Microsoft will ‘stand up to defend’ Canadian digital sovereignty, president says

Microsoft vice-chair and president Brad Smith speaks about the company's initiative to increase access to AI software and training for teachers and students across Washington on Thursday, Oct. 9, 2025 at the company's headquarters in Redmond, Wash. (AP Photo/Cedar Attanasio)

Microsoft vice-chair and president Brad Smith insists his company can protect digital sovereignty in Canada, regardless of who is leading the U.S. government.

This week, Microsoft announced it will invest $7.5 billion in Canada over the next two years as part of a data-centre expansion, bringing its total investment in this country to $19 billion between 2023 and 2027.

But amid trade and geopolitical tensions under U.S. President Donald Trump, some Canadian companies are looking to reduce their reliance on American tech companies and are pushing for more digital sovereignty, referring to a country’s ability to exercise control over its own data and the digital infrastructure managing it.

In an interview with CTV Question Period airing Sunday, Smith told host Vassy Kapelos that “no country can defend its digital sovereignty if it cannot defend its digital borders,” later adding that Microsoft defends Canada’s digital border “every day.”

“We have said that if the U.S. government seeks data from a Canadian customer, we will stand up to defend that,” Smtih said. “If there’s a legal basis, and there typically is, we’ll go to court.”

“If the continuity of our services in Canada is ever threatened by an executive order … If it were ever to come to pass in Canada, that there would be some risk of that, we wouldn’t hesitate to speak up, to stand up, to go to court to defend our right to serve our customers here in Canada,” he later added.

Smith was in Ottawa on Tuesday for his company’s announcement, during which he had a private meeting with Prime Minister Mark Carney.

Back in September, Carney announced his intent to build a “Canadian sovereign cloud” through the new Major Projects Office as part of the country’s nation-building agenda.

A sovereign cloud is a computing environment companies use to run services that can be set up to comply with a specific country’s law or core values.

Since 2022, Canada and the U.S. have been negotiating an agreement through the U.S. Cloud Act, which allows the U.S. government to ask American companies that have offices or infrastructure in other countries to hand over data if required by the law.

But according to a recent Canadian government white paper on digital sovereignty, the federal government can’t maintain full control of its data if its data storage supplier is subject to the laws of another country.

Asked about the viability of his pledge to protect Canadian data, given the Trump administration’s pattern of dismissing the law, Smith said the company also relies on its “diplomatic relationships.”

“We rely on the ability to turn to people in different governments and ask them to come together. We rely on our own relationships on Capitol Hill and with the administration itself,” Smith said. “I have a lot of confidence in our ability to succeed.”

Microsoft also announced a multi-billion-dollar investment in India this week.

Speaking to Kapelos, Smith stressed the importance for Microsoft to look outwards, even as the Trump administration puts pressure on companies to stay and maintain investments in the U.S.

“I do believe (the U.S. government) understands that this is fundamental to our business,” he said, adding that “life has lots of nuance.”

While making its latest investment announcement in Canada, Smith emphasized that Canada can “count on” Microsoft.

When asked why he felt the need to highlight that point, Smith acknowledged the changing relationships between the U.S. and other countries, including Canada, but said the company is not going anywhere.

“We have been here for more than 40 years. Our goal is to be here 40 years from now. We create the technology on which the economy relies. People have to be able to depend on us. That’s the only way we’ll be successful,” Smith said.

Microsoft currently employs more than 5,300 employees across 11 cities in Canada, including Toronto, Vancouver, Montreal, Calgary, Edmonton, Ottawa and Quebec City.

With files from The Canadian Press