The Supreme Court of Canada Upholds an Order of $1 Million in Punitive Damages Against an Insurer - Found to Be In Bad Faith

April 1, 2002

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May 6, 2026

Eight partners recognized as leaders in Canada for their expertise in infrastructure, according to Lexpert

On May 6, 2026, Lexpert recognized the expertise of five of our partners in its 2026 Lexpert Special Edition:Infrastructure. Laurence Bich-Carrière, Jean-Sébastien Desroches, Christian Dumoulin, Nicolas Gagnon, Édith Jacques, Marc-André Landry, Ouassim Tadlaoui and André Vautour now rank among Canada’s leaders in supporting economic players in the infrastructure industry. Laurence Bich-Carrière, is a member of the Quebec and Ontario Bar Associations, Laurence Bich-Carrière practices within the Litigation and Dispute Resolution group, in a versatile civil and commercial litigation practice specializing in complex litigation (class actions, appeals, extraordinary remedies, private international law). Jean-Sébastien Desroches practises business law and focuses primarily on mergers and acquisitions, infrastructure, renewable energy and project development as well as strategic partnerships. He has had the opportunity to steer several major transactions—complex legal operations, cross-border transactions, reorganizations, and investments—in Canada and at an international level on behalf of Canadian, American, and European clients and international corporations and institutional clients in the manufacturing, transportation, pharmaceutical, financial, and renewable energy sectors. Christian Dumoulin is a partner in the firm’s Business Law Group. He served as Managing Partner of the Sherbrooke office from 2015 to 2023 and sat on the firm’s Board of Directors from 2015 to 2017, and again in 2024. He specializes in mergers and acquisitions, commercial law and real estate law, and acts as a business and strategic advisor to clients of all sizes. Recognized for his rigour and practical approach, he supports clients in complex transactions (reorganizations, financings, sales and acquisitions, shareholder disputes). He has also been advising on infrastructure projects for more than fifteen years, including public-private partnerships, as well as on all aspects of commercial real estate law. Nicolas Gagnon focuses his practice on construction law and suretyship. He counsels contractors, public and private sector clients, professional services firms as well as surety companies at every stage of construction projects. He advises clients on the public bidding and procurement processes and participates in the negotiation and drafting of contractual documents involving various project delivery methods, such as public-private partnership projects and design, construction, financing and maintenance contracts. In addition to advising various construction industry stakeholders on construction management and any claims that may arise, he also assists them with dispute resolution processes. Édith Jacques is a partner in the Business Law Group in Montréal. She specializes in mergers and acquisitions and commercial and international law. Édith acts as strategic business advisor for medium to large private companies. Marc-André Landry is a member of the Litigation and Conflict Resolution group and focuses his practice on commercial litigation. He frequently assists his clients in resolving their disputes through negotiation, mediation or arbitration, or before the various courts of law. Over the years, he has represented businesses in many sectors, including construction, real estate, renewable energy, conventional energy, new technologies, financial services and pharmaceuticals. Ouassim Tadlaoui is a partner in the firm’s Litigation and Dispute Resolution Group and focuses his practice on banking litigation, restructuring, bankruptcy and insolvency, as well as construction surety. He represents chartered banks and other financial institutions and alternative lenders as creditors, as well as certain debtors, in bankruptcy and restructuring proceedings. He also represents and advises surety companies, as well as national and international businesses, in insolvency, bankruptcy and restructuring matters in the construction industry. André Vautour practises corporate law and commercial law, and is specifically interested in corporate governance, strategic alliances, joint ventures, investment funds, and mergers and acquisitions of private companies. He also practises technology law (drafting technology development and transfer agreements, licensing agreements, distribution agreements, outsourcing agreements, and e-commerce agreements). About Lavery Lavery is the leading independent law firm in Quebec. Its more than 200 professionals, based in Montréal, Québec City, Sherbrooke and Trois-Rivières, work every day to offer a full range of legal services to organizations doing business in Quebec. Recognized by the most prestigious legal directories, Lavery professionals are at the heart of what is happening in the business world and are actively involved in their communities. The firm’s expertise is frequently sought after by numerous national and international partners to provide support in cases under Quebec jurisdiction.

