Right to Repair Consultation Document

Consultation Purpose

In Budget 2024, the Government of Canada committed to launch consultations on a right to repair (RTR) policy for home appliances and consumer electronics. The purpose of this consultation is to gather feedback from Canadians to inform policy direction, including the policy levers to improve Canadians' ability to repair a range of consumer products.

To ensure Canadians can keep their devices working longer, and reduce harmful electronic waste in the process, the Government is advancing work toward a repairability policy approach with an aim to improve product durability and repairability.

Important progress is already being made to support Canadians, including:

• amending the Copyright Act to allow the circumvention of technological protection measures to diagnose, maintain, or repair a product – removing a barrier and helping consumers to repair their devices; and
• amending the Competition Act, as announced in the 2023 Fall Economic Statement, to prevent manufacturers from refusing, in an anti-competitive manner, to provide the parts, tools, and/or software needed to fix devices and products.

Budget 2024 identified three areas to be explored in this consultation – repairability, interoperability and durability:

• repairability refers to the extent to which a product can be easily repaired in a cost-effective manner instead of disposing of it once it breaks;
• interoperability is the degree to which a software system, devices, applications, or other component can connect and communicate with other entities in a coordinated manner without effort from the end user; and,
• durability ensures products do not break easily or frequently, and remain in good working conditions for the duration of their life cycle. Repairability and durability are connected in that repair may extend the time a product lasts.

This document provides an overview of issues related to right to repair in four (4) main sections:

• Right to Repair and the Canadian Context;
• Setting the Stage: Household Appliances and Consumer Electronics;
• Key Concepts: Repairability; Interoperability; and Durability; and
• Developing a Right to Repair Policy Approach.

How to Participate

Submissions for this consultation will be accepted from June 28, 2024 to September 26, 2024.

Comments and feedback can be provided through the survey questionnaire, or alternatively, you can email your comments and feedback to: isrighttorepair-ledroitalareparationsi@ised-isde.gc.ca

Following the online consultation, Innovation, Science and Economic Development Canada and Environment and Climate Change Canada, will hold a number of roundtable discussions with representatives from a range of consumer and industry stakeholders.

Additionally, and as part of this consultation, Agriculture and Agri-Food Canada will hold targeted roundtable discussions focused on interoperability and farm equipment, and the distinct considerations related to this product category of repairability.

What is Right to Repair?

While there is no single definition of right to repair, a commonly used concept is about giving consumers greater choice over, and information on, the repair options for the products they buy. This may include authorized repairs performed by the manufacturer of a product or an authorized repairer; the ability to use an independent repairer without voiding the warranty of a product; or self-repair done by a consumer. In all cases, government policy could take into account such considerations as access to replacement parts; skilled labour needs and availability, including professionals who can repair products; tools to undertake repairs mindful of health and safety considerations; and repair information.

At its root, a right to repair policy approach could make repair more accessible and possibly affordable through different initiatives. Addressing repairability and durability could also improve circular economy and environmental outcomes by making it easier to extend the life of consumer goods, thereby decreasing or discouraging consumer product waste. A consumer product that is both more durable and repairable could generate longer-term cost savings for Canadians, while supporting an economy that is both fair and affordable.

Canadian Context

A Canadian approach to repairability would take into account the country's unique context, in particular, the differing roles and responsibilities between federal, and provincial and territorial governments. At the federal level, the recently adopted Bill C-59 addresses access to repair and diagnostic services, by expanding the existing "refusal to deal" provision of the Competition Act to include the refusal by a party to provide means of diagnosis or repair in a manner that harms competition. The legislation gives the Competition Tribunal the ability to order a supplier to provide the means to diagnose or repair a product in certain circumstances.

Further, there are two additional legislative measures currently being advanced that could possibly address specific issues related to repairability. Bill C-244 proposes a new exception allowing the circumvention of a technological protection measure (TPM) if the circumvention is for the purpose of maintaining or repairing a product, including any related diagnosing, and Bill C-294 proposes to expand the exception permitting the circumvention of a TPM in order to achieve interoperability, which aligns with the spirit of right to repair, as it could facilitate the extension of product lifecycles. The measures proposed in these two Bills seek to remedy some of the issues raised in the 2021 Consultation on a Modern Copyright Framework for Artificial Intelligence and the Internet of Things. Subsequently, it is important to note that these bills have yet to be passed.

