Trade: business regulation; agricultural equipment repair act; create. Creates new act.

KNC H02474'23 (H-2) s_05372_10242023 SUBSTITUTE FOR HOUSE BILL NO. 4673 A bill to require certain original equipment manufacturers and authorized repair providers of agricultural equipment to make diagnostic, maintenance, and repair parts, tools, and documentation available to independent repair providers and owners of that equipment; to provide for the powers and duties of certain state and local governmental officers and entities; and to provide remedies and civil sanctions. THE PEOPLE OF THE STATE OF MICHIGAN ENACT: Sec. 1. This act may be cited as the "agricultural equipment 1 repair act". 2 Sec. 3. As used in this act: 3 (a) "Agricultural equipment" means a tractor, trailer, 4 combine, sprayer, tillage implement, baler, or other personal 5 2 KNC H02474'23 (H-2) s_05372_10242023 property, including any digital electronic component embedded in or 1 attached to the equipment, that is specifically designed to be used 2 on a farm or ranch and used for planting, growing, or harvesting 3 agricultural products or used for raising or breeding livestock. 4 Agricultural equipment includes any mechanical system specifically 5 designed to be used on a farm or ranch for the conveyance or 6 storage of agriculture or animal products in a raw or unprocessed 7 state, regardless of whether the mechanical system is affixed to 8 real property. Agricultural equipment does not include any of the 9 following: 10 (i) A self-propelled vehicle designed specifically for the 11 transportation of individuals or property on a highway or roadway 12 and that is certified by the manufacturer under any applicable 13 federal safety and emission standards and requirements for 14 distribution and sale in the United States. 15 (ii) An off-highway vehicle. 16 (iii) A personal watercraft. 17 (iv) A snowmobile. 18 (v) Any construction equipment. 19 (b) "Authorized repair provider" means a person that has an 20 arrangement with an original equipment manufacturer under which the 21 original equipment manufacturer grants to the person a license to 22 use a trade name, service mark, or other proprietary identifier for 23 the purposes of offering diagnostic, maintenance, or repair 24 services for agricultural equipment on behalf of the person or the 25 original equipment manufacturer. 26 (c) "Construction equipment" means a vehicle or machinery to 27 which all of the following apply: 28 (i) The vehicle or machinery is designed and specifically used 29 3 KNC H02474'23 (H-2) s_05372_10242023 for any of the following: 1 (A) The grading of a highway or roadway, the paving of a 2 highway or roadway, earth moving, or other construction work on a 3 highway or roadway. 4 (B) The construction of a structure, including, but not 5 limited to, a dwelling. 6 (C) The construction or maintenance of railroad rights-of-way. 7 (ii) The vehicle or machinery is only incidentally operated or 8 moved over a highway or roadway. 9 (iii) The vehicle or machinery is not designed or specifically 10 used for the transportation of individuals or property. 11 (d) "Documentation" means a manual, diagram, reporting output, 12 service code description, schematic diagram, library of diagnosed 13 issues, security code, password, or other guidance or information, 14 whether in an electronic or a tangible format, that is required to 15 diagnose problems with, or perform maintenance or repair of, 16 agricultural equipment. 17 (e) "Fair and reasonable costs" means all of the following: 18 (i) For a tool that is not software or a part, costs to which 19 both of the following apply: 20 (A) The costs are fair to the original equipment manufacturer 21 or authorized repair provider and the independent repair provider 22 or owner, considering the market value of the tool or part in this 23 state, any conditions that are agreed to by the parties, the 24 promised quality, and timeliness of delivery. 25 (B) The costs do not discourage or disincentivize an 26 independent repair provider or owner from making a repair to 27 agricultural equipment. 28 (ii) For a tool that is software, costs that are equivalent to 29 4 KNC H02474'23 (H-2) s_05372_10242023 the actual cost for which an original equipment manufacturer offers 1 the software to an authorized repair provider, except that the 2 original equipment manufacturer or authorized repair provider may 3 charge additional fees related to necessary or additional services 4 utilized in making the software available to the independent repair 5 provider or owner, including, but not limited to, training or 6 installation assistance. 