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July 8, 2026

Generous Federal Investment Tax Credits for Clean Energy Projects

In 2021, the federal government introduced a series of refundable investment tax credits (the “ITCs”) to accelerate the transition to a low-carbon economy, stimulate economic growth, and support innovation. The Spring Economic Update 2026 confirms the growing importance of these measures. In particular, it announces that the Canada Revenue Agency (the “CRA”) will give increased priority to requests for advance rulings regarding eligible clean energy projects. In this regard, the CRA plans to increase its capacity to process these applications by more than 4.5 times by July 2026. In this context, two measures are of particular note: the Clean Technology ITC and the Clean Electricity ITC. 1. The Clean Technology ITC The Clean Technology ITC generally applies to certain capital investments in equipment and systems that contribute to the production of clean energy, the improvement of energy efficiency, and the reduction of greenhouse gas emissions, provided that such assets are acquired and used in Canada in accordance with the applicable criteria. This refundable credit can reach up to 30% of the capital cost of eligible property. It thus serves as a significant financial lever, helping to strengthen liquidity and improve project profitability, particularly during the early years. In practice, the analysis required to apply for this credit focuses primarily on the following elements: the entity’s eligibility (including its status as a taxable Canadian corporation); the property’s qualification (eligible category, function, and use); the timeline (dates of acquisition, installation, and commissioning); the impact of labour requirements, which may influence the applicable rate; interaction with other tax credits. The application period covers property acquired and that becomes available for use between March 28, 2023, and December 31, 2034. 2. The Clean Electricity ITC The Clean Electricity ITC is another measure that is gaining importance. It is of particular interest in structures where the investor (or certain investors) is tax-exempt or belongs to categories of entities for which several clean economy ITCs have historically been less accessible. Indeed, this credit is designed to be accessible to a broader range of entities, including notably (according to the proposed definitions) certain eligible trusts, designated provincial or territorial Crown corporations, corporations principally owned by municipalities, as well as entities affiliated with Aboriginal governments. At this stage, the government has published legislative proposals accompanied by explanatory notes, and the CRA has recently consolidated the relevant information on this subject on its website. Notably, it appears that: the credit would provide a base rate of 15% of the capital cost of eligible clean electricity-related property; eligibility would apply to property used primarily to generate, store, or transmit electricity, subject to technical and environmental criteria; the rate could be reduced in the event of non-compliance with certain labour requirements; the proposed application period would cover investments made from April 2024 and that becomes available for use on or before December 31, 2034. 3. Structuring: Corporation or Limited Partnership Beyond the technical eligibility of the property, the legal structure chosen for a project will have a decisive impact on the ability to claim ITCs and pass on their economic value to investors. In some cases, a taxable corporation is simpler to administer and more easily meets the eligibility criteria. Conversely, a limited partnership (“LP”), while useful for certain financing objectives, presents several disadvantages in the context of ITCs: 3.1 Constraints Related to Investors’ Tax Status Certain tax credits—particularly the Clean Technology ITC, often considered one of the most advantageous—are naturally better suited for taxable investors. When an LP has non-taxable members, converting the tax benefit into economic value may be less optimal, depending on how the credit is allocated and used. 3.2 Allocation of Credits and Limits for Limited Partners The rules governing credits within a partnership generally require that the allocation to each partner be reasonable, taking into account, in particular, their capital investment and contribution. Furthermore, for a limited partner, the share of the credit may be limited by “at-risk” rules, which cap certain tax benefits based on actual economic exposure. In practice, this can reduce the amount of credit available and limit allocation flexibility. 3.3 Increased Complexity of Monitoring and Compliance An LP generally entails heavier administrative obligations: calculating at-risk amounts, tracking allocations, documenting contributions and distributions, and ensuring consistency between the partnership agreement, financing agreements, and tax positions. This complexity can become a significant issue in the event of a tax audit. Conclusion Federal ITCs represent a major financial incentive for clean energy projects. However, their application depends on technical, tax, and structuring criteria that must be rigorously analysed and documented. Furthermore, the legislative framework governing these credits is constantly evolving (implementing regulations, administrative guidelines, and technical requirements), making a case-by-case analysis essential to confirm eligibility and optimize a project’s structure. We invite you to contact our tax team. We would be happy to assist you in successfully bringing your project to completion. Key Takeaways A Major Administrative Acceleration by July 2026 The CRA is making clean energy a priority: its capacity to process advance tax ruling requests will increase by more than 4.5 times by July 2026. For proponents, now is the time to act to secure early tax certainty. Two Powerful Financial Levers with Distinct Criteria Clean Technology: A major refundable credit of up to 30% of capital costs, primarily targeting taxable Canadian corporations. Clean Electricity: A refundable credit of up to 15% of capital costs structured to include entities that were historically restricted, such as Crown corporations, municipalities, and Indigenous organizations. Legal Structuring Can Make or Break Your ITCs Choosing the right legal vehicle is just as critical as technical asset eligibility. While popular for financing, LPs introduce significant complexity due to "at-risk" rules, the involvement of non-taxable partners, and a heavy compliance burden during tax audits.

