Good morning! This is Queen Street Analytics' weekly roundup of regulatory developments, legislative discussions, political announcements and other government-related news concerning Canada's national defence, cybersecurity, border security, weapons systems, military commitments, and the Canadian Armed Forces (CAF), Royal Canadian Navy (RCN) and Royal Canadian Air Force (RCAF). Every Monday, we break down the most important updates in this space in under five minutes.

Want to track GR news in industries related to Defence? Don’t miss this week’s updates in ICT & Cybersecurity.

Dates: 2025-08-24 to 2025-08-30

📋 In This Week's Newsletter

• 🇨🇦 Canadian Federal GR News
• 🇺🇸 US Federal GR News
• 🗺️ Canadian Provincial GR News
• 📚 What We're Reading This Week

Canadian Federal GR News

Canada advances Canadian Patrol Submarine Project procurement, identifies qualified suppliers

On August 26, the Government of Canada, via Public Services and Procurement Canada, announced the identification of Thyssen Krupp Marine Systems (Germany) and Hanwha Ocean (South Korea) as the two qualified suppliers for the Canadian Patrol Submarine Project. This step follows comprehensive assessments of Canada’s requirements and consultations with allied governments and militaries regarding submarine fleet construction timelines and sustainment programs. The Royal Canadian Navy is seeking a fleet with extended range and endurance suitable for Arctic deployments, emphasizing stealth and advanced underwater surveillance. The project is intended to enhance national security, operational readiness, and international deployments across three ocean theatres. Procurement negotiations and technical engagements with the selected suppliers will proceed, with the first submarine delivery targeted no later than 2035. The announcement also referenced economic opportunities for Canada’s marine and defence industries over the submarine fleet’s lifecycle.

Sources: Announcements: www.canada.ca, Canadian News Outlet: www.ctvnews.ca

Canada signs Military Cooperation MoU with Indonesia’s Armed Forces

On August 25 in Ottawa, General Jennie Carignan, Chief of the Defence Staff, signed a new Military Cooperation Memorandum of Understanding with Indonesia’s Tentara Nasional Indonesia (TNI). The agreement deepens bilateral military ties, expanding collaboration in maritime security, joint exercises, and capability development. Canadian Armed Forces members are currently deployed in the region for Operation HORIZON and will participate in Exercise SUPER GARUDA SHIELD 2025 with the largest Canadian contingent to date. The MoU builds upon the existing Military Training and Cooperation Program, under which more than 700 Indonesian personnel have trained in Canada since 2008. The arrangement supports objectives set by Canada’s Indo-Pacific Strategy, fostering defence cooperation with ASEAN member nations.

Sources: Announcements: www.canada.ca

National Defence schedules public engagement sessions for Arctic Over-The-Horizon Radar Project in Ontario

The Department of National Defence has set public engagement sessions for the development of the Arctic Over-The-Horizon Radar (A-OTHR) project in Southern Ontario. On September 9, sessions in Kawartha Lakes will detail the upcoming construction of a transmit site at Thistle Trail, and on September 10, sessions in Clearview Township will focus on a preliminary receive site at Sideroad 15 and 16. These events, accessible both in-person and virtually, will provide project briefings and Q&A opportunities led by DND experts, with post-session summaries to follow. These facilities are part of Canada’s broader strategy to enhance Arctic surveillance and national security posture.

Sources: Announcements: www.canada.ca, Announcements: www.canada.ca

Canadian economic indicators for machinery, equipment, and defence-sector R&D

Statistics Canada released updated data for June 2025's Machinery and Equipment Price Index, enabling defence industry stakeholders to track relative equipment costs. Additionally, the Annual Survey of Research and Development in Canadian Industry now includes 2023 actuals, 2024 preliminary, and 2025 intentions for overall industrial R&D, covering energy and intellectual property expenditures. These datasets offer benchmarking opportunities for capital investment and R&D planning relevant to defence contractors and supply chain participants.

Sources: Open Government Data Set: www.statcan.gc.ca, Open Government Data Set: www.statcan.gc.ca

Defence procurement secretary discusses fighter jet purchase with Lockheed Martin

According to reporting dated August 27, Defence Procurement Secretary Stephen Fuhr met with Lockheed Martin representatives to discuss the potential acquisition of new fighter jets for Canada. The ongoing negotiations center on modernization requirements for the Royal Canadian Air Force and are associated with broader procurement reforms targeting project delivery timelines and supplier engagement.

Sources: Canadian News Outlet: www.theglobeandmail.com

Canada’s $2B military aid package for Ukraine features drones and armoured vehicles

Media coverage from August 24 outlines the structure of Canada’s $2 billion military aid package to Ukraine. The assistance includes surveillance drones, armoured vehicles, and supporting equipment, marking a continued commitment to supply advanced technology and mobile assets to Ukrainian forces.

