Trans-border Data Flow and the TPP: Haven’t we been here before?

By Scott Campbell


In the final weeks of the 2015 Canadian federal election, the Trans-Pacific Partnership (TPP) became a hot political issue. After seven years of virtually secret negotiations, the 12 Pacific Rim countries–including Canada–involved in the trade agreement announced on October 5 that a deal had been reached, but gave few details. The final document was not available publicly until November 5, several weeks after the Liberal government was elected.

Most of the election-related discussion in October spoke to the potential impact of the TPP on the dairy and automotive industries in Canada, but the effect on other aspects of Canadian life are worth considering. Jim Balsillie, former co-CEO of RIM, apparently feels that the TPP “is the worst thing that the Harper government has done for Canada,” as it would impose structural disadvantages on Canadian innovators, limiting growth and opportunities.

The TPP also appears to remove restrictions on trans-border data flow. Consider Article 14.11 Paragraph 2 of the released document (link to PDF):

Each Party shall allow the cross-border transfer of information by electronic means, including personal information, when this activity is for the conduct of the business of a covered person.

In other words, the TPP may prevent national governments from regulating the electronic flow of data across borders.

Why is this a concern? As critics have pointed out, “personal information” includes private information, and governments should be able to regulate matters relating to the privacy of their own citizens. Still, many businesses and business organizations have come out in support of the open and free flow of data across borders to drive “economic growth, dynamism, job creation, productivity and competitiveness.

So, trans-border data flow via the TPP touches on issues significant to the electorate and general society: economic growth, trade barriers, employment, personal privacy and regulation, as well as technological sovereignty.

The history of concern in Canada for computers, privacy, and transnational electronic data flow can be traced back about five decades, well before widespread use of the internet. In 1965 there were fewer than 900 computers in the whole country. But even then people were concerned about industrial and office automation killing jobs, and the dehumanizing effects of data processing, as well as maintaining personal privacy and freedoms in an electronic age.

Leslie Mezei, a systems analyst at Confederation Life Assurance in Toronto, was one of the first to challenge his fellow computer specialists to consider their responsibilities to society. While he recognized legitimate reasons for accumulating private personal information in databases, he acknowledged the dangerous temptation to design systems that collected as much data as possible. He recommended a code of ethics for computing professionals, as well as laws and regulations to safeguard privacy.[1]

Around this time, a new generation of mainframes created a new set of privacy problems. These computers supported time-sharing: multiple simultaneous users, each at a remote terminal. Commercial time-sharing services and computer utilities emerged to share computer resources—even across borders. These same groups could also accumulate, share or even sell private data. Regulatory agencies in Canada and the United States took notice.

Canadian Communications Minister Eric Kierans strongly favoured a regulated computer services industry in Canada. He argued that regulation would prevent American domination of the Canadian market and “losing control over how information will be stored and processed.”[2] Increased regulation, in his view, could help protect individual privacy, national sovereignty and a distinct Canadian identity.

But many Canadian computing professionals argued against regulation. Some pointed to the considerable North American success of two Canadian time-sharing services–I.P. Sharpe & Associates and Systems Dimensions Ltd–as an indication that government interference was unnecessary. Others suggested that taxing or controlling electronic data flow across borders would be technologically impossible, prohibitively expensive, or simply ridiculous.[3] One example of the last involved an incident in which software worth thousands of dollars, when transferred electronically, was taxed according to the $25.00 cost of the magnetic tape it was stored on.[4]

During the 1970s many Canadian businesspeople objected to such ill-informed “ad-hockery” policy. Their views featured prominently at a 1978 Montreal conference “Issues in Canadian/U.S. Transborder Computer Data Flows,” organized by the Institute for Research on Public Policy.[5] The consensus among attendees was that misguided government regulations that attempted to protect privacy or jobs could have considerable unintended negative consequences: business costs could increase and technological or economic growth could stall or freeze.

Almost everyone at the 1978 conference agreed that trans-border issues were complex, that the Canadian government needed to develop coherent strategies and public policies in broad consultation with various stakeholders, and that global or universal solutions were likely impossible. What’s not clear, standing here nearly 40 years on, is if the TPP and the way is has been presented to Canadians offers an improvement on these concerns.[6]


Scott Campbell is the Director of the Centre for Society, Technology and Values at the University of Waterloo, where he’s also working to create a computer museum. His research revolves around the history of computing and technology in Canada.


[1] Mezei, L. “The Social Responsibility of Computer Specialists”, Quarterly Bulletin of the Computing and Data Processing Society of Canada, April 1965, p. 32–43,51

[2] McCamus, D. R. “They Worry Too Much,” CIPS Magazine, March 1970, p. 21

[3] Pickell, C. “Editors Message,” CIPS Magazine, March 1970, p. 7

[4] W. Cundiff, & M. Reid (Eds.) Issues in Canadian/U.S. Transborder Data Flows, Institute for Research on Public Policy, 1979, p. 17

[5] Ibid.

[6] For more insight into the TPP, see Jim Clifford’s post here.

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