We keep seeing Canadian businesses reference a "Canadian AI Act" that doesn't exist. Worth correcting plainly, because acting on rules that were never passed is its own kind of risk.
What actually happened to Bill C-27
Bill C-27 — which contained the proposed Artificial Intelligence and Data Act (AIDA) alongside privacy reforms — died on the order paper in January 2025, when Parliament was prorogued following the Prime Minister's resignation. A bill that dies at prorogation doesn't carry over; it has to be reintroduced from scratch. As of mid-2026, no successor to AIDA specifically has been tabled (coverage from IAPP and industry legal trackers).
The privacy-reform half did resurface as separate legislation. AIDA did not.
Where federal AI policy actually stands
Canada created a Minister of Artificial Intelligence and Digital Innovation after the 2025 federal election, a post held by Evan Solomon. Solomon has stated publicly that AIDA will not return in its original drafted form, describing a future framework as needing to be "light, tight, right." In February 2026, the federal government published a summary of its national AI strategy consultations — a signal of direction, not a law.
What actually governs AI use in Canada right now
In the absence of a comprehensive federal AI law, what applies today is a patchwork:
- PIPEDA — federal private-sector privacy law, applying to any personal data an AI system processes
- Quebec's Law 25 — the country's most demanding automated-decision-making rules, for organizations operating in Quebec
- The ISED Voluntary Code of Conduct for generative AI — voluntary, not law, but the closest thing to a federal AI-specific standard currently in place
- Sector-specific directives — separate rules covering financial services, federal procurement, and health technology where AI is used in those contexts
Why this matters for a business right now
If a vendor or consultant tells you a specific action is "required under Canada's AI Act," that's incorrect — no such act currently exists. What is required is PIPEDA compliance for any personal data involved, Law 25 compliance if you operate in Quebec, and closer attention to the ISED voluntary code as reputational best practice, even though it carries no legal penalty for non-compliance.
FAQ
Does Canada have a federal AI law?
No. Bill C-27, which contained the proposed AI and Data Act (AIDA), died on the order paper in January 2025 and has no successor as of mid-2026.
What happened to the AI and Data Act (AIDA)?
It died along with Bill C-27 at prorogation in January 2025. Canada's Minister of Artificial Intelligence and Digital Innovation has said it will not return in its original form.
What rules actually govern AI in Canada right now?
PIPEDA for federal private-sector privacy, Quebec's Law 25 for automated-decision-making within Quebec, the voluntary ISED Code of Conduct for generative AI, and sector-specific directives for finance, procurement, and health technology.
Is the ISED Code of Conduct for AI legally binding?
No, it's voluntary. It carries no legal penalty for non-compliance, but is treated as a best-practice benchmark in the absence of binding federal AI legislation.
Staying current
We track this because it changes what we can honestly tell clients about their own AI vendor obligations. If you want a straight answer on what actually applies to your business today — not what a vendor claims — book a free 15-minute discovery call. (778) 401-6551.