Canada’s uncertain digital future

Earlier this year, the French government announced it would stop using Zoom, Microsoft Teams, and any other U.S.-based videoconferencing platforms by 2027 and begin using French-based Visio.

The decision came after Anton Carniaux, director of public and legal affairs for Microsoft France, testified before the French Senate that, under the U.S. Cloud Act, Microsoft could be forced to hand over data from any country, regardless of where it is stored. Austria, Germany and Switzerland are also racing to find alternatives to U.S.-based technology.

Digital sovereignty, which is the protection and control of Canadian data, is quickly becoming the most prominent issue in this country. Amid ongoing strained relations with our southern neighbour, Canadians now face an uncertain digital future. Policy makers have the daunting task of figuring out how to keep our data safe while trying to move away from prominent U.S. software. What’s at stake is Canada’s tech future and the safety of personal Canadian data. Protecting it may sound simple, but there are many different aspects to it.

“It’s also about not being able to control who gets access. Do we have infrastructure to manage our assets,” asks Teresa Scassa, a law professor at the University of Ottawa and the Canada Research Chair in information law and policy.

“If we don’t have sovereignty, our access to data stored on offshore servers could be lost,” she says.

Digital sovereignty fits into three categories: infrastructure, data and policy. Infrastructure relates to where data is stored, data covers how it’s used, and policy relates to whether a company’s values reflect Canadian values.

Scassa, who has been looking at digital sovereignty as part of her research on regulatory changes in technology, says one question is whether we’re sure we can collect and control the data we need to manage the resources we use.

“For example, if we rely on U.S.-based mapping software or satellite data from foreign sources, how would that impact us if we lost access? Would we feel confident that we have all the geospatial data we need in Canada?“

The issue of digital sovereignty isn’t new. When Toronto chose Google's Sidewalk Labs for a “smart city” development project in 2017, there was a lot of excitement, but public backlash over data use soon followed. The deal would have given Google access to and ownership of all data collected in the project. Several advocacy groups criticized the tech giant's plan to own Canadian data. Google eventually walked away from the project in 2020.

A tipping point

Jim Hinton, founder of Own Innovation, an intellectual property law firm, works with tech companies and has seen these issues play out for decades. As a senior fellow at the Centre for International Governance Innovation, he’s written about digital sovereignty issues, including the growing number of foreign companies owning AI patents filed by Canadians.

“(Digital sovereignty has) been an issue in our contractual agreements with the U.S. for years. Americans get access to our data even if it’s located in Canada. For years, the terms of service for Microsoft have said they can shut off access anytime.”

Hinton says the tipping point began in 2010 with the rise of cloud computing, the mainstreaming of mobile phones, and the rapid development of artificial intelligence. Our data-driven economy has brought digital sovereignty to the forefront.

“Now we have consolidation of data and access. All data flows from Canada to the U.S., then to the rest of the world. All the benefits flow to the U.S. and trillion-dollar companies. We have to go back and fix our systems so we own our data and get the economic benefits.”

Another added complexity is how tech sovereignty affects Canada’s First Nations communities, as historically the way data has been gathered, stored and interpreted has misrepresented them and reinforced colonialism. Information about their people and culture belongs to them all, which is why the First Nations Information Governance Centre was founded in 2010 to assert data sovereignty. The centre is the custodian of the Principles of OCAP (Ownership, Control, Access, and Possession). For Métis communities, that information is not OCAP-based but Métis citizenship-based and subject to Métis governance concepts.

“The Indigenous, Métis and Inuit Peoples all have different perspectives on data sovereignty, which is a core concept in digital sovereignty,” says Donald Johnston, partner at Aird & Berlis LLP.

“They don’t have this individual, Eurocentric view of property rights.”

American technology doesn’t capture these principles, which can cause long-term harm.

He says there have been situations in Canada where people come in to collect data, and because they collected it, they think they own it, and use it any way they want.

