PAUL J. RICHARDS via Getty Images Fort Meade, UNITED STATES: The logo of the National Security Agency (NSA) hangs at the Threat Operations Center inside the NSA in the Washington suburb of Fort Meade, Maryland, 25 January 2006. US President George W. Bush delivered a speech behind closed doors and met with employees in advance of Senate hearings on the much-criticized domestic surveillance. AFP PHOTO/Paul J. RICHARDS (Photo credit should read PAUL J. RICHARDS/AFP/Getty Images)

The U.S. government is prodding Ottawa and some provinces to overhaul their privacy laws and allow Canadians’ personal data to be hosted on U.S. servers.

In its latest report on international trade barriers, the Office of the U.S. Trade Representative (OUSTR) criticized federal and provincial regulations preventing public bodies from storing Canadians’ personal data outside Canada.

The OUSTR took aim at Ottawa’s plan, launched in 2011, to build a unified email system for the entire federal government that would require data to be stored within Canada. That privacy regulation essentially ruled out U.S.-based companies from bidding on the contract. Bell Canada won the $400-million contract last year.

Many data services are moving to cloud-based storage, the U.S. report notes, but Ottawa's rule “hinders U.S. exports of a wide array of products and services.”

The issue has been a point of contention between the U.S. and Canada for some years, and this is not the first time the OUSTR highlighted its concerns; the previous year’s report contained many of the same criticisms. As the agency responsible for recommending trade policy to the White House, the OUSTR's reports are a good barometer of what the U.S. wants from its trade relationships.

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