- Member of Parliament
- Member of Parliament
- Conservative
- Cypress Hills—Grasslands
- Saskatchewan
- Voting Attendance: 67%
- Expenses Last Quarter: $112,746.42
- Government Page
Madam Speaker, it is fantastic to be able to rise once again on behalf of the great people of the province of Saskatchewan, particularly the people in the southwest corner, whom I have the privilege of representing.
Right off the top, I want to just talk about the month of May, which is MS Awareness Month. One of the big asks of the MS community, in particular by MS Canada, is to have the government fund $15 million towards research on the disease, as well as the prevention and repair side of things, for people who suffer with MS.
Normally, I do not get up to ask the government to spend more money, because we know the Liberals are fantastic at spending boatloads of money and accomplishing nothing with it. However, in this particular case, we know that there is over $3.4 billion in costs to the government and in lost wages by people who suffer from MS. A $15-million investment would actually result in a tremendous amount of savings for the government for the taxpayer. It would also result in a higher quality of life for people who suffer from MS.
I just wanted to start off my budget speech by mentioning that. If the Liberals were truly listening to what Canadians want and would like to see, this is something that they could have included in this budget to make sure that they are actually working to better the lives of people in Canada. Canada has the highest rates of people who suffer from MS in the world, with my wife being one of those people as well.
I could not help but notice in the budget that there is a very small amount listed for agriculture. In fact, I believe that agriculture is first mentioned on page 131 of the budget, and it continues for the next page and a half.
One of the issues in the budget concerns the livestock tax deferral. I just want to talk about that briefly, because a lot of ranchers in my riding have been dealing with droughtlike conditions for the last number of years, which is nothing new. We live in southwest Saskatchewan, a part of the country where rain has never been a feature. It is not something that we regularly get, so it is not new for us to have droughtlike conditions.
There is a government program called the livestock tax deferral. What happens is that the local RM has to declare a state of disaster. Then the government takes a look at the rainfall and the forage percentage over the year to see if it has fallen below 50%, I believe. There is quite a process involved in implementing or triggering the livestock tax deferral. Clarification around that would go a long way to help producers to have more certainty in their industry. An issue too, though, is that the livestock tax deferral can only be used for one year. We know that, in Saskatchewan, it sometimes takes more than one year for one's pasture to regenerate. A lot of producers and organizations, such as the Canadian Cattle Association and the Saskatchewan cattle association, are saying that allowing the livestock tax deferral to be used over a period of three years would actually be a lot more beneficial. It would allow for better environmental protection and for pastures to be able to regenerate.
My riding name is Cypress Hills—Grasslands. The “grasslands” part of the name comes from the fact that we have some of the largest amounts of still untouched native prairie grass in my part of the country. It has not been broken up. It has been grazed for years. Buffalo used to be the keystone species there; they have since been reintroduced to the grasslands. Cattle have done a tremendous job of being the keystone species in the grasslands.
For ranchers who have native prairie grass on their ranch, in their rotation, it is of huge value to them to be able to preserve that grass. When ranchers sell their herd, they will get the one-year livestock tax deferral. If they are forced to rebuy and to spend more on cattle to get them back on the land, there will be a degradation of that land. Having a three-year window would actually allow for the pasture to properly regenerate. Even if there is only a small amount of rainfall, that three-year time window would allow for better regeneration of the pasture. The environment would be taken care of in a way that would allow producers to purchase cattle, regraze the land once again and keep that keystone species on the land as well.
That is something that would happen with the livestock tax deferral. If the government were truly listening to the producer groups it mentions in the budget, then that is something it would actually be talking about and looking to implement. After nine years, it definitely has not done that.
One of the other parts about it, which actually took up about a page of the page and a half in that, is the government's commitment to starting consultations, once again, on interoperability. It is really funny that this is in there. I had the privilege to sponsor Bill C-294, which is an act to amend the Copyright Act for interoperability. There are many fantastic short-line manufacturers in Saskatchewan, and quite frankly all across this country, that make great agricultural products. They also make products for other industries, but I am going to focus on the agricultural side of it.
It is funny that this section is included in the “Affordable Groceries” section of the budget. The government is finally realizing that when agriculture is treated with respect and producers are allowed to grow food in the most economical way, if we let them have a choice, they will be able to grow food in a more efficient manner, which, in the long run, is going to have a positive impact on the price of groceries and hopefully lead to groceries being more affordable.
