OTTAWA — The United States has flagged Canada’s early interest in a sovereign cloud that would bar foreign governments from accessing data without consent as a potential trade irritant.

U.S. Trade Representative Jamieson Greer included it among several procurement issues in the annual report on foreign trade barriers he submitted Tuesday to U.S. Congress and President Donald Trump.

As always, Canada’s tightly controlled dairy market got a mention. So did the Online Streaming Act and the Online News Act, which Greer has flagged as priorities for the coming review of the North American trade pact. The federal government’s Buy Canadian policy for contracts over $25 million is a new one this year, as are moves by some provinces to keep U.S. alcohol out of liquor stores. The long wait for regulatory approval of aircraft and a proposed change to the disclosure rules regarding fragrance allergens in cosmetics also debuted on this year’s list. Gabriel Brunet, a spokesperson for Canada-U.S. Trade Minister Dominic LeBlanc, said the government’s trade team is reviewing the report.

On the sovereign cloud, the report cites an August 2025 “request for information” by Shared Services Canada, the federal government’s central information technology agency, asking Canadian suppliers about their ability to provide the federal government with a “fully sovereign public cloud solution.”

That feedback would then be considered in future procurement policy development, which the agency framed as a response to “emerging challenges relating to digital sovereignty.” Shared Services did not mention the U.S. specifically, but the onset of Trump’s trade war and his threats to annex Canada by “economic force” months earlier had thrust the issue into the spotlight.

Greer’s report notes the proposal calls for cloud services where data would be “processed, transmitted and stored exclusively in Canada.” It would exclude suppliers subject to laws letting foreign governments access Canada’s data without written consent. (Another requirement Greer did not mention: providers could not be “subject to foreign laws that permit foreign governments to request measures that could affect or discontinue the service.”)

Shared Services said it was unable to comment in time for publication, but an update to the request for information suggests the conditions highlighted in Greer’s report remain. In its notice, the agency said it had invoked the National Security Exception for all stages of the procurement process for sovereign cloud services. That means nothing in any of Canada’s free trade agreements barring such protectionism would apply.

There is a difference, though, between exploring the possibility of creating a “fully sovereign public cloud solution” and actually doing it—especially without U.S. tech giants.

The federal government acknowledged as much last October in its “framework” on digital sovereignty: “It is impossible for the [government of Canada] to obtain a state of complete digital sovereignty, known as digital autonomy, due to the absolute interconnected nature of the digital world.” Manav Gupta, IBM Canada’s chief technology officer, told The Logic last month that the views of Canadian politicians on digital sovereignty had been “maturing.”

In January 2025, the federal government said it would review its business relationship with Amazon after the e-commerce firm closed its fulfillment centres and sorting facilities in Quebec. As The Logic reported, that review led officials to conclude that Ottawa’s reliance on Amazon Web Services, its second-largest cloud vendor, limited its leverage against the tech giant.