“That’s not right. The Henrietta Lacks case is an analogous example of this. Scientists never got consent from the Lacks family for the harvesting of her DNA, and that situation still hasn’t been resolved in well over 70 years.”

‘Not a lot of good answers’

Canada has long had sovereignty issues with the U.S., including over data protection and mass surveillance, but digital sovereignty has now reached a critical point, says Michael Karanicolas, an associate professor at Dalhousie’s Schulich School of Law.

Once our closest ally, the U.S., led by President Donald Trump, has adopted policies ranging from the ongoing trade wars to threats of annexation. This has left Canada even more vulnerable to the loss of digital sovereignty.

“We assumed for the last century that we have a stable relationship with the United States,” he says.

“We were worried about other countries like Russia, China, or Iran. The relationship with the U.S. was more focused on cultural protection since there is an unequal relationship there. The U.S. was a safe power even though it was an unequal relationship.”

The rise of social media has brought about a major crisis of cultural and digital sovereignty. Karanicolas says cultural sovereignty has always been an issue, prompting policies that promote and support Canadian film, TV, music, and media to reflect Canadian values. The Online News Act and similar legislation were introduced to address cultural and tech sovereignty, with mixed results, including Meta’s decision to block Canadian news accounts on its platforms.

One possible solution is moving away from U.S. technology. Several countries, including France, Switzerland, South Africa, and Ethiopia, are developing their own homegrown AI systems. Karanicolas says it’s not feasible for Canada to move away from U.S. technology, but there should be diversification in what products are used. He suggests exploring open source software and technology owned by nonprofits.

“There’s a lot of questions for us on digital sovereignty and not a lot of good answers,” he says.

“Changing our information ecosystem would be costly and take time. We can’t build a separate digital world from scratch with our own systems and architecture. Medium- to long-term, we need tech solutions like diversification, but we’ll never be in a place where we’re only using Canadian products. We need more decentralized technology, and that’s controversial because it’s harder for law enforcement to access data.”

Not everyone agrees. Hinton says Canada should absolutely pursue creating its own tools to move away from U.S. technology.

“We have to build the new house before we move out of the old house.”

He says people think it’s complicated, but it’s not because central processing units (CPUs) become obsolete in five years, as do graphics processing units (GPUs), and building new software isn’t that hard.

“Saying we can’t do it is a defeatist mentality. The reason why we’re not doing it is political will,” Hinton says.

“We saw that with TikTok, Google and Amazon, how we pissed them off and we backed off. Canada is still cozy with technology companies. They want to use these social media platforms for their political gain. There’s no political will, and we have no political leverage against these companies.”

There have been discussions in the past few years about foreign interference and digital sovereignty. This year, the federal government introduced Bill C-25, the Strong and Free Elections Act, which would ban political parties from accepting cryptocurrency donations and prohibit the creation of deepfakes of candidates, except for satire or parody. Foreign interference laws would extend to leadership campaigns and all other non-election periods.

Scassa says the threat of foreign interference worries her.

“We don’t know who might influence our elections or separatist movements. It’s real and it’s significant. It affects sovereignty and nationhood.”

The biggest challenge is managing the relationship with the U.S. She says any solution will be difficult because of the strained relationship. While Canada is working to build new relationships with allies, such as the European Union, that shift is a work in progress.

“We’re still grieving in terms of our relationship with the U.S,” Scassa says.

“There’s a feeling of betrayal and loss, and we’re still feeling the effects economically. The countries are so intertwined, and now there’s fear of how technology can interfere with our democratic system. Any solution will be painful.”

Whatever approach is taken, there’s still a need for more public education. She says this is a longstanding issue that has to be addressed to move forward.

“The bigger crisis is tech literacy or knowledge and understanding,” says Scassa.

“It’s more than just learning how to use generative AI. We need to know about misinformation, disinformation and fake sources. We need to have a conversation and start explaining what these issues are.”