set out the Automotive Industries Association of Canada's position with regard to the situation surrounding Bill C-273, also known as the “right to repair“ act.

I will be very clear. AIA does not believe that the adoption of the Bill is necessary. An agreement has been negotiated between the vehicle manufacturers and the aftermarket, and AIA has expressed its wish to participate by signing this agreement.

It has been a long road to get to where we are right now. With the indulgence of the committee, I would like to provide a brief explanation of how we arrived at this point and why we believe that legislation is no longer necessary.

In 1996, onboard diagnostics capabilities for emission systems was mandated in the United States for all vehicles 1998 and newer. The system is referred to as OBD II.

The platforms designed by the car companies to meet the requirements of OBD II have allowed the evolution of electronic repairs or software-based repairs. Industry lexicon refers to those software-based repairs as “flash downloads”. The term “flash downloads” can refer to a variety of procedures that can relate to the updating or recalibrating of the vehicle's computer or control modules, or to the initializing of various newly installed parts. Access to this flash download information is not available to the aftermarket from all car companies, nor are the factory-specific tools and training required to service modern vehicles available from all car companies.

As technology and the utility of the OBD II platform evolved as a key component of the repair process, so too did the urgency for the aftermarket to have access to this information. On late model vehicles there are many repair procedures that are not possible to complete without access to Reflash software. In a February 2006 report commissioned by AIA, DesRosiers Automotive Consultants estimated that the loss of business to the aftermarket should access to information remain unresolved could be as high as $4 billion by 2010.

The issue of access to information was addressed first in the United States through what was referred to as the Arizona Project, an attempt to legislate access to emissions-related repair information in the state of Arizona. Ultimately this resulted in regulations under the Clean Air Act, which mandated vehicle manufacturers to provide emissions-related repair information to the automotive aftermarket and the general public over the Internet.

In the context of a parallel process, vehicle manufacturers and representatives of the aftermarket have structured an alternate voluntary approach for the distribution of vehicle maintenance information. The agreement relating to the standards led to the creation of an organization called the National Automotive Service Task Force.

While it impacts businesses, the right to repair is fundamentally an issue of consumer choice. The aftermarket consistently ranks high in consumer satisfaction in an annual survey by J.D. Power and Associates. Our goal has always been to protect the businesses that provide that consumer choice.

The issue is worldwide, and references to the right to repair issue exist in Europe, the United States, South America and the Caribbean.

AIA identified access to OEM service information, tools, and training as a priority issue for its members in 2004. A coalition of industry stakeholders agreed on a path forward at the time that focused on securing industry consensus and the voluntary distribution of information for fair market value compensation.

From 2004 to 2006, AIA and its partners tried to engage vehicle manufacturers in a dialogue with a view to establishing in Canada an organization similar to the NASTF, the National Automotive Service Task Force. Despite numerous attempts at launching a dialogue, including a letter from the then Industry Minister, Maxime Bernier, the vehicle manufacturers did not recognize the existence of a problem nor follow up on our wish to arrive at a voluntary solution.

In 2007, Bill C-425, a private member's bill, was introduced in the House of Commons by the member of Parliament for Windsor West, Mr. Brian Masse. Due to the lack of progress with a voluntary solution, the concept of a legislated solution was endorsed by AIA and its partners. After the federal election in the fall of 2008, Bill C-425 was reintroduced to Parliament as Bill C-273, in January 2009. As no progress had been made on a voluntary solution up to that point, AIA and its partners fully endorsed Bill C-273 and asked all members of Parliament to consider its merits.

In April 2009, the Minister of Industry, Hon. Tony Clement, issued a letter to the vehicle manufacturers asking them to consider the creation of a voluntary option to resolve the differences within the automotive industry. On April 29, AIA participated in a meeting with the vehicle manufacturers, their associations, and other aftermarket representatives. This meeting terminated in an expectation to sign a letter of intent that made demands that AIA could not agree to at that time.

Although AIA did request to be included in the discussions regarding the formulation of an agreement, AIA did not participate in the creation of the CASIS document.

No matter how this agreement finally came to be, it rests on the central principle that the information, training and tools are to be made available to the aftermarket in a format that is compatible with that used by the vehicle manufacturers' authorized dealerships. This is what we had been asking for since 2004.

During a meeting between AIA and the signatories to the agreement, on October 15th, the reactive architecture of the agreement was expressed in the form of an interpretation guideline that clarified a fundamental concern of AIA with regard to the agreement. It is this gesture that convinced AIA of the agreement's validity.

To conclude my remarks, I offer the following.

AIA believes the most expedient and reactive way to manage access to information is through the committed structure provided by CASIS. We also believe that because of the commitment demonstrated by the signatory parties, that legislation is no longer necessary. AIA looks forward to a more collaborative and open partnership within the automotive industry, particularly with the Canadian Vehicle Manufacturers' Association, the Association of International Automobile Manufacturers of Canada, and the National Automotive Trades Association.

I would like to take this opportunity to thank all members of Parliament, as well as the committee members, for their indulgence and their assistance over the past years in raising the awareness of this issue. I would like to particularly thank Mr. Brian Masse for his courage and passion on this issue and for helping bring this to a fair and workable conclusion.

Mr. Chairman, those are my remarks.

[Brian Masse, NDP, Windsor West, ON]

Thank you, Mr. Chair, and thank you to my colleagues.