7 (iii) For documentation, costs that are equivalent to the actual 8 cost for which an original equipment manufacturer offers the 9 documentation to an authorized repair provider, unless the 10 documentation is requested in physical form, in which case the 11 costs may include a fee that is equivalent to the actual cost of 12 preparing and sending the documentation in physical form. 13 (f) "Fair and reasonable terms" means a burden or condition 14 that is necessary for the provision of the part, tool, or 15 documentation, within the ordinary course of business and that is 16 not designed to be an impediment on an independent repair provider 17 or owner. Fair and reasonable terms do not include any of the 18 following: 19 (i) Imposing an obligation on an independent repair provider or 20 owner to use a part, tool, or documentation to diagnose, maintain, 21 or repair agricultural equipment. 22 (ii) Requiring an independent repair provider or owner to 23 become an authorized repair provider. 24 (iii) Requiring a part, tool, or documentation to be registered 25 with, paired with, or approved by an original equipment 26 manufacturer or an authorized repair provider before the use of the 27 part, tool, or documentation. 28 (iv) Imposing an additional burden or material change that 29 5 KNC H02474'23 (H-2) s_05372_10242023 would adversely affect the timeliness or method of delivery of a 1 part, tool, or documentation. 2 (v) For a tool that is software, imposing an unreasonable 3 impediment to accessing the software, including, but not limited 4 to, requiring prior authorization by the original equipment 5 manufacturer for use of the software or denying a request for the 6 software to be downloaded or delivered via an alternative method. 7 (g) "Independent repair provider" means a person operating in 8 this state that is not an authorized repair provider and that is 9 engaged in diagnostic, maintenance, or repair services for 10 agricultural equipment. 11 (h) "Off-highway vehicle" means a self-propelled vehicle that 12 is designed to travel on wheels or tracks in contact with the 13 ground, designed primarily for use off of highways, and generally 14 and commonly used to transport individuals for recreational 15 purposes. Off-highway vehicle does not include any of the 16 following: 17 (i) A military vehicle. 18 (ii) A golf cart. 19 (iii) A vehicle designed and used to carry a person with a 20 disability. 21 (i) "Original equipment manufacturer" means a person that 22 manufactures agricultural equipment and sells the equipment to 23 another person. 24 (j) "Owner" means a person that owns agricultural equipment. 25 Owner does not include an original equipment manufacturer. 26 (k) "Part" means a component or subcomponent of agricultural 27 equipment that is sold, supplied, or made available by an original 28 equipment manufacturer and that is necessary for diagnosing, 29 6 KNC H02474'23 (H-2) s_05372_10242023 maintaining, or repairing the agricultural equipment. 1 (l) "Snowmobile" means a self-propelled vehicle primarily 2 designed or altered for travel on snow or ice when supported in 3 part by skis, belts, or cleats and designed primarily for use off 4 of highways. Snowmobile does not include machinery used strictly 5 for the grooming of snowmobile trails or ski slopes. 6 (m) "Tool" means a software program, hardware implement, or 7 other apparatus that is necessary for diagnosing, maintaining, or 8 repairing agricultural equipment, including, but not limited to, 9 software or other mechanisms that provision, program, or pair a new 10 part, calibrate functionality, or perform any other function 11 required to bring the product back to fully functional condition. 12 (n) "Trade secret" means that term as defined in section 2 of 13 the uniform trade secrets act, 1998 PA 448, MCL 445.1902. 14 Sec. 5. (1) Beginning January 1, 2025 and except as otherwise 15 provided in subsection (2) and section 7, an original equipment 16 manufacturer or authorized repair provider of agricultural 17 equipment that is sold and used in this state shall make available 18 to an independent repair provider or owner, at fair and reasonable 19 costs and on fair and reasonable terms, any part, tool, or 20 documentation that is needed to diagnose, maintain, or repair the 21 agricultural equipment. 22 (2) An original equipment manufacturer may make parts, tools, 23 and documentation available to an independent repair provider or 24 owner through an authorized repair provider that consents to sell 25 or make available parts, tools, or documentation on behalf of the 26 original equipment manufacturer. 