Provinces push ahead despite late-summer end to marijuana prohibition

Theglobeandmail.com
Feb. 8, 2018
Mike Hagar

Provincial governments are welcoming the news that Ottawa expects Canada's recreational cannabis market to open later this summer, but most say they will continue crafting the numerous regulations needed to meet a July timeline.

Health Minister Ginette Petitpas Taylor told reporters outside the Senate this week that Ottawa will wait eight to 12 weeks after the legislation is passed before officially lifting the 95-year-old prohibition on recreational cannabis. That timeline is designed to give industry up to three months to adapt to strict packaging rules and legally ship their products to provincially regulated stores.

That means Canadians could need to wait until late in the summer before they will be able to legally consume cannabis – even if the Senate votes in favour of the legislation by May or June, she said.

For the most part, premiers and their ministers in charge of legalization from across the country reacted by saying the news does not alter their plans, although many provinces have previously complained that the July 1 deadline was too tight.

Manitoba Premier Brian Pallister has been among the most vocal critics of the federal timeline, calling on Ottawa to delay legalization by as much as a year.

Manitoba's Minister of Growth, Enterprise and Trade, Blaine Pedersen, said on Wednesday that his province is in good shape. But he noted it is more important to get the details right than to meet an arbitrary deadline.

"We're finally seeing acknowledgment in Ottawa that the established timeline for permitting the sale of recreational cannabis is tight," he said in an e-mailed statement. "While concerns have been raised about timing to secure necessary levels of supply, Manitoba is cautiously optimistic as our discussions to date indicate we are on track."

Ontario, Nova Scotia and Alberta all confirmed they remain committed to having cannabis retail and distribution systems in place in July.

Representatives from Quebec and Saskatchewan indicated they are too, but both said more time would be welcome.

"We continue to prepare based on a July, 2018, legalization date, but it is reasonable to say that all jurisdictions, including Saskatchewan, will use any additional time to ensure readiness for post-legalization," Karen Hill, a spokesperson for the province, said in an e-mailed statement.

Quebec's National Assembly passed a motion in the fall asking the federal government to delay legalization. On Thursday, Government House Leader Jean-Marc Fournier said his province will not let Ottawa overturn its current ban on all personal cannabis production -- which is in opposition to the federal legalization bill's proposal to allow adults to grow up to four plants at home.

However, Quebec will be ready for the change in laws "whether we have time or not," a press secretary for the Health Minister said.

British Columbia's Solicitor-General Mike Farnworth said, in a statement e-mailed late Thursday, that his province would have its public-private retail system in place by late summer, noting July will be too early for its liquor agency to buy from producers and distribute it to stores.

As Health Canada accelerates its licensing of commercial growers to meet the expected recreational demand, these companies are raising money, building out more space to grow the drug, hiring more people to handle the load and boosting their expertise in new areas such as marketing and retailing. They are also weighing where they plan to allocate their inventory in the months ahead. The biggest players are doing business in multiple markets: the Canadian medical and consumer markets, as well as medical regimes around the world as public policy around cannabis changes globally.

Still, a delay could throw a wrench in near-term strategies.

"It would shift business plans. I think a lot of LPs are probably basing their forecasts on selling into the adult-use market as of July," said Nick Dean, CEO of licensed producer Emblem Corp. "The harvests, in some cases, have started, given the timing that's required and that we were working towards the July deadline."

Ontario-based Emblem is now serving 3,000 medical cannabis patients but plans to shift 60 per cent of its production toward the recreational market in Canada, he said.