I may not take the full 15 minutes, but I do want to take an opportunity to at least introduce this bill, Bill C-273, which, as you noted, is affectionately known as “the right to repair”, and to provide the public with some background as to why the bill was brought forth, what's taken place, and what's going to happen in the future.

This has been an exciting opportunity for me, coming as I do from the auto sector of Windsor, Ontario, the capital of the auto sector of Canada, and being able to work on another auto issue. I've spent a lot of time in the House of Commons working on issues related to the production and distribution of vehicles.

What came about was that I was presented with a case of problems in the aftermarket with regard to onboard diagnostics that were introduced in 1996. There was a concern related to people getting the proper equipment, training, and software. I quickly found through some research that there were some concerns about this issue. As I went around and visited my local shops in the Windsor-Essex county area, I confirmed some of the concerns that were being brought forth. Some were for very legitimate reasons and some were for reasons that I thought were not necessarily fair.

I felt it was important for the bill to come forward in order to engage good public debate, as well as to look at this issue not only through the eyes of the consumer, but also from an environmental point of view and in terms of protection of the standards on the roads.

What was happening was that some vehicles couldn't get repairs in the aftermarket shops, repairs that were happening in Detroit, Michigan, two miles across the water from my hometown. It's interesting to note that some of those repairs were being done by people who were less trained, because the qualifications of the technicians in Canada are actually superior to those of technicians in the United States.

When we introduced this bill, it attracted a lot of public interest. I would like to thank all those who took part in that debate on both sides, as well as the general public who started to step forward and raise the issues. The bill moved through the House of Commons, as everyone knows. Recently it passed with 247 in favour, so the House of Commons obviously noted that this was going to be a very significant issue that we should look at.

To be clear, I also had an opportunity to go across this country. When I went to Edmonton, I found the same problems that were in my community with, for example, certain software not being available. When I went out to British Columbia, it was the same thing. Most recently I was out in the Halifax area, where I met with technician Ken Pickles. He went through a series of demonstrations of technology that had been purchased but wasn't capable of being used successfully. What that meant for consumers was that they had fewer options. I also found out that there were some real solutions that could take place.

Recently, as we all know, because of this activity and public debate, the minister signed on, together with the auto industry and the aftermarket, to a voluntary agreement that came forward. I had some concerns with that voluntary agreement, because I felt that legislation was the place the bill should be at the end of the day. At the same time, from that voluntary agreement announcement, there's also been additional inclusion of others, including the AIA, in issues that appear to be headed towards resolution.

Today I want to put thanks on the public record. We're going to move into some deliberations with the groups that are here today, but I want to read some names, Mr. Chair. Since I have 15 minutes, I want to read these names, because people worked hard and came forward. That's how I would like to spend my time. We can delve into the issues later.

I want to thank John Strickey of Midas Automotive in Halifax, Nova Scotia; Ron Jones of Mid-Island Automotive, Nanaimo, B.C.; Bob Oliver, executive director of Pollution Probe; Bento from Bento Automotive; Dave Santing from OK Tire and the Windsor Professional Auto Repair Association; John Sawatsky from MSJ Automotive and the Windsor Professional Auto Repair Association; Nancy and Roger Suranyi of Namao Automotive in Edmonton; Mario Schuchardt from Canadian Tire; Art Wilderman, Devon Jacobs, and Scott Smith from AIA; Chris White from CAA; Eric Lamoureux from CAA; Cynthia Lee from CAA; Dan Houle from ASPQ; Andrea Chamberlain from NAPA, Rockland; Cindy Wolfe from NAPA, Morrisburg; Bob Blakely from BTC; and Daniel Grech, who is one the technicians who came forward for a press conference. I will make sure the translators have all these names and information, Mr. Chair.

I would like to conclude by also thanking the thousands of Canadians who sent in e-mails, made suggestions for improvements to the bill, and debated it. It's very important that we had that contact.

I know there was intense lobbying on the Hill, on both sides--those who had concerns about the bill, but also those who very much supported the bill--and we appreciated that input.

Additionally, I would like to thank CVMA, AIAMC, and AIA for their efforts in terms of the discussion and debate over the last few weeks as this bill has moved forward.

Should we have what I'm hopeful will be a good solid presentation and some solutions in front of us, then I have a motion I will be moving that could conclude this process.

I want to thank, once again, all those who have participated, the upcoming witnesses, and of course the committee for taking this interest.

Thank you, Mr. Chair.

[The Chair, Conservative, Michael Chong]

Welcome to the 40th meeting of the Standing Committee on Industry, Science and Technology this Wednesday, October 28, 2009.

We're here today pursuant to the order of reference of Wednesday, May 13, 2009, concerning Bill C-273, an act to amend the Competition Act and the Canadian Environmental Protection Act, 1999, otherwise known as the “right to repair act”.

Today we have in front of us two groups of witnesses. The first witness is our esteemed colleague, Mr. Masse, the MP for Windsor West, who moved this bill in the House.

The second group of witnesses includes representatives from four different organizations: the Automotive Industries Association of Canada, the National Automotive Trades Association, the Canadian Vehicle Manufacturers' Association, and finally, the Association of International Automobile Manufacturers of Canada.

We have Mr. Smith, Mr. Adams, Mr. Finch, Mr. Wilson, and Mr. Brazeau representing those various organizations. Welcome to you all.

We're going to begin with 15 minutes of opening remarks and comments from Mr. Masse.

Go ahead.

Competition Act

[The Acting Speaker, NDP, Denise Savoie]

The House will now proceed to the taking of the deferred recorded division on the motion at second reading stage of Bill C-273 under private members' business.

