THE STANDING SENATE COMMITTEE ON BANKING, COMMERCE AND THE ECONOMY
EVIDENCE
OTTAWA, Thursday, October 3, 2024
The Standing Senate Committee on Banking, Commerce and the Economy met with videoconference this day at 11:30 a.m. [ET], in public and in camera, to study Bill C-294, An Act to amend the Copyright Act (interoperability).
Senator Pamela Wallin (Chair) in the chair.
The Chair: Welcome to those in the room and online. This is the Standing Senate Committee on Banking, Commerce and the Economy.
My name is Pamela Wallin. I serve as the chair of this committee. Let me introduce the members of the committee here today: Senator Loffreda, our deputy chair; Senator Deacon from Nova Scotia; Senator Gignac; Senator Marshall; Senator Massicotte; Senator Martin; Senator Varone; and Senator Yussuff.
Today, we begin our examination of Bill C-294, An Act to amend the Copyright Act (interoperability).
We have the pleasure of welcoming in person to our session here today Jeremy Patzer, Member of Parliament for Cypress Hills—Grasslands, Saskatchewan, and sponsor of Bill C-294. Thank you for your work, for having your bill go through your system and for bringing it to us today. We will now take a few moments to hear your opening remarks. Please go ahead.
Jeremy Patzer, Member of Parliament for Cypress Hills—Grasslands, Saskatchewan, sponsor of the bill, as an individual: Thank you for inviting me to speak about my private member’s bill: Bill C-294. I want to thank Senator Housakos for sponsoring my bill and Senator Deacon for being the critic. Your work is appreciated.
I’m happy to say that Bill C-294 passed unanimously through the House of Commons at all stages.
“Interoperability” is not a word you hear very often. In this specific case, it has to do with technology, and understanding it as a technical issue can be a little complicated. But the bill is fairly simple and straightforward.
It brings an overdue amendment to the Canadian Copyright Act, which grants certain exemptions for circumventing technological protection measures, or TPMs for short.
My interest in changing the Copyright Act came from an issue brought to my attention from a manufacturer back home. Digital locks have become a common occurrence in machinery as they become more sophisticated and digitally operated.
Making farm equipment interoperate used to be as simple as hooking up a few hydraulic hoses. Over time, cabling was included as digital monitors and controls became more common.
TPMs were originally intended to encourage more innovation. But now they are being used by large original equipment manufacturers, or OEMs, to block small and medium-sized enterprises, or SMEs — sometimes as simply as forcing the acceptance of terms and conditions which stipulate that only the OEM owns the software, despite the user owning the hardware in which the software is embedded, including language that prohibits the reverse engineering of the product. Therein lies the problem.
Neither exemption currently in the Copyright Act for interoperability provides enough certainty or clarity for short-line manufacturers. This is why certainty and clarity for circumvention for the only purpose of interoperability is paramount, as the limitation provisions in my bill demonstrate.
Competition drives innovation. Innovation drives progress. If we don’t make changes to provide more certainty and clarity for our innovators, then Canada’s historical advantage will be lost.
In closing, interoperability is about more than just agriculture. It is a whole-of-the-economy issue that is national in scale and scope. Bill C-294 is the first step in the right direction toward responding to a rapidly changing digital world. Thank you.
The Chair: Thank you. We appreciate those remarks.
We will begin our questioning with our deputy chair, Senator Loffreda.
Senator Loffreda: Thank you, Mr. Patzer, for being with us, and congratulations on putting forward a much-needed bill.
When it comes to the Copyright Act, legal concerns are always a priority. I was reading recently there was one court case in Canada which is the federal case of Nintendo of America v. King.
Given the economics and significance often attributed to interoperability, why do you think there have been so few court cases on this matter?
Mr. Patzer: Part of what happened with the Nintendo of America v. King decision was there was a big chill effect put over the entire industry — more so than in the video game sphere but for innovators writ large.
When you see the precedent put in place by that decision, and when you have a smaller outfit looking at what potential fines and penalties they could face because of the precedent set, one court case would wipe out a company, such as many of our short-line manufacturers that we have across the country, whether it be Honey Bee Manufacturing, Degelman or MacDon. Companies like that are driving innovation, but they simply aren’t large-scale companies that could handle going through the court and legal system. They need more certainty and clarity. That is what we are striving to achieve with this bill.
Senator Loffreda: You’re comfortable that the court’s conclusions in this case and this bill align, and there are no further concerns moving forward?
Mr. Patzer: As I indicated, it’s the first step in the right direction. There will be more changes needed to things like the Competition Act, which does generally fall under provincial authorities.
As far as the Copyright Act goes, this will provide certainty for them to be able to circumvent a TPM in order to access the information for that sole purpose, which is to make their product interoperate.
