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‘Strong Signal’ to OEMs

Right-to-Repair Advocates Deem FTC Report a ‘Slam Dunk’

The FTC finding that OEM restrictions on independent third-party repairs have “diluted” consumer protections in the 1975 Magnuson-Moss Warranty Act (MMWA) was a “slam dunk” for right-to-repair advocates, Repair Association Executive Director Gay Gordon-Byrne told us. Commissioners vowed in Thursday's report to use enforcement and rulemaking authorities under the MMWA and 1914 FTC Act to crack down on such anti-consumer practices.

Historically, the FTC has had plenty of legal authority and not used it” to curb OEM repair restrictions on independent service shops and individual consumers, said Gordon-Byrne. Paraphrasing Lina Khan, President Joe Biden's nominee for the FTC, Gordon-Byrne said: “We don't need new law, but we do need enforcement. Will the FTC actually get more involved? No idea. It would be nice to imagine that they will.” For more of our coverage of the report, see here and here.

It’s “promising” the agency deemed OEM repair abuses “severe and widespread enough” to merit a possible rulemaking under the unfair competition language in FTC Act Section 5, said Kerry Sheehan, iFixit U.S. policy lead. “Giving companies a warning or slap on the wrist after they create whole systems to deny people their right to repair is no longer working, and we agree that the FTC needs to outlaw these practices across the board,” she said. “That this is a 4-0, unanimous report sends a strong signal to manufacturers and lawmakers alike that the FTC is taking the problem of repair restrictions very seriously.”

The commission wants to hear from consumers at who are told by manufacturers warranties were “voided because of independent repair,” blogged FTC attorney Emily Wu. “If that repair is covered by your warranty, and if your warranty hasn’t expired, the manufacturer can’t refuse to make the repair.”

The two-year investigation found “scant evidence to support manufacturers’ justifications for repair restrictions,” said the report. Of OEMs that argue that unauthorized repair presents a safety risk for a device’s user, not just its repairer, “safety considerations are a critical part of any discussion about repairs,” said the commission. Such concerns, however, “should not automatically justify restricting repairs to authorized repair networks without further analysis.”

Manufacturers in the investigation “provided no data to support their argument that injuries are tied to repairs performed by consumers or independent repair shops,” said the document. “Nor have manufacturers provided factual support for their statements that authorized repair persons are more careful or that individuals or independent repair shops fail to take appropriate safety precautions, or that independent repair workers who enter homes pose more of a safety risk to consumers than authorized repair workers.”

The report takes CTA and other tech groups and companies specifically to task for their assertions that repair restrictions protect consumers from cybersecurity risks. There's “no empirical evidence to suggest that independent repair shops are more or less likely than authorized repair shops to compromise or misuse customer data,” it said. Though access to “certain embedded software could introduce new security risks, repair advocates note that they only seek diagnostics and firmware patches,” it said. “Replacing a part on a device with an identical OEM part or functionally equivalent aftermarket part is unlikely to create a cybersecurity risk.”

Authorized repair providers, "including many local small businesses across the country, have established relationships with manufacturers," said TechNet Senior Vice President Carl Holshouser. "This ensures these businesses receive the appropriate training directly from manufacturers and have the qualifications to do repairs properly and safely. Allowing unvetted third parties with access to sensitive diagnostic information, software, tools, and parts would jeopardize the safety and security of consumers’ devices and put consumers at risk for fraud. States have continually rejected legislation like this, with 25 states alone last year deciding not to take action." We asked a half-dozen other associations for comment through Friday. None responded.

OEMs and their groups "argue that consumer demand and design decisions to service that demand, as well as consumer safety, are the drivers behind various physical repair restrictions," said the report. Right-to-repair advocates counter that consumers "care about repairability, in addition to aesthetic design, but do not have the necessary information at the point of sale to purchase products that are repairable," it said. Evidence submitted from both sides was "almost entirely anecdotal," it said. "Whether consumers are willing to trade repairability of devices for other design features is a question that remains open. Further research is required to understand the tradeoffs consumers are willing to make when fully informed about repairability."