Health Canada Cannabis Regulations: October 17, 2018

By Health Canada

Health Canada Announces Regulations to Support the Cannabis Act Including Micro-Size Licences, Industrial Hemp, Research and Analytical Testing

Canada Gazette, Part II, Volume 152, Number 14

Registration

June 27, 2018

FOOD AND DRUGS ACT
CONTROLLED DRUGS AND SUBSTANCES ACT
CANNABIS ACT

P.C. 2018-948 June 26, 2018

Her Excellency the Governor General in Council, on the recommendation of the Minister of Health, pursuant to subsection 30(1) footnotea of the Food and Drugs Act footnoteb, subsection 55(1) footnotec of the Controlled Drugs and Substances Act footnoted and subsection 139(1) and section 161 of the Cannabis Act footnotee, makes the annexed Cannabis Regulations.

Cannabis Regulations

Interpretation

Definitions — Act and Regulations

1 (1) The following definitions apply in the Act and in these Regulations.

cannabis non-solid concentrates means substances that are in non-solid form at a temperature of 22 ± 2°C and that have a maximum yield percentage of greater than 3% w/w of THC, taking into account the potential to convert THCA into THC. (cannabis sous forme d’un concentré qui n’est pas solide)

cannabis oil means an oil that contains anything referred to in item 1 or 3 of Schedule 1 to the Act and that is in liquid form at a temperature of 22 ± 2°C. (huile de cannabis)

cannabis solid concentrates means substances that are in solid form at a temperature of 22 ± 2°C and that have a maximum yield percentage of greater than 3% w/w of THC, taking into account the potential to convert THCA into THC. (cannabis sous forme d’un concentré solide)

fresh cannabis means freshly harvested cannabis buds and leaves, but does not include plant material that can be used to propagate cannabis. (cannabis frais)

non-solids containing cannabis means substances that are in non-solid form at a temperature of 22 ± 2°C and that have a maximum yield percentage of 3% w/w or less of THC, taking into account the potential to convert THCA into THC. (substances qui ne sont pas solides et qui contiennent du cannabis)

solids containing cannabis means substances that are in solid form at a temperature of 22 ± 2°C and that have a maximum yield percentage of 3% w/w or less of THC, taking into account the potential to convert THCA into THC. (solides qui contiennent du cannabis)

Definitions — Regulations

(2) The following definitions apply in these Regulations.

Act means the Cannabis Act. (Loi)

cannabis drug licence means a licence for a drug containing cannabis. (Version anglaise seulement)

cannabis product means cannabis of only one of the classes that are set out in Schedule 4 to the Act — or a cannabis accessory if that accessory contains such cannabis — after it has been packaged and labelled for sale to a consumer at the retail level, but does not include a drug containing cannabis. (produit du cannabis)

CBD means cannabidiol. (CBD)

CBDA means cannabidiolic acid. (ACBD)

client means, in respect of a holder of a licence for sale for medical purposes, an individual who is registered with that holder of the licence under subsection 282(1). (client)

common-law partner means an individual who is cohabiting with an individual in a conjugal relationship, having done so for a period of at least one year. (conjoint de fait)

common name has the same meaning as in subsection C.01.001(1) of the Food and Drug Regulations. (nom usuel)

controlled substance offence means

  • (a) an offence under Part I of the Controlled Drugs and Substances Act, except subsection 4(1) of that Act; or
  • (b) a conspiracy or an attempt to commit, being an accessory after the fact in relation to, or any counselling in relation to, an offence referred to in paragraph (a). (infraction relative à une substance désignée)

device has the same meaning as in section 2 of the Food and Drugs Act. (instrument)

drug has the same meaning as in section 2 of the Food and Drugs Act, but excludes cannabis that is

  • (a) a natural health product to which the Natural Health Products Regulations apply; or
  • (b) manufactured or sold — within the meaning of section 2 of the Food and Drugs Act — and is not represented, for use in
    • (i) the diagnosis, treatment, mitigation or prevention of a disease, disorder or abnormal physical state, or its symptoms, in human beings, or
    • (ii) restoring, correcting or modifying organic functions in human beings.

It includes cannabis that is an active pharmaceutical ingredient as defined in subsection C.01A.001(1) of the Food and Drug Regulations or that is manufactured or sold for use in a clinical trial as defined in section C.05.001 of those Regulations. (drogue)

export permit means a permit issued under subsection 62(1) of the Act that authorizes the exportation of cannabis for medical or scientific purposes. (permis d’exportation)

former Access to Cannabis for Medical Purposes Regulations means the regulations made by Order in Council P.C. 2016-743 of August 5, 2016 and registered as SOR/2016-230. (ancien Règlement sur l’accès au cannabis à des fins médicales)

grow area means, in respect of a site set out in a licence, an area of the site where cannabis plants are cultivated, harvested or propagated. (zone de culture)

hospital means, except in Part 8, a facility

  • (a) that is licensed, approved or designated by a province under the laws of the province to provide care or treatment to individuals suffering from any form of disease or illness; or
  • (b) that is owned or operated by the Government of Canada or the government of a province and that provides health services. (hôpital)

import permit means a permit issued under subsection 62(1) of the Act that authorizes the importation of cannabis for medical or scientific purposes. (permis d’importation)

licence means a licence issued under subsection 62(1) of the Act in relation to cannabis. (licence)

operations area means, in respect of a site set out in a licence, an area of the site — other than a storage area — where cannabis is present as a result of any activities conducted under a licence. It includes a grow area. (zone d’exploitation)

pharmacist means an individual who is entitled under the laws of a province to practise pharmacy and who is practising pharmacy in that province. (pharmacien)

proper name has the same meaning as in subsection C.01.001(1) of the Food and Drug Regulations. (nom propre)

point means the unit of measurement for type size that is known as a PostScript point and is equal to 0.3527777778 mm. (point)

prescription has the same meaning as in subsection C.01.001(1) of the Food and Drug Regulations. (ordonnance)

prescription drug means a drug

  • (a) that contains cannabis;
  • (b) that is a prescription drug, as defined in section A.01.010 of the Food and Drug Regulations; and
  • (c) for which a drug identification number has been assigned under subsection C.01.014.2(1) of the Food and Drug Regulations. (drogue sur ordonnance)

security clearance means, except in paragraph 53(2)(g), a security clearance granted by the Minister under section 67 of the Act and includes, for the purpose of paragraph 53(2)(e), a security clearance granted under section 112 of the former Access to Cannabis for Medical Purposes Regulations. (habilitation de sécurité)

site means, in respect of a holder of a licence, an area that is used exclusively by the holder and that consists of at least one building or one part of a building. (lieu)

storage area means, in respect of a site set out in a licence, an area of the site where cannabis is stored. (zone d’entreposage)

test kit means a kit

  • (a) that contains
    • (i) cannabis, and
    • (ii) a reagent system or buffering agent, or both;
  • (b) that is designed to be used during the course of a chemical or analytical procedure to test for the presence or quantity of cannabis for a medical, laboratory, industrial, educational, law administration or enforcement, or research purpose; and
  • (c) the contents of which are not intended or likely to be consumed or administered. (nécessaire d’essai)

THC means delta-9-tetrahydrocannabinol. (THC)

THCA means delta-9-tetrahydrocannabinolic acid. (ATHC)

Incorporation by reference

(3) For the purpose of the incorporation by reference into these Regulations of any documents published by the Government of Canada, terms that are used but not defined in those documents have the same meaning as in these Regulations.

Non-application

Non-application — Industrial Hemp Regulations

These Regulations do not apply to a holder of a licence that is subject to the Industrial Hemp Regulations, or to an applicant for such a licence.

Non-application — holder of cannabis drug licence

Subsection 10(1), sections 29 to 48 and Parts 5 and 7 do not apply to a holder of a cannabis drug licence referred to in Part 8, or to an applicant for such a licence.

PART 1

General Authorizations

Authorized activities — federal or provincial laboratory

4 (1) Individuals who are involved in the testing of cannabis as a requirement of their duties at a laboratory that is operated by the Government of Canada or the government of a province are authorized to conduct the following activities to the extent necessary to conduct the testing:

  • (a) to possess cannabis;
  • (b) to obtain cannabis by altering its chemical or physical properties by any means;
  • (c) in the case of seed viability testing, to obtain cannabis by cultivating it; and
  • (d) to distribute cannabis to another laboratory that is operated by the Government of Canada or the government of a province.

Offer

(2) An individual who conducts an activity referred to in paragraph (1)(b) or (c) is also authorized to offer to conduct that activity.

Use of organic solvent

(3) An individual who conducts an activity referred to in paragraph (1)(b) is also authorized to alter or offer to alter the chemical or physical properties of cannabis by the use of an organic solvent when conducting that activity.

Authorized activities — accredited laboratory

(4) Individuals who are involved in the testing of cannabis as a requirement of their duties at a laboratory that is designated as an accredited laboratory under section 14 of the Canada Agricultural Products Act are authorized to conduct the activities referred to in paragraphs (1)(a) and (c), and to offer to conduct the activity referred to in paragraph (1)(c), to the extent necessary to conduct the testing.

Distribution — analytical testing

An individual is authorized to distribute cannabis to a holder of a licence for analytical testing if the quantity of cannabis does not exceed the equivalent of 30 g of dried cannabis, as determined in accordance with subsection 2(4) of the Act.

PART 2

Licensing

Definition of distribute

In this Part, distribute does not include administering.

Pre-licensing Requirements

Notice to local authorities

7 (1) Before submitting an application to the Minister for a licence for cultivation, a licence for processing or a licence for sale that authorizes the possession of cannabis, the person that intends to submit the application must provide a written notice to the following authorities in the area in which the site referred to in the application is located:

  • (a) the local government;
  • (b) the local fire authority; and
  • (c) the local police force or the Royal Canadian Mounted Police detachment that is responsible for providing policing services to that area.

Content of notice

(2) The notice must contain the following information:

  • (a) the person’s name;
  • (b) the date on which the person expects to submit the application;
  • (c) the class and the subclass of licence that will be sought, the activity that the person expects to conduct under the licence and an indication that the activity will be conducted in relation to cannabis; and
  • (d) the address of the site where the person proposes to conduct the activities and, if applicable, of each building within the site.

Senior official

(3) The notice must be addressed to a senior official of the local authority to which it is provided.

Definition of local government

(4) In this section, local government includes

  • (a) an incorporated city, metropolitan area, town, village or other municipality;
  • (b) an authority responsible for delivering municipal services that are related to the activities to be conducted under the licence to an unincorporated city, metropolitan area, town, village or other municipality;
  • (c) band, as defined in subsection 2(1) of the Indian Act; and
  • (d) a First Nation, Métis or Inuit government that is party to a self-government or land claims agreement that is given effect by an Act of Parliament, or a First Nation, Métis or Inuit government established under a provincial Act.
Classes of Licences

Classes of licences

8 (1) The following, among others, are established as classes of licences that authorize activities in relation to cannabis:

  • (a) a licence for cultivation;
  • (b) a licence for processing;
  • (c) a licence for analytical testing;
  • (d) a licence for sale;
  • (e) a licence for research; and
  • (f) a cannabis drug licence.

Drug containing cannabis

(2) Despite subsection (1), the licences referred to in paragraphs (1)(a), (b) and (d) authorize activities in relation to cannabis, other than a drug containing cannabis.

Subclasses — cultivation

(3) The following, among others, are established as subclasses of a licence for cultivation:

  • (a) a licence for micro-cultivation;
  • (b) a licence for standard cultivation; and
  • (c) a licence for a nursery.