However, Bill C-294 was tabled over two years ago and still has not received royal assent. It did pass this House about a year ago now, and nothing has been done with it so far. In the 2023 budget, the government said it was going to start consultations then. It still has not done it. In 2024, it is once again committing to starting consultations, in June. It has a specific time frame in which it wants to start consultations, but given its previous track record of not doing it, we will wait and see what actually happens.
What would be even better is if Bill C-294 were able to get royal assent. My bill passed the House of Commons unanimously. When it went through committee stage, we were able to accept a friendly government amendment to the bill, which put it a bit more in line with some of the government's priorities but with the law as well. This is important because we want as much certainty as we can possibly get, even though we had done some legal work in the buildup to the bill. We accepted that friendly amendment. This is a bill that is non-controversial, but it is something that would get things done. It would have a whole-of-economy effect and impact.
If the government wants to go through consultations, I am going to make it even simpler. What the government can do is go back and read the report that was done by the government branch that used to be called Western Economic Diversification, which is now PrairiesCan. The government can go back and read the report, which was released in 2020, on this very issue. What it will find in that report is the economic impact that agricultural manufacturing has across the entire country. This is not just a southern Saskatchewan issue; this is a whole-of-Canada issue.
The government can read that report. It can see the dollar value assigned to it. It can see how every single province benefits from it. It is a nation-building exercise. It does not even have to do the consultations; that has already been done. The government department already did the report. The government can read it. The consultations are done.
We are counting on the Senate passing and giving royal assent to Bill C-294 as quickly as possible.
If the government wants to impact the price of groceries, what it could also do is have this House pass Bill C-234 in its original form. It came back from the Senate with a huge amendment that gutted the original intent of the bill, which was to put an exemption in place for all on-farm buildings for all types of fuel, which is important when we consider greenhouses, dairy barns, chicken barns and pig barns. There is a huge level of cost that goes into running those facilities with the carbon tax, so passing Bill C-234 in its original form would have a huge impact on the Canadian economy. It would have a huge impact on the price of food.
Removing the carbon tax in its entirety would be beneficial as well, when we look at the transportation costs and the costs to the grocery stores. It is a huge detriment, so scrapping the carbon tax altogether would also be of huge benefit, and I do not see any of that in the budget either.
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Mr. Speaker, it is an honour to once again be able to rise and speak to my private member's bill, Bill C-294.
This bill comes from constituents in my riding who work at Honey Bee Manufacturing and brought the issue forward to me. It was an issue that came up when we were discussing the CUSMA negotiations. Although it predates CUSMA, it was flagged at that point in time, in the same breath. That was when it was first brought to my attention, and I was able to bring the issue to the House of Commons—
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moved that the bill be read the third time and passed.
He said: Madam Speaker, it is an honour to once again be able to rise in this place and speak to my private member's bill, Bill C-294. This time, it has reached a new stage, at third reading, in the House of Commons. It is also important to acknowledge many of our fellow Canadians who are listening and who have been following this bill's progress for a while now. They are watching and waiting for the necessary change that it would bring.
So far, the process of reviewing Bill C-294 has been moving along at a steady pace. It might not happen very often, but when we voted on it, this bill passed through the House of Commons at second reading with unanimous support. That was an encouraging thing to see and I remain hopeful that it can happen once again as we go through third reading and debate in the House again. Now that the committee has finished its study and the bill passed through the committee unanimously as well, I am eager to, hopefully, vote and pass this as quickly as we possibly can. There are many communities in my riding of Cypress Hills—Grasslands, in my province of Saskatchewan and all throughout this country who are counting on this bill's passing. The sooner we can help them, the better. That is what got this whole thing started in the first place.
In my first speech with respect to Bill C-294, I told the story of Honey Bee Manufacturing, which is based in my riding, because its owners are the ones who brought this issue of interoperability to my attention. It is one success story among many for small businesses in Canada and it should be allowed to continue doing what it does best. However, it is the company's larger impact on the survival of local communities in the surrounding area that really brings it home for me, so when we had witnesses appear for the committee study, it felt like I had some déjà vu, because some people from Honey Bee came all the way out to Ottawa just to be part of the panel. About three years earlier, they had done the exact same thing when I was a member of the industry committee and we were studying the CUSMA deal. That is when they started to raise the issue of interoperability under the Canadian Copyright Act.