Sources: Canadian News Outlet: www.ctvnews.ca

Industry survey shows widespread dual-use production among Canadian companies

A recent survey reported by national media found that hundreds of Canadian companies manufacture products with dual-use civilian and military applications. The findings indicate the prevalence of cross-sector technological capabilities, which may influence future procurement strategies and export permit considerations.

Sources: Canadian News Outlet: www.theglobeandmail.com

US Federal GR News

ITAR revisions update U.S. Munitions List; new exemptions added for UUVs

The Department of State published amendments to the International Traffic in Arms Regulations (ITAR), revising the U.S. Munitions List effective September 15, 2025. Lead-free birdshot and certain GNSS anti-jam systems are removed, while controls are added for advanced military aircraft and large unmanned underwater vehicles (UUVs).

Sources: U.S. Federal Announcements: www.federalregister.gov

Defense Department finalizes rules to prevent consulting conflicts with covered foreign entities

DoD issued a final rule amending the Defense Federal Acquisition Regulation Supplement (DFARS), effective October 24, 2025, to implement section 812 of the FY2024 National Defense Authorization Act. Contracting officers are prohibited from awarding contracts under NAICS 5416 codes to offerors with consulting services for listed covered foreign entities, including governments of China, Russia, or entities on specific Commerce and Treasury lists, unless a conflict-of-interest mitigation plan is approved.

Sources: U.S. Federal Announcements: www.federalregister.gov

Federal acquisition-related thresholds rise with inflation; new micro-purchase and SAT levels adopted

On August 27, the Federal Acquisition Regulatory (FAR) Council published a final rule adjusting acquisition-related thresholds to account for inflation, effective October 1, 2025. Notably, the micro-purchase threshold increases from $10,000 to $15,000, while the simplified acquisition threshold rises from $250,000 to $350,000.

Sources: U.S. Federal Announcements: www.federalregister.gov

White House excludes additional agencies from collective bargaining requirements for national security missions

Executive Orders signed by President Trump on August 28 exclude agencies with national security missions—including certain Bureau of Reclamation hydropower units, NASA, NESDIS, NWS, PTO, and USAGM—from federal collective bargaining obligations.

Sources: White House Announcements: www.whitehouse.gov, White House Announcements: www.whitehouse.gov

DoD implements inflation adjustment and technical amendments in DFARS acquisition regulations

The Defense Acquisition Regulations System published two final rules effective October 1, 2025. The first introduces technical amendments to the DFARS, correcting cross-references, clause headings, and terminology. The second incorporates inflation adjustments across several DFARS acquisition-related thresholds, aligning reporting, contract award, and compliance benchmarks with updated Consumer Price Index figures.

Sources: U.S. Federal Announcements: www.federalregister.gov, U.S. Federal Announcements: www.federalregister.gov

Canadian Provincial GR News

Ontario invests $23M in high-demand sector training, including aerospace and manufacturing

The Ontario government announced over $23 million in funding to support training programs in Mississauga and other regions, targeting construction, manufacturing, aerospace, and transportation, with partners like Aircraft Maintenance Engineers Association of Ontario and the National Electrical Trade Council.

Sources: Provincial Announcement: news.ontario.ca

What We're Reading This Week

• Why some local businesses are looking to get into the defence industry: Local businesses in Canada are exploring new opportunities to enter defence contracting amid sector expansion.
• The economic promise – and peril – of higher defence spending: Analysis of economic effects tied to increased defence budgets in Canada.
• Opinion: How to fund increased defence spending? There’s nothing wrong with borrowing: Commentary considers fiscal options for meeting rising defence funding needs.
• Canadian car parts manufacturers hope military contracts open new doors amid Trump trade war: Automotive suppliers look to defence contracts for diversification and resilience.
• All eyes turn to the Arctic as Canada ramps up defence spending: Increased defence spending redirects attention to Arctic sovereignty and security.
• Joly asks Canada’s financial sector to lend to defence companies: Foreign Minister Mélanie Joly calls for financial sector support for Canadian defence firms.
• Hundreds of Canadian companies making ‘dual use’ products useful for defence, survey finds: Survey data reveals widespread dual-use manufacturing capabilities in Canada.
• Defence procurement secretary and Lockheed Martin meet, discuss purchase of fighter jets: Ongoing talks between government officials and Lockheed Martin regarding new fighter jets.
• Canada takes next step in submarine procurement project as PM tours one of two qualified suppliers: Coverage of Canada’s submarine project and site visits with potential suppliers.
• Drones, armoured vehicles part of Canada’s $2B military aid package for Ukraine: Details of military assets included in Canadian aid to Ukraine.

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