The House resumed from May 11 consideration of the motion that Bill C-273, An Act to amend the Competition Act and the Canadian Environmental Protection Act, 1999 (right to repair), be read the second time and referred to a committee.

[Brian Masse, NDP, Windsor West, ON]

Mr. Speaker, first, I want to thank all members for participating in this debate at first and second readings and bringing their thoughts forward. It is an important part of what has happened.

This issue has been around for a number of years. In fact, I researched the bill for a couple of years, going across the country and having people looking at it. The former minister of industry is here today. He took an interest in it. I am sure if he would have remained as minister of industry, perhaps Bill C-273 would not have been necessary.

We are here today because there is a problem with our current system. If we continue to ignore it, it will affect the environment, consumer choice and public safety. Bill C-273 attempts to address that.

I want to touch upon a couple of things that are important and that have been part of the debate. There are voluntary agreements in the Canadian automotive industry right now, but they are still based on the Consumer Protection Act. This bill would specifically address the issue through government legislation.

We have to be clear. In the United States, under the EPA, because of its environmental laws, it created an operating agreement with the original manufacturers so there would be a clear definition. The United States legislation creates the operating agreement as a solution. It still needs to be some work on it because there are some issues with it, but at least it is available to the manufactures. Canada does not have a voluntary agreement or a legislative agreement.

I know NATA, the National Automotive Trades Association, has promised a solution, which is important to recognize. All it can do is promise it might have a voluntary agreement in 2010 at best. It is not worth the paper on which it is printed because, at the end of the day, there could be manufacturers that would opt in or opt out at different times and resolution processes would not available through any type of legislation.

It is also very important not to forget that the automobile industry right now is revolutionizing in many respects. There will also be new entrants into the market. How can we have a voluntary agreement that would be based upon a group of businesses that are all foreign companies? They would have no Canadian legislative backstop to deal with any of the problems. There will be other ones, for example, China, as it emerges into the Canadian market with the Chery. China has over 100 different automotive assembly companies. Not all of them will get into our market, but some will and they could decide not to get into some type of agreement.

This dissipates the reality of having a rules-based system that is fair, open and transparent. The Competition Bureau would then be the arbitrator. The rules could be applied and there would be fairness. There is a whole process in place that could evolve.

That is why we want to get this to committee. We want to see Canadians have the same opportunity. It is important for Canadians to understand that, as things stand right now, they would be treated differently in the United States than in Canada. It is based on nothing more than the fact that it has chosen not to bring this forward to the Canadian public at this time.

When we look at our Canadian technicians in the after-market, it is interesting to note that the men and women have the same training as those in the dealerships, unless they get additional training later on. They have to go through the same type of schooling. In fact, our standards in Canada are better.

Ironically, someone could take a trip to the United States, have something go wrong with the car and go to a facility to have it repaired by a technician with fewer qualifications than a technician in Canada. We are denied that because the proper programs cannot be downloaded or the schooling or training is not provided by the company.

This is not fair, nor is it healthy. One of the reasons we want to deal with this is it is good for the environment. We want to ensure that vehicles are clean and well maintained. It is good for public safety, that cars are fixed and in good operating condition, especially in rural communities where people have to drive hundreds of kilometres to get to an facility. It is also about the consumer's right to choose.

Therefore, we hope the bill will go to committee. I appreciate the fact that there has been a lot of input, both from those who have concerns about it and those who support it. I look forward to working with everyone to ensure we have a fair, rules-based system based on Canadian legislation to protect Canadians.

[Paul Szabo, Liberal, Mississauga South, ON]

Mr. Speaker, I am pleased to add my comments to the debate on Bill C-273.

I might just say that with respect to the issue of relevance, I did a little research the last time I heard the Chair suggest that we give a lot of latitude. The relevance issue is there because the time of Parliament is very important and valuable and should be used for the purpose for which it is intended. That is why there is an order paper. It is really up to the members to keep relevant. Unfortunately, sometimes members like to push the envelope a little further. However, I think we had better ensure that the important points about a piece of legislation before the chamber are known to all members who are going to have to vote on it. It is actually a little more difficult now, given the recent developments within the auto industry, and that is what I want to talk about.

So that everybody knows what we are talking about on Bill C-273, the member for Windsor West has introduced a bill to amend the Competition Act and the Canadian Environmental Protection Act. He had a bill in the last Parliament, and the bill is back now, and it has received a lot of attention. It is one of the reasons I wanted to speak to this. Auto repair shop owners in my riding of Mississauga South have spoken to me many times over the last number of years about this problem, that as the automobile technology changes, the normal work done by automotive repair shops that are not associated with a car manufacturer gets a little more difficult. They need the manuals to know how to work on the equipment they are going to deal with. They also need the diagnostic equipment, in some cases, and they need some of the specialty tools. Without those they cannot service the automobiles. If they cannot service the automobiles, repair shops will find themselves in jeopardy with regard to staying in business. That is their argument.

The other part of the equation is the automobile industry itself. The dealers are in the business of selling cars, but they are also in the business of servicing them. If they continue to provide the full cycle of maintenance and service for automobiles, that is good and healthy for the automobile business. The technology is amazing. A 10-year-old car, as I recall, pollutes 37 times more than one of the brand new cars. It is phenomenal. All of this is because of the changes in technology. It makes this debate and this bill more relevant because it has to do with the consumer, with small businesses and with big businesses and how the interests of those parties are reconciled.

