The federal government is preparing to legalize marijuana, causing many to ask: what will a regulated cannabis industry in Canada look like?
The Task Force on Cannabis Legalization and Regulation has released its much-anticipated report to help guide the federal government on the best approach to regulating legal access to cannabis. The comprehensive report casts a wide net to address issues from public health and safety to advertising, and supply chain regulation. To inform its recommendations, the Task Force sought input from provincial, territorial and municipal governments, representatives from Indigenous governments and organizations as well as experts in relevant fields. Canadians had the opportunity to share their views through an online public consultation this past summer.
What You Need To Know
- The report is not law nor is it draft law. The federal government is expected to introduce draft legislation in the spring of 2017.1 After draft legislation is tabled, there will be an opportunity for stakeholders to comment. Cannabis will not be legalized until the new legislation comes into force after being passed by Parliament and once regulations have been developed.
- In the meantime, production, cultivation, and sale of cannabis for recreational use continues to be illegal in Canada. Only production, cultivation and sale of cannabis by licensed producers, and personal cultivation for medical use is legal. Medical users can also designate a producer to grow cannabis on their behalf.
- There are no recommendations in the report directed to the grandfathering of licenses of current producers of cannabis for medical use under the new legislation.
- The report urges all levels of government to increase capacity in many areas relating to production, distribution and retail, quality control and enforcement, and research and surveillance before legislation is finalized. This will include building capacity for licensing and inspection at all levels of government: federal (e.g., for production and laboratories), provincial and territorial (e.g., for distribution and retail), and municipal (e.g., for home-cultivation permits).
The Task Force’s key recommendations are highlighted below:
- Set a national minimum age of purchase of 18, but allow provinces and territories to set a higher age if they wish to do so.
- Limit personal possession of non-medical dried cannabis in public to 30 grams and limit personal cultivation, for non-medical purposes, to four plants per residence.
- Regulate the production of cannabis and derivatives (i.e., edibles) at the federal level.
- Regulate the wholesale distribution and retail sales of cannabis at the provincial and territorial level.
- Maintain the current legal system for access to cannabis for medical use but eliminate the category of the designated producer.
- Tax potent strains at higher rates to discourage their purchase.
- Prohibit mixed products, such as cannabis-infused alcoholic beverages or cannabis products with tobacco, nicotine or caffeine.
Overcoming the Challenges Ahead
The recommendations for an effective regulatory framework for cannabis address a number of challenges that the government will face as it moves forward with legalization. Among the more notable challenges are issues involving retail sales, advertising and packaging, production of cannabis, and public safety. The Task Force’s key recommendations in relation to these areas are highlighted below:
Retail Sales of Cannabis and Cannabis Products
- Provinces should control retail sales.
- Limit the density and location of storefronts and implement requirements for appropriate distances from schools and community centres.
- Avoid co-location of alcohol or tobacco and cannabis sales wherever possible to help mitigate combined use.
Advertising, Packaging and Labelling
- Restrictions on the advertising and promotion of cannabis should be analogous to those imposed on alcohol and tobacco. For example, in Canada, tobacco cannot be promoted by sponsorships, testimonials or lifestyle advertising (evoking images of glamour, risk, etc.). Similarly, alcohol advertising cannot associate alcohol with social or personal achievement.
- Therapeutic claims about the benefits of cannabis should comply with legislative requirements.
- Plain packaging for cannabis products should limit label information to company name, strain name, price, amounts of THC, and warnings.
- Packaging should not be "appealing to children" and should be opaque and child-resistant. For example, it should not be designed to look like candy, use bright colours, cartoon characters, etc.
- Edibles should have packaging consistent with requirements for food and beverages, with standardized servings, and a THC symbol.
- Apply good production practices, which are already in place for cultivation of cannabis for medical use, to recreational production. This includes restricting the use of pesticides and fertilizers to those approved for use on cannabis plants.
- Use licensing and production controls to encourage a competitive market.
- Allow outdoor cultivation to promote eco-friendly production and a seed-to-sale tracking system to monitor the movement of cannabis plants and resulting products throughout the supply chain—from production to distribution to final sale, and to facilitate product recalls.
Public Safety and Protection
- Maintain criminal offences for illicit production, trafficking, possession for the purposes of trafficking, possession for the purposes of export, and import/export, and trafficking to youth.
- Introduce administrative penalties (with flexibility to enforce more serious penalties) for contraventions of licensing rules on production, distribution and sale.
- Federal and provincial governments should invest immediately in the development of a national, comprehensive public education strategy to warn of the dangers of cannabis-impaired driving as well as support the development of an appropriate roadside drug screening device for detecting THC levels.
1 Statement from the Government of Canada on the Receipt of the Report from the Task Force on Cannabis Legalization and Regulation. December 13, 2016. Available online at news.gc.ca.
2016 was a year of new directions taken by companies, regulators and the marketplace—and the year ahead is primed to bear the impact of these changes.