CANADA Trends and Developments Contributed by: Brent Arnold, Carole Piovesan, Tamara Adler, Michael Pascu and Dilan Brar, INQ Law
Evolving AI Regulation in Canada Canada was an early mover in artificial intelligence. It became the first country to adopt a national AI strate - gy in 2017, and in 2019 Canada introduced one of the first binding rules for government use of automated decisions, the Treasury Board Directive on Automated Decision-Making. A general AI law has proved harder to secure. The country’s most ambitious attempt, the Artificial Intel - ligence and Data Act (AIDA), introduced as Part 3 of Bill C-27, did not survive the dissolution of parliament before the 2025 federal election. The privacy bill that followed, Bill C-36, was tabled in June 2026 and deliberately omits AI, though it does include positive obligations for the use of automated decision-making systems in certain circumstances. AI is therefore gov - erned through a combination of federal policy, privacy law, provincial statutes, and sector-specific oversight, and businesses must work within all of them. Federal developments The federal government has the longest record of regulating its own use of AI. Under the Treasury Board Directive on Automated Decision-Making, departments must complete a mandatory algorithmic impact assessment that scores each system’s risk and attaches matching obligations for transparency, human oversight, and recourse. Separate Treasury Board guidance sets out how institutions may use generative AI responsibly. For the private sector, the federal approach has so far been voluntary. A 2023 Code of Conduct invites devel - opers of advanced generative AI systems to adopt common measures on safety and accountability until formal regulation arrives. In June 2026 the govern - ment also launched a renewed national strategy, AI for All, a signal that AI remains a federal priority even without a dedicated statute. AIDA itself would have gone much further. Introduced in 2022, it proposed a risk-based framework centred on regulating “high-impact” AI systems, placing obli - gations on organisations that design and deploy them. Bundled with two privacy statutes in Bill C-27, the AI provisions proved the most contested part of the
package, which helps explain why the government later chose to legislate privacy on its own. Bill C-36 still bears on AI, even though it creates no AI statute. If enacted, it would repeal the private-sector privacy provisions of the Personal Information Pro - tection and Electronic Documents Act (PIPEDA) and require organisations that use automated systems “to make a prediction, recommendation or decision about the individual that could have a legal or similarly signifi - cant effect on them, the organisation must, on request by the individual, provide them with an explanation of the prediction, recommendation or decision”. The bill was first read in June 2026 and remains before par - liament. Privacy law remains a key mechanism for AI accountability by the federal government. Provincial developments The provinces have not waited for Ottawa. Quebec has gone furthest: under the reforms to its privacy law known as Law 25, its private-sector privacy statute requires an organisation that makes a decision based exclusively on automated processing to inform the individual concerned. On request, the person must be told which personal information was used and the main factors behind the decision, and must be allowed to submit observations to a member of staff able to review it. These rights have applied since September 2023, and the regime is now backed by significant administrative penalties. Ontario has concentrated on the public sector. Its Bill 194 received Royal Assent in 2024 and enacted the Enhancing Digital Security and Trust Act, 2024, which lets the government set requirements for public-sec - tor use of AI, including accountability frameworks and risk management. Much of the operative detail is left to future regulations that have yet to be published. Alberta’s Protection of Privacy Act, also applicable to public bodies, has provisions governing automated decision-making systems similar to those in Quebec’s Law 25. Other provinces, such as British Columbia, have created dedicated AI portfolios and published guiding principles for their own use of the technology. Alberta, Saskatchewan and Manitoba have each issued, or are considering issuing, guidance to gov -
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