Canada’s AI Consultation Closes September 23

Innovation, Science and Economic Development Canada has been running a public consultation since July 23 called Enhancing trust in artificial intelligence through increased transparency. It closes on September 23. Five areas are on the table, three of them would land directly on ordinary businesses if anything comes of them, and the submissions will mostly come from organisations with government relations departments.

The five areas

On the first area, the consultation names visible disclosures, invisible watermarks and provenance metadata as possible approaches, and asks both when identification matters most and which mechanisms would work. On the second, it asks whether and in what circumstances people should be told they are dealing with a system rather than a person.

The third area is the one most favourable to buyers. Consistent information about what an AI system can and cannot do is precisely what is missing when a small business tries to evaluate a vendor, which is the gap behind AI washing and behind the difficulty of reading accuracy claims covered in the 54% legal AI benchmark.

What is not being decided

Being accurate about this matters, because the alarmed version of the story is easy to write and wrong. The discussion paper asks whether existing market practices and legal frameworks are already sufficient, or whether additional measures are warranted.

The measures on the table span a wide range: legislation or regulation at one end, but also government guidance, voluntary codes of conduct, technical standards, research initiatives, AI literacy programmes, and procurement requirements. Procurement is quietly one of the more consequential, since a rule that applies only to government suppliers still reshapes what vendors build.

ISED has said it will publish a What We Heard report after the consultation. No timeline commits Canada to any of this, and anyone telling you new AI rules arrive next year is guessing.

Three areas that would reach a small business

Chatbot disclosure. If you run a website chatbot or automated phone handling, a disclosure requirement is a small change and a real one. Most businesses running these have never written down whether callers are told. That is worth knowing regardless of what Ottawa decides.

Content labelling. If you publish marketing material, product photography or written content produced with AI, labelling obligations would change your process. Our note on AI watermarks covers how the technical side currently works, which is less settled than the policy discussion implies.

Agent activity tracking. The newest area and the one with the least established practice. If agents act in your systems, logging what they did is something you should already be doing for your own protection, as we argued in privileged access management. A requirement would formalise it rather than invent it.

How to respond before Wednesday

Two routes, both closing September 23. There is an anonymous online survey on the ISED consultation page, and you can send written comments to AIConsultations-ConsultationsIA@ised-isde.gc.ca.

One detail worth reading before you write anything. ISED states that submissions will be considered public documents and may be posted online, and asks that you not include personal or confidential information. Keep client names, contract details and anything commercially sensitive out of it.

If you are writing rather than taking the survey, the most useful thing a small business can contribute is specifics. Not a view on whether AI should be regulated, which the policy team has heard, but a paragraph on what a particular obligation would actually cost you to comply with, who in your business would do it, and what would happen to the tools you currently rely on. That kind of detail is scarce in consultation responses and disproportionately useful.

Why bother

Consultations like this are answered by companies with government relations functions and by advocacy organisations with a position to advance. The operating reality of a ten-person firm in Saskatoon is under-represented by default, not by design.

Whether one submission changes anything is genuinely uncertain, and it would be dishonest to claim otherwise. What is certain is that the positions on record now form the input to whatever comes next, and that the window for adding yours closes Wednesday. We covered the consultation when it was announced in our note from August, and the broader policy direction in what Bill C-36 would mean.

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