I firmly believe — and with the testimony we heard at committee on the House of Commons side — that there will still be strengths in place for a big company that has created unique software. They’re not at risk of being pirated or having extra information taken that is not supposed to be there. The legal system is still strong enough to provide that certainty.
However, this provision will allow the short-line guys, who are the main innovators in the economy, to be able to access the information they need in a manner that will fall under the law and not outside of it going forward.
Senator Loffreda: Thank you.
Senator C. Deacon: Thank you, MP Patzer, for being here and for your work on this. It is a precise focus that you’ve put into this. It will generate many benefits for farmers and many others.
The point here is this: I’ve heard people say this is only for the benefit of Western Canada. I know this is to the benefit of farmers in Nova Scotia, if this goes through.
Given the experience you have with this, I would appreciate you giving us some idea of the breadth of benefit that will come to manufacturers, operators and consumers by bringing in interoperability as a way to harness the full value of whatever product you buy and integrate it in a way that works in your life.
Mr. Patzer: When you look at the whole economy, different regions of our country do different things either better or more specific than other parts of the country do.
We’re fortunate in Saskatchewan. Agriculture is the main driver of our economy; in other parts of the country, it’s mining or forestry.
When you look at the specialized nature of some of the equipment they use, you might have a large OEM that makes a generalized product but not a specialized product. Then you get some of these smaller companies where, if it’s like farming, they would have been started by somebody who has worked in that industry. They would have identified a specific problem not being solved by the large OEM.
Then they can manufacture and make that smaller, more specific product that’s going to help mine that ore in a more efficient manner. Or on the forestry side, it could get the logging done in a more efficient manner. It’s on the health and safety side of it too.
On the safety side, you would be able to make more specialized equipment to provide better safety for employees in the workforce and the labour force.
I mentioned how it’s a whole-of-the-economy approach. Interoperability happens in so many parts of our daily lives, but we’re not always aware. Something could be as simple as you taking your computer mouse and plugging it into your computer. You might have an off-brand mouse that you plugged into a Dell system. That’s interoperability. It plugs in. It works.
We’re reaching a point with bigger and larger equipment where that’s not the case. Growing up on the family farm, you would connect to your header. You could connect up a few hydraulic hoses, because everything was static hydraulics. It was a matter of the pressures aligning. Now with how digital and electronic everything has become, that is no longer the case where you can simply plug and play and away you go.
When you look at heavy equipment operators, for example, there is a bucket for the front end of a skid-steer of a Bobcat, for example. It used to be you could go clip on and away you go. Now with the way some of the components work, a simple hook-on-and-go attachment isn’t possible anymore in a lot of industries. That’s why we’re talking about the specialty side of it when it comes to other industries across the country. It’s about making sure that innovators are able to make a specific product that will work for their particular industry, not just in agriculture but also across the economy.
Senator C. Deacon: I can specifically attest to the fact that in the blueberry industry in Nova Scotia, which is hugely important in the Maritime provinces, the sophistication of the blueberry harvesters requires this interoperability to optimize. Thank you very much.
Senator Marshall: I have three questions. First of all, is it possible those amendments can be made through regulations, or is this the only route you can use? There is a provision in the legislation that the government can use regulations to make some changes. Did you look at that?
Mr. Patzer: I did explore that possibility. In some of the early-going consultations we had, we were told that a statutory change would be required, meaning we had to go the legislative route. I do think there are regulations that could be changed. That would be possible. I don’t have those specific examples in front of me at the moment. Potentially, the next panel that you have might be able to answer those for you. I do think there are some regulatory options available as well as more statutory changes.
In the interest of trying to achieve certainty and clarity as directly as possible and in as focused of a manner as possible, this was the route that we went. At committee, we accepted some amendments that came from the government officials as well on this.
Senator Marshall: One of the concerns I have is that we’re making piecemeal changes to the legislation. We have your bill today, and, yesterday, we were studying another bill that will amend the Copyright Act. I’ve noticed in the last few years that everything is being done piecemeal as opposed to comprehensively.
Do you have any concerns with regard to that? You have a piece of the puzzle, but we have several people who have other pieces. Does it all come together correctly?
Mr. Patzer: I think it can all come together correctly. In 2019, there was a wholesale review of the Copyright Act. It’s 2024; we have not seen changes to the Copyright Act from the comprehensive study that was done. While we’re still waiting for the government to make those comprehensive changes, it’s created a window of opportunity for some of these smaller, piecemeal changes to be done and put through.
I don’t think it will hinder any larger piece of legislation that may or may not come down the road, but I do think making some of these smaller changes is paramount because when you look at how fast and rapidly the digital world changes — I mean, you buy a computer today, and tomorrow it’s obsolete — it’s important that we try to make laws as quickly as we can that are reflective of it.