In the last Parliament, the debate might have been different because the automobile industry was not in jeopardy. Now the automobile industry is in jeopardy. There is going to be a massive rationalization of the auto industry. There is going to be a massive rationalization of dealerships, of plants, of places for people to get their automobiles serviced. The neighbourhood auto repair shop may become much more important than it has been in the past simply because there are not going to be as many dealerships to go to anyway. The debate in the last Parliament would have been different from this one. Now we have to balance the interests.

I have often thought that the best arrangement for consumers is to ensure that there is healthy competition within the service and repair sector so that they can choose. That would help to keep the costs fair and reasonable. Right now there is not that choice to the same extent there would be if the independent repair shops had access to the information, the diagnostic equipment and the tools they need to properly and professionally repair the vehicles and to maintain them. It is a dilemma.

The industry in the United States adopted a voluntary agreement to provide, and the right to repair is the generic name. In the United States there has been a facility whereby shops can have access to this. It is done on a voluntary basis; it is not legislated. We are talking about a bill that wants to legislate it. It appears with all of the dynamics that have occurred in the auto sector with the rationalization and changes yet to come, the industry has reached some agreements with regard to voluntarily providing the information, tools and diagnostic equipment, although I do not know to what extent because I have not seen all the details.

This issue is evolving. I wanted to bring to the attention of the House that this matter seems to be fairly fluid. There is a lot going on. We do not have the latest information but I think it is important that this bill survive and that it go to committee so that we can get the representations from the auto industry as well as the after market businesses that provide services.

We have to look at the impact on people and their jobs. This is a very important aspect. We have to look at the other implications of competition law and the rights of a person, organization or legal entity. We have to look at the implication of that person, organization or legal entity being forced to release that information to another so another can take business away. This is a very interesting problem. There is a model in the United States which I think is useful to look at.

With only two hours of debate in private members' business it is very difficult for all of the information to get out. My recommendation to my colleagues is that the bill go to committee. I would like all of the information to be brought to the committee so it can study it carefully to determine whether or not the voluntary deal that is evolving and may be taking place in Canada is the best thing on behalf of all stakeholders, whether it be the industry, the after market suppliers and the consumers.

We want to make sure there is a balance. I think this is our opportunity to look into this because how we approach this problem probably will be the same way that we approach similar problems in other sectors.

Having said that, I congratulate the member for bringing the bill forward. I know the auto sector is very important in his riding and that it is a very difficult time for the auto sector. There is a great deal of work to do. This is part of it. Let us send this bill to committee.

[Brian Masse, NDP, Windsor West, ON]

Mr. Speaker, on a point of order, I am just questioning the relevance of the member's comments to Bill C-273.

[Dona Cadman, Conservative, Surrey North, BC]

Mr. Speaker, I would like to take a few moments to speak to Bill C-273, An Act to amend the Competition Act and the Canadian Environmental Protection Act, 1999 (right to repair).

This government takes private members' business seriously. In the case of Bill C-273, the spirit of the bill is in the right place and, for this reason, the government wishes to support it. The government will, however, be seeking amendments should the bill progress to committee stage.

Before I get into the details of some of the reasons that the government will be seeking amendments, I would like to acknowledge the work that the member for Windsor West has done on this bill.

I also would like to highlight some areas in which, I think, all parliamentarians can agree.

First, I am sure that all members of Parliament are concerned with the recent economic challenges and the effects of these challenges on Canadians and Canadian businesses. The government has acted quickly in addressing these concerns through the Budget Implementation Act.

Second, members opposite must recognize the government's commitment to protecting Canadians and businesses from crime, abuse and economic uncertainty through its ambitious legislative agenda. In these times of economic uncertainty, it is important for the government to act in a manner that directly addresses what is most important to people's lives and economic security.

Third, all members of the House were elected to represent our constituents' interests to the best of our ability. This does not mean that parliamentarians will always agree but I would hope that members opposite will accept my remarks today in that spirit.

Finally, I am sure that all members believe in supporting a competitive economy that benefits businesses and consumers. The government has been working hard to support Canadian businesses to be stable and more efficient.

Let us be clear on one thing: healthy competition is the best way of empowering consumers and that is what the Competition Act sets out to do.

When companies compete with one another for a consumer's dollar, it opens the door to lower prices, better services and wider product selection, all of which benefit consumers.

There are many who believe a voluntary system rather than a legislated approach to aftermarket issues would satisfy the needs of the Canadian aftermarket auto repair industry. There are benefits to establishing a voluntary system, aside from the obvious benefit of keeping government out of regulating how businesses run their affairs. A voluntary system would, for example, have the flexibility to evolve over time so it addresses changes in technology as they arise, which is one of the root causes of the aftermarket concerns.

With that in mind, in April of this year, the Minister of Industry sent a strongly worded letter to all automakers calling on them to develop a voluntary accord here in Canada. I am pleased to say that there has been progress. Representatives of the vehicle manufacturers and aftermarket industries met last month to begin discussions on the development of a voluntary accord. Most parties have signed on to a process and timeframe to draft this agreement.

One of the signatories is the National Automotive Trades Association, or NATA. NATA represents a large portion of the aftermarket repair shops across the country. It had this to say in a recent letter to its members and to the public:

NATA has publicly stated that in absence of a voluntary agreement it would participate in the legislative process. Now that we have a commitment from the Canadian auto manufacturers, we do not believe legislation is necessary.