The same effort to make sure that Canadian innovators and communities can thrive has been going strong ever since. Once again, during their most recent appearance, they were the best advocates for the issue because of their unique position on the front lines as the people who are the boots on the ground working on these issues each and every day. I am going to quote from a large portion of their statement to the committee, because they can speak to their own situation better than anyone else can. I quote:
We are a global company, from the people we work with to the 29 countries we export to. Honey Bee sells 50% of its product in North America and exports the remainder to the rest of the world. However, our industry is still placed on an uneven playing field versus our U.S. counterparts. Foreign platforms seek to prevent participation by Canadian brands.
Honey Bee's opportunity to capitalize on intellectual property is based on our ability to interoperate with OEM equipment platforms. Interoperability means that a Honey Bee harvest header can “plug and play” with OEM equipment. Historically, this has been provided in a straightforward and obvious way, like the way a keyboard plugs into a computer.
Today, Canadian industry is technically blocked by some dominant international brands, with the impact being a loss of substantial market participation opportunity. The net result is “authorized use only”. This is controlled by OEM digital locks and keys that are unavailable to manufacturers of implement. Instead of spending our research budget on innovation, we are burning it on adaptation.
It is important to state that in no way should Canadian manufacturers, dealers and—most importantly—farmer customers be at a disadvantage on choice. Historically, we had an integrated farm equipment market in North America and abroad. Honey Bee innovation caters to the specific needs of many markets and considers their unique environments, practices and crops. Meeting these challenges brings Canadian innovation to the world. The impact of technical lockout by OEMs will be the collapse of our Canadian implement manufacturing industry, which will decimate many of our smaller communities.
Throughout the different stages of Bill C-294, I have talked a lot about Honey Bee specifically. It is a good example of short-line manufacturing in particular, but it is always important to emphasize that the issue of interoperability is something much larger and more significant than a single business or any one single type of product. In their presentation, the people from Honey Bee made a point of passing on support for the Agricultural Manufacturers of Canada and the North American Equipment Dealers Association, whose representatives were unable to attend the proceedings on that particular day. They mentioned that those two industry associations represent 240 members and 4,000 members, respectively.
In addition, the committee heard directly from other witnesses who were present. Along with members of the Canada West Foundation, there were various stakeholders and experts who specialize in copyright or related areas of public policy. Overall, it is fair to say that the testimony provided to the committee was overwhelmingly supportive of Bill C-294 and what it is aiming to do.
For the benefit of my colleagues who were not at the committee meetings but are participating in this debate tonight, I will try to quickly provide some highlights from the study. One of the witnesses, Anthony Rosborough, is a lawyer with relevant expertise. He explained part of the issue this way:
In the world of embedded computer systems and the Internet of things, interoperability is synonymous with innovation.
Bill C-294 reflects this reality, and it reflects the needs of Canadian innovators by not allowing manufacturers to prevent competition in secondary markets under the auspices of copyright.
In another part of his opening statement, he added:
This bill takes the right approach by broadening the application of the interoperability exception to include not only computer programs but also devices in which they are embedded. This is crucial, because the distinction between the computer program and the computing hardware is much less clear than it once was. In the past, it may have been easier to distinguish between hardware and software, but when software now controls the physical functioning of devices and components, the software and hardware blend together. As I wrote in my 2021 article, the Copyright Act’s conceptualization of interoperability needs to reflect today's computing and innovation paradigm. Computers are no longer just boxes with screens and keyboards. They are cars, home appliances, pacemakers, agricultural equipment and learning technologies.
With the rapid pace of changing technology, it is no surprise we need to update the Copyright Act after its most recent update over 10 years ago. The focus of Bill C-294 is to update our legal enforcement of TPMs so they are not misused to stifle creativity and innovation. That was never their original intention, and we have to make sure our law is applied fairly and with common sense. Over the last decade, the use of digital locks has been spreading far beyond the simple protection of creative works.
Dr. Alissa Centivany, who works as a professor and researcher, provided more detail and context about TPMs. In her opening remarks, she said:
TPMs were originally intended to create artificial digital scarcity so that creators of creative and artistic works who feared that the burgeoning Internet would lead to unfettered infringement on their works online wouldn't lose all incentive to create. Times have changed. We can now see that TPMs overshot their original mark. Today TPMs are used to restrict a wide range of lawful non-infringing activities that bear no relationship to protected works at all. By being keyed to access rather than infringement, TPMs have been a disaster for consumers....
