Less than two months after the Federal Court set aside the Canadian government’s order requiring TikTok Technology Canada Inc. (TikTok Canada) to shut down, the parties have reached a settlement that will allow TikTok Canada to maintain its operations in Canada. The deal, which was officially announced by the federal Minister of Innovation, Science and Economic Development (Minister) on March 9, 2026, includes commitments by TikTok Canada to increase the privacy and protection of Canadian user data, enhance protections for minors, and invest in Canada’s cultural sector.
As discussed in our previous Cassels Comment, the shutdown saga began in November 2024, when the Minister ordered TikTok Canada to wind down its domestic operations on the basis of security concerns relating to its Chinese parent company, ByteDance Ltd. A month after that shutdown order was issued, TikTok Canada challenged the order in the Federal Court. That eventually led to the Minister’s order being set aside by the Federal Court on January 21, 2026, on consent of both TikTok Canada and the Canadian government. In consequence of the Federal Court’s order, the Minister undertook a new Investment Canada Act national security assessment of TikTok Canada.
On March 9, 2026, the Minister released an official statement announcing that the further national security review was complete and that TikTok Canada would be permitted to continue operating in Canada, subject to its ongoing compliance with a new set of legally binding undertakings. According to the Minister’s official statement, these undertakings include commitments by TikTok Canada:
- to add security gateways and privacy-enhancing technologies to control access to Canadian user data to reduce the risk of unauthorized or prohibited access;
- to enhance protections for minors on the TikTok app; and
- consistent with steps taken in the European Union, appoint an independent third-party monitor to audit and verify TikTok’s data access controls on an ongoing basis.
The Minister’s statement did not include details as to which specific technologies and protections TikTok Canada intends to implement pursuant to these new undertakings. Instead, the Minister’s statement generally notes that the undertakings are similar to the approach to TikTok taken in the European Union.
The Minister also broadly referred to TikTok Canada making “commitments to invest in [Canada’s] cultural sector”, an activity suspended by TikTok Canada when the Minister initially ordered TikTok Canada to wind down its operations. However, the Minister’s official statement does not enunciate what those commitments are or what form they will take.
For those who have been following the regulation and national security reviews of TikTok around the world, this latest deal is unlikely to come as a surprise. Less than two months ago, ByteDance Ltd. finalized a deal with the US federal government pursuant to which the TikTok app will be operated in the US by a majority American-owned joint venture company, and as noted above, the European Union has also been engaged in extensive negotiations with TikTok to improve its privacy and security protections. The consistent global approach to placing restrictions on TikTok’s operations while still allowing it to operate as a commercial enterprise reflects a recognition that a balance needs to be struck between the legitimate security concerns posed by TikTok and its parent company and the growing role that TikTok’s app plays as a platform for expression, the exchange of ideas, and the dissemination of cultural content.
The Cassels Entertainment & Sports Law team will continue to monitor developments in this area. If you have any questions about the contents of this article, please reach out to the authors of this article or any member of our team.