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July 2, 2026

Bill 10: Significant amendments to the Consumer Protection Act and heightened risk for merchants

The Act to protect consumers against abusive practices in ticket reselling and online subscription renewal (“Law 10,” formerly Bill 10, “Bill 10”) was adopted on June 11, 2026, and assented to on June 12, 2026. Law 10 is part of the legislature’s efforts to strengthen Quebec’s consumer protection regime. It will come into force on September 12, 2026. However, certain provisions took effect as soon as June 12, 2026, in particular section 10, which provides for the addition of new section 272.1 to the Consumer Protection Act (“CPA”). Some measures in Law 10 are aimed at commercial transparency and making the consumer experience more straightforward. Others, such as the introduction of the new section 272.1 of the CPA, are likely to substantially reconfigure consumer law in Quebec. The Parliamentary Committee significantly amended Bill 10 during its detailed review on May 7, 2026. The most consequential amendment was making the new section 272.1 of the CPA “declaratory,” overriding the Court of Appeal’s interpretation in Union des consommateurs c. Air Canada, 2025 QCCA 480,1 currently under appeal before the Supreme Court of Canada. Ticket reselling: stricter rules focused on disclosure Law 10 introduces a structured regime for ticket resale platforms without prohibiting the business model. The focus is on the quality of information provided to consumers. These requirements will take effect on September 12, 2026. The new provisions impose a transparency requirement from the moment consumers access a website and throughout the entire transaction process. They must be informed that they are using a resale platform—and not dealing directly with the original seller—and must be given clear information about the type of ticket, its original price and applicable terms and conditions. With this provision, the legislature is requiring that prices be broken down rather than banning certain fees. The chosen model continues to allow commercial flexibility, provided that the price structure is fully disclosed. Contracts involving sequential performance: tighter regulation of the contract lifecycle Law 10 also introduces new requirements regarding contracts involving sequential performance, in particular online subscriptions. These requirements will take effect on September 12, 2026. The law requires merchants to provide a cancellation mechanism that is not only accessible, but also designed not to create an undue obstacle. In addition, merchants are required to notify consumers before the end of a promotional period or before a new price takes effect. Note: The requirement to provide notice before the end of a free or discounted period does not apply to contracts already in effect as of September 12, 2026. These provisions reflect a desire to tighten control over the performance of contracts, rather than just their formation. For merchants, this means they need to review their digital interfaces and internal processes to ensure ongoing compliance. Beyond technical adjustments, there is also a litigation risk, as these new obligations could serve as grounds for legal action under the CPA, especially when the cancellation mechanism is perceived as difficult or hard to access. Clauses prohibiting consumer reviews Law 10 also prohibits provisions that prevent consumers from publishing or communicating reviews of a good or service, or of the merchant’s conduct. This prohibition took effect on June 12, 2026. It aims to eradicate contractual practices that restrict consumers’ freedom of expression in the digital environment. The decision in Union des consommateurs c. Air Canada, 2025 QCCA 480, and the new section 272.1 of the CPA In its decision rendered on April 22, 2025, in Union des consommateurs c. Air Canada, the Court of Appeal reiterated that a merchant who advertises a partial price and then demands a higher price at the time of payment violates section 224 of the CPA, which requires that the advertised price reflect the total amount payable. The Court acknowledged that a violation such as this may give rise to the remedies provided for in section 272 of the CPA, particularly because of the presumption of fraudulent effect2. It concluded that the practice of breaking down the price is likely to influence consumer behaviour and may, as such, trigger the application of the presumption. However, the Court of Appeals refused to automatically award compensation equal to the difference between the advertised price and the price paid. It stressed that, despite the applicable presumption, the consumer must demonstrate quantifiable harm, in accordance with the general principles of civil law. It thus cast aside the notion that a violation of the CPA must automatically result in restitution. The Court also pointed out that the remedies provided for in section 272 of the CPA are compensatory in nature and must not result in the consumer’s enrichment. It did, however, award $10 million in punitive damages for the conduct in question, deeming it vital to deter its repetition. This decision