The independent aftermarket auto service and repair industry (aftermarket industry) claims that motor vehicle manufacturers provide preferential treatment to franchised motor vehicle dealers by providing them with tools, training and software for the repair of vehicles not offered to independent auto service and repair facilities (repair shops). In particular, dealers are provided with tools and software of an increasingly proprietary nature to access computer control units contained in vehicles with on-board diagnostic capabilities. The aftermarket industry alleges that this unequal treatment between repair shops and dealers results in fewer auto servicing options. This, in turn, means higher repair costs for consumers who, as a result, may delay or ignore necessary repairs (particularly in the current economic climate), putting highway safety at risk and increasing the risk of poor quality emissions.
Due to a lack of agreement in the automotive industry as to how the aftermarket industry should be treated by motor vehicle manufacturers, private member’s public Bill C-273, An Act to Amend the Competition Act and the Canadian Environmental Protection Act, 1999, was introduced in the House of Commons in January 2009. The Bill was intended to amend the Competition Act (Act) and the Canadian Environmental Protection Act, 1999 (CEPA) to require motor vehicle manufacturers to provide access to tools, training and software to repair shops and motor vehicle owners on the same basis as franchised auto dealers. However, based on a past decision of the Competition Tribunal, it quickly became unclear whether the proposed amendment to the Act would achieve its desired effect as it was unlikely that manufacturers would be obliged to grant licenses for information that is protected by intellectual property rights. Further, the proposed amendments to the Act would have general application to deal with issues in one particular sector, which was troubling as this could result in unanticipated problems for other industries which rely heavily on technology and intellectual property.
In response to the controversial introduction of Bill C-273 and at the behest of the Minister of Industry, the motor vehicle manufacturers and the aftermarket industry reached a voluntary agreement, the Canadian Automotive Service Information Standard (CASIS) on September 29, 2009. CASIS was endorsed by the Minister and on November 17, 2009, the House of Commons concurred in a recommendation by the Standing Committee on Industry, Science and Technology that the House of Commons not proceed with Bill C-273.
Expected to be implemented by May 2010, CASIS provides that repair shops will have timely access to the tools, training and information required to diagnose and repair motor vehicles in the same or similar manner and extent as they are available to authorized dealers. This will enable repair shops to compete in a fair marketplace. The agreement specifies that all original equipment manufacturer (OEM) tools, service information, training information, indirect information and tool information are proprietary to, and remain the exclusive property of, the OEM. The government intends to follow the development of CASIS closely to ensure that the proposed legislative reform continues to be unnecessary.