If we look down the road toward the future projection of where things will head — when it comes to farming or manufacturing and the autonomous elements that are coming on board — my bill will help provide certainty for innovators who are working in that sphere, so I don’t think there is a risk of this change being outdated when it comes into force.
Senator Marshall: When you authored your bill and you went to do your research, I’m sure you heard from a lot of people who support your bill. Did you hear from many opponents of the bill? And I’m not talking about what you heard at committee over in the House of Commons because I’m sure before your bill ever reached that stage, you spoke with a lot of people. What were you hearing as you were formulating your bill and speaking to various individuals and organizations?
Mr. Patzer: Yes, I heard from a local manufacturer, but it was actually in the negotiations of what we now call the Canada-United States-Mexico Agreement, or CUSMA, deal. The United States has a far superior exemption for interoperability. They have a different system that hands out those exemptions differently than Canada does, but they have a superior level compared to where Canada was at.
I didn’t actually encounter any opposition to my bill outside of committee because what we are doing with my bill is only bringing us up to the same level of our counterparts in the United States, and bringing us to a similar level as what’s happening in Europe and Australia. If I had been looking to go above and beyond that, then I think I would have started to hear pushback from large industry, but the fact is that the groups that were supportive of my bill also happened to represent some of those large OEMs that otherwise would have maybe opposed my bill. From the feedback I received, I had unanimous support from industry.
Senator Marshall: Thank you.
Senator Martin: Thank you so much for being here. I know that your bill received unanimous support in the House, so here we are today.
We have heard about the benefits to a real cross-section of industry. My first question is specific to the tech sector. Can you speak to how your bill might impact smaller businesses and start-ups?
Mr. Patzer: When you’re looking at a small start-up company, they need certainty because they’re taking on all of the risk. With one misstep, they would be snuffed out by a large player. When you look at who the big tech giants are in the world, if they don’t like what someone smaller than them is doing, they can find a small infringement on something as simple as the Copyright Act. They can say, “Here is your notice of papers being served,” and that will be enough for the start-up to say, “Okay, we’re out. We’re done.”
We need to have a regulatory system and legal system that creates an atmosphere where innovation can thrive. That’s where my bill comes in handy. We’re still waiting for the wholesale changes, which we talked about earlier, to the Copyright Act as well as the Competition Act. Those will be helpful and beneficial. This is about trying to create that ecosystem where the small innovators and the next generation of innovators can have the certainty and clarity that they need going forward. That’s what we’re hoping to achieve with this.
Senator Martin: The U.S., the EU and Australia already have something in place, so we are just trying to catch up to our greatest competitors and our allies.
Mr. Patzer: Yes, that is exactly right. In Canada, we have a pretty good system of people who get started, but then they leave Canada. We want to see innovators create a product but also see it grow and thrive. I think part of this will help grow those companies here in Canada so that they’re not leaving to go to more friendly systems in the United States, Europe or wherever else it might be. Again, that’s where our system needs to be a little bit more agile to try to respond to the current needs and demands of the digital world as it is.
Senator Martin: That’s a very important point.
How does Bill C-294 balance the need for interoperability while ensuring that the intellectual property rights of manufacturers are still protected, particularly in cases where circumventing TPMs may lead to reverse engineering of proprietary technology?
Mr. Patzer: Part of the amendment that I accepted at committee dealt with some of that to make sure that our trade obligations were still met. That was part of why we accepted the amendments that we did.
The wording around some of the non-applications and around the limitations in the bill is quite key to make sure that someone who has spent a lot of time and capital in developing a proprietary software still has that layer of security.
The short-line companies are not interested in that proprietary software. The interoperability is about access and use. Copyright is about having a copy of a lawfully obtained product. Interoperability is about access and use. My bill is about trying to create the right dichotomy between the two so that people can access the information they need without necessarily having to go buy a new machine. For example, a new combine is over $1 million. For a short-line company to go buy every new model of a John Deere, Case IH, New Holland or Fendt combine — all these different brands — it’s impossible.
This, again, allows them to simply access information without digging into that proprietary software. That’s where I think the certainty in provision lies. The language is very specific and very narrowly focused to make sure that those guardrails are in place so that we still have the development of proprietary software while also allowing innovators to access the information that they need.
Senator Martin: Thank you.
Senator Yussuff: Mr. Patzer, thank you for being here. I know this is hard work, and hopefully we’ll get to the end.
The House committee did make a number of amendments to the bill when it was introduced in the other place as a result of the hearing. Is there anything in their amendments that strengthens the bill or changes it in a way that you might have issues with in regard to their recommendations?