aligns with the balance set out in Fortin c. Mazda Canada Inc., 2022 QCCA 6353 and other rulings, namely that the seriousness of violations of the CPA must be recognized, but damages must still be proven. It is precisely this balance that the new section 272.1 of the CPA, as amended on May 7, 2026, calls into question. In its final form, section 272.1 of the CPA provides that a merchant who demands payment of a sum in violation of the CPA must refund that sum, regardless of whether a service was provided in return. What is crucial here, however, is the fact that the provision was made declaratory. By doing so, the legislature has reaffirmed what it considers to be the true state of the law, effectively overriding the Court of Appeal’s interpretation in Air Canada. The legislature’s position directly challenges the conclusion that restitution is not automatic but contingent on proof of prejudice. The term “declaratory” paves the way for the immediate—or even retroactive—application of this remedy. For merchants, the implications are considerable. Section 10, which adds section 272.1 to the CPA, came into force immediately on assent. As a result, it will likely—in some cases—nullify or render largely ineffective one of the main defences recognized by the Court of Appeal, namely the argument based on the absence of quantifiable prejudice. The scope of the new section 272.1 of the CPA is even more impactful given that the appeal of the decision in Air Canada is currently pending before the Supreme Court of Canada, with leave having been granted on February 5, 2026. The legislature thus intervened even as the country’s highest court is set to rule on the scope of remedies under the CPA. Conclusion The adoption of Bill 10, and it subsequent assent, marks significant turning point for merchants subject to the Consumer Protection Act. The law will mainly come into force on September 12, 2026, but certain provisions, including the new article 272.1 of the CPA and the prohibition of certain clauses targeting consumer notices, came into force on June 12, 2026. While the new rules governing the resale of tickets and contracts involving sequential performance primarily impose stricter operational requirements, the new section 272.1 of the CPA more directly affects the core of civil liability for merchants. By casting the Court of Appeal’s approach in Air Canada aside, the legislature has established a more automatic restitution regime, which is likely to significantly heighten financial and litigation risks for merchants. The progress of the case before the Supreme Court will need to be closely monitored, as the Court will be called upon to clarify the relationship between this legislative intervention and the principles applicable to remedies under the CPA. In this context, businesses would be well advised to (i) assess the immediate impact of section 272.1 of the CPA on their pricing practices and the risks arising therefrom and (ii) review their business practices, transactional interfaces and contractual documentation by September 12, 2026, to anticipate the entry into force of the other provisions of Law 10. If you have any questions or wish to discuss the impacts of Law 10 on your business, we invite you to contact members of Lavery’s commercial litigation team. Takeaways 1. Entry into force: two dates to remember Law 10 was adopted on June 11, 2026, and assented to on June 12, 2026 Entry into force of most provisions: September 12, 2026, but some measures have already been in effect since June 12, 2026, including the new section 272.1 of the CPA and the prohibition of clauses preventing consumer reviews. 2. New operational obligations to come into force on September 12, 2026 Ticket resale The provisions focus on disclosure, such that the consumer must: Be informed that they are using a resale platform Be given clear information about the ticket, its original price, and any terms and conditions Be given a price breakdown, as fees are not prohibited but must be itemized Contracts involving sequential performance and online subscriptions The cancellation mechanism must genuinely be accessible, without undue obstacles. Notice must be given before the end of a promotional or free period and before a new price takes effect. The notice regarding a free or discounted period coming to an end does not apply to contracts already in effect on September 12, 2026. 3. Heightened risk for merchants with the change in section 272.1 of the CPA opening the door to legal action The new section 272.1 of the CPA provides that a merchant who demands payment of a sum in violation of the CPA must refund that sum, regardless of whether a service was provided in return. Most importantly, the provision is made “declaratory” to depart from the Court of Appeal’s approach in Union des consommateurs c. Air Canada (2025 QCCA 480), significantly limiting defences based on the absence of quantifiable harm and opening the door to immediate and even retroactive application, increasing the financial and legal risk. 2025 QCCA 480 (CanLII) | Union des consommateurs c. Air Canada | CanLII Richard c Time, 2012 SCC 8 2022 QCCA 635 (CanLII) | Fortin c. Mazda Canada inc. | CanLII