Subclasses — processing

(4) The following, among others, are established as subclasses of a licence for processing:

  • (a) a licence for micro-processing; and
  • (b) a licence for standard processing.

Subclasses — sale

(5) A licence for sale for medical purposes is established as a subclass, among others, of a licence for sale.

Licence Content

Licence — content

A licence, other than a licence referred to in paragraph 8(1)(f), must set out the following information:

  • (a) the name of the holder of the licence;
  • (b) the licence number;
  • (c) the class of the licence and, if applicable, the subclass of the licence;
  • (d) the address of the site where the activity is authorized and, if applicable, of each building within the site;
  • (e) the authorized activity at the site and, if applicable, the authorized activity that may be conducted at each building within the site;
  • (f) any conditions that the Minister considers appropriate;
  • (g) the effective date of the licence; and
  • (h) the date of expiry of the licence.
Possession

Obtaining cannabis

10 (1) Subject to the other provisions of these Regulations, a holder of a licence that authorizes the possession of cannabis must only possess cannabis that was obtained in accordance with the former Access to Cannabis for Medical Purposes Regulations, or that is obtained in accordance with these Regulations or from a person authorized to sell cannabis under a provincial Act by reason of subsection 69(1) of the Act.

Exception — licence for cultivation

(2) A holder of a licence for cultivation is authorized to possess cannabis plants and cannabis plant seeds that were not obtained in accordance with subsection (1) if the holder had submitted to the Minister, with the licence application, a declaration, signed and dated by the individual who signed and dated the application, indicating the quantity of such cannabis plants and cannabis plant seeds that they will have in their possession on the effective date of the licence.

Authorized quantity

(3) The quantity of cannabis plants and cannabis plant seeds that the holder is authorized to possess under subsection (2) must be equal to the amount indicated in the declaration.

Cultivation Licences
Licences for Micro-cultivation and Standard Cultivation

Authorized activities

11 (1) Subject to the other provisions of these Regulations, a holder of a licence for micro-cultivation or standard cultivation is authorized to conduct those of the following activities that are authorized by the licence:

  • (a) to possess cannabis;
  • (b) to obtain dried cannabis, fresh cannabis, cannabis plants or cannabis plant seeds by cultivating, propagating and harvesting cannabis;
  • (c) for the purpose of testing, to obtain cannabis by altering its chemical or physical properties by any means; and
  • (d) to sell cannabis.

Offer

(2) A holder of a licence for micro-cultivation or standard cultivation that is authorized to conduct the activity referred to in paragraph (1)(b) is also authorized to offer to conduct that activity.

Ancillary activities

(3) A holder of a licence for micro-cultivation or standard cultivation that is authorized to conduct the activity referred to in paragraph (1)(b) is also authorized, to the extent necessary to conduct that activity, to conduct ancillary activities such as drying, trimming and milling cannabis.

Use of organic solvent

(4) A holder of a licence for micro-cultivation or standard cultivation that is authorized to conduct the activity referred to in paragraph (1)(c) is also authorized to alter the chemical or physical properties of cannabis by the use of an organic solvent when conducting that activity.

Sale

(5) A holder of a licence for micro-cultivation or standard cultivation whose licence authorizes the sale of cannabis is authorized to conduct the following activities:

  • (a) to sell and distribute dried cannabis, fresh cannabis, cannabis plants and cannabis plant seeds to any of the following:
    • (i) a holder of a licence for micro-cultivation or standard cultivation,
    • (ii) a holder of a licence for processing,
    • (iii) a holder of a licence for analytical testing,
    • (iv) a holder of a licence for research,
    • (v) a holder of a cannabis drug licence,
    • (vi) the Minister,
    • (vii) a person to which an exemption has been granted under section 140 of the Act in relation to the cannabis or class of cannabis that is sold or distributed; or
    • (viii) the individuals referred to in section 4;
  • (b) to sell and distribute cannabis plants and cannabis plant seeds to a holder of a licence for a nursery;
  • (c) to sell and distribute cannabis plants and cannabis plant seeds, that are cannabis products, to
    • (i) a holder of a licence for sale, or
    • (ii) a person authorized to sell cannabis under a provincial Act by reason of subsection 69(1) of the Act; and
  • (d) to send and deliver cannabis plants and cannabis plant seeds, that are cannabis products, to the purchaser of the products at the request of
    • (i) a person authorized to sell cannabis under a provincial Act by reason of subsection 69(1) of the Act, or
    • (ii) a holder of a licence for sale.

Client’s shipping address

(6) If a holder of a licence for micro-cultivation or standard cultivation sends or delivers cannabis plants and cannabis plant seeds under subparagraph (5)(d)(ii) the sale of such products under section 289, the holder must send or deliver the products to the client’s shipping address as indicated by the holder of a licence for sale for medical purposes.

Master grower

12 (1) A holder of a licence for micro-cultivation or standard cultivation must retain the services of one individual as a master grower.

Responsibilities and knowledge

(2) The master grower is responsible for the cultivation, propagation and harvesting of cannabis and must have sufficient knowledge of the provisions of the Act and these Regulations in relation to those activities.

Alternate

(3) A holder of a licence for micro-cultivation or standard cultivation may designate one individual as the alternate master grower who is qualified to replace the master grower.

Micro-cultivation — threshold

13 (1) A holder of a licence for micro-cultivation

  • (a) must clearly delineate a surface area that does not exceed 200 m2 in which all the cannabis plants, including all the parts of the plants, must be contained; and
  • (b) must cultivate, propagate or harvest cannabis plants only from that surface area.

Surface area — calculation

(2) If the surface area referred to in paragraph (1)(a) consists of multiple surfaces, such as surfaces arranged above one another, the area of each surface must be included in the calculation of the total surface area.

Licence for Nursery

Authorized activities

14 (1) Subject to the other provisions of these Regulations, a holder of a licence for a nursery is authorized to conduct those of the following activities that are authorized by the licence:

  • (a) to possess cannabis;
  • (b) to obtain cannabis plants or cannabis plant seeds by cultivating, propagating and harvesting cannabis;
  • (c) for the purpose of testing, to obtain cannabis by altering its chemical or physical properties by any means; and
  • (d) to sell cannabis.

Offer

(2) A holder of a licence for a nursery that is authorized to conduct the activity referred to in paragraph (1)(b) is also authorized to offer to conduct that activity.

Ancillary activity

(3) A holder of a licence for a nursery that is authorized to conduct the activity referred to in paragraph (1)(b) is also authorized, to the extent necessary to conduct that activity, to conduct ancillary activities such as drying cannabis.

Use of organic solvent

(4) A holder of a licence for a nursery that is authorized to conduct the activity referred to in paragraph (1)(c) is also authorized to alter the chemical or physical properties of cannabis by the use of an organic solvent when conducting that activity.

Sale

(5) A holder of a licence for a nursery whose licence authorizes the sale of cannabis is authorized to conduct the following activities:

  • (a) to sell and distribute cannabis plants and cannabis plant seeds to any of the following:
    • (i) a holder of a licence for cultivation,
    • (ii) a holder of a licence for processing,
    • (iii) a holder of a licence for analytical testing,
    • (iv) a holder of a licence for research,
    • (v) a holder of a cannabis drug licence,
    • (vi) the Minister,
    • (vii) a person to which an exemption has been granted under section 140 of the Act in relation to the cannabis or class of cannabis that is sold or distributed, or
    • (viii) the individuals referred to in section 4;
  • (b) to sell and distribute cannabis plants and cannabis plant seeds, that are cannabis products, to the following:
    • (i) a holder of a licence for sale, or
    • (ii) a person authorized to sell cannabis under a provincial Act by reason of subsection 69(1) of the Act; and
  • (c) to send and deliver cannabis plants and cannabis plant seeds, that are cannabis products, to the purchaser of the products at the request of
    • (i) a person authorized to sell cannabis under a provincial Act by reason of subsection 69(1) of the Act, or
    • (ii) a holder of a licence for sale.

Client’s shipping address

(6) If a holder of a licence for a nursery sends or delivers cannabis plants and cannabis plant seeds under subparagraph (5)(c)(ii) further to the sale of such products under section 289, the holder must send or deliver the products to the client’s shipping address as indicated by the holder of a licence for sale for medical purposes.

Master grower

15 (1) A holder of a licence for a nursery must retain the services of one individual as a master grower.

Responsibilities and knowledge

(2) The master grower is responsible for the cultivation, propagation and harvesting of cannabis and must have sufficient knowledge of the provisions of the Act and these Regulations in relation to those activities.

Alternate

(3) A holder of a licence for a nursery may designate one individual as the alternate master grower who is qualified to replace the master grower.

Obtaining cannabis plant seeds

16 (1) A holder of a licence for a nursery that cultivates cannabis for the purpose of obtaining cannabis plant seeds must

  • (a) clearly delineate a total surface area that does not exceed 50 m2 in which all the budding or flowering cannabis plants, including all the parts of those plants, must be contained;
  • (b) not possess more than 5 kg of flowering heads harvested from the plants referred to in paragraph (a), with the exception of the cannabis plant seeds; and
  • (c) destroy the flowering heads — with the exception of the cannabis plant seeds — leaves and branches of the plants referred to in paragraph (a) within 30 days of harvesting them.

Surface area — calculation

(2) If the surface area referred to in paragraph (1)(a) consists of multiple surfaces, such as surfaces arranged above one another, the area of each surface must be included in the calculation of the total surface area.

Processing Licences

Authorized activities — licence for standard processing

17 (1) Subject to the other provisions of these Regulations, a holder of a licence for standard processing is authorized to conduct those of the following activities that are authorized by the licence:

  • (a) to possess cannabis;
  • (b) to produce cannabis, other than obtain it by cultivating, propagating or harvesting it; and
  • (c) to sell cannabis.

Authorized activities — licence for micro-processing

(2) Subject to the other provisions of these Regulations, a holder of a licence for micro-processing is authorized to conduct those of the following activities that are authorized by the licence:

  • (a) to possess cannabis;
  • (b) to produce cannabis, other than obtain it by
    • (i) synthesis, or
    • (ii) cultivating, propagating or harvesting it; and
  • (c) to sell cannabis.

Offer

(3) A holder of a licence for micro-processing or standard processing that is authorized to conduct the activity referred to in paragraph (1)(b) or (2)(b) is also authorized to offer to obtain cannabis by any method authorized by the licence.

Use of organic solvent

(4) A holder of a licence for micro-processing or standard processing that is authorized to conduct the activity referred to in paragraph 1(b) or (2)(b) is also authorized to alter or offer to alter the chemical or physical properties of cannabis by the use of an organic solvent when conducting that activity.

Sale

(5) A holder of a licence for micro-processing or standard processing whose licence authorizes the sale of cannabis is authorized to conduct the following activities:

  • (a) to sell and distribute cannabis to any of the following:
    • (i) a holder of a licence for processing,
    • (ii) a holder of a licence for analytical testing,
    • (iii) a holder of a licence for research,
    • (iv) a holder of a cannabis drug licence,
    • (v) the Minister,
    • (vi) a person to which an exemption has been granted under section 140 of the Act in relation to the cannabis or a class of cannabis that is sold or distributed, or
    • (vii) the individuals referred to in section 4;
  • (b) to sell and distribute the following cannabis to a holder of a licence for micro-cultivation or standard cultivation:
    • (i) dried cannabis, fresh cannabis, cannabis plants and cannabis plant seeds, or
    • (ii) any cannabis that was obtained or produced for the purpose of conducting testing that is necessary to determine the chemical characterization of cannabis;
  • (c) to sell and distribute the following cannabis to a holder of a licence for a nursery:
    • (i) cannabis plants and cannabis plant seeds, or
    • (ii) cannabis that was obtained or produced for the purpose of conducting testing that is necessary to determine the chemical characterization of cannabis;
  • (d) to sell and distribute cannabis products to the following:
    • (i) a holder of a licence for sale, or
    • (ii) a person authorized to sell cannabis under a provincial Act by reason of subsection 69(1) of the Act; and
  • (e) to send and deliver cannabis products to the purchaser of the products at the request of
    • (i) a person authorized to sell cannabis under a provincial Act by reason of subsection 69(1) of the Act, or
    • (ii) a holder of a licence for sale.

