TORONTO — Cohere has won its first public contract with the federal government, selling access to its flagship model for use in an AI assistant that’s set to be rolled out to all public servants.

Under the deal, IT department Shared Services Canada is paying the Toronto-based firm $339,000 for a one-year licence for its software starting in November 2025. The contract was disclosed on the federal open data portal late last month.

Shared Services spokesperson Nick Wells said the department has integrated Cohere’s Command A model into CANChat, Ottawa’s in-house version of ChatGPT. “This marks a major milestone in delivering a sovereign, made-in-Canada AI capability for federal public servants,” he said.

Staff can use CANChat to draft emails, memos and other documents, conduct research or analyze data. Some 11,500 federal employees across 20 departments are currently signed up for the tool, and Shared Services is set to start rolling it out across the rest of the public service this quarter, according to Wells. 

Cohere did not respond to a request for comment.

The firm’s contract with Shared Services represents a very small piece of the $2.17 billion the department plans to spend on federal IT operations in the 2025-26 fiscal year. Still, it comes as Cohere tries to win more government business, and after Ottawa promised to back homegrown champions and improve its own operations with AI.

Last August, the two sides signed a non-binding memorandum to explore how Cohere’s technology could be used by federal departments and agencies. The company has also demonstrated its products to public servants via workshops. Ottawa has since signed a similar deal with Montreal-based Coveo, which sells technology that helps chatbots and other generative tools provide better responses.

“The MoUs are a signal that we’re going to help develop the ecosystem,” AI Minister Evan Solomon told The Logic in December, adding that the deals “are leading toward contracts.”

As The Logic first reported, the firm has had at least one other federal contract, with the Communications Security Establishment; the agency has declined to disclose details of the deal or the work it covers, citing national security.

Cohere claims Command A uses less processing power than competitors’ large language models (LLM), running on two Nvidia AI chips, making it particularly useful to clients that want to keep their tools on in-house hardware, for security or regulatory reasons.

While many model makers charge customers based on usage, Shared Services is paying Cohere a flat fee for a single “instance” of Command A, Wells said. “This may expand as we continue to onboard more users.” The model will live and run from government-approved compute infrastructure in Canada.

CANChat users can still pick from several LLMs to run their queries and prompts, according to Shared Services’ guidelines. Options include a fine-tuned version of Meta’s Llama, which the department recommends for drafting professional correspondence; Google’s Gemini, which works well for summarization, coding or tasks that involve images and OpenAI’s GPT-5, which can handle multi-step problems like research. 

The department suggests public servants use Cohere’s model to generate text or run AI agents, and notes that it’s conversant in both English and French, ensuring they comply with language rules. 

First developed in 2023, CANChat is a major pillar of Ottawa’s internal AI strategy. Lots of public servants are already using ChatGPT and other AI tools to do their work, then federal chief data officer Stephen Burt told The Logic last June. To get staff to switch to CANChat, it needs to be as good as commercial applications, he acknowledged.

Shared Services is also looking to roll out other new software. In January 2025, it launched a procurement process for “commercially-available generative AI productivity tools” on behalf of federal departments and agencies, according to a memo The Logic obtained via an access to information request. 

Shared Services ultimately signed off on a small list of suppliers, including longtime vendors IBM, Microsoft, OpenText, as well as Ottawa-based startup Copoly.ai and a tie-up between software company Factr and recruitment firm Altis Technology. The department plans to re-open the process during the spring to “allow other vendors, including Cohere, to qualify for [federal] opportunities,” according to the memo.