Federal Report Warns Ottawa’s ‘Sovereign Cloud’ Is an American Illusion

A federal white paper has revealed that the federal government can’t fully control its own data as long as it relies on cloud services run by U.S. tech giants—despite Ottawa’s repeated claims about promoting “digital sovereignty.”

The document, prepared for the Treasury Board, warns that Canada only maintains complete legal authority over government data if it hosts it internally or uses providers entirely under Canadian law, reports The Canadian Press.

Otherwise, the data remains vulnerable to foreign jurisdictions, including the United States under its Cloud Act, which allows U.S. authorities to demand access to information held by American companies—even when that data sits on servers abroad.

The finding directly contradicts the federal government’s messaging around data independence and the push for a “sovereign cloud.” Since 2021, Ottawa has spent nearly $1.3 billion on cloud services from Amazon, Microsoft, and Google, including sensitive defence applications hosted on Amazon Web Services.

Artificial Intelligence Minister Evan Solomon (fired former CBC journalist), who has called digital sovereignty “the most pressing policy and democratic issue of our time,” recently told the CBC that “Canadian data isn’t subject to foreign law.” However, the white paper makes clear that’s not the case—a contradiction that critics say exposes deep hypocrisy in the government’s AI strategy.

Solomon acknowledged “concerns about the Cloud Act,” telling the CBC that any access requires “a judicial warrant” and applies only to “specific kinds of data, one time.” Still, experts say U.S. law leaves plenty of room for Washington to compel access. It’s beginning to sound like the government has no idea what’s it’s talking about when it mentions AI sovereignty.

The revelation comes as Solomon’s 27-member task force on AI policy faces growing criticism for being too industry-heavy and for rushing its consultation process, which has now closed after receiving 11,000 public submissions.

Last December, the feds said they plan to drop $2 billion to build up Canada’s AI infrastructure and declared the country is an AI leader. Back in August, Ottawa signed a handshake deal with Cohere to modernize public services leveraging AI. The contradiction raises a broader question: how can Canada claim to protect its data sovereignty while paying foreign tech firms billion to store and process it?