Client’s shipping address

(6) If a holder of a licence for micro-processing or standard processing sends or delivers cannabis products under subparagraph (5)(e)(ii) the sale of such products under section 289, the holder must send or deliver the products to the client’s shipping address as indicated by the holder of a licence for sale for medical purposes.

Consumer information document

18 (1) A holder of a licence for processing must ensure that each shipment of a cannabis product, other than cannabis plants and cannabis plant seeds, is accompanied by copies of the current version of the document entitled Consumer Information — Cannabis, published by the Government of Canada on its website, in a number that is equal to or greater than the number of cannabis products in the shipment in the following cases:

  • (a) the sale and distribution of cannabis products to a person authorized to sell cannabis under a provincial Act by reason of subsection 69(1) of the Act; and
  • (b) the sending or delivering of cannabis products under paragraph 17(5)(e).

Exception

(2) Subsection (1) does not apply if the holder sells or distributes the product to a person referred to in paragraph (1)(a) and that person has notified the holder in writing, that they will obtain the copies through other means and provide it to consumers with their purchase of the product.

No modification

(3) The copies must be identical to the document referred to in subsection (1).

Quality assurance person

19 (1) A holder of a licence for processing must retain the services of one individual as a quality assurance person who has the training, experience and technical knowledge related to the requirements of Part 5.

Responsibilities

(2) The quality assurance person is responsible for

  • (a) assuring the quality of the cannabis before it is made available for sale; and
  • (b) investigating every complaint received in respect of the quality of the cannabis and, if necessary, taking corrective and preventative measures.

Alternate

(3) A holder of a licence for processing may designate up to two individuals as alternate quality assurance persons who are qualified to replace the quality assurance person.

Non-application

(4) Subsections (1) to (3) do not apply to a holder of a licence for processing that only manufactures or assembles test kits.

Minister’s approval

20 (1) A holder of a licence for processing must obtain the Minister’s approval before

  • (a) designating or replacing an alternate quality assurance person; and
  • (b) replacing the quality assurance person by an individual, other than by the alternate quality assurance person.

Application — content

(2) The holder of a licence for processing must, for the purpose of obtaining the Minister’s approval, submit an application that includes the following:

  • (a) the name and date of birth of the proposed alternate quality assurance person or the proposed quality assurance person;
  • (b) a description of the proposed quality assurance person’s or the proposed alternate quality assurance person’s qualifications in respect of the matters referred to in subsection 19(1); and
  • (c) a declaration, signed and dated by the responsible person referred to in section 37, indicating that all information provided in support of the application is correct and complete to the best of their knowledge.

Additional information

(3) The Minister may, on receiving an application for approval, require the submission of any additional information that pertains to the information contained in the application and that is necessary for the Minister to consider the application.

Micro-processing — threshold

21 (1) A holder of a licence for micro-processing must not possess, in a calendar year, cannabis of one or more classes of cannabis — other than cannabis plants and cannabis plant seeds — that has been sold or distributed to them the total amount of which, as determined in accordance with the table to this section, is equivalent to more than 600 kg of dried cannabis.

Equivalency

(2) The cannabis referred to in subsection (1) is exempt from the application of subsection 2(4) of the Act and a quantity referred to in column 2 of the table to this section in respect of any class of cannabis referred to in column 1 is deemed to be equivalent to 1 kg of dried cannabis.

Non-application

(3) Subsection (1) does not apply if the holder also holds a licence for micro-cultivation in relation to the same site and the cannabis that is sold or distributed to them is exclusively from that site.

TABLE

Item Column 1

Class of cannabis

Column 2

Amount that is equivalent to 1 kg of dried cannabis

1 dried cannabis 1 kg
2 fresh cannabis 5 kg
3 solids containing
cannabis
10 kg
4 non-solids containing cannabis 10 kg
5 cannabis solid
concentrates
0.25 kg
6 cannabis non-solid concentrates 0.25 kg
Licence for Analytical Testing

Authorized activities

22 (1) Subject to the other provisions of these Regulations, a holder of a licence for analytical testing is authorized, for the purpose of testing, to conduct those of the following activities that are authorized by the licence:

  • (a) to possess cannabis; and
  • (b) to obtain cannabis by altering its chemical or physical properties by any means.

Offer

(2) A holder of a licence for analytical testing that is authorized to conduct the activity referred to in paragraph (1)(b) is also authorized to offer to conduct that activity.

Use of organic solvent

(3) A holder of a licence for analytical testing that is authorized to conduct the activity referred to in paragraph (1)(b) is also authorized to alter or offer to alter the chemical or physical properties of cannabis by the use of an organic solvent when conducting that activity.

Head of laboratory

23 (1) A holder of a licence for analytical testing must retain the services of one individual as the head of laboratory who must work at the site set out in the licence and who is responsible for the testing referred to in section 91.

Qualifications

(2) The head of laboratory must have sufficient knowledge of the provisions of the Act and these Regulations that apply to the holder of the licence for analytical testing, have knowledge and experience related to the duties of the position and possess a degree in a science related to the work to be carried out that is awarded by a Canadian university or, if awarded by a foreign university, that is recognized by a Canadian university or a Canadian professional association.

Alternate

(3) A holder of a licence for analytical testing may designate one or more individuals as the alternate heads of laboratory who are qualified to replace the head of laboratory.

Minister’s approval

24 (1) A holder of a licence for analytical testing must obtain the Minister’s approval before

  • (a) designating or replacing an alternate head of laboratory; and
  • (b) replacing the head of laboratory by an individual, other than by an alternate head of laboratory.

Application — content

(2) The holder of a licence for analytical testing must, for the purpose of obtaining the Minister’s approval, submit an application that includes the following:

  • (a) the name and date of birth of the proposed alternate head of laboratory or the proposed head of laboratory;
  • (b) a description of the proposed head of laboratory’s or the proposed alternate head of laboratory’s qualifications in respect of the matters referred to in subsection 23(2); and
  • (c) a declaration, signed and dated by the responsible person referred to in section 37, indicating that all information provided in support of the application is correct and complete to the best of their knowledge.

Additional information

(3) The Minister may, on receiving an application for approval, require the submission of any additional information that pertains to the information contained in the application and that is necessary for the Minister to consider the application.

Destruction

25 (1) A holder of a licence for analytical testing must destroy all samples of cannabis of a lot or batch that have been distributed to them, and all cannabis obtained from those samples, within 90 days after completing the testing of the samples of the lot or batch.

Samples not tested

(2) If testing of the samples of cannabis distributed to the holder of the licence for analytical testing is not initiated within 120 days of their receipt, the holder must destroy the samples within that period.

Licence for Sale for Medical Purposes

Authorized activities

26 Subject to the other provisions of these Regulations, a holder of a licence for sale for medical purposes is authorized to conduct those of the following activities that are authorized by the licence:

  • (a) to possess cannabis products; and
  • (b) to sell cannabis products.

Sale — other than clients

27 (1) Subject to subsection (2), a holder of a licence for sale for medical purposes that authorizes the sale of cannabis products is authorized to sell or distribute

  • (a) cannabis products to any of the following:
    • (i) a holder of a licence, other than a licence for cultivation,
    • (ii) the Minister, or
    • (iii) a person to which an exemption has been granted under section 140 of the Act in relation to the cannabis or class of cannabis that is, or is contained in, a cannabis product that is sold or distributed;
  • (b) dried cannabis, fresh cannabis, cannabis plants and cannabis plant seeds, that are cannabis products, to a holder of a licence for micro-cultivation or standard cultivation;
  • (c) cannabis plants and cannabis plant seeds, that are cannabis products, to a holder of a licence for a nursery; and
  • (d) cannabis products, other than cannabis plants and cannabis plant seeds, to a hospital employee if the employee’s possession of the cannabis product is for the purpose of, and in connection with, their duties.

Packaging

(2) A holder of a licence for sale for medical purposes must sell the cannabis products referred to in subsection (1) in the packaging in which they were sold or distributed to the holder.

Licence for Research

Authorized activities

28 (1) Subject to the other provisions of these Regulations, a holder of a licence for research is authorized to conduct those of the following activities, that are authorized by the licence:

  • (a) for the purpose of research,
    • (i) to possess cannabis,
    • (ii) to produce cannabis, and
    • (iii) to transport, send or deliver cannabis between the sites that are set out by the licence; and
  • (b) to sell cannabis plants and cannabis plant seeds to any of the following:
    • (i) a holder of a licence for cultivation,
    • (ii) another holder of a licence for research,
    • (iii) a holder of a cannabis drug licence,
    • (iv) the Minister, or
    • (v) a person to which an exemption has been granted under section 140 of the Act in relation to the cannabis or class of cannabis that is sold or distributed.

Offer

(2) A holder of a licence for research that is authorized to conduct the activity referred to in subparagraph (1)(a)(ii) is also authorized to offer to obtain cannabis by any method authorized by the licence.

Use of organic solvent

(3) A holder of a licence for research that is authorized to obtain cannabis by altering its chemical or physical properties by any means is also authorized to alter or offer to alter its chemical or physical properties by the use of an organic solvent when conducting that activity.

Administer and distribute — research subject

(4) A holder of a licence for research is also authorized, for the purpose of research, to administer and distribute cannabis to a research subject.

Distribution

(5) A holder of a licence for research is also authorized to distribute

  • (a) cannabis to any of the following:
    • (i) another holder of a licence for research,
    • (ii) a holder of a licence for analytical testing,
    • (iii) a holder of a cannabis drug licence, or
    • (iv) the Minister; and
  • (b) cannabis plants and cannabis plant seeds to the following:
    • (i) a holder of a licence for cultivation, or
    • (ii) a person to which an exemption has been granted under section 140 of the Act in relation to the cannabis or class of cannabis that is sold or distributed.
Refusal, Suspension and Revocation

Refusal to issue, renew or amend — other grounds

29 For the purpose of paragraph 62(7)(h) of the Act, other grounds for refusing to issue, renew or amend a licence are the following:

  • (a) an individual who is required to hold a security clearance under section 50 in respect of an application does not hold such a security clearance;
  • (b) in respect of the renewal or amendment of a licence, the holder of the licence does not hold a cannabis licence issued under subsection 14(1.1) of the Excise Act, 2001, if it is required;
  • (c) in respect of the issuance or amendment of a licence for cultivation, the site proposed in the application would be authorized by another licence for cultivation;
  • (d) in respect of the issuance or amendment of a licence for micro-cultivation, the site proposed in the application would be authorized by a licence for standard processing and a licence for micro-cultivation;
  • (e) in respect of the issuance or amendment of a licence for standard cultivation, the site proposed in the application would be authorized by a licence for micro-processing and a licence for standard cultivation;
  • (f) in respect of the issuance or amendment of a licence for a nursery, the site proposed in the application would be authorized by a licence for processing and a licence for a nursery;
  • (g) in respect of the issuance or amendment of a licence for processing, the site proposed in the application would be authorized by another licence for processing;
  • (h) in respect of the issuance or amendment of a licence for processing, the site proposed in the application would be authorized by a licence for processing and a licence for a nursery;
  • (i) in respect of the issuance or amendment of a licence for micro-processing, the site proposed in the application would be authorized by a licence for standard cultivation and a licence for micro-processing; and
  • (j) in respect of the issuance or amendment of a licence for standard processing, the site proposed in the application would be authorized by a licence for micro-cultivation and a licence for standard processing.