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June 26, 2026

Recent developments in workplace AI adoption

Artificial intelligence (AI) is no longer merely a futuristic concept but a present-day reality—a practical business tool that is routinely used in management and production. Organizations are increasingly adopting generative AI and analytics solutions for tasks such as writing, sorting, decision-making, monitoring and evaluating. However, this is often done without any prior structured planning. Employers now face the dual challenge of achieving productivity gains quickly while ensuring that AI does not pose legal, reputational or operational risks. The range of applications is expanding to include writing assistance, decision-making support, performance analysis, digital monitoring and incident and accident prediction. This raises questions of interest to both executives and the media. For example, who should be held responsible when the tool makes a mistake? What data is being used? How far can employers go in monitoring their employees? If properly regulated, AI can support innovation and expedite its implementation, while also contributing to workplace well-being, health and safety. In Quebec, these benefits are particularly significant in the context of an aging population, labour shortages and increased pressure to boost productivity. Addressing this situation requires solutions that foster growth and competitiveness. The use of AI systems in the workplace raises real and multifaceted challenges. These include protecting personal information and maintaining confidentiality, establishing liability and accountability where errors or failures occur, and considering the potential impact on workloads and the work environment. Aware of the effect that digital transformation and AI are having on the workplace, the Minister of Labour launched a consultative process to assess whether existing legislation adequately addressed these developments. In October 2025, he tasked the Comité consultatif du travail et de la main-d’œuvre (the “CCTM”) with further exploring ideas and developing a shared vision regarding: Consultation processes that factor in the implications of AI use in the workplace; Ethical, governance and transparency principles in human resources decision-making; The prevention of emerging occupational health and safety risks.1 CCTM report: Recommendations The Avis du CCTM concernant les enjeux entourant l’implantation et l’usage des systèmes d’intelligence artificielle en milieux de travail au Québec [CCTM report on the implications of implementing and using artificial intelligence systems in Quebec workplaces] (“CCTM Report”) was released on April 29, 2026. The recommendations set out in the report regarding the implementation and use of AI systems in Quebec workplaces include, in particular: Applying the current legal framework governing labour and employment law in Quebec; Preserving the essential role of human judgment—and the responsibility that comes with it—in automated decision-making processes; Applying laws respecting the protection of personal information2 when developing, implementing and using AI systems, and prioritizing solutions that limit the use of electronic surveillance; Implementing an algorithmic impact assessment process that would involve employees and take into account the impact of automated decision-making on fundamental rights and privacy; Ensuring that organizations continue to support employee mobility and ongoing professional development; Regulating algorithms through sound governance practices that promote transparency and explainability in algorithmic decision-making; Placing emphasis on the need to pay special attention to discriminatory biases. In its report, the CCTM also makes recommendations to the Commission d’accès à l’information, such as updating its guide on drafting privacy policies to include disclosure requirements regarding AI and surveillance technologies, and encouraging employers to inform employees of their intention to use partially or fully automated decision-making processes. Lastly, the CCTM recommends that the Ministère du Travail develop, in collaboration with the CCTM, a guide to support the implementation of responsible, compliant and socially acceptable AI. Guide released by the Ministère du Travail: 5 principles Further to the recommendations made in the CCTM report, the Minister of Labour released, on June 12, 2026, a document titled L’intelligence artificielle au travail : Guide d’accompagnement pour une intégration responsable [A guide to using artificial intelligence responsibly in the workplace] (the “Guide”). The Guide aims to ensure that AI is integrated into workplaces in a responsible, user-centric and collaborative manner. It sets out five (5) key principles designed to inform discussions and help organizations recognize the main issues, namely: Respect for rights and freedoms in the workplace; Protection of privacy and data governance; Governance, participation and social dialogue; Human oversight and transparency; Sustainable development and well-being. For each principle, the Guide provides examples of how AI is used in the workplace. It also highlights the associated benefits and challenges, and suggests practical steps to ensure that AI is adopted and used responsibly. The Guide serves as a practical, evolving tool that organizations and labour market stakeholders are encouraged to tailor to their specific circumstances. Accessible and regulated AI While the adoption of AI in the workplace offers tangible opportunities for improvement, it also raises important issues that require careful oversight. With that in mind, the Guide aims to support the use of AI in a way that protects rights and users, while taking workplace considerations into account. It also aims to provide the various stakeholders involved with the tools they need to facilitate the adoption of AI at work. A number of interesting challenges are likely to arise over the next few years, and Lavery’s highly qualified professionals are ready to help you deal with them. Contact the team today. Comité consultatif du travail et de la main-d’œuvre, Avis du CCTM concernant les enjeux entourant l’implantation et l’usage des systèmes d’intelligence artificielle en milieux de travail au Québec, online: lien, April 9, 2026, p. 6. (In French only) Act respecting the protection of personal information in the private sector, CQLR c. P-39.1; Act respecting Access to documents held by public bodies and the Protection of personal information, CQLR c. A-2.1.

