WASHINGTON – U.S. Senators Amy Klobuchar (D-MN) and Mike Lee (R-UT), Chair and Ranking Member of the Senate Judiciary Subcommittee on Antitrust, Competition Policy and Consumer Rights, sent a letter to Federal Trade Commission (FTC) Chair Lina Khan, requesting an update on the agency’s efforts to address anticompetitive and illegal restrictions on repairing electronic equipment.
“We write regarding the Federal Trade Commission’s (FTC) efforts to stop unlawful restrictions on product repairs,” the lawmakers wrote. “These restrictions can increase repair and replacement costs for owners of products ranging from smartphones to farm equipment, prevent consumers and businesses from repairing equipment they own, impact consumers’ rights under existing law, limit opportunities for small and independent repair businesses, and create unnecessary harmful electronic waste.”
The lawmakers explained “A variety of institutions, such as public schools, hospitals, public safety agencies, libraries, and state and local governments all rely on repaired and refurbished electronic equipment. In recent years, many consumer products have become more difficult to repair and maintain, often requiring proprietary repair tools; parts that are difficult to find; or access to diagnostic software, product guides, and repair manuals.”
In December 2022, Klobuchar’s bipartisan Merger Filing Fee Modernization Act was enacted by Congress to update the funding formula for premerger filing fees as part of the year-end government funding package. The legislation updated the merger filing fees for the first time since 2001 - lowering fees on smaller acquisitions and increasing them for the largest mergers - raising additional revenue that Congress intended to be used to strengthen enforcement of the antitrust laws.
The full text of the letter is available HERE and below:
Dear Chair Khan:
We write regarding the Federal Trade Commission’s (FTC) efforts to stop unlawful restrictions on product repairs. These restrictions can increase repair and replacement costs for owners of products ranging from smartphones to farm equipment, prevent consumers and businesses from repairing equipment they own, impact consumers’ rights under existing law, limit opportunities for small and independent repair businesses, and create unnecessary harmful electronic waste.
A variety of institutions, such as public schools, hospitals, public safety agencies, libraries, and state and local governments all rely on repaired and refurbished electronic equipment. In recent years, many consumer products have become more difficult to repair and maintain, often requiring proprietary repair tools; parts that are difficult to find; or access to diagnostic software, product guides, and repair manuals.
As you know, Congress passed the Magnuson-Moss Warranty Act in 1975, which includes an anti-tying provision that prohibits conditioning a warranty on the use of a specific brand’s replacement parts or service providers. The law ensures that consumers cannot void a product’s warranty by fixing the product themselves, using third-party replacement parts, or using an independent repair shop to fix and maintain their product. Unlawful repair restrictions, such as tying arrangements, refusals to deal, exclusive dealing may also violate the antitrust laws. We appreciate the FTC’s work with many state legislators and other federal agencies on raising awareness and highlighting the importance of “right to repair” for consumers.
In 2019, the FTC called for public comment on repair restrictions, and in 2021 the FTC issued its report to Congress, Nixing the Fix, examining antitrust and consumer protection issues related to repair restrictions. That same year, the President’s Executive Order on Promoting Competition in the American Economy encouraged the FTC to take action against repair restrictions, and the FTC unanimously issued a Policy Statement on Repair Restrictions Imposed by Manufacturers and Sellers, explaining it would devote more enforcement resources to combat unlawful repair restrictions.
As Chair and Ranking Member of the Subcommittee on Competition Policy, Antitrust, and Consumer Rights, we ask that you provide the following information to help Congress understand what steps the FTC is taking to enforce existing laws against unlawful and anticompetitive repair restrictions, and what additional tools or authorities the agency may need to effectively carry out that mission.
- In 2022, the FTC took action against Harley-Davidson, Westinghouse, and Weber for illegally restricting customers’ right to repair. How have these actions, and others, such as the FTC’s 2021 Policy Statement, eased or eliminated repair restrictions for consumers?
- What other actions has the FTC taken to stop or deter product manufacturers and sellers from voiding or limiting their product warranties, or threatening to do so, when owners repair products themselves or use an independent repair shop?
- Has the FTC taken action to determine whether product manufacturers and sellers make replacement parts, repair tools, software, and manuals and schematics available to consumers and independent repair shops?
- What actions has the FTC taken to stop product manufacturers or sellers from blocking, degrading product performance, or discouraging consumers and independent repair shops from using third-party replacement parts in repairs?
- What additional tools or authorities does the FTC need from Congress to effectively police illegal and anticompetitive repair restrictions?
Thank you very much for your efforts to protect consumers and small businesses in repair markets and to eliminate unlawful and anticompetitive repair restrictions.
###
