How to Complete a Privacy Impact Assessment for AI Under Law 25

Law 25 section 23 requires Quebec organizations to complete a privacy impact assessment (PIA) before implementing AI systems that process sensitive information, create legal effects through profiling, or present high privacy risks. The assessment must be submitted to the Commission d'accès à l'information at least 60 days before deployment. This requirement applies to most AI implementations in regulated sectors including legal services, healthcare, and financial services.

The PIA process involves six mandatory components: risk identification, data flow mapping, legal basis documentation, mitigation measures, retention schedules, and ongoing monitoring protocols.

When Law 25 triggers a PIA for AI systems

Law 25 section 23 establishes clear triggers for mandatory privacy impact assessments. AI systems require a PIA when they involve:

• Processing of sensitive personal information as defined in section 1
• Profiling that produces legal effects or significantly affects individuals under section 12.1
• Systematic monitoring of publicly accessible areas
• High risk to privacy rights based on technology, scope, or context as determined under section 3.5

Most AI deployments in Quebec law firms trigger the PIA requirement through sensitive information processing. Client communications, case files, and legal research typically involve confidential personal information under Law 25's expanded definition in section 1.

Healthcare AI systems almost universally require PIAs due to health information sensitivity under section 1. Financial services AI for credit decisions, fraud detection, or customer profiling similarly trigger section 23 requirements through automated decision-making under section 12.1.

Law 25 section 23 PIA requirements apply to AI systems processing any personal information of Quebec residents, regardless of where the organization is located, making compliance mandatory for any AI system serving Quebec users.

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The six mandatory PIA components

Risk identification and classification

Your PIA must identify specific privacy risks created by the AI system under Law 25 section 3.5. Quebec's legislation focuses on risks to individual rights rather than just data security concerns.

Document how the AI makes decisions, what personal information it processes, and potential impacts on individuals. Include risks from automated decision-making under section 12.1, data inference, and algorithmic bias.

For legal AI systems, identify risks to solicitor-client privilege, work product doctrine, and confidential client information. Healthcare AI requires analysis of health information sensitivity and potential discrimination in treatment decisions.

Data flow mapping

Section 23 requires detailed documentation of personal information flows through your AI system. Map data collection points, processing activities, storage locations, and any transfers to third parties.

Specify exactly what personal information the AI accesses, how it's processed, and where processing occurs. Include training data, inference data, and any derivative information created by the system.

Cross-border data flows require particular attention. Any transfer outside Quebec or Canada must comply with Law 25 sections 17-22, including adequacy determinations and contractual safeguards.

Legal basis documentation

Your PIA must establish legal basis for AI processing under Law 25. Most AI systems rely on legitimate interest (section 12) or contractual necessity (section 11).

Consent under section 14 rarely provides adequate basis for AI systems due to the complexity of explaining algorithmic processing to individuals. Professional services often rely on legitimate interest for client service delivery under section 12.

Document why your chosen legal basis applies and how you've balanced organizational needs against individual privacy rights under section 3.5.

Mitigation measures

Law 25 section 8 requires specific mitigation measures for identified privacy risks. These must be concrete, measurable, and implemented before system deployment.

Technical measures include encryption, access controls, data minimization under section 10, and algorithmic auditing. Organizational measures cover staff training, incident response procedures, and ongoing oversight protocols.

For AI systems processing sensitive information, consider pseudonymization, differential privacy, or federated learning approaches to reduce privacy risks under section 3.5.

Law 25 section 8's privacy-by-design requirements mandate that mitigation measures be built into AI system architecture from inception, not added as aftermarket compliance measures.

Retention and disposal schedules

Your PIA must specify retention periods for all personal information processed by the AI system. Law 25 section 10 requires retention only as long as necessary for stated purposes.

Training data, model weights, inference logs, and system outputs may have different retention requirements. Legal professional privilege materials require indefinite retention in many cases. Healthcare records follow sector-specific retention rules under provincial health information acts.

Document automated deletion procedures and manual review processes for retained information under section 10.

Monitoring and review protocols

Section 23 requires ongoing monitoring of AI system privacy impacts. Your PIA must establish review schedules and trigger events for reassessment.

Monitor for algorithmic drift, changing privacy risks, and new legal requirements. Review your PIA annually or when system functionality changes materially under section 23.

Document who conducts reviews, what metrics trigger concern, and how you'll address identified issues.