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June 10, 2026

The Legal Pitfalls of Using Human DNA and Tissue in Quebec-based Biotechnology Projects

Biotechnology projects rely on sensitive genetic data and biological material Nowadays, innovation-driven companies involved in life sciences, research and biotechnology handle some of the most legally sensitive assets: human tissue, biological material and genetic data. Innovation models involving tissue engineering, biobanks or AI-based analytical technologies are now based on the transfer and use of biological data with high scientific and commercial value. Yet, many organizations still prioritize the scientific and operational aspects of their projects without giving sufficient consideration to the legal restrictions that arise when a project involves a person’s DNA or biological material. From a business standpoint, the risk is that an organization—whether a private company or a public institution—might develop a technology, but then be unable to market that technology because it does not hold the necessary rights to use the biological material and information involved. In Canada, and particularly in Quebec, laws that protect personal and health information have become central to such projects.1 We are no longer simply dealing with typical cybersecurity or privacy concerns. These laws directly affect how biological material is: collected used transferred stored altered and potentially leveraged for commercial or collaborative research purposes2. Why DNA and human tissue are subject to a particular legal protection The highly sensitive nature of DNA and genetic data is no longer disputed. Canadian case law has long recognized the highly personal and private nature of this type of information.3 It also emphasizes the fact that human tissue and genetic data play a unique role in research and innovation projects because of the identification risks they carry, their scientific value, and the ethical and commercial concerns related to their use.4 This perspective is evident in section 2 of the Act respecting health and social services information5, for example, which defines health information as any information that concerns “any material taken from [a] person,” including biological material. Section 5 and following of this act set out the conditions under which such information may be used, disclosed or transferred in the context of research or collaboration involving third parties6 These obligations supplement those set forth in the Act respecting the protection of personal information in the private sector,7 which requires in particular that personal information be collected for specific and legitimate purposes, and that it be used in a manner consistent with the purposes for which it was originally collected.8 Artificial intelligence, genetic data and the risk of re-identification From a biotechnology perspective, the matter becomes particularly touchy when human tissue or genetic data, which was initially collected for clinical or scientific purposes, is then used for technology or artificial intelligence projects. In fact, many projects that utilize artificial intelligence require not only biological samples and DNA, but also phenotypic data, health information and family history information from the patients from whom the biological samples were obtained. As such, there is a real risk of data cross-referencing here that must be managed with full awareness of the potential impact on those individuals. In certain projects, combining DNA with family information could compromise the privacy of not only the individuals from whom the biological material was collected, but also their family members. This problem has already been raised in relation to genetic genealogy.9 Consent, health information and secondary uses tend to be overlooked A project that was initially intended for research purposes can quickly drift into secondary uses that extend beyond its original scope. However, consent obtained at the outset does not necessarily cover all future uses, particularly where derived data or analysis results are integrated into technology platforms or used to develop analytical tools.10 Research agreements and biological material transfer agreements constitute an essential governance mechanism Agreements have thus become the key governance mechanism. Biological