Canada needs to do more to protect data from U.S. in NAFTA talks: industry

OTTAWA _ Concern is growing that federal negotiators aren’t doing enough to protect the personal information of Canadians from prying U.S. interests at the North American Free Trade Agreement negotiations.

Information technology companies and other digital economy insiders say federal negotiators appeared unprepared during this week’s third round of talks to counter an American proposal that would forbid the storage of sensitive data in computing facilities on Canadian soil.

Some warned that Canada appeared soft on the issue and might concede to the American demands in the interest of horse-trading _ to potentially win concessions on higher-profile areas of contention, such as autos and agriculture.

They say giving in to American demands to open up a freer flow of cross-border data would not only undermine domestic privacy rights, but hamstring the ability of emerging Canadian companies to compete in the growing digital economy.

At issue is so-called “data localization,” which would allow the government to protect the sensitive personal information of Canadians _ especially health and financial records _ from unwanted American intrusion, by storing it in Canada.

There was no immediate response to a request for comment from the office of Foreign Affairs Minister Chrystia Freeland, which is leading Canada’s NAFTA efforts.