Mr. Patzer: As far as the strengthening of the bill, again, because we do have so many trade deals around the world that do involve intellectual property protections — and that’s where the TPM elements come into play — we need to be mindful and respectful of those obligations that we do have. I do think the amendments that I accepted helped strengthen the bill in that regard to make sure that we have certainty and clarity for the short-line manufacturers going forward. Otherwise, they would be exposed to potential litigation from outside of Canada over TPMs and things like that. We didn’t want that to happen, so when we received the proposed amendments and when we heard testimony that this will strengthen the bill in that regard, that was important both to me and to the supporters of the bill.
Senator Yussuff: Are there sectors that are opposed to the bill as is? Obviously, it has finished in the House, and it’s now here. We’ll hear from people who want to come and testify, but is there anyone still making noise by saying we shouldn’t go this far and that this bill will cause problems or challenges in regard to the operability of how other service technicians and companies might now have access to equipment that they didn’t have previously?
Mr. Patzer: I haven’t heard any pushback like that. My office has not received any communications in that regard. As I mentioned earlier, because we only went to a certain level, it puts us on a similar playing field as other countries. That way, we’re not creating a new precedent where industry must try to follow and catch up. That did help create that environment.
Working with multiple different parts of the economy was helpful. I look at it from an agricultural lens, but we went out and sought support from the heavy construction association and from some of the mining and forestry people out there, just for their particular industries. They were fully supportive of it.
Some of the associations represent people who may have been opposed to this in the early going, but now they aren’t opposed because, like I said, we only went to the level where they are already operating in other countries. This is not something new and foreign to them. That’s a big part of why we haven’t faced pushback from the big industry players.
Senator Yussuff: Thank you for your work.
Senator Varone: Thank you, Mr. Patzer, for being here.
I wanted to pick up on a lived experience with respect to equipment. You talked about heavy equipment and the interoperability of the equipment. You have players like CASE, Bobcat and Caterpillar. You can buy their base equipment, but the attachments make the equipment productive. On the interoperability part of it, are you suggesting this bill will now allow a CASE jackhammer to operate on a Caterpillar Bobcat? Or is it for the third party innovators who are selling into the market the replacement parts that go with these machines? I want to get a sense of how this works its way through in a lived experience.
Mr. Patzer: Yes, you nailed it on the head with that. That’s exactly what we’re looking for: those add-on pieces. For example, Cat would make parts that are then attached to a bigger machine.
Senator Varone: They have a separate way of connecting.
Mr. Patzer: Yes, they might have a separate way of connecting, but they may also have in place a digital lock that would prevent a third party from making a very specialized piece of equipment that would attach onto their main equipment. This bill is about trying to allow that third party group to access the information they would need from that main platform — without being offside of the law — to make their product work on it. Again, this does not allow them to infringe on the copyright of the software in the OEM’s main piece. It’s simply about getting the information they need to make their product work on it.
Senator Varone: That didn’t spook the manufacturers of the machines? They make a fortune off their attachments because they’re proprietary to their machines.
Mr. Patzer: Yes, they are. Again, I didn’t hear any pushback from them. I met with some of the big players. I met with Finning Canada of Swift Current. We talked about interoperability, and they were good with that. I talked to one of the CASE dealerships in my riding, and they were all for it. They were okay with it because, at the end of the day, as a dealer, you want to be able to sell the product, right? If you have a full range of products to sell, it’s better for the dealership. It’s also better for the end-user. It also benefits the main OEM because it allows the farmer or the heavy construction company to buy their preferred main machine, but they can then get the small specialty pieces that will allow them to do a better, more efficient job on the work site. That’s what this is about.
Senator Varone: Thank you.
Senator C. Deacon: Again, MP Patzer, we really appreciate your testimony. It’s brought a lot of clarity to the issue.
By doing this, it supports Canadian businesses to grow nationally and internationally. Canadian innovators will benefit, but the users of their innovations will also benefit because of more competition. Increased competition drives innovation, productivity and cost-efficiency. It’s a good thing all around.
I will build off what Senator Varone was saying. One of the things that amazes me is why would global manufacturers not have adopted this anyway? They have it in other countries where they must allow access for interoperability. It just proves the importance of keeping our legislation and regulations up to date. If we don’t force them to do it, even though they do it in every other market, they will not do it here, and Canadians will lose. We haven’t seen anybody — have we — who has done this voluntarily?
Mr. Patzer: No, you rarely see it voluntarily, in part because some big operators want a captive market. They want to be the only one who can sell you everything of their brand. They want brand purity in a lot of cases. It might make it simpler for them in selling their product, but it might not necessarily mean you get the best product. That’s where the problem comes in.
As an aside, competition law in this country would have a role to play in that. I’m not addressing that with my bill, but that is another factor that goes into how this is working out. What are the sales agreements they’re trying to put to the end-user? Are they trying to create brand purity?
