Government Relations: Doing Business in Canada 2026
This chapter is part of our Doing Business in Canada guide, designed to help global investors navigate the legal, regulatory and strategic considerations that affect investment decisions, execution, and long-term success in Canada.
Government Relations
In Canada, legislative power is divided between the Parliament of Canada (the federal legislature) and provincial and territorial legislative assemblies. Each of these branches of government is based on the Westminster parliamentary model, under which the political party with the most members elected to Parliament or to the provincial/territorial assembly typically forms the government. See Canada.
Usually, the governing party that forms the federal or provincial government holds a majority of the seats in the federal or provincial legislature and governs through a Cabinet of appointed “ministers,” who are themselves members of the legislature. It is rare that members of the governing party vote against a government-supported initiative, which tends to reduce the relative influence of individual elected members of the legislature who are not Cabinet ministers.
Since April 2026, Prime Minister Mark Carney has led a majority government, following a series of floor-crossings and federal by-elections that resulted in the Liberal Party securing a majority of seats in the House of Commons. The return to majority government, after a series of minority Liberal governments between 2019 and 2026, materially reduces the influence of opposition parties and individual members of Parliament on the government’s legislative agenda, and generally allows Cabinet-supported legislation to proceed with greater certainty and speed.
At the provincial and territorial levels, minority governments and confidence-and-supply arrangements remain common. As a result, enterprises operating across Canada must remain attentive to jurisdiction-specific political dynamics, particularly where policy development or legislative reform is politically contested.
Given the extensive role of federal, provincial, and territorial governments in the Canadian economy, enterprises operating in Canada should consider a thoughtful and compliant government relations strategy. This applies not only to highly regulated industries, such as energy, telecommunications, transportation, pharmaceuticals, financial services, infrastructure, and natural resources, but also to enterprises whose operations may be significantly affected by government procurement decisions, policy shifts, taxation, trade, labour, environmental regulation, housing policy, foreign investment review, or the like.
Government relations work is needed when an enterprise seeks to initiate, support, or oppose legislative initiatives, or seeks a change in regulation or policy. A number of government ministries and regional or political interests may be involved with any given initiative or change, and the enterprise may seek meetings with all the responsible senior government employees and ministers. For example, enterprises involved in interprovincial trucking operate within a regulatory environment that includes provincial and federal ministries of transportation, industry and commerce, and labour. Likewise, private development of hydroelectric power projects usually requires contact with provincial ministries of energy, lands and environment, as well as the federal ministries of fisheries and oceans, and environment. It also may be necessary to engage the senior elected member of the governing political party who is “politically responsible” for a given region, as any given initiative or change can affect regions differently.
Notable Areas of Potential Engagement with Government
Two notable areas of potential engagement with government are relationships with Indigenous Peoples and the Canadian system of environmental assessments (EAs). Each of these is required for major project approvals.
Relationships with Indigenous Peoples
Relationships with Indigenous Peoples remain a central aspect of government relations in Canada. The three constitutionally recognized Indigenous groups (First Nations, Inuit, and Métis) hold distinct rights and interests that vary across regions.
Major projects and policy initiatives may engage the Crown’s constitutional duty to consult and, where appropriate, accommodate Indigenous Peoples whose rights or asserted rights may be affected. In recent years, governments and courts have increasingly emphasized early engagement, partnership-based approaches, and the alignment of project development with Indigenous economic participation and self-determination.
As of 2026, the federal government continues to implement the United Nations Declaration on the Rights of Indigenous Peoples (UNDRIP) through federal legislation and policy, with practical implications for project approval processes, co-governance arrangements, and consultation expectations across multiple sectors. See Aboriginal Law.
Environmental Assessments
Canada requires environmental or impact assessments for major projects that meet prescribed thresholds or fall within designated classes of activity. At the federal level, assessments are governed by the Impact Assessment Act (IAA).
In October 2023, the Supreme Court of Canada held that elements of the original IAA were partially unconstitutional. In response, Parliament enacted significant amendments to the IAA in June 2024, which are now fully in force. The amended IAA narrows the scope of federal assessments to projects that may cause non-negligible adverse effects within areas of federal jurisdiction, enhances opportunities for substitution and co-operation with provincial processes, and is intended to restore regulatory certainty while remaining consistent with co-operative federalism.
Provincial environmental assessment regimes continue to vary significantly in scope, complexity, and timelines. Some projects may be subject to both federal and provincial processes, while others may proceed under a single substituted or coordinated assessment. Enterprises contemplating major investments should engage early with regulators and governments to manage assessment risk and timing. See Environmental Regulation.
