Canada seems to be turning the heat on US tech companies

Canada is making bold moves that send a clear message to its southern tech rivals. In a two-pronged regulatory blitz, Canadian authorities are scrutinizing social media giant X over its AI data practices while ramping up fees on Google under the country’s new Online News Act. The playful yet pointed actions signal a new era of digital accountability — and they’re heating up the transnational tech debate.

Canada’s privacy watchdog is stepping into the spotlight with an investigation into X, the social media platform once known as Twitter. The probe was launched after a complaint alleged that X might have skirted federal privacy laws when using Canadians’ personal data to train its artificial intelligence models. With AI rapidly reshaping how we connect online, regulators are determined to ensure that tech innovation doesn’t come at the expense of personal privacy.

“The investigation will focus on the platform’s compliance with federal privacy law with respect to its collection, use, and disclosure of Canadians’ personal information to train artificial intelligence models,” the statement said.

X isn’t just about tweets and trends anymore — it’s also the home of xAI’s Grok chatbot, a digital assistant that was recently accused of manipulation to stop it from roasting Elon Musk and President Trump. As X integrates more AI-powered features, the investigation underscores a critical question: How much data is too much, and at what cost to privacy?

Canadian authorities haven’t revealed all the juicy details yet, but it’s clear the country is not shy about holding tech giants accountable for their data practices.

While X faces scrutiny over its AI endeavors, Google is finding itself on the receiving end of Canada’s regulatory heat. Under the new Online News Act, the tech titan has been hit with an extra levy designed to recover the costs of enforcing rules that require digital platforms to pay domestic news publishers for using their content.

Google had previously settled with Canadian authorities by agreeing to pay an annual fee of C$100 million — a sum meant to keep the country’s news ecosystem afloat. But the Canadian Radio-television and Telecommunications Commission (CRTC) isn’t done yet. Effective April 1, Google will now face an additional charge as part of a broader strategy to ensure that digital giants contribute their fair share.

The move has stirred up a bit of transnational drama. U.S. officials have taken notice, with warnings of retaliatory tariffs aimed at protecting American economic interests. The dispute over digital service taxes is just the latest twist in the ongoing global debate over how to regulate and tax tech companies that operate across borders. Similar tensions are rising between the U.S. and the EU over what some, like Bird CEO, think is overregulation that is killing innovation.

For X and Google, these actions could mean increased compliance costs and operational changes. X might need to alter data practices for AI, impacting tools like Grok, while Google faces additional financial burdens. The US-Canada relationship, already strained by trade and border issues, could see further tension, with Trump’s tariff threats adding fuel to the fire.

Globally, this aligns with efforts like the EU’s GDPR, suggesting a fragmented regulatory landscape for tech firms. For Canada, these moves reinforce its commitment to protecting citizens’ data and supporting local media, but they risk retaliatory measures from the US, potentially affecting broader economic ties.