We’re trying to set up a system here that allows innovators to make their products and to make sure that competition does exist in the marketplace.
The company I worked with, Honey Bee Manufacturing, had its origins in a shop on a farmyard. For the first number of years, their products were just built in a shop. There was lack of a product that would harvest in an efficient manner, particularly for the type of land that we farm on within southern Saskatchewan. They built a superior product, and it didn’t take long before the big players saw what they were doing and then tried to build their own equivalent of that. They started to see more and more competitors in the marketplace.
That’s how you drive innovation: through competition. But the idea comes from someone who has the lived, practical experience. I’m sure we could talk to anyone in any industry who could point to a person who worked in the industry, identified a problem and built a superior product in their own shop.
I used to work for a construction company in Saskatoon. We built a shop for a paving company. They actually built a lot of their own equipment for paving. They still have to make that product work with the big, mainline brands. That’s another example where someone identified what they could do better because of their lived experience. Without certainty going forward, given how digital and how connected things have become, that’s not possible.
That paving company would not be able to do what they have done up to this point if we don’t have the adjustments made in our laws to meet the reality of what is happening on the ground.
Senator C. Deacon: It’s of huge importance for us to keep our legislation and regulations up to date for innovation to occur and go forward in Canada. Thank you very much.
The Chair: I have a final point here. I think somebody did raise it quickly, but you don’t see any other issues on the CUSMA side? From your point of view, this is a positive, bringing us to the same level as our counterparts — not something that would come up at the table?
Mr. Patzer: That’s right; the amendments that we received from the government officials are to ensure that we are in line with those trade agreements, in particular with CUSMA because that was the one that had just recently been negotiated, signed and adopted. The witness who talked about the need for interoperability and changes to our Copyright Act first came to us from the CUSMA negotiations back in late 2019 or early 2020 when that was going on.
The Chair: Yes, thank you. We’re hearing — on many bits of legislation, not just these two — the larger point of keeping ahead of the game here but also being consistent with our trading partners.
Senator Loffreda: You did mention other industries in your opening remarks. Do you feel that other industries could be impacted by amendments to this bill, and, if so, would any of the other industries oppose the amendments?
And I was reading something from the Canada West Foundation about the role of provincial legislators. There was some concern that provincial legislation has to collaborate. Do you feel the provincial legislators will collaborate to mitigate some of those concerns — without delving too deeply into concerns that are being brought forward — which I’m certain you’re aware of?
Mr. Patzer: Yes, when we were in the early stages of this bill, I had some brief interactions with the provincial government in Saskatchewan to talk to them about what they were looking at doing at the provincial level.
It was an issue that they were acutely aware of, but they were also still waiting for the federal Copyright Act review and changes to be implemented before they went ahead, because they wanted to see what the national standard was before making changes to their provincial acts.
When we do reviews in this country at the federal level, we need to make sure that we are speedy in implementing some of those changes. The provinces are still waiting for that. Maybe they’ll want to make some piecemeal changes after they have seen some of these smaller changes happen from my bill and other bills that are currently in this place.
As for other industries, they will only serve to benefit from it. Again, the only people who might be opposed to it are people who are pursuing brand purity, which is anti-competitive and not in the best interest of the end-users and innovators in this country.
The Chair: Excellent point. Thank you for ending on that.
Thank you, Jeremy Patzer, sponsor of Bill C-294 and Member of Parliament for Cypress Hills—Grasslands in the centre of the universe, Saskatchewan.
We will wrap up this portion. Again, thank you very much, Mr. Patzer.
We are pleased to have our second panel back in person with us. You may recognize them. They were here yesterday, so we know their work. We know your names, but let me just do this again.
We welcome officials from Innovation, Science and Economic Development Canada: Patrick Blanar, Director, Copyright and Trademark Policy Directorate; and Luc Laforest, Senior Policy Analyst, Copyright and Trademark Policy Directorate.
Mr. Blanar, I think you are going to be making the opening remarks, so please go ahead.
Patrick Blanar, Director, Copyright and Trademark Policy Directorate, Innovation, Science and Economic Development Canada: Madam Chair, Mr. Deputy Chair and members of the committee, as we discussed yesterday, the main purpose of the Copyright Act is to encourage innovation and creativity for the benefit of all society. As mentioned, the technological protection measure, or TPM, regime has been part of the Copyright Act since 2012 to help facilitate new business models and encourage the distribution of digital works.
[Translation]
Unlike repair, the technological protection measures, or TPM, regime already contains an exception for interoperability. The scope of this TPM exception applies to making two computer programs interoperable. However, with the growing number of software products that include TPMs, such as agricultural equipment, achieving interoperability may require more than making two computer programs interoperable.
