Expanding and Doing Business in Canada: Defence Industrial Strategy

For defence and military businesses seeking to supply into Canada, the Defence Industrial Strategy (“the Strategy”), released in February 2026, materially reshapes the procurement landscape by prioritizing domestic production, strengthening the Canadian defence industrial base and expanding defence-related investment.

This overview addresses key questions arising from that policy shift, with a focus on domestic procurement preference, proposed reforms to the Industrial and Technological Benefits (“ITB”) policy, the possible use of national security exceptions and the broader spending opportunities tied to Canada’s North Atlantic Treaty Organization (“NATO”)-aligned defence and security commitments.

Because a number of measures remain subject to further policy development and implementation, businesses should assess both the current framework and the announced reforms expected to unfold through 2026.

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