A charity with close ties to Canada's prime minister has withdrawn from overseeing a government programme amid criticism of the sole-source contract.
We Charity co-founders Craig and Marc Kielburger announced they were pulling out because of the "controversy".
The charity had been hired to deliver a national youth volunteer programme.
The charity hosts worldwide events attended by thousands of youths that feature celebrity guests like Idris Elba, Mia Farrow and Kelly Clarkson.
Mr Trudeau, his wife and his mother have all been speakers at one point, which led to accusations of special treatment.
"The program has also been enmeshed in controversy from the moment of its announcement," said the charity's co-founders, brothers Craig and Marc Kielburger.
"Our concern is that to continue in this way, the program itself will begin to suffer - and as a consequence, opportunities for students might be negatively affected."
Mr Trudeau called We Charity's decision to withdraw from its government contract "unfortunate" and raised concerns "young people may not have access to the same level of programmes that they might have had" if We Charity were still involved.
What was We Charity hired to do?
In June, the government announced it had tapped We Charity to run its new Canada Student Service Grant programme. The programme was designed to connect post-secondary students to paid volunteer opportunities that would help make up for the lack of summer jobs available as a result of Covid-19.
The C$900m ($664m, £533m) programme would place up to 20,000 young people with a volunteer opportunity and award them a grant of between C$1000-C$5000, depending on the length of their contract.
The grants would work out to about $10 an hour, which is below minimum wage.
What were some of the concerns?
The contract with We Charity raised eyebrows and accusations of favouritism, since it was outsourcing a massive federal aid programme to a private organisation with close ties to the prime minister.
Mr Trudeau, his wife Sophie Grégoire Trudeau and his mother Margaret Trudeau have all been speakers during the organisation's massive We Day events.
In April, Ms Grégoire Trudeau flew to the UK to speak in front of a crowd of 12,000 at Wembley Arena. She shared a stage with former Australian Prime Minister Julia Gillard and singer Leona Lewis.
Mr Trudeau had said the group was the "only" one up to the task.
"Quite frankly, when our public servants looked at the potential partners, only the WE organization had the capacity to deliver the ambitious programme that young people need for this summer that is so deeply impacted by Covid," he told reporters on Monday.
Opposition MPs have asked the auditor general and the procurement ombudsman to investigate the summer volunteer grants contract, and other contracts awarded to We Charity over the years.
Others have criticised the programme for paying below the minimum wage, and for a lack of clarity about how much of the programme's budget goes to students and how much will go to administration costs.