Suspension — other circumstance

30 For the purpose of paragraph 64(1)(b) of the Act, other circumstances for the suspension of a licence are the following:

  • (a) an individual who is required to hold a security clearance under section 50 in respect of the licence does not hold such a security clearance;
  • (b) the holder of a licence has failed to pay a fee in relation to the licence that is fixed under subsection 142(1) of the Act; and
  • (c) the cannabis licence issued to the holder under subsection 14(1.1) of the Excise Act, 2001 is suspended under subsection 23(2) of that Act.

Revocation — other circumstances

31 For the purpose of paragraph 65(h) of the Act, other circumstances for the revocation of a licence are the following:

  • (a) the holder of the licence has requested, in writing, the revocation;
  • (b) the licence has been suspended and not reinstated because the reasons for the suspension still exist or the holder of the licence has not demonstrated to the Minister that the suspension is unfounded;
  • (c) since the issuance of the licence, a security clearance in respect of the licence has been refused; and
  • (d) the holder of the licence no longer holds the cannabis licence issued under subsection 14(1.1) of the Excise Act, 2001, if it is required.
Changes Relating to Licence

Amendment

32 A holder of a licence must submit an application for an amendment to the licence if they propose to make any of the following changes:

  • (a) a change to the name of the holder of the licence;
  • (b) a change to the address of the site or building within the site where the activity is authorized; or
  • (c) a change to the authorized activity at the site or the authorized activity that may be conducted at each building within the site.

Minister’s approval

33 (1) A holder of a licence that proposes to make a change to the site plan that would require physical security measures to be carried out in order to comply with Part 4 must obtain the Minister’s approval before making the change.

Application — content

(2) The holder of a licence must, for the purpose of obtaining the Minister’s approval, submit an application that includes the following:

  • (a) a description of the change;
  • (b) the proposed site plan; and
  • (c) a declaration, signed and dated by the responsible person referred to in section 37, indicating that all information provided in support of the application is correct and complete to the best of their knowledge.

Additional information

(3) The Minister may, on receiving an application for approval, require the submission of any additional information that pertains to the information contained in the application and that is necessary for the Minister to consider the application.

Notification — various changes

34 (1) A holder of a licence must notify the Minister of any of the following changes within five days after the change occurs:

  • (a) a change to the mailing address, telephone number, email address or facsimile number of the holder;
  • (b) a change to the site plan, other than a change referred to in subsection 33(1);
  • (c) the replacement of an individual who must hold a security clearance referred to in any of paragraphs 50(b) to (g), (i) and (j) or the addition of another such individual, other than an individual who is designated as an alternate for the position of quality assurance person referred to in section 19; and
  • (d) in the case of a holder of a licence for cultivation, a licence for processing or a licence for sale, a change to the organizational security plan.

Notification — content

(2) The notification must include the following:

  • (a) a description of the change; and
  • (b) a declaration, signed and dated by the responsible person referred to in section 37, indicating that all information provided in support of the notification is correct and complete to the best of their knowledge.

Additional information

(3) In the case of a change referred to in paragraph (1)(c), the notification must also include the following:

  • (a) the name and date of birth of the individual who replaced an individual referred to in any of paragraphs 50(b) to (g), (i) and (j) or who was added as another such individual; and
  • (b) if the individual replaced a director or officer referred to in subparagraph 50(b)(i) or (c)(i) or was added as such a director or officer, the certificate of incorporation or other amended incorporating instrument of the corporation or cooperative.

Notification to local authorities

35 (1) A holder of a licence for cultivation, a licence for processing or a licence for sale that authorizes the possession of cannabis must, within 30 days after the issuance, amendment, suspension, reinstatement or revocation of the licence, provide a written notice to the local authorities referred to in paragraphs 7(1)(a) to (c) in the area in which the site set out in the licence is located and provide a copy of the notice to the Minister.

Content of notice

(2) The notice must contain the following information:

  • (a) the name of the holder of the licence and the address of the site set out in the licence; and
  • (b) a description of the applicable event referred to in subsection (1) and its effective date and, in the case of an amendment to the licence, details of the amendment.

Senior official

(3) The notice must be addressed to a senior official of the local authority to which it is provided.

Cessation of activities

36 (1) A holder of a licence that intends to cease conducting all the activities authorized by the licence — whether before or on the date of expiry of the licence — must provide the Minister with a written notice to that effect at least 30 days before the day on which those activities cease.

Content of notice

(2) The notice must be signed and dated by the responsible person referred to in section 37 and contain the following information:

  • (a) the date on which activities are expected to cease;
  • (b) a description of the manner in which any cannabis remaining at the site as of the date referred to in paragraph (a) will be disposed of by the holder of the licence, including
    • (i) if the cannabis will be sold or distributed, in whole or in part, the name and address of the person to which it will be sold or distributed, and
    • (ii) if it will be destroyed, in whole or in part, the day on which and the location at which the destruction is to take place;
  • (c) the address of the location at which the holder’s records, reports, electronic data and other documents that are required to be retained under the Act by the holder will be retained after activities have ceased; and
  • (d) the name, address, telephone number and, if applicable, facsimile number and email address of a person from which the Minister may obtain further information after activities have ceased.

Update

(3) After having ceased the activities, the holder must submit to the Minister an update of the information referred to in paragraphs (2)(a) to (d), if it differs from the information submitted in the notice under subsection (1). The update must be signed and dated by the responsible person referred to in section 37.

General Requirements Relating to Authorized Activities

Responsible person

37 (1) A holder of a licence must retain the services of one individual as the responsible person who has the authority to bind the holder.

Responsibilities and knowledge

(2) The responsible person is responsible for the activities conducted under the licence and must have sufficient knowledge of the provisions of the Act and these Regulations that apply to the holder of the licence.

Alternate

(3) A holder of a licence may designate one individual as the alternate responsible person who is qualified to replace the responsible person.

Head of security

38 (1) A holder of a licence, other than a licence for analytical testing or a licence for research, must retain the services of one individual as the head of security who is responsible for

  • (a) ensuring that the applicable physical security measures set out in Part 4 are complied with; and
  • (b) the organizational security plan of the holder.

Alternate

(2) A holder of a licence, other than a licence for analytical testing or a licence for research, may designate one individual as the alternate head of security who is qualified to replace the head of security.

Approved site

39 (1) A holder of a licence must only conduct activities that are authorized by the licence at the site and, if applicable, the building within the site, set out in the licence.

Non-application

(2) Subsection (1) does not apply to the possession of cannabis for the purpose of antimicrobial treatment or destruction or the distribution of cannabis.

Dwelling-house

40 A holder of a licence must not conduct any activity that is authorized by the licence at a dwelling-house.

Outdoor activities

41 A holder of a licence must not produce cannabis — other than obtain cannabis by cultivating, propagating or harvesting it — or test, store, package or label cannabis outdoors.

Antimicrobial treatment

42 A holder of a licence, other than a licence for analytical testing, may conduct antimicrobial treatment of cannabis at a location other than the site set out in the licence only if

  • (a) the holder ensures that the cannabis that is at the location is, at all times, in the presence of at least one individual referred to in paragraph 43(2)(a), or in the case of a holder of a licence for research, an individual referred to in paragraph 43(2)(b); and
  • (b) the cannabis is subsequently returned to the site set out in the licence or distributed in accordance with these Regulations.

Destruction

43 (1) A holder of a licence is authorized to destroy cannabis only

  • (a) in accordance with a method that
    • (i) complies with all federal, provincial and municipal environmental protection legislation applicable to the location where it is to be destroyed, and
    • (ii) does not result in any individual being exposed to cannabis smoke or cannabis vapour;
  • (b) in the presence of at least two individuals who are qualified to witness the destruction and, except in the case of a holder of a licence for analytical testing or a licence for research, one of whom is an individual referred to in paragraph (2)(a); and
  • (c) in the case where the cannabis is destroyed at a location other than the site set out in the licence, the holder of the licence ensures that the cannabis that is at the location is, at all times, in the presence of at least one individual referred to in paragraph (2)(a) or, in the case of a holder of a licence for analytical testing or a licence for research, an individual referred to in paragraph (2)(b).

Witness to destruction

(2) The following individuals are qualified to witness the destruction of cannabis:

  • (a) an individual who holds a security clearance; and
  • (b) an employee of the holder of the licence.

Security clearance holder

44 A holder of a licence, other than a holder of a licence for analytical testing, a licence for research, or a licence for sale that does not authorize the possession of cannabis, must ensure that an individual who holds a security clearance is present at the site when activities are conducted by other individuals in an operations area or a storage area.

Organizational security plan — update

45 A holder of a licence, other than a holder of a licence for analytical testing or a licence for research, must on request of the Minister, update and submit the organizational security plan.

Recall

46 A holder of a licence must establish and maintain a system of control that permits the rapid and complete recall of every lot or batch of cannabis that has been sold or distributed.

Safekeeping during distribution

47 A holder of a licence must take any steps that are necessary to ensure the safekeeping of cannabis when distributing it.

Identification of holder of a licence

48 A holder of a licence must include their name, as set out in the licence, in all the means by which they identify themself in relation to cannabis, including advertising, purchase orders, shipping documents and invoices.

PART 3

Security Clearances

Definitions

49 The following definitions apply in this Part.

corporation does not include a federal or provincial Crown corporation. (personne morale)

partnership does not include an incorporated entity. (société de personnes)

Requirement for security clearance

50 The following individuals must hold a security clearance:

  • (a) an individual who holds a licence for cultivation, processing or sale;
  • (b) in the case of a corporation that holds a licence for cultivation, processing or sale,
    • (i) the directors and officers of the corporation,
    • (ii) any individual who exercises, or is in a position to exercise, direct control over the corporation,
    • (iii) the directors and officers of any corporation or cooperative that exercises, or is in a position to exercise, direct control over the corporation,
    • (iv) any individual who is a partner in a partnership that exercises, or is in a position to exercise, direct control over the corporation, and
    • (v) the directors and officers of any corporation that is a partner in a partnership that exercises, or is in a position to exercise, direct control over the corporation;
  • (c) in the case of a cooperative that holds a licence for cultivation, processing or sale,
    • (i) the directors and officers of the cooperative,
    • (ii) any individual who exercises, or is in a position to exercise, direct control over the cooperative,
    • (iii) the directors and officers of any corporation or cooperative that exercises, or is in a position to exercise, direct control over the cooperative,
    • (iv) any individual who is a partner in a partnership that exercises, or is in a position to exercise, direct control over the cooperative, and
    • (v) the directors and officers of any corporation that is a partner in a partnership that exercises, or is in a position to exercise, direct control over the cooperative;
  • (d) in the case of a partnership that holds a licence for cultivation, processing or sale,
    • (i) any individual who is a partner,
    • (ii) the directors and officers of any corporation or cooperative that is a partner,
    • (iii) any individual who is a partner in a partnership that exercises, or is in a position to exercise, direct control over the partnership that holds the licence, and
    • (iv) the directors and officers of any corporation that is a partner in a partnership that exercises, or is in a position to exercise, direct control over the partnership that holds the licence;
  • (e) in the case of a licence for cultivation, processing or sale, the responsible person referred to in section 37;
  • (f) in the case of a licence for cultivation, processing or sale, the head of security referred to in section 38;
  • (g) in the case of a licence for cultivation, the master grower referred to in section 12 or 15;
  • (h) in the case of a licence for processing, the quality assurance person referred to in section 19;
  • (i) an individual who has been designated as an alternate for a position referred to in any of paragraphs (e) to (h); and
  • (j) an individual who has been specified by name by the Minister under subsection 67(2) of the Act or who occupies a position that has been specified by the Minister under that subsection.