Other Areas of Interest
In recent years, several other sectors and issues are of particular importance to government relations in Canada:
Critical Minerals and National Security: Critical minerals remain a strategic priority for the federal government. Foreign investment in the exploration, extraction, processing, and supply chains of critical minerals continues to attract heightened scrutiny under Canada’s foreign investment and national security review regime, particularly where state-owned or state-influenced enterprises are involved.
Housing and Land Use: Governments of all levels are actively intervening in housing markets in response to affordability pressures (see Real Property). Measures include restrictions on foreign ownership, planning reform, accelerated project approvals, and expanded public funding for residential development and infrastructure. Enterprises involved in real estate, construction, financing, and development should expect continued policy evolution and political sensitivity in this area.
Climate Policy and Industrial Carbon Pricing: Canadian climate policy has undergone a significant reset. As of April 1, 2025, the federal consumer fuel charge was eliminated, and climate policy has shifted toward industrial carbon pricing as the principal emissions-reduction tool. In 2026, the federal government is undertaking a comprehensive review of the industrial carbon pricing benchmark, with particular focus on competitiveness, interprovincial consistency, and investment incentives. This review has substantial implications for energy, manufacturing, mining, and infrastructure projects.
The Importance of Lobbying Regulation Compliance
Lobbying is legal in all Canadian jurisdictions but is also subject to strict reporting and registration laws, which differ, to some extent, in each jurisdiction. Scrutiny of lobbying activities has been a particularly sensitive political issue in Canada over the past few years. Enterprises need to be mindful of the high standards expected of those engaged in lobbying efforts.
Codes of conduct for public officials regulate the public officials. Such codes of conduct govern what activities a public official may engage in, as well as the hospitality or gifts he or she may accept, if any. An enterprise should, for example, avoid inadvertently placing public officials in a conflict-of-interest position that could impede that official from being involved with a given issue and also bring negative attention to the enterprise’s government relations effort.
Separate codes of conduct regulate lobbyists and their interactions with public officials. An amended federal code of conduct for lobbyists came into force on July 1, 2023. It creates new disclosure requirements and revised limits around gifts and hospitality. The code restricts the circumstances in which a registered lobbyist may lobby a public official, and prohibits the lobbying of officials who could “reasonably have a sense of obligation” toward the lobbyist. The code applies to those engaging in grassroots communications.
Lobbying legislation governs individuals and organizations in the private sector who interact with public officials in Canada. Such legislation provides that organizations and their employees, and their lobbying consultants, may need to register their government relations activities with a central registry. These central registries are publicly available on the internet. Federal and provincial lobbying laws distinguish between in-house lobbyists (for businesses and organizations) and external consultant lobbyists. Businesses and organizations are required to register their in-house lobbying activities. Some jurisdictions require registration once their paid employees, directors, and officers collectively devote a certain amount of time to regulated communications with public officials. Other jurisdictions, like British Columbia, for example, require registration within 10 days of any regulated communication with public officials.
Registration of lobbyists has come under increasing scrutiny in almost every jurisdiction in Canada. The Parliament of Canada and every provincial legislature have enacted lobbyist legislation. Some cities, such as Toronto and Ottawa, also have bylaws requiring individuals who lobby municipal politicians and government employees to register. Lobbying activities in other cities, such as St. John’s, in the Province of Newfoundland and Labrador, and Montréal and Québec City, in the Province of Québec, are regulated by provincial lobbying legislation.
The types of communication that may require registration vary from jurisdiction to jurisdiction. Broadly speaking, they include: communications with public officials (which includes not only politicians, but also many government employees) with respect to the development of legislative proposals; the introduction, passage, defeat or amendment of legislation; the making or amending of any legislation; the development or amendment of any policy or program; the awarding of any grant, contribution or other financial benefit; and, in some cases, the awarding of contracts and the arrangement of meetings with public officials.
Canada has recently enacted the Foreign Influence Transparency and Accountability Act, which establishes a foreign influence transparency registry. While key provisions are not yet fully in force as of April 2026, regulations are expected imminently. The regime will require individuals and entities acting pursuant to certain arrangements with foreign principals to register and publicly disclose activities intended to influence government or political processes at all levels in Canada (see Foreign Investment Law & National Security). This new regime introduces a distinct and significant compliance consideration for multinational enterprises, state-affiliated entities, and organizations engaged in cross-border advocacy or government relations.
A well-planned government relations strategy can lead to a productive and professional relationship with decision-makers in government. Both industry and public officials benefit from these relationships because they ensure that all the facts relevant to a government decision are expressed, understood and taken into account. Governments in Canada will generally do their best to be responsive, transparent and effective in addressing the needs of enterprises. However, when engaging public officials, it is essential for an enterprise to know and follow the rules.
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