TPMs lock consumers and third parties out. They also lock us in to ongoing relationships with companies and service providers whether we like it or not. We live in walled gardens, platform bubbles and tech silos—disconnected, closed worlds—and we are largely stuck because restrictions on interoperability have enabled switching costs to rise to untenable levels. We lack the economic agency to leave for an alternative or substitute provider. No matter how nice the trappings might appear at times, a cage is still a cage.
On a similar point, a witness for the Public Interest Advocacy Centre added:
In order to achieve improved access to compatible goods, competing companies must be able to examine each other's software for the purpose of developing interoperable products. Currently, manufacturers use TPMs to deny competitors access to the information, preferring instead to make goods that can only be used in conjunction with other products that they manufacture in a closed loop that encourages anti-competitive lock-in.
It was good for us to hear some of the academic input in committee. It helped us to step back and hear about the issue in a way that shows how broad and far-reaching it can be. While most people do not think of interoperability very often, if they ever do at all, it is still an issue that affects us as consumers or as businesses in a competitive marketplace. This issue has so many aspects and we only have a limited amount of time for debate.
There were some points of disagreement between different witnesses, although there seemed to be almost consensus that Bill C-294 is going in the right direction and would improve an outdated version of the Copyright Act. It reaffirmed the all-party support that this bill received at second reading. We are moving forward with the same principles that the Copyright Act has always maintained.
This bill is not doing something new. It is only responding to recent changes in the marketplace that have caused innovators and consumers to lose ground they once had. All we are trying to do is get back to the right balance, which we had before. Interoperability has existed all along and was taken for granted. It is an essential part of our economy that we cannot afford to lose. Bill C-294 has a simple solution. We would have a limited exemption for interoperability with clear and meaningful language that is currently lacking.
Something else that should be discussed at this stage is the amendment that was made to the bill at committee. The original draft that I introduced had a separate section with specific language about manufacturers. With the example of Honey Bee and similar businesses out there, it is absolutely necessary for the legislation to protect what they are doing. At the same time, I have acknowledged from the start that our approach to copyright has to be compliant with our trade agreements. The additions to the bill have taken a careful look at our agreements and have expanded the scope of the bill in some ways. That is what we are trying to do by using newer language about “lawfully obtained computer programs”, instead of specifically mentioning manufacturers.
To be clear, the intent of this bill remains exactly the same as it was in the first version. We want to guarantee manufacturers the right to circumvent TPMs for the purpose of interoperability. That is non-negotiable. For my part, I agreed to accept this amendment from the government on the understanding that this would be the case. I have been assured that this is what the bill’s language would do in practice if it is, hopefully, passed.
Along with the need to use technical language that is in harmony with our trade agreements, I want to reassure my colleagues across the House once again about our relationship with our trading partners, especially the United States. For the agricultural sector, we are seeking an exemption for interoperability that is equivalent to what already exists south of the border. Their system for regulating copyright is quite different from ours in practice, but this bill is trying to accomplish the same goal, mainly for our farm equipment, but also across other parts of the economy.
We did hear some testimony at committee about the potential benefits of imitating the U.S.'s regulatory approach, and that could be a conversation worth having. That will have to be on another day. It is not the intent of this particular bill. What we wanted to deal with is what is not happening in Canada, and we need to catch up. Sometimes we have to move faster than the speed of bureaucracy, which is why we are taking this legislative approach.
As it stands, our consideration of Bill C-294 has helped to show how we might want to improve the Copyright Act in other ways, such as by having a more flexible approach that can be accomplished through regulation, but that is a much larger issue than is typical or realistic for a private member’s bill. I will leave that to the government side to figure out, and I hope the work we have all done together on Bill C-294 will help that out.
I have a lot of hope that we can move forward with this bill and see it quickly pass this House and move on to the other place, where hopefully it can receive royal assent.
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Mr. Speaker, it is an honour to rise at the end of this debate on my private member's bill, Bill C-294. I would like to thank all of my colleagues who have expressed interest in speaking to this bill, in particular the members from all of the other parties of the House and the great ideas that they spoke about on this bill. I think of the planned obsolescence issue that the Bloc Québécois raised in both of their hours of debate. I definitely appreciate what they had to say about that issue.
At the start of our discussion, I provided the background for the issue of interoperability. I spoke about what it is and how it is important for the life of communities across Canada. It will allow them to survive and to keep on doing the good work that they have been doing for decades. That is what leads me to raise this issue and bring this bill forward.
