The Government of Canada has launched a formal consultation on AI transparency, seeking public input on AI agents that mislead people and on the labelling of AI-generated content. The consultation, hosted on the Innovation, Science and Economic Development Canada website under the title "Have your say: Advancing AI transparency in Canada," includes a survey and will run until September 23. (The Globe and Mail; ISED)

A detailed discussion paper accompanying the consultation, published on a Thursday, sets out five areas for consideration. The paper grapples with questions that sit at the intersection of consumer protection, tort liability, and platform regulation — questions the government acknowledges existing legal frameworks were not built to answer.

One of the central questions the paper poses is who should be held responsible if an AI chatbot gives a person wrong information. The paper describes AI agents being used by Canadians to do shopping, send emails, and book meetings, and warns that these agents challenge existing understandings of liability. The point is not abstract. The paper includes a real example: a Toronto man received an erroneous $27,163 vehicle buyback offer from a car dealership's AI chatbot, named Quinn, which did not identify itself as non-human. The case illustrates the concrete consumer-protection gap the consultation is designed to address. (The Globe and Mail)

The paper also highlights a newer concern: AI agents are now interacting with other AI agents in multi-agent systems, creating reliability challenges from miscoordination or conflicts between agents. This goes beyond the familiar scenario of a single user interacting with a single chatbot and raises questions about cascading failures, attribution of fault, and what disclosure obligations should apply when no human is directly involved in a transaction.

On the international dimension, the discussion paper notes that the EU and several U.S. states have already put in place requirements to ensure users know when they are interacting with an AI system. Canada has not yet enacted comparable disclosure mandates at the federal level. The consultation appears designed to inform whether and how Ottawa might close that gap, though the government is framing this as an open question rather than a predetermined outcome.

The consultation follows the launch of Canada's federal AI strategy in June. (The Globe and Mail; ISED) The strategy and the consultation together signal that the federal government is moving from broad AI policy commitments toward specific transparency and accountability measures. The five areas set out in the discussion paper, and the responses the consultation gathers, will likely shape whatever legislative or regulatory instruments follow.

The broader context here is one of jurisdictional and temporal pressure. The EU's AI Act and various U.S. state-level measures have established disclosure and transparency obligations that Canadian entities operating cross-border may already be complying with in practice. A federal consultation that runs until late September means any resulting policy output would land well after the House of Commons resumes sitting, and likely after the AI agent market has evolved further. The inclusion of multi-agent system risks in the discussion paper acknowledges that the policy target is moving. Whether a consultation-to-legislation timeline can keep pace with deployment is a question the September 23 deadline does not answer.

For practitioners, the key detail is the scope. This is not a consultation about general AI safety or research funding. It is specifically about transparency: when and how users must be told they are dealing with an AI system, who bears liability when that system errs, and what rules should govern agents acting autonomously on behalf of users. The five areas in the discussion paper, the survey instrument, and the September 23 closing date define the narrow window in which affected parties can shape the federal approach.