Pub. 20 2021-2022 Issue 2

N E W J E R S E Y C O A L I T I O N O F A U T O M O T I V E R E T A I L E R S I S S U E 2 | 2 0 2 1 28 new jersey auto retailer To some degree, the nationwide Motor Vehicle Right to Repair discussions had been quieted years ago by the historic January 15, 2014, Memorandum of Understanding (MOU) between representatives of automotive manufacturers and representatives of independent repair shops – the first agreement of its kind. The MOU provided a uniform remedy for the sale of automotive manufacturers’ diagnostic and repair information to independent repair shops. And it finalized an agreement that applied nationwide. The Federal Trade Commission (FTC) recently issued a report providing its analysis on the status of repair restrictions throughout various industries. Its May 2021 report “ Nixing the Fix: An FTC Report to Congress on Repair Restrictions ” (Report) responds to Congress’ 2020 directive for a report on anticompetitive practices related to repair markets nationwide. The FTC report covers a variety of industries, including automotive. The FTC analyzes responses to consumer protection efforts, repair restrictions on products and consumers’ preference for choices when repairing their products. With respect to the automotive industry, it is complimentary. It favorably acknowledges the automotive manufacturing companies’ lead in developing the MOU. It states: “ no industry sector, other than the automotive industry, has worked to open repair markets through a self-regulatory framework. ” However, by issuing the Report, the FTC may have taken the subtle opportunity to reopen the discussion. It invites a reconsideration of the MOU, noting that “ any self-regulating agreement would also need to be f lexible enough to change or grow as the industry and products covered by that agreement change. ” The FTC calls the MOU a “ sufficiently comprehensive agreement. ” However, the FTC also notes that the MOU does not extend to the sale of telematics ( vehicle computer systems that collect real-time information concerning a vehicle’s performance and maintenance ). In so doing, it invites a reconsideration of the 2014 MOU. Two months after the FTC’s report, on July 9, 2021, President Biden issued an “Executive Order on Promoting Competition in the American Economy” that directs agencies to further policies that seek to address practices that inhibit competition, including restrictions on third-party repair or self-repair of items. The same day, the Motor and Equipment Manufacturers Association (MEMA) and the Automotive Aftermarket Suppliers Association (AASA) issued a press release applauding the President’s Executive Order. The FTC hosted a Commission meeting on July 21 to discuss the implications of the Executive Order. The impetus for the development of the 2014 MOU began in Massachusetts. Its 2013 Legislature and electorate were, to varying degrees, proposing mandatory access requirements to sell diagnostic and repair data to independent repair shops. When the automotive manufacturers crafted the MOU as a self-regulating mechanism instead, the effort helped address the existing concern. The MOU was an agreement among the Alliance of Automotive Manufacturers, the Association of Global Automakers, and independent garages and retailers. It made Massachusetts’ law a national standard. It extended nationwide the provisions for all light vehicles in the Massachusetts law and impacted all companies and organizations that were Motor Vehicle Right To Repair Is Not A One-State Solution BY MAGDALENA PADILLA