Industry Committee on Oct. 31st, 2022

[The Chair, Liberal, Joël Lightbound]

I call this meeting to order. Good morning, everyone.

Welcome to meeting number 42 of the House of Commons Standing Committee on Industry and Technology.

Pursuant to the order of reference adopted by the House on Wednesday, October 5, Bill C‑244, An Act to amend the Copyright Act (diagnosis, maintenance and repair).

Today's meeting is taking place in a hybrid format, pursuant to the House Order of Thursday, June 23.

We will now begin the opening remarks with Wilson Miao.

Without further ado, dear colleague, you have the floor. You have five to 10 minutes to tell us about your bill.

[Wilson Miao, Liberal, Richmond Centre, BC]

Thank you, Mr. Chair.

Thank you to all the members of the INDU committee for allowing me to appear today to speak on my private member's bill, Bill C-244, an act to amend the Copyright Act for the purpose of diagnosis, maintenance and repair.

It would be my honour to see this bill passed unanimously in the House. I would like to take a moment to thank everyone who supported this bill and allowed it to be discussed and studied here today in the standing committee.

This bill was previously tabled in the last Parliament by the member from Cambridge, who is now the parliamentary secretary to the Minister of National Defence. I'd like to also take this opportunity to thank him for his work.

It's important to recognize the significance of this bill and understand the potential for it to benefit all consumers across Canada. I cannot stress enough the impact this bill will have for Canadians, consumers and our environment.

The Copyright Act as it stands today is being interpreted in areas beyond its scope. Bill C-244 addresses the concerns that are becoming more frequent in today's world. We are seeing more digital products integrated into our daily lives and relied upon for everyday services. At the same time, the actual lifespan of electronics has been reduced dramatically with planned obsolescence, leading to more cost for consumers and more burden to our environment.

Copyright exists to protect the intellectual property and the original work of its creator, not to prevent the right to repair even when nothing is being copied or distributed. The current Copyright Act contains certain clauses that make it either impossible or extremely difficult for anyone to legally repair a product, or else these clauses prevent any repairs from happening at all. As a result, Canadians are not able to seek repair alternatives and face the dilemma of throwing out their new purchase because of a small malfunction or minor damage to a product.

As technology is becoming more sophisticated, technological protection measures, or TPMs, usually in the form of a technical restriction, are built in as a barrier to prevent access to the original work. TPMs may be a digital lock, an encryption or even a custom screw. These can be found in many products, such as heavy machinery from tractors to electric scooters and everyday devices from mobile phones to health devices that save human lives. These are just a few examples of the many products that have a TPM incorporated.

There are certain exemptions, such as the Canadian Automotive Service Information Standard, which is a voluntary agreement reached in 2009 in the automotive industry that ensures that automakers and aftermarket providers provide access to service and repair information to repair facilities across Canada.

Any circumvention of a TPM is prohibited and would be considered illegal. This bill ensures that any circumvention for the sole purpose of diagnosing, maintaining and repairing a product will not violate the Copyright Act.

In order to address the limitations of the Copyright Act in Canada now, Bill C-244 would change the definition of a technological protection measure by applying it to the software and computer programs within the product, allowing consumers to circumvent a TPM for the sole purposes of diagnosis, maintenance and repair. This gives back control to our Canadian consumers.

This bill is important because it is one part of the federal responsibility that must be addressed before any right-to-repair legislation exists across Canada. Bill C-244 does not rewrite the Copyright Act, but without this change, any other legislation or regulatory changes will not have their desired effect and TPMs could not be bypassed for repair. This means that anyone who decides to circumvent a TPM now could face legal consequences.

It is time to give a measure of control back to Canadians. Canadians should have the right to repair. With this, we're able to promote a greener future by reducing waste to our landfills and extending the lifespan of a product.

I look forward to hearing your comments and to answering any questions you might have.

I'm very happy to discuss any amendments moving forward to prevent unintended consequences and to strengthen the sustainability and efficacy of the legislation.

Thank you.

[The Chair, Liberal, Joël Lightbound]

Thank you very much, MP Miao. It's much appreciated.

To start the discussion, we'll go to MP Williams for six minutes.

[Ryan Williams, Conservative, Bay of Quinte, ON]

Thank you, Mr. Chair.