material transfer agreements, collaborative research agreements and data-related provisions are no longer solely intended to protect intellectual property or commercial confidentiality. They also serve to define the processes involved in transferring biological samples, ensuring data traceability, imposing restrictions on reuse and meeting anonymization requirements.11 The rights relating to intellectual property, DNA and personal information are interconnected The interplay between biotech innovation, intellectual property and personal information protection raises complex legal issues. A genetic database or a biological model derived from it can be both a strategic business asset AND a collection of highly sensitive personal information. However, any intellectual property rights that may apply to the results, algorithms or analytical methods do not exempt organizations from the obligations set out in Quebec laws regarding the protection of personal and health information12. On the contrary, in order to market a technology, organizations must hold not only the necessary intellectual property rights but also the rights required under the legal framework governing health and personal information. The commercialization of a technology begins long before it is brought to market As organizations increasingly seek to leverage data from scientific research, issues related to the governance of human tissue, DNA and biological material should no longer be treated as a secondary consideration addressed only at the end of a project. They are becoming an integral part of the legal, operational and commercial framework of modern biotechnology projects and therefore deserve careful consideration from the outset. Summary 1. From a legal standpoint, DNA is considered to be health information In Quebec, biological material and genetic data are not merely instruments of research. Under the law, they are defined as highly sensitive “health information”. The collection, use and transfer of this type of information is strictly regulated and requires explicit, informed consent. 2. Intellectual property does not confer all rights to the holder Just because a company develops a high-performance AI algorithm or an innovative biological model does not mean it can circumvent Quebec’s privacy laws. Bringing biotech products to market requires holding the necessary intellectual property rights AND complying with the legal framework governing the use of health data. 3. The pitfall of project drift (secondary uses) Consent obtained at the outset of a clinical research project usually does not extend to future uses, such as the integration of data into AI platforms. Organizations that fail to establish a solid contractual framework (e.g., transfer agreements, anonymization clauses) from the start may never be able to market their technology. Act respecting health and social services information, CQLR c R-22.1, ss. 1, 2, 5, 44 to 49 and 77. Act respecting the protection of personal information in the private sector, CQLR c P-39.1, ss. 4, 5, 8, 12 and 14. R. v. Dyment, 1988 CanLII 10 (SCC), [1988] 2 SCR 417 Marie Hirtle and Bartha Maria Knoppers, Le stockage des éléments du corps humain, les droits de propriété intellectuelle et les autres droits de propriété, Industrie Canada, 2014. Act respecting health and social services information, supra, note 1, s. 2. Id., ss. 5, 44 to 49 and 77. Act respecting the protection of personal information in the private sector, supra, note 2. Id., ss. 4, 5, 8, 12 and 14. Clausius, K., Kenny, E. & Crawford, M. J. (2023). BILL S-231: The Ethics of Familial and Genetic Genealogical Searching in Criminal Investigations. Canadian Journal of Bioethics / Revue canadienne de bioéthique, 6(3-4), 44–56. Act respecting health and social services information, supra, note 1, ss. 44 to 49; Act respecting the protection of personal information in the private sector, supra, note 2, ss. 12 and 14. Act respecting health and social services information, supra, note 1, ss. 48 and 49; Act respecting the protection of personal information in the private sector, supra, note 2, ss. 18.3 and 23. Act respecting health and social services information, supra, note 1, ss. 5 and 49; Act respecting the protection of personal information in the private sector, supra, note 2, ss. 12, 17 and 18.3.

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