[English]
Bill C-294 would amend the Copyright Act to expand the existing exception permitting the circumvention of TPMs to achieve interoperability.
Bill C-294 would provide certainty to Canadians that the copyright framework allows the circumvention of TPMs to make a computer program, or a device in which it is embedded, interoperable with another computer program, device or component. Bill C-294 would also clarify that the exception would apply to third parties helping product owners with achieving interoperability as long as the computer program was lawfully obtained. Facilitating interoperability would help Canadian farmers and short-line manufacturers to develop and install tractor add-ons adapted to specific agricultural activities.
Thank you, and I would be pleased to answer any questions.
The Chair: We appreciate that. Thank you very much, and we will start, as we always do, with our deputy chair, Senator Loffreda.
Senator Loffreda: Thank you for being here once again today. You did mention encouraging innovation and productivity, which are crucial to Canada’s economy. How does Bill C-294 support innovation and competition in industries dependent on interoperable products and technology? Maybe you can elaborate on that.
In what ways will this bill promote collaboration between the different sectors and encourage technological advancements? Innovation, as you mentioned, is key as well as productivity and competition.
Mr. Blanar: Thank you very much for your question. It’s an important question.
Again, going back to the purpose of the Copyright Act and the TPM regime, it was designed to enable new business models relating to digital works. We have seen, over the years, it is used to protect different business models that are not necessarily related to the creative sector. I think the one example that comes to many people’s minds is printers and printer cartridges. Oftentimes, the business model is now to sell you a cheap printer and really expensive printer cartridges. They can do that because only their printer cartridges, through the use of software and now through the use of TPMs to protect that software, allow for communication to occur between those two devices.
This will allow more competition in that market and in many other markets such as that.
In terms of innovation, clearly, we’ve heard from Honey Bee Manufacturing — which I know Mr. Patzer has talked about — that they are building equipment that is specifically designed to address specific Canadian realities in the farming industry, so that enables innovation to flourish, and it doesn’t rely on potentially a large multinational that is creating the base of the tractor and the combine. It doesn’t rely on them to have that local knowledge in order to customize it. Then, potentially, that local knowledge can be exported and can apply in other areas.
It really does allow for that level of competition and innovation to take place at the local level, which I think is just incredibly important.
Senator Loffreda: Thank you.
Senator Marshall: My question is more general. We have this bill — yesterday, you were here on another bill — and it seems as if there are a lot of amendments going through piecemeal. For example, on the Financial Administration Act — I know you’re not responsible for that one — or the Competition Act, we’re getting all these amendments in piecemeal, and the appearance is that our legislation is not keeping up with the times.
If we have two amendments to amend a piece of legislation, I wonder where the department is. Why doesn’t the department come forward with some amendments that would modernize the legislation so that it would come as a comprehensive package rather than us seeing individual private members’ bills coming in bits and pieces? I’m wondering if they come together properly.
Can you speak to that? Why is the legislation not kept to a modern level? Why are the Americans and the Australians so far ahead of us? I just don’t understand that.
Mr. Blanar: First, I don’t know that the Americans and the Australians are that far ahead of us, especially to —
Senator Marshall: They are ahead of us.
Mr. Blanar: I think the Americans are ahead of us right now because they have a triennial review of their TPM regime, and they have been doing it every three years, which has been enabling certain exceptions to be put into practice. Those exceptions also get reviewed every three years, so it doesn’t necessarily provide the same long-term stability because if factors change, then they can be rolled back.
I know the Australians have a right to repair, and it’s all very interrelated.
Senator Marshall: Why is your department not coming forward and trying to modernize the legislation? Why are we getting the modernization in bits and pieces as private members’ bills? That’s my question.
Mr. Blanar: As part of my minister’s mandate commitment, the right to repair was one of the elements. The private members’ bills were tabled, and, honestly, part of the logjam that we had is we can’t introduce amendments to sections that are already being amended and that are currently before the House, because that can create a certain degree of chaos.
We were waiting for these two bills to resolve themselves. We are already planning on looking at these bills, looking at them once we have certainty over where the Copyright Act is, to do an evaluation of whether there are other things that need to be done in the Copyright Act in order to facilitate repair and interoperability.
Senator Marshall: I would be very receptive to studying any amendments put forward to the bill that come from the department, so I look forward to that time. Thank you.
The Chair: I think this discussion is for another day, but we keep hearing threads of it through these two discussions in the last two days, which is that we have a lot of innovation and creativity here, but it disperses or doesn’t grow large enough, or it’s sold to an American. We keep having this same problem, and we are trying to find mechanisms and ways to stay ahead of the game and support those who are innovators. Senator Marshall is reflecting testimony we have heard for the last two years on this issue.