27 Sec. 7. If an original equipment manufacturer enters into and 28 is covered under a nationwide memorandum of understanding regarding 29 7 KNC H02474'23 (H-2) s_05372_10242023 a right to repair agricultural equipment, the memorandum of 1 understanding governs an owner's right to repair, or right to 2 engage the services of an independent repair provider for the 3 repair of, the agricultural equipment of the original equipment 4 manufacturer, if the requirements imposed on the original equipment 5 manufacturer under the nationwide memorandum of understanding 6 comply with the requirements of this act. 7 Sec. 9. (1) This act does not require an original equipment 8 manufacturer to do any of the following: 9 (a) Divulge a trade secret to an independent service provider 10 or owner. 11 (b) Provide a part that is used by the original equipment 12 manufacturer only to design, develop, manufacture, test, or improve 13 its products. 14 (2) This act does not do any of the following: 15 (a) Alter the terms of an arrangement described in section 16 3(b) between an authorized repair provider and an original 17 equipment manufacturer, except that a provision of the agreement 18 that limits the original equipment manufacturer's or authorized 19 repair provider's obligation to comply with this act is void and 20 unenforceable. 21 (b) Authorize a repair to agricultural equipment that 22 deactivates a safety notification system or that is otherwise 23 illegal. 24 (c) Authorize access to a tool function that enables an 25 independent repair provider or owner to change the settings of 26 agricultural equipment in a manner that brings the equipment out of 27 compliance with an applicable safety or emission law. 28 (d) Authorize the evasion of an emission or copyright law. 29 8 KNC H02474'23 (H-2) s_05372_10242023 (3) This act does not apply to leased or rented agricultural 1 equipment. 2 Sec. 11. An original equipment manufacturer or authorized 3 repair provider is not liable under this act for any of the 4 following: 5 (a) A faulty or otherwise improper repair provided by an 6 independent repair provider or owner, including, but not limited 7 to, a faulty or otherwise improper repair that causes any of the 8 following: 9 (i) Any damage to the agricultural equipment during the repair. 10 (ii) An inability to use, or a reduced functionality of, any 11 piece of the agricultural equipment that results from the repair. 12 (iii) An injury or death of an individual that results from the 13 repair. 14 (b) A violation of a state emission or safety standard 15 resulting from a faulty, illegal, or otherwise improper repair to 16 agricultural equipment provided by an independent repair provider 17 or owner. 18 Sec. 13. (1) If the attorney general has probable cause to 19 believe that an original equipment manufacturer is engaged in or 20 has engaged in a violation of section 5, and gives notice in 21 accordance with this section, the attorney general may bring an 22 action in accordance with principles of equity to restrain the 23 original equipment manufacturer from engaging in the violation of 24 section 5. 25 (2) The action described in subsection (1) may be brought in 26 the circuit court of the county where the defendant is established 27 or conducts business or, if the defendant is not established in 28 this state, in the circuit court of Ingham County. 29 9 Final Page KNC H02474'23 (H-2) s_05372_10242023 (3) The court in an action described in subsection (1) may 1 award costs to the prevailing party and may require damages to be 2 awarded to the independent repair provider or owner impacted by the 3 violation of section 5. 4 (4) Unless waived by the court on good cause shown not less 5 than 30 days before the commencement of an action described in 6 subsection (1), the attorney general shall notify the original 7 equipment manufacturer of the intended action and give the original 8 equipment manufacturer an opportunity to cease and desist from the 9 alleged violation of section 5 or to confer with the attorney 10 general in person, by counsel, or by other representative, as to 11 the proposed action before the filing date. 12 (5) An original equipment manufacturer that knowingly violates 13 the terms of an injunction, order, decree, or judgment issued under 14 this section shall forfeit and pay to the state a civil fine of not 15 more than $25,000.00 for each violation. 16 (6) For the purpose of this section, the court issuing an 17 injunction, order, decree, or judgment shall retain jurisdiction, 18 the cause must be continued, and the attorney general may petition 19 for recovery of a civil fine as provided under this section. 20