A major American private equity firm is set to acquire Moneris, a leading payment processing company in Canada, jointly owned by Royal Bank of Canada (RBC) and Bank of Montreal (BMO). The deal, valued at $2 billion, has already boosted the shares of both RBC and BMO following the announcement. RBC anticipates a post-tax gain of around $475 million, while BMO expects $600 million from the transaction.
Despite the positive impact on the companies involved, concerns have been raised by industry analysts regarding the potential negative implications for Canada’s digital sovereignty, especially amid the ongoing trade tensions with the United States.
Digital sovereignty broadly refers to a nation’s or individual’s ability to maintain control over their digital assets. In a recent statement, AI Minister Evan Solomon emphasized the need for Canada to establish a sovereign digital economy that is not subject to external pressures.
In a significant move, Prime Minister Mark Carney was urged in an open letter by numerous experts and academics to safeguard Canada’s digital sovereignty against potential interference from the U.S. government.
Sharon Polsky, the President of the Privacy and Access Council of Canada, voiced concerns about the acquisition, emphasizing the risk of Canadians’ data being exposed to foreign governments and law enforcement agencies. Polsky highlighted potential scenarios, such as U.S. border agents accessing individuals’ transaction histories.
The concern is further compounded by the current trade war between Canada and the U.S., raising fears that the transaction data from millions of Canadian consumers could be used as leverage in trade negotiations, according to Polsky and Independent Canadian Senator Colin Deacon.
Both RBC and BMO declined to provide additional comments beyond their press releases regarding the Moneris deal. Moneris, in a separate statement, assured that its dedication to serving Canadian businesses would remain unchanged under the new ownership.
Polsky emphasized the inadequacy of Canada’s existing privacy legislation and pointed out the potential dilemma Canadian companies might face if compelled to share data with the U.S. government due to the deal. She highlighted the introduction of Bill C-36, aiming to bolster Canada’s private sector privacy framework and protect consumer data.
Despite these legislative efforts, Polsky believes that more needs to be done to address concerns related to data retention and national security. The Moneris sale is still pending regulatory approvals and is expected to be finalized by the end of the banks’ fiscal first quarter in 2027, leaving Canada with challenges in maintaining its digital sovereignty.
Overall, the acquisition of Moneris by an American firm has sparked debates about the potential implications for Canadian digital sovereignty and the need for stronger privacy protection measures in the country.