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Industry Minister Mélanie Joly said the federal government is developing a regulatory framework to protect personal data collected by electric vehicles, as the arrival of Chinese-made EVs in the Canadian market draws mounting scrutiny over surveillance risks.

The disclosure came during a parliamentary hearing in which the Conservative Party of Canada’s Shadow Minister for Industry Raquel Dancho pressed Joly on whether she would be comfortable with the Chinese government accessing personal information from the vehicles.

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Data Concerns

The data security question has been a central flashpoint in Canada’s Chinese EV debate, and one that Dancho has raised consistently.

In March, she called the trade deal “frankly incomprehensible” and flagged surveillance risks in Chinese-made connected vehicles.

Later, the shadow labor minister said the Conservative Party was “hearing loud and clear from security experts” that “Chinese electric vehicles have the capability, for all intents and purposes, of being surveillance vehicles.”

The Conservatives have partly based their opposition to the Chinese EV quota on those risks, with party leader Pierre Poilievre pledging to scrap the deal and ban Chinese-connected vehicle software from those sold in Canada.

Experts who testified at the House of Commons Industry Committee have warned that Chinese EVs often use software that can collect camera, microphone, GPS, and phone data — including when the vehicle is off — and that China’s national security laws could compel companies to transmit that data back to Beijing.

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The hearing also highlighted the broader reversal within the Liberal government on Chinese EVs.

Dancho opened the exchange by reading from the government’s own September 2024 Gazette order — which Joly helped impose as Foreign Affairs Minister — stating that “increasing Chinese EV imports are expected to undermine the growth and development of the Canadian EV industry.”

“I’m reading this and thinking that you’ve made a deal with China that directly undermines the Canadian auto industry,” Dancho told Joly. “So I’m deeply concerned about this. I’m trying to figure out why you aren’t."

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Finance Minister François-Philippe Champagne — who as Innovation Minister repeatedly pledged that Canada would “never” serve as a backdoor for Chinese EVs into North America — has since traveled to Beijing to promote deeper economic ties with China after the trade deal he helped design was replaced with the current quota.

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Forced Labor

Dancho also raised forced labor during the hearing, quoting Margaret McCuaig-Johnston from the China Strategic Risks Institute, who testified that Canadians do not want to drive vehicles produced under conditions of modern slavery.

The shadow labor minister then pressed Melanie Joly on why she was allowing 49,000 vehicles into the country that may have been partially made with forced labor.

“First and foremost, what we will do is when it comes to forced labour, we will address that through legislation, period,” Joly said, pointing to the Canada Border Services Agency’s enforcement role.

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The forced labor argument has gained traction following reports of labor abuse at BYD’s factory operations in Brazil and Hungary.

The Canadian Vehicle Manufacturers’ Association has warned that Chinese automakers benefit from weak or non-existent labor rights that distort competition.

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