In addition to the federal roles and responsibilities, it is equally important to recognize that provinces and territories also have a role to play in advancing consumer product repairability policy in a Canadian context. For example, consumer protection legislation related to buying goods and services and contracts, and consumer complaints often fall under provincial and territorial jurisdiction. Saskatchewan's Agricultural Implements Act and Quebec's Bill 29, the Act to protect consumers from planned obsolescence and to promote the durability, repairability and maintenance of goods are both examples of provincial legislation that address elements of repairability in their own distinct manner.

Beyond shared responsibility, repairability policy presents various considerations for Canada given the smaller size of the consumer market and manufacturing base for household appliances and consumer electronics compared to other jurisdictions such as the United States (US) or European Union (EU). To highlight this consideration, in 2023, Canada held a negative trade balance of $4.8 billion for household appliances meaning that consumers in Canada are inherently reliant on imports or products manufactured outside of the country.^{Footnote 1}

Additionally, supply chains are global in scope with components being manufactured in a range of countries or regions and as such, government policy will need to consider both potential impacts on supply chains and alignment with measures in other countries. This element is important in the Canadian context given international trade agreements such as the Canada-United States-Mexico Agreement (CUSMA), Canada-European Union Comprehensive Economic and Trade Agreement (CETA) and others.

International Context

Jurisdictions and countries such as the EU, United Kingdom, France, Australia and US are adopting approaches to consumer product repairability policy. Currently, most approaches are legislative in nature and seek to advance multiple outcomes. Policy approaches include initiatives focused on warranty and consumer guarantees, access to repair services and reasonable availability of spare parts.

As an example, in 2024, the EU adopted the Right-to-Repair Directive, which will promote and introduce common rules on right to repair for EU member countries. The new directive will require manufacturers or sellers to repair products under warranty, assure that consumers can choose to have products repaired through a prolonged legal guarantee if a defect appears within the legal guarantee, and increase information about repair services.

Other approaches focusing on the design phase of a product's development are becoming more common. For example, one approach is the EU's Ecodesign for Sustainable Product Regulation that is currently in the process of adoption. The regulation would establish a framework for eco-design requirements for specific product groups to improve their circularity, repairability, energy efficiency, and recycled content amongst others. The new EU directive would build off the EU's existing Ecodesign Directive, which is similar in nature to Canada's EnerGuide.

In the US, Canada's largest trading partner, approaches are predominantly being advanced at the state rather than federal level, meaning that there is no consistent national approach. For example, over the past several years over 30 states have introduced, and at least six states have passed, right to repair legislation covering a broad range of sectors. Typically, state level efforts focus on the availability of repair manuals, tools, software and parts through legislative measures. As of mid 2024, 25 bills are aiming to establish right to repair for various consumer items, and more than half are targeting electronics devices.

Governments around the world are increasingly attempting to advance repairability by addressing a number of factors. These include, but are not limited to:

• access to spare parts;
• warranties;
• use of intellectual property protection to hinder repair;
• intentionally designing products to be replaced with newer products (planned obsolescence);
• higher cost of repair than replacement; and
• a lack of awareness or information on repair options or the actual durability and repairability of a product.

Repairability

What is Repairability?

Repairability is the ability of a product, system, or device to be fixed or restored to its working condition after it has been damaged. Measuring the level of repairability includes factors such as the ease to disassemble a product to repair or replace a defective part or parts. It also includes the cost of repair and the length of time to get a spare part or to receive the service of an independent repairer. It often entails consumers' freedom to choose a favorable repair option that is not necessarily tied to the after sale services offered by the original manufacturer.

Repairability is increasingly becoming an issue of high interest for consumers. It is gathering significant attention from industry and governments, domestically and globally. Recent studies in Canada point to a declining rate of repair among consumers. It is vital to understand consumers' behaviour as it relates to repair, particularly existing barriers to choose a cost-effective and timely repair option.

Repairability Considerations

Repairability ties together different players including: the original manufacturer (industry); the end user (consumer); independent parts manufacturers; and the independent or certified repairer. Each one has specific perspectives, considerations and potential opportunities that could be leveraged through increased repairability.

Increased repairability can present different opportunities for industry, as it could become a competitive advantage that would help companies increase their market share and customer loyalty. However, some industry stakeholders are concerned that increased access to information and tools required to facilitate repair may compromise their trade secrets and intellectual property rights. They have also raised concerns related to the safety and security of consumers and repairers, who, while performing complex repair operations may harm themselves if they do not have the appropriate knowledge, tools, or relevant certification. Ensuring the health and safety of consumers and repairers, and protecting trade secrets and intellectual property rights are legitimate considerations.