Eligibility

51 Only the following individuals may submit an application for a security clearance:

  • (a) an individual who is required to hold a security clearance;
  • (b) an individual who will be required to hold a security clearance if an application for a licence, or for its renewal or amendment, that has been filed with the Minister results in the issuance, renewal or amendment of the licence;
  • (c) an individual who will be required to hold a security clearance if a pending business transaction is completed;
  • (d) an individual who has been selected for a position referred to in any of paragraphs 50(e) to (h) or as an alternate for such a position; and
  • (e) an individual who has been selected for a position that has been specified by the Minister under subsection 67(2) of the Act or who has been notified that the Minister intends to specify them, by name or position, under that subsection.

Checks

52 The Minister may, at any time, conduct checks that are necessary to determine whether an applicant for, or the holder of, a security clearance poses a risk to public health or public safety, including the risk of cannabis being diverted to an illicit market or activity. Such checks include

  • (a) a check of the applicant’s or holder’s criminal record; and
  • (b) a check of the relevant files of law enforcement agencies that relate to the applicant or holder, including intelligence gathered for law enforcement purposes.

Grant of security clearance

53 (1) Before granting a security clearance, the Minister must, taking into account any licence conditions that he or she imposes under subsection 62(10) of the Act, determine that the applicant does not pose an unacceptable risk to public health or public safety, including the risk of cannabis being diverted to an illicit market or activity.

Factors

(2) Factors that the Minister may consider to determine the level of risk posed by the applicant include

  • (a) the circumstances of any events or convictions that are relevant to the determination, the seriousness of those events or convictions, their number and frequency, the date of the most recent event or conviction and any sentence or other disposition;
  • (b) whether it is known, or there are reasonable grounds to suspect, that the applicant
    • (i) is or has been involved in, or contributes or has contributed to, an activity that is prohibited by, or conducted in contravention of, any of the provisions of Division 1 of Part 1 of the Act — other than paragraphs 8(1)(a) to (e) — or Subdivision E of Division 2 of Part 1 of the Act,
    • (ii) is or has been involved in, or contributes or has contributed to, an activity that is prohibited by, or conducted in contravention of, any of the provisions of Part I of the Controlled Drugs and Substances Act — other than subsection 4(1) — or subsection 32(1) or (2) of that Act,
    • (iii) is or has been involved in, or contributes or has contributed to, an activity that is prohibited by, or conducted in contravention of, any provision of the Criminal Code relating to fraud, corruption of public officials, terrorism financing, counterfeiting or laundering the proceeds of crime,
    • (iv) is or has been involved in, or contributes or has contributed to, an offence involving an act of violence or the threat of violence,
    • (v) is or has been a member of a criminal organization as defined in subsection 467.1(1) of the Criminal Code, or is or has been involved in, or contributes or has contributed to, the activities of such an organization,
    • (vi) is or has been a member of an organization that is known to be involved in or to contribute to — or in respect of which there are reasonable grounds to suspect its involvement in or contribution to — activities directed toward, or in support of, acts of violence or the threat of violence, or is or has been involved in, or contributes or has contributed to, the activities of such an organization,
    • (vii) is or has been associated with an individual who
      • (A) is known to be involved in or to contribute to — or in respect of whom there are reasonable grounds to suspect their involvement in or contribution to — activities referred to in subparagraphs (i) to (iii), or
      • (B) is a member of an organization referred to in subparagraph (v) or (vi), or
    • (viii) has conspired to commit
      • (A) an offence under any of the provisions of the Criminal Code referred to in subparagraph (iii),
      • (B) an offence referred to in subparagraph (iv), or
      • (C) an offence under any of sections 467.11 to 467.13 of the Criminal Code;
  • (c) whether there are reasonable grounds to suspect that the applicant could be induced to commit an act — or to aid or abet any person to commit an act — that might constitute a risk to public health or public safety;
  • (d) whether there are reasonable grounds to believe that the applicant’s activities, including their financial activities, pose a risk to the integrity of the control of the production and distribution of cannabis under the Act;
  • (e) whether the applicant has had a security clearance suspended or cancelled;
  • (f) whether there are reasonable grounds to believe the applicant has, now or in the past, submitted false or misleading information, or false or falsified documents, to the Minister; and
  • (g) whether an entity has refused to issue a security clearance to the applicant — or has suspended or cancelled one — and the reason for the refusal, suspension or cancellation.

Outstanding criminal charge

54 If the Minister refuses to consider an application for a security clearance because there is an outstanding criminal charge against the applicant that may be relevant to the determination of the risk under subsection 53(1), the Minister must provide the applicant, and any affected holder of or applicant for a licence, with notice of the refusal in writing.

Refusal to grant security clearance

55 (1) If the Minister intends to refuse to grant a security clearance, the Minister must provide the applicant with a notice that sets out the reason for the proposed refusal and that specifies the period of time within which they may make written representations to the Minister. The period must start on the day on which the notice is provided and must be not less than 20 days.

Notice of refusal

(2) If the Minister refuses to grant the security clearance, the Minister must provide the applicant, and any affected holder of or applicant for a licence, with notice of the refusal in writing.

Validity period

56 (1) The Minister must establish a validity period for a security clearance in accordance with the level of risk to public health or public safety — including the risk of cannabis being diverted to an illicit market or activity — posed by the applicant, but the period must not exceed five years.

Extension of validity period

(2) If the validity period of a security clearance is less than five years, the Minister may subsequently extend the period to a total of five years if the Minister, taking into account any licence conditions that he or she imposes under subsection 62(10) of the Act, determines that the holder does not pose an unacceptable risk to public health or public safety, including the risk of cannabis being diverted to an illicit market or activity.

Factors

(3) The factors that the Minister may consider to determine the level of risk posed by the holder include those set out in subsection 53(2).

Obligation to notify — offences

57 A holder of a security clearance must, without delay, provide the Minister with notice in writing if they are charged with, or found guilty of, an offence under the Act, the Controlled Drugs and Substances Act or the Criminal Code.

Suspension of security clearance

58 (1) Before suspending a security clearance, the Minister must have reasonable grounds to believe that the risk to public health or public safety posed by the holder, including the risk of cannabis being diverted to an illicit market or activity, has become unacceptable.

Notice of suspension

(2) A suspension takes effect as soon as the Minister provides the holder with a notice in writing that sets out the reasons for the suspension and that specifies the period of time within which they may make written representations to the Minister. The period starts on the day on which the notice is provided and must be not less than 20 days.

Notice to holder of licence

(3) The Minister must, without delay after suspending a security clearance, also provide any affected holder of or applicant for a licence with notice of the suspension in writing.

Reinstatement of security clearance

59 (1) The Minister must reinstate a suspended security clearance if

  • (a) the reasons for the suspension no longer exist or the holder of the security clearance demonstrates to the Minister that the suspension was unfounded; or
  • (b) the Minister determines, taking into account any licence conditions that he or she imposes under subsection 62(10) of the Act, that the holder of the security clearance does not pose an unacceptable risk to public health or public safety, including the risk of cannabis being diverted to an illicit market or activity.

Factors

(2) The factors that the Minister may consider to determine the level of risk posed by the holder of the security clearance include those set out in subsection 53(2).

Notice of reinstatement

(3) The Minister must, without delay after reinstating a security clearance, provide the holder of the security clearance, and any affected holder of or applicant for a licence, with notice of the reinstatement in writing.

Cancellation of security clearance

60 (1) A security clearance may not be cancelled unless

  • (a) it is suspended and the period within which the holder may make representations in respect of the suspension has expired; and
  • (b) the Minister has determined that the holder poses an unacceptable risk to public health or public safety, including the risk of cannabis being diverted to an illicit market or activity.

Factors

(2) The factors that the Minister may consider to determine the level of risk posed by the holder include those set out in subsection 53(2).

Notice of cancellation

(3) The Minister must, without delay after cancelling a security clearance, provide the holder, and any affected holder of or applicant for a licence, with notice of the cancellation in writing.

Ineligibility — new application

61 If the Minister refuses to grant or cancels a security clearance, the individual who has been refused a security clearance or the former holder may submit a new application for a security clearance only if

  • (a) a period of five years has elapsed since the day on which the refusal or cancellation occurred; or
  • (b) a change has occurred in the circumstances that led to the refusal or cancellation.

PART 4

Physical Security Measures

DIVISION 1

Licences Requiring Increased Security Measures
General Provisions

Security measures

62 (1) The security measures set out in sections 63 to 72 apply in respect of the sites set out in the following licences:

  • (a) a licence for standard cultivation;
  • (b) a licence for standard processing;
  • (c) a licence for sale that authorizes the possession of cannabis; and
  • (d) a cannabis drug licence if the amount of cannabis that is sold or distributed to the holder of the licence is, as determined in accordance with the table to section 21, equivalent to more than 600 kg of dried cannabis per calendar year.

Compliance with security measures

(2) A holder of a licence referred to in subsection (1) must ensure that the security measures are complied with.

Equivalency

(3) The cannabis referred to in paragraph (1)(d) is exempt from the application of subsection 2(4) of the Act and a quantity referred to in column 2 of the table to section 21 in respect of any class of cannabis referred to in column 1 is deemed to be equivalent to 1 kg of dried cannabis.

Site Design

Site design

63 The site must be designed in a manner that prevents unauthorized access.

Perimeter of Site

Visual monitoring

64 (1) The perimeter of the site must be monitored at all times by visual recording devices to detect any attempted or actual unauthorized access to the site.

Visual recording devices

(2) The devices must, in the conditions under which they are used, be capable of making a visible recording of any attempted or actual unauthorized access.

Intrusion detection system

65 The perimeter of the site must be secured by means of an intrusion detection system that operates at all times and that allows for the detection of any attempted or actual unauthorized access to the site and any attempted or actual tampering with the system.

Monitoring and response

66 (1) The intrusion detection system referred to in section 65 must be monitored at all times.

Appropriate measures

(2) The holder of the licence must determine the appropriate measures to be taken if any occurrence referred to in section 65 is detected.

Record of detected occurrences

(3) If any such occurrence is detected, the holder of the licence must ensure that a document is retained that contains the following information:

  • (a) the date and time of the occurrence; and
  • (b) the measures taken in response to it and the date and time when they were taken.
Operations Areas and Storage Areas

Location of storage area

67 Each storage area must be located within an area that satisfies the security measures set out in subsection 68(1), section 69, subsections 70(1) and (3), subsection 71(1) and section 72.

Restricted access

68 (1) Access to each operations area and storage area must be restricted to individuals whose presence in the area is required by their duties.

Record — storage area

(2) A record must be maintained of the identity of every individual entering or exiting a storage area.

Physical barrier

69 Each operations area and storage area must be surrounded by a physical barrier that prevents unauthorized access.

Visual monitoring

70 (1) Each operations area and storage area must be monitored at all times by visual recording devices to detect illicit conduct.

Exception — grow area

(2) For a grow area, only the entry and exit points of the area must be monitored by the devices.

Visual recording devices

(3) The devices must, in the conditions under which they are used, be capable of making a visible recording of any illicit conduct.

Intrusion detection system

71 (1) Each operations area and storage area must be secured by means of an intrusion detection system that operates at all times and that allows for the detection of any attempted or actual unauthorized access to the area, any unauthorized movement in the area and any attempted or actual tampering with the system.