I would like to more directly address some of the government's concerns with this private member's bill. The bill seeks to amend the Competition Act and the Canadian Environmental Protection Act. I will be focusing my comments today on concerns raised by amending the Competition Act in the way that the bill proposes.

As members opposite know, the Competition Act is framework legislation, the enforcement of which has wide-ranging implications for the Canadian economy.

Even before the recent improvements contained in the Budget Implementation Act, the Competition Act was generally considered to be effective legislation.

Consultations on changes to the act have taken years to complete and have assisted the competition policy review panel in its assessment of Canada's competition and investment policies. This government has acted on the recommendations of the panel to ensure that the Competition Bureau has the tools it needs to continue to be effective in the years to come.

As all members of the House know, Bill C-273 proposes an amendment to section 75, refusal to deal, of the Competition Act by adding to the definition of product, for the purpose of that section, technical information that is required by a person in order to provide a service to a customer.

The member opposite may believe that this small change to the Competition Act will help to address the issues in the auto repair sector but this is not the case. This amendment to the Competition Act is problematic in at least two significant ways.

First, the amendment could have serious, unintended consequences. Bill C-273 has not been drafted in a way that applies only to the automotive industry to strictly address the right to repair issue. The proposed change to the definition of product could impact on all industries and all relevant bureau investigations under section 75. Such an amendment could raise questions regarding safety issues or intellectual property rights, which could cause other concerns that I do not intend to address today.

Second, amending the Competition Act to address the right to repair issue is not necessary. This issue can already be reviewed under section 75 or section 79, abuse of dominance, of the Competition Act. In the case of section 75, refusal to deal, if a party could establish that the inability to obtain the technical information was the result of another's refusal to provide a product as currently defined would satisfy the other elements of section 75. They would be able to address those concerns under the act.

Either the Competition Bureau or the affected party could make an application to the Competition Tribunal for a remedy. Another way to address this is that the bureau could make an application to the Competition Tribunal for a remedy if a party could establish that the refusal to supply the technical information was an anti-competitive practice and could establish the other elements of section 79, abuse of dominance.

Given the avenues already existing under the Competition Act to review the right to repair issue in the appropriate case and given the unintended consequences that could result from the proposed change to the definition of product, the government will be seeking to remove this Competition Act amendment during the committee stage.

We look forward to more debate on this issue and I am sure t all members will act in the best interests of their constituents.

[David Christopherson, NDP, Hamilton Centre, ON]

Mr. Speaker, I am pleased to offer support to my colleague from Windsor West who has put forward this bill.

This gives me a chance to take a trip down memory lane for the next few minutes. A lot of this is about dealerships doing work versus work being done outside the dealership network but still in the repair part of the economy.

Back in the day, a lot of years ago now, I worked at such a place, for International Harvester. It was a truck centre where we sold and repaired international trucks, not the farm equipment but the trucks. I was there for about 11 years before I was elected to Hamilton city council. I can speak with some authority in terms of the way it was and relate that to where things are going now. Back then there was a level playing field.

Let us keep in mind that at its core the member for Windsor West is trying to bring in a fair, rules-based system that treats everybody the same. Back in the day when I was on the shop floor, that is the way it was. There was no advanced technology. We were in the early stages of that when I left, which would have been in the mid-1980s. There was a level playing field. Nobody held any secrets. Nobody had any special tools that they were not giving to others. Software was not even in the vocabulary. Everyone had to compete on the same basis.

Much like today, all the warranty work was done at our shop.That was probably the biggest part of our work, as well as work on the big fleets that were willing to pay for the very best mechanics, and I might say, parts people. They did not want any problems. They wanted things to go as smoothly as possible. A corporation at that level wants things to go smoothly. Working with a dealership with a major infrastructure attached to the mother corporation was a great way to go.

There were a lot of brokers and smaller trucking firms that would do their own work, or have it done by an offshoot of their company, or by someone such as a brother-in-law who ran a local garage, or Bill down on the corner who had been there for 30 years and treated everyone like family so people wanted to go there. People were able to save a few bucks, but they were not freebies or giveaways.

That was their choice, and that is the issue. To allow consumers and other after market repair businesses access to this material, the tools and the information takes us back to where we were before, which was that everybody was equal. It was business preference, productivity and efficiency that decided where people went, not whether or not they had the secret code.

They do not allow it in the United States, interestingly. It is done under the EPA, the Environmental Protection Agency. Why? Obviously the environment is so crucial now, or at least we have now woken up to how crucial it is. The last thing we want to do is take cars that are being designed to do less damage to the environment and repair them in a way that suddenly has them polluting. It does not make sense.

That seems to be what the EPA in the U.S. has said. The U.S. has that system. Why do we not? It denies consumers a choice. It is not as productive. It increases costs through lack of choice. It creates unfairness. Everyone attached to the automotive industry ought to be thanking the member for Windsor West for this bill.

I can appreciate there are some employees, as I was, who see the possibility that their work is going to go somewhere else, and they are fighting to retain it. Fair enough. That is the union's job. However, my experience was that allowing others to do the same work or at least to compete did not detract from that because we had so much extra to offer.

Other communities may argue, but I am sure the member for Windsor West would be proud to say he is from the automotive capital of Canada. We will give him that for the purposes of this bill. Let us remember that he represents a lot of the workers who are trying to protect the work they have in the current system. It would have been very easy for the member to stand in the tall grass on something like this if somebody else had brought it forward. Not only did he not do that, he was the one who brought it forward. He is doing it because he knows it is in the best interests of Canadians and he believes it is not going to do any damage to jobs that exist.