While I focused on the familiar examples of farming equipment in rural areas, I will repeat that interoperability is something much larger than just a single sector. We are really talking about something that lays a foundation for stronger competition and innovation in the workplace.
It is not anything new. Before digital technology was a factor, there were always innovators creating new equipment or devices, which customers could freely use with the products from established brands. It happened in an open market where all of the players, as well as their customers, could benefit. One such example is a simple USB connection. That is one of the easiest ways to describe interoperability. One simply plugs it into one's computer and the brand does not matter; it will work. That is what copyright is supposed to encourage and protect.
All we need to do is to update and clarify the law to uphold this principle under changing circumstances. It should never be discouraged by a technicality found in the Copyright Act. Digital locks and TPMs have a legitimate function and the law will continue to enforce them as such, but the force of law should never be used by larger companies to discourage or shut down competitors and innovators. For this sole purpose, Bill C-294 would provide a clear, limited exemption to enable interoperability.
I would like to go back to what brought attention to this issue in Parliament. A short-line manufacturer from my riding provided witness testimony while the industry committee studied the CUSMA trade agreement. Considering our trade relationship, they said this:
It's a challenge for us to achieve the ability to continue to legally manufacture our product and sell it onto these platforms. The copyright act in the United States has provision for circumventing for the purpose of interoperation. The Canadian Copyright Act does not have this same term in the agreement.
They explained that they do not want to have an uneven footing with the U.S. if they are facing a barrier in Canada that does not exist south of the border. Even if a short-line manufacturer operates outside of a small town or rural Saskatchewan, they are still selling their equipment internationally, whether it goes to the States or down to Australia. Both of these countries, by the way, are moving in this direction with interoperability. The Australian Competition and Consumer Commission has studied the situation with agricultural machinery and recommended data standards to promote interoperability between brands of machinery.
Similarly, our own Competition Bureau has discussed barriers for interoperability and has signalled some support for updating the Copyright Act. The U.S. Copyright Office, with the Library of Congress, regularly reviews the application of TPMs and provides exemptions. Their ruling, in 2018, allowed for circumvention in different areas, which included agricultural equipment, vehicles and phones, to name a few. This worked well enough for them to renew the exemptions in 2021 for another three-year term.
While the process might work differently in their system, Bill C-294 is seeking to provide an equivalent exemption here in Canada, as requested by our own industry. We have industry associations, manufacturers and dealers from many provinces, including Ontario, who see the growing need for us to do this so that they can stay in business and remain competitive.
As I said earlier, the process that led to this bill began with studying CUSMA. Our international agreements are an important factor for our policy decisions. Canada has made certain commitments with respect to intellectual property and what our own copyright laws will look like. I want to reassure my colleagues that I have kept this in mind while researching and discussing the issue with policy analysts from the Library of Parliament. It has shaped the drafting of this bill from early on.
With the support of my fellow members at this stage, I am hopeful that Bill C-294 will be studied at committee and we can continue to have a constructive discussion throughout the legislative process. As always, I am happy to talk with my colleagues further about this as we go forward.
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Madam Speaker, I think there is always the question around proprietary software. I think that will be where some of the push-back might be, but what this act clearly does is say that the exemption we are going to allow for only allows for making a product interoperate. It leaves the protection in there for the developer of proprietary software, because the usage of the act is only for that very specific purpose.
We made sure to make sure that this was focused clearly on interoperability and no further than that, because we do want that certainty there for innovators. However, in the same breath, we have to make sure that we have the ability for people to build the short line or the secondary pieces onto mainline platforms.
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Madam Speaker, the hon. member was a great chair of the committee, so I really enjoyed working with her.
What I will say is that they both, in principle, address the Copyright Act in a very similar way but in a very different way. I have a different section of the act that is being amended and there is another exemption that is being included.
The reason for it is that, down in the United States, for example, they have a very clear exemption for interoperability. Here in Canada, we do not. What this bill is trying to do is make sure that we have the same operating field that the Americans do. It is in line with our trade deal with the European Union. We are seeing moves by other countries around the world, Australia, in particular. France, as well, is leading the conversation on this issue.
This is something with which we have an opportunity to match what other people are doing, and this bill does that with the amendment to the section of the Copyright Act.