Consumers are supportive of improved access to repairability, but may not always select a favorable repair option for multiple reasons. Increased cost of repair could be a major disincentive, followed by lack of technical knowledge and awareness of alternative repair options. Some studies indicate that the shortage of skilled labour and certified repairers is limiting the access to viable repair options. This consideration may also be more acute for consumers who live in rural or remote regions.

Additionally, consumer products and their level of repairability vary in terms of their complexity, with some products posing greater safety hazards if not handled properly. Having access to the services of certified technicians who are professionally trained could address health and safety concerns identified by industry stakeholders. A repairability policy could attempt to address skilled labour shortages. Increasing the pool of certified technicians could potentially ease access to repair and ensure safe and effective repair. Independent repairers may offer consumers an alternative and cost-competitive means to repairing products; if service providers have access to the appropriate spare parts.

Currently, many manufacturers require repairers to source the original (or proprietary) parts to repair or replace a broken device. Disruption in supply chains of manufactures may limit the availability of spare parts and can create another barrier to repair. Supply chain disruptions could lead to delays that could render a repair option less favorable. Moreover, and at times, certain practices can create barriers to the repair of products, such as manufacturers' use of TPMs to prohibit access to software embedded in their products. The possibility of repairing products using generic parts that may be less expensive, instead of solely relying on a manufacturers' approved ones could potentially make repairability easier.

Legislative Initiatives

The Government of Canada is already advancing work on repairability. Through the copyright consultations conducted in 2021, the government examined issues related to repairability and is considering the removal of an obstacle to repair in the Copyright Act (the Act). Additionally, the government passed amendments to the Competition Act (Bill C-59) to prevent manufacturers from refusing to provide third parties the "means of diagnosis and repair" where competition is harmed. The objective is to provide Canadians the flexibility to choose the best option for maintaining and repairing the devices and equipment that they own, and to support a clean environment and competitiveness in the market place.

Given the interconnected and shared jurisdictional nature of repair in Canada, facilitating repair will require a variety of measures, including at the provincial level. Recently, Quebec adopted Bill 29 (The Act to protect consumers from planned obsolescence and to promote the durability, repairability and maintenance of goods). It introduces several amendments to facilitate repair by adding an obligation on industry to provide the information and tools (including proprietary one) required to perform maintenance or repairs, and any necessary diagnostic software. The Bill prohibits planned obsolescence and the use of any technique that can make a product difficult to repair. Other provinces are contemplating similar amendments to facilitate repairability.

These measures indicate progress in easing repair and could lead to further changes if there is a need to address other pending issues affecting repairability.

Interoperability

What is Interoperability?

Interoperability is the degree to which software systems, devices or applications can connect or communicate with each other or with other entities in a coordinated manner without effort from the end user, and it works on multiple levels. Firstly, interoperability allows different electronics and parts in the same device to work properly and secondly, it can also permit the interaction between two different pieces of equipment. Additionally, interoperability permits remote diagnosis and possibly repair of defective products.

The pace of technological advancement is affecting the way we manufacture, and use appliances and equipment. Digital technologies provide numerous advantages on multiple levels, and improve the functionality of every appliance and device we use on a daily basis. However, technological advancement and interoperability can pose challenges as well. Increasingly, electronics are embedded in a vast array of consumer products not considered digital, creating barriers such as various forms of TPMs in which manufacturers maintain control of repair, the aftermarket and lifecycle of products.

Without interoperability, one may end up with different devices that are perfectly fine but are not able to digitally "communicate" and receive the appropriate "command" to perform an intended operation. This can hinder the ability to engage independent repair providers and limit the options available to consumers when choosing their preferred option to repair, maintain, and preserve the items that they own.

Interoperability Considerations

In some cases, manufacturers can find ways to electronically restrict self repair of their devices to protect copyright, trade secrets, and intellectual property. Manufacturers also assert that such measures are essential to prevent the illegal modification of equipment and appliances in a way that may cause safety and environmental hazards.