Exception — grow area

(2) The intrusion detection system is not required to detect unauthorized movement in a grow area.

Monitoring and response

72 (1) The intrusion detection system referred to in section 71 must be monitored at all times.

Appropriate measures

(2) The holder of the licence must determine the appropriate measures to be taken if any occurrence referred to in section 70 or 71 is detected.

Record of detected occurrences

(3) If any such occurrence is detected, the holder of the licence must ensure that a document is retained that contains the following information:

  • (a) the date and time of the occurrence; and
  • (b) the measures taken in response to it and the date and time when they were taken.

Retention

73 A holder of a licence referred to in subsection 62(1) must retain

  • (a) a visual recording made under section 64 or 70 for at least one year after the day on which it is made;
  • (b) a document referred to in subsection 66(3) or 72(3) for at least two years after the day on which it is prepared; and
  • (c) the information in the record referred to in subsection 68(2) for at least two years after the day on which the information is recorded.

DIVISION 2

Other Licences

Micro-cultivation, micro-processing and nurseries

74 A holder of a licence for micro-cultivation, micro-processing or a nursery must ensure that the following security measures are complied with in respect of the site set out in the licence:

  • (a) the site is designed in a manner that prevents unauthorized access;
  • (b) the site is surrounded by a physical barrier that prevents unauthorized access;
  • (c) storage areas are surrounded by a physical barrier that prevents unauthorized access; and
  • (d) access to each storage area is restricted to individuals whose presence in the area is required by their duties.

Analytical testing

75 A holder of a licence for analytical testing must ensure that the following security measures are complied with in respect of the site set out in the licence:

  • (a) storage areas are surrounded by a physical barrier that prevents unauthorized access; and
  • (b) access to each storage area is restricted to individuals whose presence in the area is required by their duties.

Cannabis drug licences

76 (1) If the amount of cannabis that is sold or distributed to the holder of a cannabis drug licence is not equivalent, as determined in accordance with the table to section 21, to more than 600 kg of dried cannabis per calendar year, the holder must ensure that

  • (a) if they only conduct analytical testing, the security measures set out in paragraphs 75(a) and (b) are complied with in respect of the site set out in the licence; and
  • (b) in any other case, the security measures set out in paragraphs 74(a) to (d) are complied with in respect of the site set out in the licence.

Equivalency

(2) The cannabis referred to in subsection (1) is exempt from the application of subsection 2(4) of the Act and a quantity referred to in column 2 of the table to section 21 in respect of any class of cannabis referred to in column 1 is deemed to be equivalent to 1 kg of dried cannabis.

Research

77 A holder of a licence for research must ensure that operations areas at the site set out in the licence are designed in a manner that prevents unauthorized access.

DIVISION 3

Exemptions

Exemption — storage area

78 (1) A holder of a licence referred to in paragraph 62(1)(a), (b) or (c) is exempt from the application of section 67 in respect of the site set out in the licence if

  • (a) immediately before the day on which these Regulations come into force, the holder was, in respect of the site,
    • (i) licensed under Part 1 of the former Access to Cannabis for Medical Purposes Regulations,
    • (ii) in compliance with their obligations under sections 57 to 60 and 62 of those Regulations, and
    • (iii) securely storing cannabis, other than cannabis plants and cannabis plant seeds, in accordance with the Directive on Physical Security Requirements for Controlled Substances (Security Requirements for Licensed Dealers for the Storage of Controlled Substances), as amended in December 1999 and published by the Government of Canada on its website; and
  • (b) the holder has, since the day on which these Regulations come into force, been securely storing cannabis, other than cannabis plants and cannabis plant seeds, in accordance with the Directive referred to in subparagraph (a)(iii).

Exemption — application under former Regulations

(2) A holder of a licence referred to in paragraph 62(1)(a), (b) or (c) is exempt from the application of section 67 in respect of the site set out in the licence if

  • (a) the holder had, before the day on which these Regulations come into force, submitted an application under section 33 of the former Access to Cannabis for Medical Purposes Regulations in respect of the same site;
  • (b) the application referred to in paragraph (a) was, by virtue of subsection 158(9) of the Act, deemed to be an application for a licence made under section 62 of the Act;
  • (c) the Minister issued a licence under section 62 of the Act on the basis of the deemed application; and
  • (d) the holder has, since the licence referred to in paragraph (c) was issued, been securely storing cannabis, other than cannabis plants and cannabis plant seeds, in accordance with the Directive referred to in subparagraph (1)(a)(iii).

Interpretation

(3) For the purposes of paragraphs (1)(b) and (2)(d), a reference in the Directive to a term set out in column 1 of the table to this subsection is deemed to be a reference to the corresponding term set out in column 2.

TABLE

Item Column 1

Term used in the Directive

Column 2

Corresponding term

1 Controlled substance Cannabis
2 Licensed dealer / licenced dealer Holder of a licence
3 Cannabis Sativa, its preparations, derivatives and similar synthetic preparations except Nabilone Cannabis
4 Office of Controlled Substances, Therapeutic Products Programme Health Canada
5 Office Health Canada

Exemption — cannabis drug licence

(4) The holder of a cannabis drug licence is exempt from the application of this Part in respect of the site set out in the licence if they are securely storing cannabis in accordance with the Directive on Physical Security Requirements for Controlled Substances and Drugs Containing Cannabis, as amended from time to time and published by the Government of Canada on its website.

PART 5

Good Production Practices

General Provisions

Sale, distribution and exportation

79 A holder of a licence must not sell, distribute or export cannabis unless the applicable requirements set out in sections 80 to 88 have been met.

Standard operating procedures

80 Cannabis must be produced, packaged, labelled, distributed, stored, sampled and tested in accordance with standard operating procedures that are designed to ensure that those activities are conducted in accordance with the requirements of this Part.

Pest control product

81 Cannabis must not be treated with a pest control product unless the product is registered for use on cannabis under the Pest Control Products Act or is otherwise authorized for use under that Act.

Storage

82 Cannabis must be stored under conditions that maintain its quality.

Distribution

83 Cannabis must be distributed in a manner that maintains its quality.

Building or part of building

84 (1) Cannabis must be produced, packaged, labelled, stored, sampled and tested in a building or part of a building that is designed, constructed and maintained in a manner that permits those activities to be conducted appropriately and under sanitary conditions, and in particular that

  • (a) permits the building or part of the building to be kept clean and orderly;
  • (b) permits the effective cleaning of all surfaces in the building or part of the building;
  • (c) prevents the contamination of cannabis; and
  • (d) prevents the addition of an extraneous substance to the cannabis.

Non-application

(2) Despite subsection (1), cannabis may be obtained by cultivating, propagating or harvesting it outdoors.

Filtration of air

85 The building or part of the building where cannabis is produced, packaged, labelled and stored must be equipped with a system that filters air to prevent the escape of odours.

Equipment

86 (1) Cannabis must be produced, packaged, labelled, stored, sampled and tested using equipment that is designed, constructed, maintained, operated and arranged in a manner that

  • (a) permits the effective cleaning of its surfaces;
  • (b) permits it to function in accordance with its intended use;
  • (c) prevents the contamination of the cannabis; and
  • (d) prevents the addition of an extraneous substance to the cannabis.

Non-application

(2) Paragraph 1(d) does not apply to the outdoor cultivation, propagation or harvesting of cannabis.

Sanitation program

87 (1) Cannabis must be produced, packaged, labelled, stored, sampled and tested in accordance with a sanitation program that sets out

  • (a) procedures for effectively cleaning the building or part of the building in which those activities are conducted;
  • (b) procedures for effectively cleaning the equipment used in those activities;
  • (c) procedures for handling any substance used in those activities; and
  • (d) all requirements, in respect of the health and hygienic behaviour of the personnel who are involved in those activities, that are necessary to ensure that those activities are conducted in sanitary conditions.

Non-application

(2) Paragraph (1)(a) does not apply to the outdoor cultivation, propagation or harvesting of cannabis.

Quality assurance

88 (1) In the case of a holder of a licence for processing, every complaint received in respect of the quality of the cannabis must be investigated by the quality assurance person referred to in section 19 who must, if necessary, take corrective and preventative measures.

Methods and procedures

(2) In the case of a holder of a licence for processing, the cannabis must be produced, packaged, labelled, distributed, stored, sampled and tested using methods and procedures that, prior to their implementation, have been approved by a quality assurance person.

Approval prior to sale

(3) In the case of a holder of a licence for processing, every lot or batch of cannabis must be approved by a quality assurance person before it is made available for sale.

Testing

Sale and exportation — cannabis product

89 A holder of a licence must not sell or export a cannabis product unless the applicable requirements set out in sections 90 to 92 have been met.

Validated methods

90 The testing conducted under section 91 and further to the requirements in Part 6 must be conducted using validated methods.

Composition

91 Testing for the following must be conducted on each lot or batch of cannabis, other than cannabis plants or cannabis plant seeds, that will become a cannabis product or that will be contained in a cannabis accessory that is a cannabis product:

  • (a) the residues of solvents used in the production of cannabis oil;
  • (b) the contaminants referred to in section 94;
  • (c) the dissolution or disintegration referred to in section 95; and
  • (d) the quantity or percentage of THC, THCA, CBD and CBDA, as the case may be.

Representative sample

92 (1) For the purposes of the testing referred to in section 90, a representative sample of the lot or batch must be taken.

Quantity

(2) A portion of the sample referred to in subsection (1) must be retained for at least one year after the date of the last sale of any portion of the lot or batch and must be of sufficient quantity to enable a determination of

  • (a) whether the lot or batch meets the requirements of section 81, subsection 93(2) and section 94 and, if applicable, subsection 93(3) and sections 95, 97, 101 and 102; and
  • (b) the quantity or percentage of THC, THCA, CBD and CBDA, as the case may be.

PART 6

Cannabis Products

General Provisions

Substances

93 (1) Cannabis that is a cannabis product or that is contained in a cannabis accessory that is a cannabis product must not contain any substance other than the cannabis.

Maximum residue limit

(2) Despite subsection (1), the cannabis may contain residues of a pest control product, its components or derivatives, if they do not exceed any maximum residue limit, in relation to cannabis, specified for the pest control product, its components or derivatives under section 9 or 10 of the Pest Control Products Act.

Cannabis oil

(3) Despite subsection (1), cannabis oil may contain the carrier oil, residues of the solvents listed in the document entitled Limits for Residual Solvents in Cannabis Products, as amended from time to time and published by the Government of Canada on its website that do not exceed the limits established in that document and other substances that are necessary to maintain the oil’s quality and stability.

Microbial and chemical contaminants

94 (1) Despite subsection 93(1), cannabis that is a cannabis product or that is contained in a cannabis accessory that is a cannabis product may contain microbial or chemical contaminants provided that they are within generally accepted tolerance limits for herbal medicines for human consumption, as established in any publication referred to in Schedule B to the Food and Drugs Act.

Non-application — cannabis plant or cannabis plant seeds

(2) The tolerance limits referred to in subsection (1) do not apply to a cannabis product that is a cannabis plant or cannabis plant seeds.

Dissolution and disintegration

95 Each discrete unit of a cannabis product that is intended to be administered orally, rectally or vaginally must meet the requirements of a dissolution or disintegration test that is applicable to its formulation and that is set out in any publication referred to in Schedule B to the Food and Drugs Act.

Components — fit for intended use

96 If a cannabis product is intended to be administered orally, rectally, vaginally or topically, all the components of the product must be fit for the intended use.

