Policy Statement - Securing Canada's Telecommunications System

Innovation, Science and Economic Development Canada

The transition to 5G wireless technology is expected to usher in a new industrial era that will create significant economic and social opportunities for Canadians. The first principle of the Government of Canada's Digital Charter affirms that all Canadians should have access and equal opportunity to participate in the digital world and the necessary tools to do so, which includes connectivity. Access to advanced wireless networks is, and will continue to be, essential for Canadians and a key priority of the Government.

These advanced networks will provide the data capacity, speed, and responsiveness necessary to connect billions of devices and, over time, make technology like automated vehicles, smart cities, and the Internet of Things not only possible, but mainstream. These advanced networks will serve as the basis upon which other technologies, our digital economy, and our critical infrastructure, will depend.

Given the greater interconnectedness and interdependence of 5G networks, a breach or exploitation in this environment would have a more significant impact on the safety and security of Canadians and Canadian critical infrastructure than in previous network generations. In order to reap the economic and social benefits of 5G technology, Canada must continue to secure the foundation of its telecommunications system and adapt to the changing technological and threat environment.

The Government of Canada has conducted an extensive examination of 5G wireless technology and the various technical, economic and national security aspects of 5G implementation. The examination made clear that while this technology will bring significant benefits and economic opportunities, the technology will also introduce new security concerns that malicious actors could exploit. In 5G systems, sensitive functions will become increasingly decentralized and virtualized in order to reduce latency, and the number of devices they will connect will also grow exponentially.

The Government of Canada has serious concerns about suppliers such as Huawei and ZTE who could be compelled to comply with extrajudicial directions from foreign governments in ways that would conflict with Canadian laws or would be detrimental to Canadian interests.

Canada's closest allies share the similar concerns about these two suppliers. Given the potential cascading economic and security impacts a telecommunications supply chain breach could cause, allies have taken actions to enable them to prohibit the deployment of Huawei and ZTE products and services in their 5G telecommunications networks.

Like our allies, Canada believes that evolving international supply chain dynamics have further implications due to growing restrictions on access to certain components. Shifts from well-known inputs to others have implications for Canada's ability to conduct assurance testing. This changing supply chain environment toward other components will make it increasingly difficult for Canada to maintain a high level of assurance testing for certain network equipment from a number of potential suppliers.

The Government of Canada is announcing today that it intends to prohibit Canadian telecommunications service providers from deploying Huawei and ZTE products and services in their 5G networks.

Other forms of equipment from these suppliers have different risk profiles. However, in the context of this review the Government of Canada considers that it would be prudent to impose restrictions that build on actions already in place. These are intended to further safeguard the Canadian telecommunications system.

Overall, the Government is announcing its intention to implement the following actions:

The use of new 5G equipment and managed services from Huawei and ZTE will be prohibited and existing 5G equipment and managed services must be removed or terminated by June 28, 2024.
Any use of new 4G equipment and managed services from Huawei and ZTE will be prohibited and any existing 4G equipment and managed services must be removed or terminated by December 31, 2027.
The Government expects that telecommunications service providers will cease procurement of new 4G or 5G equipment and associated services by September 1, 2022.
The government further intends to impose restrictions on Gigabit Passive Optical Network (GPON) equipment used in fibre-optic networks.
During these transition periods, telecommunications service providers that use this equipment and managed services would be required to comply with any assurance requirements prescribed by the government, building from the Communications Security Establishment's Security Review Program.
As outlined below, these actions will be subject to consultation.

To date, Canada has already excluded Huawei and ZTE in sensitive areas of Canadian 3G/4G and LTE networks. Further, the government has imposed assurance testing in independent third-party laboratories for these suppliers before they are deployed in less sensitive areas of Canadian networks while restricting outsourced managed services from these companies across Canadian critical networks.

These measures will be implemented as part of a new telecommunications security framework. We intend to introduce amendments to the Telecommunications Act to ensure that promoting the security and protection of our telecommunications system is an overriding objective of Canada's telecommunications policy. Amendments will include mechanisms to prohibit the use of equipment and services from designated suppliers where necessary to protect Canada's telecommunications system. They would also adopt other measures under a holistic telecommunications security framework. This approach is aligned with the approach taken by our allies and partners. The Government intends to consult on the issuance of Orders taken under this legislation including with regard to prohibitions on the use of equipment and services. Further, the Government will engage with industry throughout the implementation of such measures to ensure they appropriately take into consideration any logistical realities and the need to maintain and promote the resiliency of networks in Canada.

To complement the proposed legislative actions, the Government will build on the success of the Security Review Program, led by the Communications Security Establishment in partnership with Canadian telecommunications service providers. This program will expand to consider risks from all key suppliers and apply more broadly to help industry improve the cyber security and resilience in Canada's telecommunications networks.

The Government is committed to maximizing the social and economic benefits of 5G and access to telecommunications services writ large, but not at the expense of security. As other sectors and technology adapt and connect to these networks, the Government will continue its work to uphold Canada's security interests.

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