AI funding announcement good news for tech sector, but also means legislation coming: BLG lawyer

Edona Vila says enforcement funding means Ottawa is likely to fast-track new law

AI funding announcement good news for tech sector, but also means legislation coming: BLG lawyer
Edona Vila and Lisa Chamandy, Borden Ladner Gervais LLP ("BLG")

The federal government’s recent announcement allocating $2.4 billion to support the artificial intelligence sector has created excitement for tech companies across several industries and may signal that Ottawa is fast-tracking AI legislation, says Edona Vila, a partner at Borden Ladner Gervais LLP.

Vila, who specializes in complex commercial disputes and risk advisory services, says that after the announcement, she attended a summit on AI and the Internet of Things where “there was a palpable excitement and welcome of the government's focus on AI.”

Ottawa’s funding is intended to develop AI infrastructure, enhance the private sector's capabilities, and align Canada’s AI approach with international standards.

“We might be seeing a faster rollout of the adoption of the AI federal legislation that's now undergoing clause-by-clause review,” says Vila.

The AI Compute Access Fund and Canadian AI Sovereign Compute Strategy will receive the bulk of the investment, with $2 billion set aside over the next five years. The government said these funds aim to provide Canadian researchers, start-ups, and scale-up businesses with the computational power necessary for innovation.

Vila says the focus on computational power is a sign that the government and industry “recognized that it's necessary for us to compete and catalyze the development of Canadian-owned and located AI infrastructure."

One concern tech companies expressed to Vila was how funding would be balanced between research and development and commercialization.

The budget allocates $50 million to create an “AI Safety Institute of Canada” to support the safe development and deployment of AI technologies.

The AI and Data Commissioner's Office will also receive $5.1 million to enforce the proposed Artificial Intelligence and Data Act. "If you're going to empower the commissioner's office dedicated to AI and data with resources to begin enforcing when you don't still have that legislation... that tells me that the government is thinking seriously about putting some teeth to this legislation that's to come," says Vila.

Over five years, an additional $200 million will support AI start-ups and accelerate technology adoption in agriculture, clean technology, healthcare, and manufacturing, managed through Canada’s Regional Development Agencies. This indicates a “desire to boost AI adoption in critical sectors,” says Vila.

The National Research Council’s AI Assist Program will be endowed with $100 million to help small- and medium-sized businesses implement new AI solutions to increase national productivity. $50 million will fund the Sectoral Workforce Solutions Program, which provides skills training for workers in sectors likely to be impacted by AI.

Transport Canada is also set to benefit from $6.7 million for the pre-load air cargo targeting program, which screens all air cargo bound for Canada.

Vila says it is possible the legislation could be passed as soon as the end of this year. “Companies may want to be getting themselves ready for what's to come based on what we already know.”

Lisa Chamandy, BLG's chief knowledge and innovation officer, says this funding boost will likely significantly accelerate the development of new AI tool applications in the legal space.

This acceleration means legal professionals must adapt and innovate, she says, as AI data sets become more reliable and customized. "We're starting to see tools that are coming into the Canadian market that are grounded in authoritative Canadian legal content... Lawyers should think holistically and not be afraid to experiment."

While she expects a “breakneck pace” of innovation, Chamandy says, “legal professionals, lawyers, and also the business services operations professionals who support the practice of law, need to make sure that they stay focused on being purposeful about the whole thing.”

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