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Madam Speaker, this bill is tackling a very specific problem, which was brought forward to me by some valuable members of the manufacturing community. This is an issue that impacts all of Canada and it is something that is going to bring about more opportunities for people to innovate
As I alluded to in the title of it, this is an act to innovate. We want to see that innovation go forward. I suppose it would address the issue that the member has brought up, making better products that will last longer, so that consumers have high-quality products that do not just break down all too easily and then they are forced to buy other things or something that they may not necessarily want because what they had was working so well.
I do think that it would address that in the long run, maybe not quite as directly head-on as the member alluded to, but I do think that this is a very positive bill and it is one that I think we should all support.
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moved that Bill C-294, An Act to amend the Copyright Act (interoperability), be read the second time and referred to a committee.
He said: Madam Speaker, it is a great honour to rise in the House today and speak to my first-ever Private Member's Bill, Bill C-294, an act to amend the Copyright Act as it relates to interoperability.
It has also been unofficially called the “unlocking innovation act”. The pathway for putting together this bill began in the winter of 2019-20 as the federal government was finalizing the new NAFTA deal, which is now officially known as CUSMA. For my part, it started with working on the industry committee. We were studying the legislation which would implement the new trade deal. Some of my own constituents from back home in Cypress Hills—Grasslands appeared as witnesses to give their feedback on it. They were representing Honey Bee Manufacturing, and I will say more about them in a moment.
During the meeting, while expressing their support for having a free trade agreement in place, they pointed out a threat to their industry. This is what they laid out in their opening statement:
The challenge we face is interoperability. Recently, with technical protection measures and so on, companies have started to use digital locks and keys to prevent us from allowing our equipment to interoperate with these major OEM brands. It's a form of protectionism that allows them to own and operate the entire value chain at the exclusion of independent manufacturers.
In Canada we have 1,400 manufacturers of implements that are attached to agriculture, mining, forestry or construction equipment. Of those manufacturers, 500 are for agricultural equipment. That agricultural equipment is primarily manufactured adjacent to small communities in Canada, rural communities, where the majority of that type of manufacturing takes place. It's a challenge for us to achieve the ability to continue to legally manufacture our product and sell it onto these platforms. The copyright act in the United States has provision for circumventing for the purpose of interoperation. The Canadian Copyright Act does not have this same term in the agreement.
We would like to see that ratified prior to the signing of the trade agreement so that we're not on that uneven footing that prevents us from competing legally in the marketplace here and abroad.
That is the main problem in a nutshell, and it is the type of challenging situation that this bill would correct. The requested change did not end up happening around the timing of CUSMA, or in the time since then, but it has brought us to today as we debate this bill. Bill C-294 seeks to move ahead with a change to the Copyright Act that would help to put interoperability back in its rightful place in the Canadian marketplace.
This is the right thing to do on a number of fronts, because interoperability means support for innovation, consumer choice and protection, competitive markets, small business and job creation. Before explaining in a little more detail what it is, I am going to tell a story about why interoperability is important.
Two farmers from southwest Saskatchewan, Glen and Greg Honey, out of a desire to have a product that worked better and more efficiently on their farm, took the initiative to engineer and build a 425-horsepower tractor. They then went on to make a self-propelled swather, as well as the grain belt header that has become the standard in the marketplace for how headers are built.
As farm implements and attachments, it was easy to use them with something else, such as a tractor or a combine, which they would have already had. At that time, interoperability was generally open and achievable because of the simplified nature of the equipment. All one needed was a common hydraulic hose connection and a PTO shaft, and they would be ready to go. It did not stop there.
As local farmers around the area began to see the equipment the Honeys were using on their farm, they began to want the same kind of swather and header as well. Over the course of a decade, they eventually moved their new manufacturing outfit from their farm to the town of Frontier.
There they were able to set up in the shop in the space vacated by Flexi-Coil when they bought out Friggstad Manufacturing, another family-owned and operated farm equipment manufacturer in Frontier. Friggstad had a similar operation that had built a superior product of its own. However, it was a victim of rapid inflation and market instability in the 1980s which unfortunately put it in receivership. It was eventually bought out by the bigger competition. The sale of Friggstad Manufacturing to Flexi-Coil was devastating to the community because they moved the operation up to Saskatoon, cutting the population of the town almost in half, from over 500 people down to around 300.
