APInternal Trade Minister Chrystia Freeland stated that Ottawa has removed all 53 federal exemptions under the Canadian Free Trade Agreement (CFTA) in a landmark move announced on June 30, 2025.
These carve-outs, known as “exceptions,” gave preferential treatment in federal procurement to certain sectors such as finance, commercial land development, transportation services, and space projects, but also blocked companies from doing business across provincial borders.
“Removal of all federal exceptions in the Canadian Free Trade Agreement is one of the many recent measures we are taking, following the passing of the One Canadian Economy Act, to eliminate internal trade barriers and cut red tape for Canadian businesses,” Freeland said in the statement.
One Canadian economy
Freeland’s announcement comes just one day before Canada Day, fulfilling Prime Minister Mark Carney’s commitment to finish this work by July 1. Carney, who campaigned on uniting Canada’s 13 provinces and territories into “one Canadian economy”, immediately hailed this as a victory in a broader strategy to reduce Canada’s reliance on the US amid ongoing trade disputes.
Most exemptions lifted were federal-only issues, such as procurement rules that gave Ottawa bias. Provincial exemptions remain in place, including in areas like dairy, alcohol, and licensing laws. Provinces and territories are scheduled to review and remove their exceptions, with updates expected at a special Committee on Internal Trade meeting on July 8.
This announcement follows the June 20 passage of Bill C‑5, known as the One Canadian Economy Act, which received royal assent on June 26. The bill has two parts, one codifies the elimination of federal trade and labour restrictions; the other fast‑tracks large national projects deemed in the national interest.
Industry groups, including the Canadian Chamber of Commerce, support the move, calling it a long‑overdue modernization. But critics raise flags. The Assembly of First Nations and environmental groups worry the new Building Canada Act, part of Bill C‑5, could override provincial, Indigenous, and environmental laws in pursuit of “national interest” megaprojects.
These carve-outs, known as “exceptions,” gave preferential treatment in federal procurement to certain sectors such as finance, commercial land development, transportation services, and space projects, but also blocked companies from doing business across provincial borders.
“Removal of all federal exceptions in the Canadian Free Trade Agreement is one of the many recent measures we are taking, following the passing of the One Canadian Economy Act, to eliminate internal trade barriers and cut red tape for Canadian businesses,” Freeland said in the statement.
One Canadian economy
Freeland’s announcement comes just one day before Canada Day, fulfilling Prime Minister Mark Carney’s commitment to finish this work by July 1. Carney, who campaigned on uniting Canada’s 13 provinces and territories into “one Canadian economy”, immediately hailed this as a victory in a broader strategy to reduce Canada’s reliance on the US amid ongoing trade disputes.
What changed, and what hasn’t
Most exemptions lifted were federal-only issues, such as procurement rules that gave Ottawa bias. Provincial exemptions remain in place, including in areas like dairy, alcohol, and licensing laws. Provinces and territories are scheduled to review and remove their exceptions, with updates expected at a special Committee on Internal Trade meeting on July 8.
Bill C‑5
This announcement follows the June 20 passage of Bill C‑5, known as the One Canadian Economy Act, which received royal assent on June 26. The bill has two parts, one codifies the elimination of federal trade and labour restrictions; the other fast‑tracks large national projects deemed in the national interest.
Industry groups, including the Canadian Chamber of Commerce, support the move, calling it a long‑overdue modernization. But critics raise flags. The Assembly of First Nations and environmental groups worry the new Building Canada Act, part of Bill C‑5, could override provincial, Indigenous, and environmental laws in pursuit of “national interest” megaprojects.
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