I want to start by thanking MP Miao for bringing this bill forward. Certainly we can all agree that a circular economy, one in which we can have as many businesses competing as possible, is a great thing.

I have a few questions for you this morning, sir.

I'm going to start with warranties. You do talk about the circumvention of TPMs and wanting to make sure that companies cannot get around that in the Copyright Act. How do we work around warranties? A company has a warranty on a product, and if there's tampering or any circumvention, they can void that warranty. Have you thought about that in this bill? What can we do about that?

[Wilson Miao, Liberal, Richmond Centre, BC]

Thank you for your statement and comments and, of course, your questions.

With regard to warranties, this was brought up yesterday, actually, by a constituent of mine who was asking me about it and telling me about the importance of this bill. Recently he purchased a Microsoft Surface Pro, and somehow it got damaged within the warranty period. He took it back to the shop, but Microsoft decided not to honour that warranty because there were signs of tampering with the laptop.

In that regard, I feel that as long as the consumer is able to find options to repair it at a facility—not necessarily an authorized facility, but through a technician who knows what to do—it is the right of the consumer to carry that out. At the same time, it is for the manufacturer to determine whether or not there would be further amendments to the warranty they provide to the consumers so that the lifespan of the product can be also extended as well.

[Ryan Williams, Conservative, Bay of Quinte, ON]

Mr. Miao, I'm looking at it in terms of perhaps what the U.S. has done—because they have some legislation—and what we can do in Canada. Would it be something that we have to do under the Copyright Act, or is there something else we're going to have to look at in terms of the two sides of this situation?

One is looking at warranties and the legal protections the manufacturers have under warranty, and two is enforcement. Either we enforce that, or the law changes to allow a third party to go under a warranty for a competitor or for a company. An example I'm going to give is that Tesla is known in the U.S. for not allowing others to work on their systems, but also, there's no enforcement. When Tesla doesn't allow others to work on their systems, that's not followed, and there's no enforcement and no penalty for people who go around that prohibition.

[Wilson Miao, Liberal, Richmond Centre, BC]

With regard to that part, I would say that a warranty usually falls under the consumer protection act. Without this bill being brought forward, other legislation could not come into play, because it's about a technological protection measure being accessed in any way—a warranty situation or not a warranty situation— for the purpose of the repair.

The limitation comes with certain exceptions, and these exceptions can also be brought forward and discussed moving forward after this—

[Ryan Williams, Conservative, Bay of Quinte, ON]

I think that's valid, and it does the first step. I'm not so sure, though, that in this bill we get around that. I think that's still going to exist.

However, I think that in the circular economy there are going to be third parties that can work outside of warranties. I think there's certainly a part of the circular economy that could look at something—a cellphone or a car—outside of warranty and still be able to fix it. I think this bill does it. I'm just not sure if we get around the warranty when it is in warranty, just because of the legal ramifications.

The second question is this: Have we looked at our major trading partners—the U.S., Mexico and the EU—and is this bill in line with CUSMA and with CETA?

[Wilson Miao, Liberal, Richmond Centre, BC]

With regard to anything related to CUSMA, there are certain prohibitions put forward right now to not allow technological protection measures to be circumvented. Globally right now, in the U.S., many states—I believe 20 states in the U.S. right now—have right-to-repair framework legislation being discussed or developed, as do our EU and Australian trading partners. These are important issues to be discussed and studied once that part of the Copyright Act is amended. Any exception coming forward can be also considered as an amendment to further strengthen the legislation in the right-to-repair framework.

[Ryan Williams, Conservative, Bay of Quinte, ON]

Through the chair to Mr. Miao again, do we have any numbers on the markets this bill will affect—current market numbers for potential growth for third-party electronics repair and servicing? Do we have current market numbers for OEM repair and servicing? Do we know the economic potential of this bill so far?

[Wilson Miao, Liberal, Richmond Centre, BC]

I don't have those numbers with me. Definitely, in the OEM market and aftermarket parts industry, there are demands for accessing certain parts and information in order to support the manufacturers or producers and help with the repair.

[Ryan Williams, Conservative, Bay of Quinte, ON]

I have one last question, Mr. Chair.