However, the move into town in 1987 by the Honey brothers became a new opportunity for the community, and soon Honey Bee Manufacturing became the largest source of employment for the region. They created a future for the community once again. It really shows how crucial and how much of a difference these short-line manufacturers can make in rural communities when they are in business and are allowed to succeed. The success story of Honey Bee is not unique just to Frontier. There are hundreds of companies across the Prairies and this country that share a similar success story of innovation that was born out a need to create either a better product or a new one altogether.
Whether it is a company such as Schulte in Englefeld, Bourgault in St. Brieux or Väderstad north of Langbank, these are companies in Saskatchewan who are driving innovation in their industry. While doing it, they are making an absolutely essential contribution to the livelihoods and the social fabric of our small communities and rural area.
Sadly, Honey Bee Manufacturing's level of early success 40 years ago would likely not be possible right now. This innovative industry has long been losing ground to large companies that are pushing them out of the market. It might sound hard to believe, but our copyright law seems to be helping large companies and providing them the tools to do just that, which is actually the opposite of what the Copyright Act was originally intended to do. I will offer some support for this common sense principle from a book on Canadian copyright law by David Vaver, who published it while serving as an Oxford professor of intellectual property law and a director for the Oxford Intellectual Property Research Centre.
It reads:
patents and copyrights are supposed to encourage work to be disclosed to the public and to increase society's pool of ideas and knowledge.
Keeping a broad public domain itself encourages experimentation, innovation, and competition—and ultimately the expectation of lower prices, better service, and broader public choice.
Those are the known benefits of an open and competitive market against a monopoly. Interoperability has been a key part in that for the agriculture sector as long as anyone can remember and that is what it is still doing in other areas of our lives. At a basic level, interoperability is something that is actually quite broad.
It happens whenever different devices, machines or pieces of equipment can connect and work together. There are many examples of this, including how people use simple tools or digital technology that we simply take for granted in our daily lives. It is something that we do not usually notice, and there is a good reason for that. That is because most of the time we do not actually have a problem with interoperability and there is usually not a barrier to prevent it from happening.
However, today, I am talking about where a barrier does exist and how a simple update to the Copyright Act would get us back on track for supporting innovation and consumer choice. A new barrier comes from technological protection measures, or TPMs for short. They are a legitimate tool designed to protect intellectual property, including things like movies, music or software, and they have been enforced by Canadian copyright law for over 10 years.
The bill introducing legal recognition for TPMs into the Copyright Act had this to say in its preamble:
Whereas the Government of Canada is committed to enhancing the protection of copyright works or other subject-matter, including through the recognition of technological protection measures, in a manner that promotes culture and innovation, competition and investment in the Canadian economy;
That is exactly how they should be used in line with the principles of copyright. At that time, copyright law in different parts of the world was catching up to significant changes in technology and industry. We have reached the point again where there is a critical need to do the same thing in our own time. Technology has advanced into new areas. Everything is increasingly digital. This enables new features in our homes, our vehicles and our machinery.
However, in some ways, this has also created a catch when it comes to the Copyright Act. The digital aspect of machinery means that it is operating with software to communicate as needed with a user interface or with other devices or attachments. Copyright applies to the software contained inside these products, and this has given the original manufacturers a new mechanism to control access to the entire product after it has been purchased.
This is what is happening with digital locks. If a user of the equipment wants to attach a piece of equipment to a tractor, but it was not made by the same major brand, if we keep down the path we are on, it will be locked out and will not be used. Good luck keeping customers for innovative SMEs.
The digital lock also prevents a short-line manufacturer from reverse engineering to make their products compatible in the first place, since the OEMs own the software in the machine, as per the terms and conditions that must be accepted every single time the machine is started after purchase.
Clearly, there is movement toward a monopoly, and it is partly being done in the name of copyright. While the current version of the act explicitly mentions interoperability of two computer programs as a non-violation of TPMs, the language in place does not capture what is happening right now. As it is, there is enough ambiguity to allow for some OEMs to take advantage of it and hold it over their customers and their competitors.
There is more reason to be uneasy than having a vague fear in the face of an unknown. Back in 2017, the Nintendo v. King decision came out from the Federal Court. It is one of the first decisions to apply to Canada's TPM provisions and, since then, has been cited in several other cases.
For the larger issue of interoperability, the main point is not really about how Nintendo games were used in the particulars of this case. The case set a precedent in which a piece of physical hardware was considered copyrighted material. That is how the current law has been interpreted, and it means there is one more way to stop reverse engineering for legitimate reasons.