Maximum yield quantity — discrete unit

97 Each discrete unit of a cannabis product that is intended to be administered orally, rectally or vaginally must not exceed a maximum yield quantity of 10 mg of THC, taking into account the potential to convert THCA into THC.

Sale

98 The following cannabis products must not be sold or distributed:

  • (a) a cannabis product that is intended to be used in the human eye; and
  • (b) a cannabis product that is administered by disrupting the skin barrier.

Dried and Fresh Cannabis

Addition of THC or THCA

99 THC or THCA must not be added to dried or fresh cannabis that will become a cannabis product or that is, or will be, contained in a cannabis accessory that will become a cannabis product.

Consumption by inhalation — net weight of dried cannabis

100 The net weight of dried cannabis that is intended to be consumed by means of inhalation in each discrete unit of a cannabis product must not exceed 1.0 g.

Cannabis Oil

Maximum yield quantity

101 Cannabis oil that is a cannabis product or contained in a cannabis accessory that is a cannabis product must not exceed a maximum yield quantity of 30 mg of THC per millilitre of the oil, taking into account the potential to convert THCA into THC.

Maximum yield quantity — Activation of accessory

102 Each activation of a cannabis accessory that dispenses cannabis oil and that is packaged with a cannabis product that is cannabis oil or of a cannabis accessory that contains the oil, if the oil is intended to be taken by ingestion, must not dispense more than a maximum yield quantity of 10 mg of THC, taking into account the potential to convert THCA into THC.

Cannabis Accessory or Component

Flavour

103 A cannabis accessory that is a cannabis product or that is packaged together with a cannabis product must not impart a characterizing flavour to the cannabis.

Alteration or enhancement of phytocannabinoid effects

104 Any component of a cannabis product, other than the cannabis, as well as any cannabis accessory that is packaged with the cannabis product, must not through chemical means, other than heating or combustion, alter or enhance the effects of the phytocannabinoids.

PART 7

Packaging and Labelling

Definitions

Definitions

105 The following definitions apply in this Part.

expiry date means the date, expressed at minimum as a year and month, that is the end of the stability period of a cannabis product. (date limite d’utilisation)

exterior surface includes a label or an image. (surfaces extérieures)

immediate container means the container that is in direct contact with a cannabis product. (contenant immédiat)

principal display panel has the same meaning as in subsection 2(2) of the Consumer Packaging and Labelling Regulations. (espace principal)

standardized cannabis symbol means the symbol set out in the document entitled Standardized Cannabis Symbol, as amended from time to time and published by the Government of Canada on its website. (symbole normalisé du cannabis)

General Provisions

Requirement — sale and distribution of cannabis product

106 (1) A holder of a licence must not sell or distribute a cannabis product unless the applicable requirements set out in sections 108 to 136 have been met.

Requirement — exportation of cannabis product

(2) A holder of a licence must not export a cannabis product unless the requirements set out in paragraph 123(1)(a) and subparagraphs 123(1)(c)(ii) and (iv) have been met.

Exception — shipping container

107 The requirements set out in this Part do not apply in respect of a shipping container.

Packaging — Cannabis Products

Immediate container

108 The immediate container in which a cannabis product, other than a cannabis plant or cannabis plant seeds, is packaged must

  • (a) be opaque or translucent;
  • (b) prevent contamination of the cannabis;
  • (c) in the case of dried cannabis, or a cannabis accessory that contains dried cannabis, keep the cannabis dry;
  • (d) have a security feature that provides reasonable assurance to consumers that it has not been opened prior to receipt;
  • (e) meet the requirements of a child resistant package under subsections C.01.001(2) to (4) of the Food and Drug Regulations; and
  • (f) not contain more than the equivalent of 30 g of dried cannabis, as determined in accordance with subsection 2(4) of the Act.

Cannabis plant — not budding or flowering

109 (1) A cannabis plant must not be budding or flowering at the time of packaging.

Cannabis plant — container

(2) The container in which a cannabis plant is packaged must not contain more than four cannabis plants.

Cannabis plant seeds — immediate container

110 The immediate container in which cannabis plant seeds are packaged must

  • (a) keep the cannabis plant seeds dry; and
  • (b) not contain more than the equivalent of 30 g of dried cannabis, as determined in accordance with subsection 2(4) of the Act.

Brand element

111 Subject to the other provisions of these Regulations, the interior surface and exterior surface of any container in which a cannabis product is packaged must not display any brand element.

Image

112 Except as otherwise provided under the Act, any other Act of Parliament or any provincial Act, the interior surface and exterior surface of any container in which a cannabis product is packaged must not display any image.

Uniform colour

113 (1) Except as otherwise provided under the Act, any other Act of Parliament or any provincial Act, the colour of the interior surface and exterior surface of any container in which a cannabis product is packaged must be one uniform colour. However, the interior surface may be a different colour than that of the exterior surface.

Colour — other requirements

(2) The colour of the interior surface and exterior surface must meet the following requirements:

  • (a) it must not have the lustre of metal or have metallic properties in the ink, such as Pantone Metallics or Pantone Premium Metallics;
  • (b) it must not be fluorescent, have fluorescent properties in the ink or have pigments that absorb ultraviolet energy and transmit it as a longer wavelength, such as the Pantone 800 series; and
  • (c) it must create a contrast with
    • (i) the yellow colour of the background of the health warning message, and
    • (ii) the red colour of the standardized cannabis symbol.

Exception

(3) Despite subsection (2), an interior surface that is made of metal may be the colour of the metal.

Package finish

114 Except as otherwise provided under the Act, any other Act of Parliament or any provincial Act, the exterior surface of any container in which a cannabis product is packaged must have a matte finish.

Texture

115 (1) Except as otherwise provided under the Act, any other Act of Parliament or any provincial Act, the interior surface and exterior surface of any container in which a cannabis product is packaged and any covering of such a container must have a smooth texture without any raised features, embossing, decorative ridges, bulges or other irregularities.

Non-application

(2) Subsection (1) does not apply to the features of a container that are necessary to

  • (a) facilitate the opening and closing of the container; or
  • (b) assist visually impaired individuals.

Features

116 (1) The interior surface and exterior surface of any container in which a cannabis product is packaged and any covering of such a container must not include

  • (a) any hidden feature that is designed to change the appearance of the container or covering, such as heat-activated ink or a feature that is visible only through technological means; or
  • (b) any feature that is designed to change the surface area of the container or covering, such as a fold-out panel.

Non-application

(2) Paragraph (1)(a) does not apply to a feature that is used to prevent counterfeiting.

Scent and sound

117 The interior surface and exterior surface of any container in which a cannabis product is packaged, and any covering of a container, must not be capable of emitting a scent or sound.

Covering — brand element

118 The covering of any container in which a cannabis product is packaged must not display any brand element.

Covering — image or information

119 Except as otherwise provided under the Act, any other Act of Parliament or any provincial Act, the covering of any container in which a cannabis product is packaged must not display any image or information.

Covering — transparent and colourless

120 Except as otherwise provided under the Act, any other Act of Parliament or any provincial Act, the covering of any container in which a cannabis product is packaged must be transparent and colourless.

Cut-out window

121 The interior surface and exterior surface of any container in which a cannabis product is packaged must not include any cut-out window.

Bar code

122 (1) A bar code may be displayed only once on any container in which a cannabis product is packaged.

Shape and colour

(2) Every bar code must be rectangular in shape and not contain any image or design and must be printed in black and white.

Labelling — Cannabis Products

Information

123 (1) The following information must be included on the label that is applied to any container in which a cannabis product is packaged:

  • (a) the name, telephone number and email address of the following:
    • (i) in the case of a cannabis plant or cannabis plant seeds, the holder of a licence for cultivation that cultivated the cannabis plant or cannabis plant seeds, or
    • (ii) in the case of any other cannabis product, the holder of a licence for processing that manufactured the product;
  • (b) the class of cannabis set out in Schedule 4 to the Act to which the cannabis that is in the immediate container belongs;
  • (c) in respect of the product
    • (i) the brand name,
    • (ii) the lot number, preceded by one of the following designations:
      • (A) “Lot number”,
      • (B) “Lot no.”,
      • (C) “Lot”, or
      • (D) “(L)”,
    • (iii) the recommended storage conditions,
    • (iv) the packaging date, and
    • (v) except in the case of a cannabis plant or cannabis plant seeds, either
      • (A) the expiry date in accordance with subsection (2), or
      • (B) a statement that no expiry date has been determined;
  • (d) the warning “KEEP OUT OF REACH OF CHILDREN / TENIR HORS DE LA PORTÉE DES ENFANTS”;
  • (e) a health warning message set out in the document entitled Cannabis Health Warning Messages, as amended from time to time and published by the Government of Canada on its website, that is
    • (i) in the case of dried cannabis, or a cannabis accessory that contains dried cannabis, one of the health warning messages set out in Part 1 of the document, and
    • (ii) in the case of any other cannabis product, one of the health warning messages set out in Part 2 of that document; and
  • (f) in the case of a cannabis product that contains THC in a concentration greater than 10 μg/g, the standardized cannabis symbol that must be obtained from the Minister in the form of an electronic file.

Expiry date

(2) The label of a container must not include an expiry date unless the holder of the licence for processing that manufactured the cannabis product has data that establishes the stability period during which, after the cannabis is packaged in accordance with these Regulations and stored under its recommended storage conditions,

  • (a) it maintains not less than 80% and not more than 120% of its THC content and CBD content; and
  • (b) its microbial and chemical contaminants remain within the limits referred to in section 94.

Stability period — retention of document

(3) The holder of the licence for processing that manufactured the cannabis product must, if they include an expiry date on the label of the container, retain a document that contains the data referred to in subsection (2) for at least two years after the day on which the last sale or distribution of any portion of the lot or batch of the cannabis product with that expiry date takes place, other than for destruction.

Rotation

(4) The health warning messages referred to in paragraph (1)(e) must be displayed in rotation on each type of container of each brand name of the cannabis product that is packaged in a year, so that each health warning message is displayed, to the extent possible, on equal numbers of containers of that product.

Dried cannabis or fresh cannabis — discrete units

124 In the case of dried cannabis or fresh cannabis — or a cannabis accessory that contains dried cannabis or fresh cannabis — that is in discrete units, the label of any container in which the cannabis product is packaged must also include the following information:

  • (a) the net weight, in grams, of dried cannabis or fresh cannabis;
  • (b) the number of units;
  • (c) the net weight, in grams, of dried cannabis or fresh cannabis in each unit;
  • (d) the quantity of THC, in milligrams, in each unit, preceded by “THC per unit”;
  • (e) the quantity of THC, in milligrams, that each unit could yield, taking into account the potential to convert THCA into THC, preceded by “Total THC per unit”;
  • (f) the quantity of CBD, in milligrams, in each unit, preceded by “CBD per unit”; and
  • (g) the quantity of CBD, in milligrams, that each discrete unit could yield, taking into account the potential to convert CBDA into CBD, preceded by “Total CBD per unit”.

Dried cannabis or fresh cannabis — not in discrete units

125 In the case of dried cannabis or fresh cannabis — or a cannabis accessory that contains dried cannabis or fresh cannabis — that is not in discrete units, the label of any container in which the cannabis product is packaged must also include the following information:

  • (a) the net weight, in grams, of dried cannabis or fresh cannabis;
  • (b) the percentage of THC w/w, preceded by “THC”;
  • (c) the percentage of THC w/w that the dried cannabis or fresh cannabis could yield, taking into account the potential to convert THCA into THC, preceded by “Total THC”;
  • (d) the percentage of CBD w/w, preceded by “CBD”; and
  • (e) the percentage of CBD w/w that the dried cannabis or fresh cannabis could yield, taking into account the potential to convert CBDA into CBD, preceded by “Total CBD”.