All it does is provide an unfair competitive advantage, almost a monopoly on some work by virtue of keeping secrets, which are not allowed to be kept in the country that is our biggest trading partner, the United States of America. The U.S. understands that Toyota, Honda and others ought not to be able to send their cars here and keep the secrets back home. That ought to apply whether it is a domestic or foreign automotive producer.

That is what this is about at its core. Again, it is about choice. It is about fairness. It is about making sure that Canadians have an opportunity to decide for themselves where they want to spend their money and where they want to get their vehicles repaired.

In bringing in Bill C-273, the member for Windsor West, in a large way, is doing every consumer in Canada a huge favour by removing an unfairness, an imbalance that has now been created that did not exist before. It is part of going through the transition ultimately into the new digital economy. We need to keep an eye on it from a legislative point of view to ensure that these new technologies do not create an inherent unfairness. This is one of those times.

When the member for Windsor West saw what was happening and heard from his constituents and the tens of thousands of small automotive repair shops, 95% Canadian owned, all employing local people, he investigated and, as I said, in the face of a possibility of political backlash, he had the courage to bring it forward just because it is the right thing to do.

Many issues we deal with here are of utmost importance, and consumer protection is one of the most important. That is really what this is. It is not life and death. None of our kids are going to be facing critical health issues because of this. There is no pandemic attached to the bill, or those kinds of worries. However, protecting consumers is an important part of a legislative body's duty in a mature democracy. That is what this bill does.

I want to thank my colleague from Windsor West for bringing this bill forward and making things better for the Canadian people. I can only hope that the vast majority of parliamentarians will agree and at least allow us to get the bill to committee. Let us bring in the players and have a look at it. At the very least, let us do that.

I urge members to support this bill, at least at second reading, so we can look at it further.

[Robert Vincent, Bloc, Shefford, QC]

Mr. Speaker, the Bloc Québécois would like to see this bill go to committee to be thoroughly studied. First of all, this bill addresses a legitimate concern, namely, allowing motor vehicle owners to benefit from increased competition when they need to have their vehicle repaired.

However, before going ahead with such a measure, it is our responsibility to carefully weigh the repercussions, particularly on carmakers and dealerships. We therefore plan to ask representatives from car dealerships, manufacturers, independent repair facilities and consumers groups to testify before the committee during our study of the bill. The committee study will allow for a more thorough analysis of what is going on with vehicle repairs in Canada. Based on that analysis, we will be in a better position to make recommendations for the government to follow.

I think it is too early to express an opinion on the conclusions the committee will reach regarding this bill. However, we will ensure that the committee's study of this bill will favour the interests of consumers, while taking into account the concerns of the auto industry. Any amendments brought forward by the committee must be along those lines.

Auto mechanics has become quite a bit more sophisticated in recent years, and more and more servicing can be done electronically. Technicians must have access to the equipment and the codes they need to service and repair a car. Bill C-273 addresses this problem by providing that motor vehicle owners and repair facilities can have access to the information and diagnostic tools and capabilities necessary to diagnose, service and repair those motor vehicles.

On the one hand, this bill could promote healthy competition in the automotive repair market, which in turn could make for a viable repair industry. The consumer would benefit in the end.

On the other hand, we are well aware of the negative impact such a measure could have on dealers as a result of the dramatic drop in new car sales. In addition, we will have to make sure that this bill will not curb innovation by threatening the provisions that apply to automakers' intellectual property.

In the interest of shedding light on these issues and getting an idea of the big picture, we have decided to support the bill at second reading, so that the committee can study it. However, as I said earlier, it is far too soon to venture to say what the committee's findings will be. One thing is sure: the Bloc Québécois will play an active role in the committee's consultations.

According to a recent study by the DesRosiers consulting firm, the number of vehicles and the concentration of automotive dealers are increasing in urban centres. Rural regions account for 21% of vehicles and only 12% of dealers. The committee study will therefore provide an opportunity to determine the extent to which controlling automotive repair technologies will affect the accessibility and competitiveness of regional vehicle repair facilities.

A number of years ago, the United States put in place a law establishing a right to repair similar to the one in the bill we are debating today. The U.S. has a voluntary system that anyone can use to access servicing and repair information, for a fee.

In Canada, service and repair technicians cannot consult this information. We want to know how adopting such a measure might affect the market and consumers in this country. But given the situation in the automotive market, we also need to hear from dealers, who derive nearly 30% of their profits from vehicle servicing and repairs, according to the DesRosiers consulting firm.

We have to consider the fact that, in Quebec, the vehicle maintenance sector is a $3.5 billion business that contributes to the health of our economy and must be allowed to continue to prosper.

This is not a straightforward bill. On the one hand, we have mechanics, and on the other, manufacturers. We have to consider both parties. We all know what is going on with the auto sector these days, but consumers should not be the ones who have to pay the price at the end of the day. We have to find a solution together.

I think that sending this bill to committee will give us our best opportunity to hear from all of the witnesses—dealers, consumer advocates, manufacturers and mechanics. They will talk to us about their concerns and about what they think we should do with the bill. Listening to what they have to say is the best way to figure out how the government should change the bill, if necessary.

We should not come to any conclusions or favour one option over another before that. Making up our minds ahead of time would put us at a disadvantage. We should not make assumptions about what should be done with respect to mechanics or manufacturers. We should not make up our minds yet. We have to give the parties a chance to tell us what they think about this bill, what should be done with it, and we have to carefully consider all of the ins and outs.