Senator C. Deacon: I’m going to try to build on Senator Marshall’s insightful comments.
Professor Alissa Centivany at Western University has been a great researcher in this space in Canada, and we should be very proud of her work.
She’s of the opinion that this legislation doesn’t go far enough. Rather than allowing for interoperability, forcing interoperability — and I think we saw that in the EU last year or two years ago when USB-C became the forced standard for charging and connecting devices so that everybody doesn’t have 15 different power cords to every single device that they have, and they don’t work. It’s just about the simplicity in people’s lives and the ability to allow this in our world where the internet of things, industrially or commercially, for consumers is just not slowing.
What are your thoughts there, especially in light of what Senator Marshall just said? Why are we not going further? Why are we not following the lead we’ve seen in the EU and other places, where we are saying, “No, you must demonstrate interoperability in the markets that you operate”?
We can do that through standards. We can do it through any number of means. It’s why planes stay in the sky, for the most part, and cars are safe. It’s standards.
Mr. Blanar: That’s a big question that goes way beyond copyright, but I personally agree that these are all good things. Ultimately, the sale of products is more of a provincial matter than it is a federal matter.
At the end of the day, what this is doing is ensuring that the Copyright Act doesn’t act as a barrier to all of these things. We are strong believers that is what this bill is doing, and we want to ensure that when the legislator, whether it be at the federal or provincial level, decides that they are ready to do this — and if new standards arise — the Copyright Act doesn’t stand in the way of these things.
It’s also one thing to say that you have a new standard, and the standard is the USB-C plug, as you said, and it’s great that it could be used for power, but without these changes — well, they already exist, but what these changes do are they potentially expand the ability of interoperability so that, yes, maybe the standard is all devices will be powered through a USB, but isn’t it also nice to ensure that if somebody wants to create a new form of power adapter that may also provide network capabilities at the same time via a USB, then it’s not a proprietary device. At that point, the end device is able to leverage and reverse-engineer the software so that it can benefit from that. I think that’s what this bill does.
Senator C. Deacon: It’s an important first step.
Mr. Blanar: Absolutely.
Senator C. Deacon: Thank you.
The Chair: As a quick follow-up, we heard from MP Patzer that he learned from consultations with his own provincial government that they kind of wait for Ottawa to do it. They don’t want to keep doing this and then have it challenged or not match and all the rest of it. It’s a little bit in response to what Senator Marshall was saying. Is it not incumbent on you folks to take the lead?
Mr. Blanar: On repair and interoperability, the lead can start anywhere. We all need to work together. It really is a collaborative effort to ensure that the public has access to the devices they want and that we enable companies to ensure that products are able to speak to each other. We don’t want to lock consumers into one given ecosystem so that they cannot repair their devices. At the end of the day, the Copyright Act should not be the tool used to prevent that.
The Chair: Yes, I think you are right on that one.
Senator Yussuff: Mr. Blanar, thank you again for being here a second day. You may get tired of us, or we may get tired of you; I don’t know which.
Coming back to these two bills — yesterday’s bill and today’s bill — if they should make it through the chamber and become law, what is the department’s game plan in promoting the changes so that Canadians are aware they now have this legal right to repair devices, which is a right that was not so readily available to them before? Knowledge is really important, as well as seeking support from all the small businesses that will be trying to tackle the opportunities that come with the passage of this legislation. Does the department have any game plan to promote this, other than simply adopting the law and hoping that people figure it out or learn about it in some manner?
Mr. Blanar: I know the government has recently completed a second set of consultations on the right to repair. Another section of the department is leading that. They are tackling it from a broader perspective than copyright. We actually had a consultation in 2021 on the copyright angles to repair and interoperability. Coming out of those consultations, there might be some learning and some new initiatives.
Our branch has a program to help sponsor, basically, intellectual property legal clinics. We are trying to get the word out about intellectual property in general and the changes. We will continue to work on that side of it. Again, repair and interoperability are much broader issues than the copyright angle. We will obviously make it known to practitioners in the field of copyright and in the field of intellectual property that these changes are taking place. We’re hoping that will go a long way toward disseminating the knowledge to those who need to know this.
Senator Yussuff: As you know, advocacy for this has existed for a long time. Consumer organizations have been saying this is long overdue from two angles: obviously on the sustainability angle but also on the opposite side when it can be cheaper to fix something than to replace it at the end of the day.
Is the department considering collaborating with some of those organizations or redoing some of this work and advocating for it? Of course, we would like to see much more knowledge reach out to Canadians so that they can at least be aware of how to deal with things. Most often, when a product doesn’t work, we take it to the dump, and we replace it with whatever the next model might be.
