Canada’s AI Strategy: Reading Between the Lines of “What We Heard”
Ottawa - March 11, 2026
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Speakers: Franca Palazzo (Executive Director, The Canadian Internet Society); Katie Preiss (VP Public Policy & Government Relations, TELUS); Erin Kelly (CEO & Co-Founder, Advanced Symbolics Inc.); Jaxson Khan (Senior Fellow, Munk School, University of Toronto); Michael Geist (Professor, University of Ottawa; Canada Research Chair in Internet & E-commerce Law)
Moderator: Brent Arnold (Chair, Canadian Internet Society; Partner, INQ Law)
Context and Framing
Franca Palazzo opened by framing the session as a critical review of Canada’s forthcoming AI strategy, focusing on gaps between the consultation output (“What We Heard”) and actual stakeholder priorities. She emphasized recurring themes: intellectual property and commercialization, digital sovereignty, accountability and regulation, sustainability, labour impacts, and the central role of public trust in enabling adoption.
Katie Preiss positioned AI as a major opportunity for Canada, highlighting advantages in renewable energy, climate, and talent. She emphasized infrastructure as the foundation of sovereignty, arguing that control over data centres and compute is essential. At the same time, she called for a clear, consistent national policy framework and definition of AI to support investment and scaling.
Consultation Process and “What We Heard” Critique
Michael Geist argued the consultation process was rushed and largely performative. A 30-day consultation, in his view, cannot produce meaningful policy input. He suggested the “What We Heard” report selectively emphasized certain narratives—such as sovereignty and risk—while downplaying key stakeholder concerns like access to capital and the need for speed in policy execution.
Jaxson Khan offered a more balanced perspective, noting the inherent tension between urgency and inclusivity. He described the government as navigating competing pressures from industry and civil society, and emphasized that the actual strategy remains unclear, with more insight likely found in the underlying reports than in the summary itself.
Capital and Commercialization Challenges
Erin Kelly highlighted capital access as a fundamental weakness in Canada’s AI ecosystem. She argued that government funding alone cannot sustain AI development and that attracting private investment must be central to the strategy. The absence of this focus in consultations was, for her, a major concern.
She also pointed to a structural funding gap: strong early-stage support but limited growth capital, forcing companies to seek U.S. investment and resulting in foreign ownership of Canadian innovations.
Digital Sovereignty vs Practical Constraints
Kelly stressed that Canadian AI companies currently cannot operate fully on domestic infrastructure due to limitations in cloud services, scalability, and supporting technologies. Mandating Canadian hosting without equivalent capability risks excluding domestic innovators.
Khan argued for a pragmatic definition of sovereignty focused on reducing dependency over time rather than achieving الكامل independence. He emphasized infrastructure as a starting point but acknowledged limits in capital and technical capacity.
Geist added that sovereignty is not just about infrastructure; foreign legal regimes can still apply, meaning policy must also address legal control and jurisdiction.
Regulation, Responsibility, and AI Harms
Kelly argued that governments must clearly define illegal conduct rather than expecting companies to interpret and enforce vague standards. Businesses face conflicting obligations, particularly around privacy and reporting.
Geist countered that platforms already have responsibility to enforce their own policies, particularly for harmful but lawful content, and that the focus should be on consistent enforcement rather than expanding criminal law.
Khan emphasized technical solutions, including safety-by-design, pre-deployment testing, and collaboration with AI safety institutes, arguing that regulation alone cannot keep pace with AI’s speed and scale.
Transparency and Oversight
Geist proposed transparency as a priority, advocating for disclosure of AI system policies, enforcement practices, and escalation thresholds to improve accountability.
Kelly supported independent monitoring rather than relying on company self-reporting, while Khan suggested governments should build their own AI capabilities to enable proactive oversight.
Geist cautioned that expanded government monitoring could raise significant privacy and civil liberties concerns, particularly in the context of lawful access powers.
Strategic Choices for Canada
Khan outlined key decisions facing policymakers:
Whether to prioritize national champions or broader ecosystem development
How far to pursue sovereignty across the AI stack
Whether to focus on targeted regulation or technical safety mechanisms
He stressed that maintaining economic competitiveness is essential for preserving regulatory influence, noting global shifts toward deregulation in some jurisdictions.
Procurement and Domestic Adoption
Kelly identified government procurement as a missed opportunity. Canadian AI firms lack visibility and structured pathways to sell into government, while foreign providers dominate through existing platforms and integrations.
This limits domestic adoption even when competitive Canadian solutions exist.
Government Structure and Coordination Issues
Both Geist and Khan emphasized fragmentation across government departments. AI policy spans multiple domains—privacy, copyright, innovation, justice, procurement—without unified coordination.
Khan suggested a dedicated digital or AI ministry with consolidated authority, drawing on international examples, while Geist highlighted the difficulty of implementing whole-of-government approaches in practice.
Key Policy Priorities
Panelists identified immediate actions:
Jaxson Khan: pass comprehensive privacy legislation
Erin Kelly: incentivize domestic capital investment
Michael Geist: introduce an AI Transparency framework
All stressed the need for clarity, coordination, and decisive policy action.
Overall Takeaway
The discussion underscored a gap between Canada’s AI ambitions and its current capabilities. While the country has strong fundamentals—talent, energy, research—it faces structural challenges in capital, infrastructure, policy alignment, and execution.
The “What We Heard” report, rather than resolving these issues, reflects ongoing ambiguity. The effectiveness of Canada’s AI strategy will depend on concrete decisions around investment, governance, and balancing sovereignty, competitiveness, and public trust.
RESOURCES
The Canadian Internet Society (TCIS) — hosts today’s event; advocates for open, accessible Internet policy in Canada
Canada’s AI Strategy Consultation — “What We Heard” Report (ISED) — the government’s summary of 11,300+ public submissions that the panel examined and critiqued
Engagements on Canada’s Next AI Strategy: Summary of Inputs (PDF) — the full report, including the AI-assisted classification pipeline methodology discussed by Michael Geist
Sovereign by Design: Strategic Options for Canadian AI Sovereignty — Jaxson Khan and Sean Mullin’s Munk School report on Canadian AI sovereignty vulnerabilities and strategic options, released the day before the panel
An Illusion of Consensus — Michael Geist’s analysis of the “What We Heard” report — the blog post critiquing the government’s framing of consultation results, referenced during the panel
askpolly.ai — Advanced Symbolics Inc. — Erin Kelly’s Canadian AI for predictive public opinion research, the only Canadian app currently on Microsoft Copilot
Aperture AI — Jaxson Khan’s AI strategy consultancy
Human Feedback Foundation — non-profit focused on open-source human engagement with AI models, discussed by Jaxson Khan
Hon. Evan Solomon — Minister of Artificial Intelligence and Digital Innovation — the minister whose consultation process and OpenAI meetings were central to the panel discussion
AI Competitiveness Project — Munk School of Global Affairs & Public Policy — the research initiative behind the Sovereign by Design report