I believe that the members of the House and the members of the Standing Committee on Industry, Science and Technology will send this bill to committee so that they can report on it. The members of the committee will approach the issue with clarity and a sense of cooperation. They will not take anything for granted. They will really think about what people have to say before coming to any conclusions.

[Frank Valeriote, Liberal, Guelph, ON]

Mr. Speaker, I am pleased to have the opportunity to stand in the House today to share my thoughts on Bill C-273, An Act to amend the Competition Act and the Canadian Environmental Protection Act, 1999 (right to repair).

I commend the member for Windsor West for bringing the bill before us today.

In short, the auto industry is being asked to make available to third party repair shops intellectual property information and diagnostic equipment, among other things, perceived by some to be exclusively available to auto dealerships.

This is a matter of utmost importance involving issues of vehicle safety and the protection of intellectual property rights of auto manufacturers on the one hand, and small business needs for information on the other.

Though a challenge in striking a balance between competing interests, it is one that can be met without the need for invasive legislation, the effect of which will lead to the complete erosion of intellectual property rights of auto manufacturers and manufacturers of other equipment whose IP rights will be threatened by this precedent setting legislation.

I would like to spend a moment to offer my specific concerns with regard to Bill C-273. We know that Canada's non-franchised, non-dealership repair facilities conduct the majority of parts and service business in Canada. Clearly the absence of this legislation will not be a threat to an already thriving industry.

Another important fact is that a significant amount of repair and diagnostic information is often already available to the independent mechanics in garages through third party information providers on line for a monthly fee.

Further, with the advent of new technology like powerful hybrid batteries requiring expensive tools, gloves and diagnostics, only the best equipped mechanics can manage the safety issues arising with specialized equipment.

Other than two or three very large national auto repair shops able to afford the training and equipment required to conduct such services, who are we really helping? Would we be passing legislation to accommodate only two or three national repair shops when they all otherwise have access to necessary information?

Manufacturers go to considerable expense to develop the technology that we see in automobiles today. They also go to considerable expense to develop the training, tools and diagnostic equipment dealers use to repair these cars.

We are all well aware of the significant challenges facing our auto industry today. I believe it would be counterintuitive to place additional demands and regulations on the struggling auto sector at this particular time.

General Motors alone is expected to close 300 dealerships across Canada as part of its restructuring. I am assured that the location of dealerships closed will be strategic so that access to dealer servicing will remain available.

This is not the time for Canada's sagging auto industry to be confronted with new challenges. At this time the industry is being hit by a tsunami of events: lack of credit, plant shutdowns and recession.

We are asking, demanding, that the auto sector restructure into a leaner, more agile industry. It is not the time to regulate the industry out of existence entirely by requiring it to give up intellectual property rights completely for the benefit of its competitors.

Frankly, this might be considered by some to be an affront to normal business ethics.

I was pleased to learn last week that the Association of International Automobile Manufacturers of Canada, the Canadian Vehicle Manufacturers' Association and the National Automotive Trade Association have committed to the creation of a voluntary framework on this very issue.

This co-operative effort will put in place a framework that would establish a voluntary system for the systematic dissemination of repair and diagnostic information; a positive first step toward the further dissemination of information.

Surely, successful voluntary efforts are preferable to yet more legislation. Imagine all the additional costs of passing the legislation, monitoring compliance, amending it and enforcing it; cost to the industry and government and in each case cost to the taxpayer.

Of particular interest to me is the national automotive service task force that exists in the United States. This voluntary task force is considered by the assembly industry, dealers, many in the auto service industry and consumers alike, to be common ground where the needs of consumers on the one hand and the safety concerns and intellectual property rights of manufacturers on the other are addressed satisfactorily.

The national automotive service task force is a voluntary, co-operative effort among the automotive service industry, the equipment and tool industry, and automotive manufacturers. The task force ensures that automotive service professionals have the information, training, and tools needed to properly diagnose and repair today's high-tech vehicles, assures the flow of relevant information, and includes a system to deal with complaints.

A Canadian version of this task force is what is ultimately proposed by the industry.

We will be told by some that the American voluntary system is legislated. In fact, only a very small part is, a part dealing with emissions. The vast majority remains, indeed, voluntary.

I have learned that the industry has already begun working groups, including manufacturers and after-market servicers, to develop the technical and non-technical provisions of a voluntary model, from tooling to training, with an estimated time of arrival no later than September 1, 2009.

Once fully implemented, the national permanent and voluntary Canadian agreement would create a framework to provide all Canadian after-market service and repair providers with the desired and agreed upon information from all Canadian manufacturers and distributors, in a similar fashion as in the U.S.

Canada's auto industry has a long and successful history of developing, implementing and enforcing voluntary memorandums of understanding. In fact, 14 voluntary memorandums of understanding have been signed to date and the industry has met or exceeded the terms of each one of them.

Legislating the forfeiture of the auto industry's IP rights is akin to demanding the forfeiture of a food retailer's secret recipe so smaller retailers can compete against the very creator of that secret recipe. This is not fair.

Indeed, in my discussions with multiple non-dealer repair shops, I have learned that in addition to already having access to necessary information online, often a simple call to the local dealer's parts and repair shop usually leads to a complete explanation of the necessary work to be done. The fact is that this legislation is described by many in the industry as a solution looking for a problem that does not now exist.