This is further complicated as interoperability lingers on the fine line between intellectual property and competition laws. It facilitates interaction between different owners of platforms (different manufacturers, brands or suppliers of parts). The original owner of a platform can deny access to key data thus hindering the work of another supplier or an independent repairer in an uncompetitive manner. They can further void the warranty if they do not authorise a repair and/or the installation of a specific spare part. This harms competitiveness and eventually limits consumers to the options that the original owner or manufacturers are offering. Such behaviour broadly affects various user groups to different extents, and interoperability is specifically recognized as a repairability consideration for farmers.

In 2021, two of the issues raised in the Consultation on a Modern Copyright Framework for Artificial Intelligence and the Internet of Things were how best to remove obstacles to repair and interoperability in the Copyright Act (the Act). Proposed amendments to the Act seek to address these two issues to ensure that consumers have greater access to repair options and interoperability.

To complement progress at the federal level, measures under provincial and territorial jurisdiction over consumer protection and property rights would be needed to empower Canadians with increased interoperability and a full "right to repair". Many contractual agreements, that fall under provincial and territorial jurisdiction include conditions restricting repair (e.g., prohibit the circumvention of TPMs; void the product warranty if one does not use an authorised repair service provider).

Durability

What is Durability?

Durability is the ability of a product or material to withstand wear, pressure, or damage over time. Many appliance companies maintain that creating reliable and durable products is important for retaining customer loyalty. This is the case for some electronics but not all. For example, in the cell phone industry, new products may debut annually and feature greater memory, cameras, or other functions to entice customers to trade in their old — often well functioning — phone to get the latest design. However, it is also important to recognize that new products are also released in response to consumer interest, demand and preferences.

The less durable products are, the more they contribute to environmental problems such as discarded home appliances and electronics. Electronics at or near the end of their life that are discarded and not recycled, refurbished, or repurposed for reuse are a part of a large environmental problem known as e-waste. E-waste includes computers, printers, cellphones, televisions, audio visual equipment, gaming equipment, landline telephones and microwave ovens. In 2021, computers, cellphones and televisions were among the most-frequently reported types of e-waste, with 15 percent of households having computers to dispose of, 14 percent having cellphones, and 14 percent having televisions to discard.^{Footnote 2}

While Canadians are improving on e-waste disposal, the vast majority of e-waste still creates the problem that increased durability of products could help resolve. In 2021, 38 percent of Canadian households reported having at least one type of unwanted electronic device to dispose of, down 5 percentage points from 2019, and most used a depot or drop-off centre. An increasing proportion of households are choosing to repair, sell, or donate or give away their unwanted cellphones. When it came time to retire a cellphone in 2021, 6 percent of households repaired or sold their device, compared with 1 percent in 2011, and 12 percent donated them or gave them away, up from 8 percent in 2011.^{Footnote 3} Still, the e-waste generation per capita increased from 8.3 kg in 2000 to 25.3 kg in 2020 — enough to fill Toronto's CN Tower 110 times, and it is estimated to reach 31.5 kg by 2030.^{Footnote 4}

Durability Considerations

Consumer products are increasingly complex in nature and durability is connected with affordability and repairability. This connection is not necessarily direct. Historically, home appliances were designed with less complicated and replaceable parts that were manufactured with greater durability. As many long-time repairers or consumer groups note, this meant home appliances from 20 years ago last much longer than those produced today.

Affordability is not just affected by the cost of product design, manufacturing, sales and servicing of home appliances or electronics, but also by the availability of skilled repairers, spare parts, distribution within supply chains, and other factors. Moreover, some academic experts have pointed out that affordability, repairability and durability can be mutually exclusive. Nevertheless, changes to the design of a product to make it more durable, may mean that it will now be less affordable to consumers compared with cheaper less durable alternatives, and perhaps less easily repaired because of the cost of higher quality parts. A more durable product may be less likely to break but more difficult to disassemble and repair.

The affordability of durability, as it could be termed, is determined by market forces of labour supply and demand, and the cost analysis consumers use when deciding to repair or replace. For example, consumers paid 7.8 percent more in February 2024 on a year-over-year basis for services related to household furnishings and equipment, including appliance repair. Prices for these services have trended upward over the past few years, including an 8.8 percent year-over-year increase observed in March 2023.

Conversely, consumer prices for new household appliances have mostly decreased since the recent peak in April 2022, when they increased 12.0 percent. In February 2024, prices for household appliances were down 2.2 percent compared with the same month a year earlier.^{Footnote 5} However, and in the long run, consumer products that are both more durable and repairable could generate cost savings for households by incentivizing the repair rather than the replacement of a consumer product.