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Submission timeline and Commission review

Law 25 section 23 requires PIA submission at least 60 days before AI system deployment. The Commission d'accès à l'information has 60 days to review and may request additional information or modifications.

Plan for potential delays. The Commission frequently requests clarification on AI system functionality, legal basis selection, or mitigation measure adequacy. Incomplete submissions restart the 60-day review period.

Submit your PIA in French per Quebec's Charter of the French Language requirements. English submissions may be rejected without review.

The Commission may require ongoing reporting for high-risk AI systems under section 23. Budget for annual compliance reports and system audits beyond the initial PIA.

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Common PIA pitfalls for AI systems

Inadequate risk assessment

Many organizations focus on data security rather than privacy rights impacts required under Law 25 section 3.5. The Commission looks for analysis of individual autonomy, decision-making transparency, and potential discrimination.

Document how individuals can challenge AI decisions affecting them under section 27. Explain algorithmic logic in accessible terms. Address fairness concerns for protected groups under Quebec's Charter of Human Rights and Freedoms.

Incomplete data flow documentation

AI systems often process personal information in unexpected ways. Training data may contain sensitive information not obvious from source documents. Models can infer protected characteristics from seemingly innocuous inputs.

Map all data flows including model training, validation, testing, and inference. Document any data transformation, aggregation, or derivative information creation under section 23 requirements.

Insufficient mitigation measures

Generic privacy policies don't satisfy Law 25 section 8's mitigation requirements. The Commission expects specific technical and organizational measures addressing identified AI risks.

Implement privacy-by-design principles in system architecture under section 8. Establish clear data governance procedures. Train staff on AI privacy considerations specific to your sector.

Law 25 section 93 penalties of up to $25 million CAD make inadequate AI privacy impact assessments a material business risk requiring technical depth beyond traditional PIA documentation.

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Choosing compliant AI infrastructure

Your AI infrastructure choices directly impact PIA complexity and Commission review. Systems with built-in Law 25 compliance reduce assessment burden and ongoing monitoring requirements.

Sovereign AI platforms like Augure eliminate cross-border transfer concerns through 100% Canadian data residency, avoiding Law 25 sections 17-22 adequacy requirements and U.S. CLOUD Act exposure that complicates legal basis analysis.

Consider AI platforms designed for regulated Canadian sectors. Systems built for legal professional privilege, healthcare confidentiality, and financial services compliance address sector-specific privacy requirements.

AI platforms with compliance-by-design architecture reduce PIA documentation requirements and ongoing Commission reporting burden under section 23.

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Sector-specific PIA considerations

Legal services

Law firms face unique PIA requirements due to solicitor-client privilege and provincial Law Society regulations. Your PIA must address how AI processing maintains privilege protection and professional confidentiality obligations.

Document safeguards preventing inadvertent privilege waiver through AI processing. Explain how client consent requirements under section 14 interact with AI system functionality.

Consider file security requirements under provincial Law Society rules. Many jurisdictions require specific technical safeguards for electronic client information.

Healthcare providers

Healthcare AI requires analysis under both Law 25 and provincial health information legislation. Your PIA must address medical record confidentiality, patient consent, and potential treatment discrimination.

Document how AI decisions integrate with clinical judgment. Explain algorithmic bias testing for health outcome fairness across demographic groups under section 3.5.

Consider professional liability implications of AI-assisted diagnosis or treatment recommendations.

Financial services

Financial AI systems often trigger Law 25 PIA requirements through credit profiling, fraud detection, or customer analytics under section 12.1. Your assessment must address fair lending practices and financial privacy rights.

Document compliance with federal Bank Act and Insurance Companies Act privacy requirements alongside Law 25. Explain how AI decisions meet Canadian Human Rights Act requirements for protected grounds.

Consider consumer protection implications of automated financial services decisions under federal and provincial legislation.

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Quebec organizations have 60 days to complete their Law 25 privacy impact assessment before AI deployment. The Commission's review process adds another 60 days minimum, making early preparation essential for compliance timelines.

Start your PIA process by documenting your AI system's data flows, risk profile, and mitigation measures under section 23 requirements. Choose AI infrastructure that supports rather than complicates your compliance obligations.

For AI platforms designed specifically for Canadian regulatory requirements with built-in Law 25 compliance, explore Augure's sovereign AI solutions that eliminate cross-border data transfer complexities.