There is no doubt that should a voluntary framework fall short in Canada, we can then take the necessary steps to implement the requirements set out in the legislation before us today. However, we have the benefit of a successful voluntary framework project at work in our neighbour to the south. We can look to this model to guide us in developing a voluntary initiative in Canada.

I am not saying third-party repair shops should be denied access to required information. I ask this House, however, to look to the leadership and competence of the industry, and support a voluntary system for the dissemination of repair and diagnostic information rather than the proposal put forward by Bill C-273.

The House resumed from March 6 consideration of the motion that Bill C-273, An Act to amend the Competition Act and the Canadian Environmental Protection Act, 1999 (right to repair), be read the second time and referred to a committee.

[Robert Bouchard, Bloc, Chicoutimi—Le Fjord, QC]

Mr. Speaker, I am happy to speak today in the House of Commons, on behalf of the Bloc Québécois, about Bill C-273. To begin, I would like to point out that we are in favour of this bill in principle and feel that it deserves to be studied in committee. I salute the efforts my colleague from Windsor West has made to encourage competition in the automobile maintenance sector so that Quebeckers and Canadians have the right to affordable, accessible and good quality services. This legislative measure will allow consumers to choose the business they want to use for vehicle maintenance.

As my colleagues have mentioned, cars and trucks are becoming increasingly complex. Some of the businesses that sell automobiles in Canada offer specialized information and tools needed to repair and maintain the vehicles they sell, but others do not. If a business does not do so, the customers are locked in to getting their cars fixed there. Such businesses then have a monopoly on the repairs and maintenance done on the vehicles they sell. A monopoly often means higher prices for the consumer, but above all, it means less choice. In this type of situation, the consumer cannot take the vehicle to any garage of their choice. They have to do business with the dealership. Without this legislative measure, the consumer has no other choice but to do business with the dealership.

The people of my riding, Chicoutimi—Le Fjord, elected me to represent their interests and this bill is a step in that direction, since it aims to promote accessible, affordable, good-quality maintenance services. Without this important legislative measure, Quebeckers and Canadians will be forced to continue doing business with dealerships for their vehicle maintenance. The situation is particularly difficult for Quebeckers who do not live close to a major urban centre.

More and more, vehicles require electronic diagnostic tools and as a result, garages in more remote regions do not have access to the information needed for proper maintenance, and repairs to vehicles can therefore be limited. People who live in rural areas must travel great distances to have their vehicles serviced and repaired. The numbers on this speak for themselves. According to a study by DesRosiers Automotive Consultants, the number of motor vehicles and the concentration of dealerships is increasing in urban centres. Yet 21% of vehicles but only 12% of dealerships are located in rural areas, and this discrepancy will only become more pronounced over time. I therefore ask my hon. colleagues the following question. When was the last time any of us saw a new car dealership open up in a rural area?

This bill would allow garages in the regions to service vehicles for Quebeckers and Canadians in the very communities where they live. As a result, these people will no longer have to travel to urban centres to have their vehicles serviced.

As I pointed out, under this bill, independent mechanics in rural regions will be able to compete in the vehicle maintenance sector and do work for vehicle owners. This bill will ensure that local garages continue to be part of the landscape.

Neighbourhood garages in all regions of Quebec and Canada are important. Two of the largest replacement parts distributors, NAPA and Uni-Select, are located in Quebec. Together, they employ hundreds of Quebeckers in a Montreal plant, and their activities rely on neighbourhood and rural garages.

We think that Bill C-273 will be good for consumers because it will enable them to decide where they take their cars for service and repairs. Vehicle manufacturers want consumers to come to them, but the Bloc Québécois believes that car owners should have the right to choose their own mechanic.

This bill will ensure that consumers are not forced to go back to the dealer for repairs and maintenance, unless the committee finds, in its study of the bill, that some vehicle parts should be serviced exclusively by the dealer. That is why we think it is important to study Bill C-273 in committee.

We have to wonder why the solution currently before us has not yet been implemented. The United States has been looking at a similar bill for a few years now. They implemented a voluntary system that enables anyone to access the information for a fee.

In Canada, vehicle maintenance and repair technicians cannot get that information. I would like to ask the members of the House a question: if vehicle manufacturers have refused to supply the information to Canadians to date, then why should they start now, given that they make more money by forcing people to come to them for maintenance and repairs?

Some dealers even imply that if clients do not use the dealer's services, vehicle safety could suffer. However, members should know that to work in a car centre anywhere in Canada, technicians must have a valid licence. Whether they work at a car dealership or the corner garage, they are responsible for the safety of their clients' vehicles.

The bill gives consumers the right to choose where they have their vehicle serviced and repaired, and it enables neighbourhood garages to continue serving local communities.

The bill is not designed to deprive manufacturers of innovations in which they have invested a great deal of money. However, it does establish that when a consumer purchases a vehicle, the innovations it contains are included in the price.

In conclusion, Bill C-273 allows consumers to choose where they have their vehicle serviced and repaired and will prevent people from paying monopoly prices. It will also enable rural Quebeckers and Canadians to continue having their vehicles serviced and repaired at local garages.

In Quebec, the vehicle maintenance industry, which does $3.5 billion in business annually, could continue employing Quebeckers and contributing to the health of our economy.

Companies will be able to compete in the vehicle maintenance sector, and consumers will benefit from quality services that are more affordable and accessible. By giving vehicle service and repair technicians access to the training and tools they need, we will help the market work better.

Lastly, companies will benefit from healthy competition, which will be good for consumers in Quebec and Canada.