[The Chair, Liberal, Joël Lightbound]

Provide a brief answer.

[Ryan Williams, Conservative, Bay of Quinte, ON]

You mentioned that states are making these laws in the U.S. We also have provinces passing legislation. How is this bill going to work with the provinces?

[Wilson Miao, Liberal, Richmond Centre, BC]

From my understanding, there was previous legislation carried out at the provincial level. However, most of this fell through because of the limitation on circumvention of TPMs.

[Ryan Williams, Conservative, Bay of Quinte, ON]

Thank you, Mr. Chair.

[The Chair, Liberal, Joël Lightbound]

Thank you very much.

We'll now move to MP Erskine-Smith for six minutes.

[Nathaniel Erskine-Smith, Liberal, Beaches—East York, ON]

Thanks very much.

I say you did a great job bringing this bill back to us. I hope we can strengthen it wherever possible.

I want to start simply.

In your view, what sectors would be most impacted by legislation like this?

[Wilson Miao, Liberal, Richmond Centre, BC]

Because of how our technology advances today, I think this bill will affect every sector across the nation. There are a lot more electronic products for consumers to choose from. At the same time, these electronic products include many restrictions to access, which I have mentioned, such as TPMs. That will limit access for consumers in terms of not allowing intellectual property or the work of original creators to be accessed. At the same time, it limits the rights of consumers to repair.

[Nathaniel Erskine-Smith, Liberal, Beaches—East York, ON]

Through our review of the bill, we are going to hear, I am sure, perspectives strongly in support of the legislation. I expect we might also hear some concerns. You, as the sponsor, are obviously working closely with Bryan May, who originally brought it to us in the last parliament.

What do you see as the core objections? How do you think we can best respond to them?

[Wilson Miao, Liberal, Richmond Centre, BC]

The intention of this amendment to the Copyright Act is to allow an important part of the right-to-repair framework. Without this being carried forward, it would be considered illegal for any consumer or third party to do repairs.

Before we can discuss other legislation related to the scope, it is critical to move this part forward so that any circumvention of TPMs is not considered illegal here in Canada.

[Nathaniel Erskine-Smith, Liberal, Beaches—East York, ON]

—You would obviously be engaging with MP May, who would have done his own consultation on this. Of the organizations you have consulted, are there any we should be inviting that would be in support of the legislation? On the other side, are there organizations that have raised concerns with you that we would want to address?

[Wilson Miao, Liberal, Richmond Centre, BC]

Thank you for that.

I believe that in the second hour of today's meeting, there will be several witnesses appearing, including Global Automakers of Canada, AIA Canada and Associated Equipment Distributors, some of which I have spoken to. They have raised some of their concerns regarding issues surrounding the industry.

However, I have to say that any industry that has consideration under the right-to-repair framework is thinking from the perspective of supporting more benefits to the consumer. No matter what industry we're talking about here, different producers across many industries have similar concerns about not allowing circumvention of a digital lock on the device or product that consumers own. In order for them to access it with the intention of repair, this change has to be carried out under the Copyright Act before other legislation can come forward.

[Nathaniel Erskine-Smith, Liberal, Beaches—East York, ON]

Your bill addresses an important consumer rights issue in a very specific and concrete way. I'm sure you will be faced with some organizations that will come to us with objections, and I expect we'll also hear from some others that would like the legislation to go further.

We're going through this with MP Carr around his legislation. He indicated an openness to certain amendments. In your legislation, are there amendments that you would look to and say, “We could tweak it this way to improve it” or “I looked at that, but I couldn't exactly deliver on that with the time I had”? Are there ways we could strengthen this bill?

[Wilson Miao, Liberal, Richmond Centre, BC]

Of course, I definitely think there is a lot more room for improvement on this bill. For example, I've spoken to Stryker, a stakeholder that develops health devices, and their main concern is if a non-technician decides to tamper with the machine and causes a death. That's very critical.

Of course, in talking about amendments, there are certain exemptions that can be considered specifically and come into play because of other consequences that we might face.

We also get to a dilemma if it's a life or death situation. During the pandemic, technicians were not able to access hospital facilities to repair or diagnose a health machine. What happens in those circumstances?

These are the situations we have to consider when discussing any amendments as we move forward with the right-to-repair framework.