Open Markets - FTC Releases Report on Right to Repair – It’s an Excellent Start
Daniel Hanley walks us through the FTC’s May 5, 2021 report to Congress on the Right to Repair.
The FTC released on May 5 its long-awaited report to Congress on repair restrictions. The report is a critical step to ensure that people are provided the right to repair — the means and ability to repair their goods. The report heavily relied on the research, testimony, and advocacy on the right to repair by the Open Markets Institute and allies including U.S. PIRG, iFixit, and the Repair Association.
The report details how restricted repair practices can harm consumers (particularly those in poor communities and communities of color) by raising repair costs and by decreasing product lifespan. The FTC also strongly noted the damaging effects such practices can have on the environment. The commission wrote that “extending the life of consumer products unquestionably delays these products’ entry into the waste stream and reduces the amount of energy used to generate replacement products.”
The FTC’s report also highlights the numerous techniques and tactics that dominant manufacturers use to restrict, inhibit, or outright prevent consumers from fixing their products. Specific techniques include using various software locks, restrictive consumer contracts, exclusive distributor contracts, and limiting the supply of parts and repair manuals. In several instances, the commission stated that many of the justifications for these restrictive practices were pretextual or unjustified in explicit terms. “The record contains scant rebuttal from manufacturers to the argument that a more open repair ecosystem would allow consumers to have their goods repaired more quickly or repair them in a timely manner themselves.”
Importantly, the FTC details how the agency can use its rule-making authority under the Magnuson-Moss Warranty Act and Section 5 of the FTC Act to prohibit unfair and restrictive repair practices. The commission also spent several pages explaining how antitrust law is a tool at its disposal to create a more open repair environment for consumers. This section especially appears to draw from Open Markets’ submissions.
But the commission fell short of a complete analysis of the intersection between monopolization and restrictions on repair. The report did not, for instance, detail how restricted repair practices can be a direct indication and expression of monopoly power. The FTC should have explained the connection between restricted repair practices and monopoly power and explained how inhibiting these practices can create a fairer market in line with the overall purpose of the antitrust laws.
As the Open Markets Institute has delineated, the FTC has exceptionally broad powers to enforce the antitrust laws and promulgate rules to stop dominant firms from relying upon restrictive repair practices that maintain their control in the market, harm the environment, and increase costs to consumers. The commission should vigorously use its vast arsenal of regulatory tools to create a more open and deconcentrated repair environment.
For more on consumers’ right to repair, be sure to check out some of the Open Markets’ groundbreaking publications on the issue:
Daniel A. Hanley, The First Thing a Biden FTC Should Tackle: We Need the Right to Repair Our Products, Slate (November 18, 2020).
Claire Kelloway & Daniel A. Hanley, How Enforcing Antitrust Rules Can Help Our E-waste Crisis, The Hill (May 14, 2020).
Daniel A. Hanley & Claire Kelloway, Coronavirus Reveals Consequences of Restricted Repair, The American Prospect (May 12, 2020).
Daniel A. Hanley, Claire Kelloway, & Sandeep Vaheesan, Fixing America: Breaking Manufacturers’ Aftermarket Monopoly and Restoring Consumers’ Right to Repair, Open Markets Institute (April 2020).
Sandeep Vaheesan, Unleash the Existing Anti-Monopoly Arsenal, The American Prospect (September 24, 2019).
Claire Kelloway, At FTC Workshop, Advocates and Business Owners Say Manufacturers Monopolize Repair, Food & Power (August 1, 2019).