Ottawa is turning away from Washington and towards Brussels. The EU and Canada have opened formal negotiations on a Digital Trade Agreement. The deal is set to reshape how businesses and consumers on both sides of the Atlantic trade, share data, and connect online.
In early March in Toronto, EU Trade Commissioner Maroš Šefčovič and Canada’s Minister for International Trade Maninder Sidhu formally launched negotiations on an EU-Canada Digital Trade Agreement (DTA). Preliminary talks had begun the previous month.
The Commission says the deal will make cross-border digital trade easier and safer for businesses, and strengthen online consumer protections. The European Parliament, however, went further in a report on 11 March. Given the current turmoil in the international order, they argued, elevating the EU-Canada strategic partnership is not just desirable but necessary.
Significant stakes
The geopolitical backdrop is hard to ignore. MEP Javier Moreno Sánchez (S&D/ESP) said Canada felt “betrayed” by its long-time ally and neighbour, the US. “They choose Europe,” he added.
The resolution passed by 482 votes to 108. It went beyond the DTA announcement, calling for specific cooperation on fibre-optic infrastructure to create new digital corridors. Among the priorities: improved connectivity for Arctic communities.
You might be interested
The push comes as the Comprehensive Economic and Trade Agreement (CETA), in place for nine years, remains unratified by 10 member states — a gap MEPs want closed. The stakes are significant. More than 60 per cent of global GDP is linked to digital transactions. By 2023, digital channels carried 54 per cent of the EU’s service trade.
The deal would uphold EU rules on cross-border data flows and personal data protection. It would also guarantee strong consumer protections and predictable rules for businesses. Moreover, cooperation could extend to cybersecurity, artificial intelligence, and quantum research.
The next floor
The DTA builds on the EU-Canada Digital Partnership signed in December 2023. Negotiators want to ban customs duties on electronic transmissions, prevent unjustified data localisation requirements, and prohibit forced transfers of software source code. Common rules on electronic signatures, contracts, and spam are also on the table.
If CETA laid the foundation, a Digital Trade Agreement will build the next floor. — Maroš Šefčovič, EU Trade Commissioner
Mr Šefčovič struck an ambitious note. “Already more than 40 per cent of our €51bn in services trade is delivered digitally,” he said. “No modern economy runs without trusted, secure data. If CETA laid the foundation, a Digital Trade Agreement will build the next floor.”
