Executive Summary: Key Legal and Evidentiary Issues

• Characterization of the preservation order as a prohibitive injunction restraining Shopify Inc. from deleting data, avoiding the stricter mandatory-injunction standard.

• Application of the RJR-MacDonald test with public interest in tax enforcement driving findings on serious issue, irreparable harm, and balance of convenience.

• Tension between the Minister of National Revenue’s unnamed-person powers under the Income Tax Act and Excise Tax Act and Shopify Inc.’s two-year deletion policy for inactive accounts.

• Use of the Federal Court’s prior concerns about vagueness, ascertainable group, and disproportionality to narrow and refine the data preservation obligations.

• Finding that unquantified operational and privacy impacts on Shopify Inc. are outweighed by the risk that ongoing deletion of data would irreparably harm the public interest in tax compliance verification.

• Grant of a tailored preservation order and expedited appeal in favour of the Minister, with no costs awarded and the Minister’s undertaking as to damages maintained.

Facts and procedural background

The case involves the Minister of National Revenue as appellant and Shopify Inc. as respondent. The Minister originally asked the Federal Court to authorize an unnamed-person requirement under subsection 231.2(3) of the Income Tax Act and subsection 289(3) of the Excise Tax Act, seeking information about merchants using Shopify’s platform to verify an “ascertainable group” for tax compliance purposes. The Federal Court found the requirement vague, confusing, and disproportionate, held that no proper ascertainable group had been defined, and refused authorization. The Minister appealed that refusal to the Federal Court of Appeal.
Separately, Shopify operates under privacy and data retention policies that delete data from accounts inactive for two years. The Minister accepted these policies in general but wanted to preserve up to six years of historical data that might become unavailable while the appeal is pending. Although the Minister had known of the deletion policy since early 2024, he did not seek relief earlier. In November 2025, after filing his memorandum of fact and law, he obtained an interim preservation order ex parte in the Court of Appeal, preventing data deletion for a limited period. Before that interim order expired, he moved on notice for its renewal and for a further order requiring Shopify to preserve specified data until the appeal is finally disposed of. Shopify opposed the new order and criticized the ex parte process, but the issue over the interim order was treated as moot because it was expiring.

Legal framework for the preservation order

To assess the new preservation order, the court applied the RJR-MacDonald interlocutory injunction test: serious issue, irreparable harm, and balance of convenience. Shopify argued the requested relief was a mandatory injunction, requiring positive changes to business operations and therefore a higher “strong prima facie case” threshold. The court focused on substance and found the order mainly restrained Shopify from deleting data it would otherwise erase, rather than compelling creation or reinstatement of content. It therefore treated the relief as a prohibitive injunction and applied the lower “serious issue” threshold, finding the Minister’s appeal from the Federal Court’s refusal of the unnamed-person requirement plainly non-frivolous.

Irreparable harm and public interest

On irreparable harm, the court noted the Minister’s almost two-year delay in seeking preservation relief, despite knowing about Shopify’s two-year deletion policy. That delay undermined his claim of urgency from a purely private perspective. However, data from accounts inactive for two years was being deleted on a rolling basis, and Shopify’s characterization of this as a “small subset” of the information sought was unsupported by evidence. The court emphasized that irreparable harm turns on whether the loss can be repaired or compensated, not on its size. Once deleted, potentially relevant tax compliance data cannot be restored or made good by damages.
The court distinguished the Minister’s litigation conduct from the broader public interest. It defined public interest as society’s interest in the proper enforcement of tax laws and in the Minister’s ability to verify compliance using available information. Continued deletion of data that might assist in verification was found to cause irreparable harm to that public interest. The court held that the Minister’s delay did not negate this broader harm, and it concluded that the irreparable harm requirement was met through the lens of public interest in tax enforcement rather than through the Minister’s private position alone.

Balance of convenience and scope of relief

On the balance of convenience, the court weighed this public interest against the harms alleged by Shopify. Shopify argued that the proposed order lacked a defined time frame, could cause a worldwide deletion freeze due to ambiguous “associated with” wording, and would impose additional storage and maintenance costs contrary to its privacy and retention practices. The court accepted that the order needed refinement. It held that a clear temporal window should be specified and observed that some of the most confusing language criticized by the Federal Court—such as “any person(s) associated with the Shopify account” and certain registration-address language—no longer appeared in the updated proposal.
The Federal Court had identified specific categories of data that made the original requirement disproportionate and suggested that excluding those categories would likely be acceptable. The court adopted that guidance, narrowing the preservation obligations so that the most problematic data types were not included. It found that Shopify had not quantified its added storage and operational costs, which weakened its claim of prejudice. With a narrowed order and an expedited appeal, the court concluded that the public interest in preserving potentially relevant tax information outweighed the unquantified burdens on Shopify, and that the balance of convenience favoured granting a tailored preservation order.

Outcome, costs, and undertakings

The court granted an order requiring Shopify Inc. to preserve specified categories of information in its possession, including data that would otherwise be deleted from inactive accounts, for a defined period while the appeal proceeds. It also ordered that the appeal be heard on an expedited basis. As a result, the Minister of National Revenue, as appellant, was the successful party on the motion, securing continued preservation of potentially relevant evidence pending resolution of the appeal.
On costs, the court made no award, despite the Minister’s success. It cited the lack of clarity and limited usefulness of the Minister’s written submissions and his lengthy delay before seeking preservation while later asking for expedited treatment. Regarding undertakings, the Minister had given the usual undertaking as to damages for interlocutory relief but sought leave to withdraw it. The court refused that request and kept the undertaking in place. No damages or monetary amounts were ordered for either party; the decision concerns only interim procedural relief in the form of a tailored preservation order and an expedited appeal.