A New Leaf for Canada: Senate Passes Draft Cannabis Act

Canadians will be able to consume cannabis for recreational use—without fear of prosecution—on October 17 after the Senate passed the draft Cannabis Act (Bill C-45) on June 19. The Cannabis Act is expected to receive Royal Assent in the coming days.

What You Need To Know

  • The House of Commons responded to the unprecedented number of amendments proposed by the Senate to Bill C-45.1
  • While most amendments were accepted, the House voted to reject key changes that could have significantly impacted the way cannabis is accessed and sold in Canada.
  • Some of the key amendments rejected by the House include those relating to home cultivation, brand promotion, product review, THC limits, and shareholder identity.
  • The rejected amendments were thought to undermine the government's goal of eliminating the black market.
  • The amendments would have also applied restrictions on cannabis inconsistent with other regulated products, such as tobacco and alcohol.

The Details

Below are the details of some of the Senate's amendments rejected by the House.

Home Cultivation

The amendment allowing provinces to restrict or ban home cultivation was rejected by the House in large part because home cultivation is a cornerstone of the federal government's objective to displace the illegal market.

Brand Promotion

The amendment prohibiting licensed producers from using their brands on non-cannabis items was rejected. Bill C-45 already contains comprehensive restrictions on promotion. The government found the additional restrictions stifling and inconsistent with the rules on promotion for other regulated products, such as alcohol.

Product Review

The government rejected an amendment that would have required a month-long dual review and approval by both the House and the Senate (in a manner similar to how bills are passed into law) of any regulation to add new cannabis products or product forms, such as edibles and concentrates, to the list of legally permitted cannabis products under Schedule 4 of the Cannabis Act.

THC Limits

The amendment that would have required regulators to set a maximum THC potency limit was rejected. The government has already committed to establishing THC limits in the regulations which will provide flexibility to make future adjustments based on new evidence and product innovation.

Shareholder Identity

Citing operational challenges and privacy concerns, the amendment requiring the name of shareholders, directors, and officers of licensed companies be made available to the public was rejected. Disclosure requirements with respect to company ownership and operation may also affect the volume and nature of corporate deals in the cannabis industry.

What's Next?

Royal Assent of Bill C-45 is expected soon. After Royal Assent, Health Canada will publish final regulations under the Cannabis Act in the Canada Gazette, Part II, to support timely implementation of the new cannabis legal framework.

Torys lawyers have written extensively on cannabis. You can view the team's thought leadership by heading to the Emerging Trends in the Cannabis Industry page.

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1 See https://www.ourcommons.ca/DocumentViewer/en/42-1/house/sitting-314/order-notice/page-14.

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