The government now has a structured process for identifying and working with select Canadian defence companies on long-term sovereign capability development.
Ottawa is starting to put structure around one of the biggest promises in Canada’s Defence Industrial Strategy: building Canadian defence champions, not just buying from the lowest compliant bidder.
Published June 3, the Strategic Partnership Framework gives the Defence Investment Agency (DIA), the Department of National Defence (DND) and Innovation, Science and Economic Development Canada (ISED) a formal mechanism for identifying and designating select Canadian companies as Strategic Partners. It sits inside the Build-Partner-Buy model from Canada’s Defence Industrial Strategy and complements existing tools like the Industrial and Technological Benefits Policy.
Inside lane
A Strategic Partner designation could give selected companies earlier access to CAF capability planning, co-development opportunities, and the potential for directed or accelerated procurement where appropriate. The framework also positions government as a possible anchor customer and first buyer for a designated partner’s identified capability, which is exactly the kind of demand signal Canadian defence firms have been asking for.
Final designation authority rests with the Secretary of State (Defence Procurement), with input from the Ministers of Defence and Industry.
The practical effect is that some companies may be brought into government planning earlier than the normal procurement cycle allows. That matters because defence firms have long argued that Canada asks industry to invest, hire and scale without giving enough visibility into future demand.
What Ottawa wants back
Designation will not be unconditional. The framework sets out expectations that may include substantive decision-making authority located in Canada, Canadian-developed and Canadian-held IP, active integration of Canadian SMEs into supply chains, transparent governance and financial disclosure, and a credible plan to grow Canadian-based R&D and operations.
The framework is explicit that these are not requirements or part of a fixed scoring system. Their relevance will vary by sector, capability and opportunity.
Designations are time-limited and subject to formal review every five years. Following designation, the government and the Strategic Partner conclude a Memorandum of Understanding outlining each party’s responsibilities. The MOU is described in the framework as non-binding.
Where Canada has depth
Annex B of the framework includes a breakdown of Canadian content across sovereign capability areas, drawn from ITB policy data and Statistics Canada surveys covering 2014 to 2025.
Digital systems lead at nearly 90 per cent Canadian content, with high SME participation, strong R&D activity and substantial export performance. Naval in-service support and training and simulation for air domain in-service support both come in above 80 per cent, reflecting the depth of Canada’s domestic sustainment and simulation industries.
Aerospace sits at around 40 to 45 per cent, and specialized manufacturing for land vehicles at around 45 per cent. Uncrewed and autonomous systems sit at the bottom, at around 30 per cent Canadian content, reflecting continued reliance on foreign-built platforms in a capability area posting very strong revenue growth.
That gap matters. The framework is not only identifying where Canada is already strong. It is also showing where Ottawa may use procurement, R&D support and strategic partnerships to build domestic capacity.
What comes next
Companies cannot apply directly. The DIA will identify potential partners proactively or through formal processes where appropriate, with proposals reviewed at the Deputy Minister level across DIA, DND and ISED before going to the Secretary of State for approval.
The six guiding principles the government says it will consider when evaluating potential partners cover Canadian ownership, sovereign capability contributions, R&D and commercialisation track record, ability to deliver at scale, ecosystem support, and conduct as a trusted partner and corporate citizen.
The first designations will show how far Ottawa is prepared to go in turning industrial strategy into procurement behaviour. For companies operating in the sovereign capability areas, understanding the designation criteria is now a business priority.
Questions on the framework can be directed to engagement@dia-aid.gc.ca.