It is easy to see this becoming a bad trend across various industries if it were left unchecked, but right now the battle line seems to be in agriculture. There is still some time to clarify the law in line with its spirit and intent, but there are already some signs of damage.
A 2021 report released by what was then called Western Economic Diversification outlines industry data for the agriculture manufacturing sector in Canada and organizes it for us to get an idea of the economic impact. It starts out by presenting a financial picture:
Nationally this sector accounts for total revenues over $4 billion with western Canada accounting for a dominant share, 65.9 percent, of Canadian agricultural equipment manufacturing. In 2018, agricultural equipment manufacturing in Western Canada contributed an estimated $2.6 billion in revenue with total salaries and wages accounting for $488 million.
For the breakdown of employment, the report found that 87% of the businesses are micro, meaning they have 1 to 4 employees, or small, with 5 to 99 employees. Regardless of their size, they are productive in their own right. The report continues, “Based on 2018 data for small and medium sized enterprises, industry averages for revenue was $996,900 with 72 percent of establishments being profitable. Financial performance data was reported for 311 businesses with an annual revenue range of $30,000 to $5 million.”
Besides showing these numbers, the report later states:
Impacts of interoperability will be affecting the industry in 2020 as one OEM’s starts restricting access to short line manufactures equipment. A survey of implement dealers has indicated a significant drop in orders of short line manufacture combine headers for the coming year and in to the future.
From table 4, dealers of agriculture equipment have indicated a reduction in intentions to purchase headers from short line manufactures base on the past five-year average. The current sales, specifically in OEM 1 mainline dealers, could see sales numbers decreasing by as much as 60 percent this year over the five-year average. A further reduction in future sales is predicted moving forward.
Again, so many of our SMEs are independent from major brands. They tend to make their own innovative pieces of equipment that are meant to connect with others produced by different companies, which are often the bigger players. If restrictions tighten on equipment users and engineers with the expanding use of digital locks, these small competitors and innovators will die out as time goes on. Everybody will lose. What has to be understood here is the nature of a rural economy and how it all works. Rural areas have small populations that are spread further apart. They cannot afford to lose the people or the jobs they have. It is nothing less than their survival that is at stake.
Section 92 of the Copyright Act mandates that it be reviewed every five years, and we have reached that designated time for reviewing it. Both Parliament and the government have been taking steps toward updating our copyright laws, and this bill is exactly in line with what needs to be done to improve it. The work has been done and the change is ready to be made.
Bill C-294 will provide a clear, limited exemption for consumers and innovators who simply wish to enable their devices or machinery to interoperate with other equipment, as they were always able to do in the past. My conversations with other members across party lines has been encouraging, and I look forward to discussing it with more of my colleagues.
This is a simple update to make sure that our Copyright Act is fair for everyone, while also making sure that it is in line with our international commitments and our international trade agreements with other countries, while in the meanwhile making sure that we are on the same level playing field as other signatories in the CUSMA deal.
I believe that as a Parliament we can work together to see this bill gets it done.
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moved for leave to introduce Bill C-294, An Act to amend the Copyright Act (interoperability).
He said: Madam Speaker, today I am here in support of Canadian consumers as well as the countless innovators who work in our industry across the country.
Bill C-294 would provide a clear and limited exemption to consumers and product innovators who simply wish to enable their device or machinery to interoperate with other equipment, as they were once able to do. Right now, they run into a problem with doing this under the Copyright Act. Section 41 was passed back in 2012 to legally enforce technological protection measures, but 10 years later, technology has changed a lot and we see a much different landscape with the types of products available.
Many devices and machinery now include software, and that is how some companies try to block interoperability for users and small competitors alike. I have seen first-hand how this issue plays out with our farmers and manufacturers.
Interoperability is important for a lot of other industries as well. There is a special business near Frontier, Saskatchewan, called Honey Bee Manufacturing. It is a short-line manufacturer of farm equipment. I would be happy to share its success story when we discuss this bill in greater detail, but what I will say for now is that it is a source of creativity and innovation in the field. It is also the lifeblood that is keeping a small rural community alive.
There are other stories like this, and there is no reason to shut them down. Canada has been the home of many remarkable advances. We should never discourage new ones from happening now or in the future. If we make a small adjustment in the law, Canadian creativity will do the rest. We can support consumers and innovators while upholding our copyright framework, and I hope all members will help in doing that.
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