Mr. Blanar: On the right to repair consultation that was just completed, the department was working with Environment and Climate Change Canada. This is definitely not something being done in isolation from the rest of government. Absolutely, this initiative is across government, and I know it will be treated in the same way when it comes to the public rollout of any outcomes.
Senator Yussuff: I have a quick story. I bought a kettle, and it stopped working. I could see there was a problem with the lid. I called the manufacturer and said, “The kettle is perfect. There’s nothing wrong with it, but the lid needs a spring. Can I purchase the spring?” They said, no, I couldn’t purchase the spring. I had to get rid of the kettle because the lid didn’t open anymore. The spring was broken.
My point is that Canadians go through the same frustrations day in and day out. I went on the internet looking for a supplemental way to buy the spring. Nowhere could I find a spring to fix the lid. Unfortunately, this is reality. What happened? The kettle ended up in the garbage although there was nothing wrong with it. I’m the mechanic in the house, but my point is that this is a common problem in every household across this country.
These two bills are long overdue. They will do tremendous good for the country if there are broader opportunities to fix things, rather than just getting rid of them.
Senator Varone: I’m in favour of the bill, but this is what I struggle with: Copyright allows inventors to be compensated for their inventions. Interoperability diminishes the return for copyright holders. We have the inverse here. When you look at the drug industry, the brand name drugs have a time frame for when they can exploit the drug before the generics get to cash in.
Before interoperability becomes reality, has there been any thought of a time frame to allow the copyright holder to recoup his or her investment? This is about creativity, but if you shortchange the inventors, are you cutting off your nose to spite your face?
Mr. Blanar: First, when it comes to rewarding inventions, that is the purview of patent law, not copyright law. The inventor of a new patentable invention will not be impacted by anything that we are doing here.
Senator Varone: Excellent. Okay.
Mr. Blanar: With respect to interoperability, we believe it will, in fact, help the ecosystem overall because it will allow more people to tinker around the edges of the invention and potentially improve it and create add-ons or ways to actually expand a product’s usefulness. This is actually a principle of patent law as well, where you can build upon what came before.
At the end of the day, one of the important caveats of this exemption — and I know that MP Patzer touched on this — is the non-application provision. If the TPM is circumvented, and if it turns out that it was not done for the purpose of interoperability or repair but for an otherwise infringing purpose, then the exception doesn’t apply in the first place. It doesn’t become a defence to infringement. It also protects inventors, creators and software makers in that way.
Senator Varone: Thank you.
Senator Loffreda: I would like to continue on Senator Varone’s question and my earlier question, and you mentioned building upon what came before.
Do we have sufficient measures in place to prevent potential abuse of copyright exceptions? If so, what measures are in place, particularly in cases where interoperability might infringe on intellectual property? Is that a concern?
Mr. Blanar: That’s a great question. It’s absolutely a concern, and, again, that is why we have a non-application provision in both Bill C-244 and Bill C-294. So the minute that the circumvention is used for an infringing purpose, then the exception doesn’t apply in the first place. It doesn’t become a defence and create a free-for-all, allowing somebody to claim that they are doing this for the purpose of interoperability and then they opened up the digital lock, allowing a free-for-all.
The example I like to use is that of a real lock. It’s like saying, “I can pick the lock if I own the apartment behind it. I can authorize someone to do it for me.” But let’s say I’m renting that apartment out. If I do that for the purpose of stealing something from the person who lives there, then even though I am the owner of the apartment, the picking of the lock in the first place becomes illegal.
Senator Loffreda: Thank you.
Senator C. Deacon: Thank you for being with us, and thanks for your clear answers. We have been studying these two bills in concert because there is a strong relationship and correlation between the two of them. From your standpoint, that has not been a problem, has it? I want to confirm that you feel comfortable that the way we’re studying this makes sense and that moving these bills at the same time will bring about the clarity that may be needed in the Copyright Act at this time.
Mr. Blanar: These two bills complement each other very well. We often say that while Bill C-294 is not the right to repair, it goes to the same spirit. It goes to the idea that if we’re trying to preserve the use of products, and we’re trying to avoid them ending up in a landfill, these are the kinds of things that will help, whether it’s the repair of the product or the continued use and enhancements to products.
Senator C. Deacon: I like the way you said that. They are doing different things, but the spirit is the same. It really is about reducing costs to consumers, reducing waste and increasing productivity.
Mr. Blanar: Absolutely.
Senator C. Deacon: Thank you very much.
The Chair: Thank you all very much. This has been a very efficient look at these two pieces of legislation. I appreciate the work of Mr. Blanar. Thank you very much to Mr. Blanar, and thanks to his colleague Mr. Laforest, both from the Copyright and Trademark Policy Directorate. You can take tomorrow off. We won’t be questioning you anymore. We appreciate your contributions.
(The committee continued in camera.)