Cannabis oil — discrete unit

126 In the case of cannabis oil — or a cannabis accessory that contains cannabis oil — that is in discrete units, the label of any container in which the cannabis product is packaged must also include the following information:

  • (a) the net weight, in grams, and net volume, in millilitres, of cannabis oil;
  • (b) the number of units;
  • (c) the net weight, in grams, and net volume, in millilitres, of cannabis oil in each unit;
  • (d) the quantity of THC, in milligrams, in each unit preceded by “THC per unit”;
  • (e) the quantity of THC, in milligrams, that each unit could yield, taking into account the potential to convert THCA into THC, preceded by “Total THC per unit”;
  • (f) the quantity of CBD, in milligrams, in each unit, preceded by “CBD per unit”;
  • (g) the quantity of CBD, in milligrams, that each unit could yield, taking into account the potential to convert CBDA into CBD, preceded by “Total CBD per unit”;
  • (h) the carrier oil used;
  • (i) the name of any food allergen, within the meaning of subsection B.01.010.1(1) of the Food and Drug Regulations, that is contained in the cannabis oil; and
  • (j) in the case of cannabis oil that is not intended for oral administration, the warning “DO NOT SWALLOW / NE PAS AVALER”.

Cannabis oil — not in discrete units

127 In the case of cannabis oil — or a cannabis accessory that contains cannabis oil — that is not in discrete units, the label of any container in which the cannabis product is packaged must also include the following information:

  • (a) the net weight, in grams, and net volume, in millilitres, of cannabis oil;
  • (b) the concentration of THC, in milligrams per millilitre, in the cannabis oil, preceded by “THC”;
  • (c) the concentration of THC, in milligrams per millilitre, that the cannabis oil could yield, taking into account the potential to convert THCA into THC, preceded by “Total THC”;
  • (d) the concentration of CBD, in milligrams per millilitre, preceded by “CBD”;
  • (e) the concentration of CBD, in milligrams per millilitre, that the cannabis oil could yield, taking into account the potential to convert CBDA into CBD, preceded by “Total CBD”;
  • (f) the carrier oil used;
  • (g) the name of any food allergen, within the meaning of subsection B.01.010.1(1) of the Food and Drug Regulations, that is contained in the cannabis oil; and
  • (h) in the case of cannabis oil that is not intended for oral administration, the warning “DO NOT SWALLOW / NE PAS AVALER”.

Cannabis plants

128 In the case of a cannabis plant, the number of plants in the container must be included on the label that is applied to any container in which a cannabis product is packaged.

Cannabis plant seeds

129 In the case of cannabis plant seeds, the number of seeds in the container must be included on the label that is applied to any container in which a cannabis product is packaged.

Presentation — all information

130 (1) All information that is included on a label must be in English and in French.

Presentation — required information

(2) All information that is required to be included on a label must be clearly and prominently displayed and readily discernible under the customary conditions of purchase and use.

Other required information

(3) All information that is required to be included on a label, other than the brand name, the standardized cannabis symbol and the health warning message must meet the following requirements:

  • (a) subject to subparagraph (e)(ii), it must be in a regular weight and width standard sans serif font, without italics, in the colour black and with leading of at least 7 points;
  • (b) it must be in one single font type;
  • (c) it must be in a type size of at least 6 points and smaller than the type size used for the health warning message;
  • (d) it must be on a white background that extends at least 6 points on all sides away from the information; and
  • (e) in the case of the information required under paragraphs 124(d) to (g), 125(b) to (e), 126(d) to (g) and 127(b) to (e), it must be
    • (i) displayed on the principal display panel, or if there are separate principal display panels for English and French, on each principal display panel,
    • (ii) in bold type, and
    • (iii) at least 6 points away from any other information.

Brand name

(4) The brand name that is required to be included on a label must meet the following requirements:

  • (a) it must be in a type size that is smaller than or equal to the type size used for the health warning message;
  • (b) it must not be a colour that has the lustre of metal or has metallic properties in the ink, such as Pantone Metallics or Pantone Premium Metallics;
  • (c) it must not be a colour that is fluorescent, has fluorescent properties in the ink or has pigments that absorb ultraviolet energy and transmit it as a longer wavelength, such as the Pantone 800 series; and
  • (d) it must be displayed only once on the principal display panel, or if there are separate principal display panels for English and French, only once on each principal display panel.

Standardized cannabis symbol

(5) The standardized cannabis symbol that is required to be included on a label must meet the following requirements:

  • (a) it must appear in the upper left 25% of the principal display panel, or if there are separate principal display panels for English and French, in the upper left 25% of each principal display panel;
  • (b) it must be at least 1.27 cm by 1.27 cm in size;
  • (c) it must be displayed with a white border of at least 2 points on all sides;
  • (d) it must be oriented in such a manner that its text is parallel with the base of the container; and
  • (e) if a change is made to the size of the symbol, its dimensions must be proportional vertically and horizontally.

Health warning message

(6) The health warning message that is required to be included on a label must meet the following requirements:

  • (a) it must be displayed on the principal display panel or, if there are separate principal display panels for English and French, on each principal display panel;
  • (b) subject to paragraphs (c) and (d), it must be in a regular weight and width standard sans serif font, without italics, in the colour black and with leading of at least 8 points;
  • (c) the word “WARNING” must be in upper case letters and bold type;
  • (d) the first sentence must be in sentence case letters and bold type;
  • (e) the second sentence must be in sentence case letters;
  • (f) it must be in the same font type as that used for the information referred to in subsection (3);
  • (g) it must be in a type size of at least 7 points and the type size must be equal to or larger than the type size used for the brand name;
  • (h) it must be within a black border that is a solid line of at least 1 point and that has an inset of at least 6 points on all sides between the message and the border;
  • (i) the background colour must be yellow with the CMYK value (C=0 M=0 Y=100 K=0);
  • (j) the message must be
    • (i) left-justified without hyphenation,
    • (ii) parallel with the base of the container, and
    • (iii) oriented in such a manner that it is readable from left to right when the container of the cannabis product is displayed; and
  • (k) in the case where there is one principal display panel, there must be at least 3 points between the English and French message.

Attribution

(7) Any attribution to the source of the health warning message that is included on the label must meet the following requirements:

  • (a) only the following attributions may be displayed:
    • (i) if there is one principal display panel, the words “Health Canada / Santé Canada”, and
    • (ii) if there are separate principal display panels for English and French, the words “Health Canada” for the English display panel and the words “Santé Canada” for the French display panel;
  • (b) it must be in the same font type as that used for the information referred to in subsection (3);
  • (c) it must be in a type size of at least 6 points and smaller than the type size used for the health warning message; and
  • (d) it must be inside the border of the health warning message and be displayed in the bottom right corner below the health warning message text, with leading of at least 7 points.

Other information

(8) Any other information that is included on the label must meet the following requirements:

  • (a) it must be in regular weight and width standard sans serif font, without italics, and in black or white colour; and
  • (b) it must be in a type size that is smaller than or equal to the type size used for the information referred to in subsection (3).

Brand element

(9) A label may include only one brand element, other than a brand name, if that brand element meets the following requirements:

  • (a) it must be displayed only once on the principal display panel or, if there are separate principal display panels for English and French, only once on each principal display panel;
  • (b) it must not be a colour that has the lustre of metal or has metallic properties in the ink, such as Pantone Metallics or Pantone Premium Metallics;
  • (c) it must not be a colour that is fluorescent, has fluorescent properties in the ink or has pigments that absorb ultraviolet energy and transmit it as a longer wavelength, such as the Pantone 800 series;
  • (d) if the brand element is an image, the surface area must be smaller than or equal to the surface area of the standardized cannabis symbol; and
  • (e) if the brand element is text only, its type size must be smaller than or equal to the type size used for the health warning message.

Image

(10) The label may include an image that is printed in black and white and that provides instructions on how to open the container.

Representation resembling standardized cannabis symbol

131 A representation, such as an illustration, sign, mark, symbol or design, that so closely resembles the standardized cannabis symbol that it is likely to be mistaken for that symbol must not appear on any container in which a cannabis product is packaged.

Insert or leaflet

132 Except as otherwise provided under the Act, any other Act of Parliament or any provincial Act, any container in which a cannabis product is packaged must not include, or be accompanied by, an insert or leaflet.

Cannabis Product Accuracy Rules

Net weight and volume

133 The net weight and net volume that must be included on the label of a cannabis product in accordance with sections 124 to 127 must be within the tolerance limits set out for that product in the document entitled Tolerance Limits for the Net Weight and Volume Declared on Cannabis Product Labelling, as amended from time to time and published by the Government of Canada on its website.

Number of discrete units

134 The number of discrete units in a container that is labelled in accordance with sections 124 and 126 must be equal to the number specified on the label.

Number of cannabis plants

135 The number of cannabis plants in a container that is labelled in accordance with section 128 must be equal to the number specified on the label.

Number of cannabis plant seeds

136 The number of cannabis plant seeds in a container that is labelled in accordance with section 129 must be equal to the number specified on the label.

Labelling — Cannabis Other than Cannabis Products

Requirement — cannabis other than a cannabis product

137 A holder of a licence must not sell, distribute or export cannabis, other than a cannabis product, unless the requirements in section 138 have been met.

Information

138 A label that includes the following information must be applied to any container that contains cannabis, other than a cannabis product:

  • (a) the name, telephone number and email address of the holder of the licence that sells, distributes or exports the cannabis; and
  • (b) in respect of the cannabis,
    • (i) the lot number, preceded by one of the following designations:
      • (A) “Lot number”,
      • (B) “Lot no.”,
      • (C) “Lot”, or
      • (D) “(L)”, and
    • (ii) the packaging date.

PART 8

Drugs Containing Cannabis

Definitions

Definitions

139 The following definitions apply in this Part.

brand name has the same meaning as in subsection C.01.001(1) of the Food and Drug Regulations. (nom commercial)

distribute does not include administering. (distribuer)

establishment licence means a licence issued under section C.01A.008 of the Food and Drug Regulations. (licence d’établissement)

hospital means a facility

  • (a) that is licensed, approved or designated by a province under the laws of the province to provide care or treatment to individuals or animals suffering from any form of disease or illness; or
  • (b) that is owned or operated by the Government of Canada or the government of a province and that provides health services. (hôpital)

licensed dealer means a licensed dealer, as defined in subsection 2(1) of the Narcotic Control Regulations, that specializes in the destruction of narcotics, as defined in subsection 2(1) of those Regulations. (distributeur autorisé)

practitioner has the same meaning as in subsection C.01.001(1) of the Food and Drug Regulations. (praticien)

qualified person in charge means the individual referred to in section 150. (responsable qualifié)

Security Directive means the Directive on Physical Security Requirements for Controlled Substances and Drugs Containing Cannabis, as amended from time to time and published by the Government of Canada on its website. (Directive en matière de sécurité)

senior person in charge means the individual referred to in section 149. (responsable principal)

DIVISION 1

Licence

Activities

Authorized activities

140 (1) Subject to the other provisions of these Regulations, a holder of a cannabis drug licence is authorized to conduct the following activities if they are authorized by the licence:

  • (a) possessing cannabis obtained in accordance with these Regulations; and
  • (b) producing or selling a drug containing cannabis.

Ancillary activities — production

(2) A holder of a cannabis drug licence that authorizes the production of a drug containing cannabis is also authorized to distribute and offer to produce the drug.

Ancillary activities — sale

(3) A holder of a cannabis drug licence that authorizes the sale of a drug is also authorized to distribute the drug.

Definition of produce

(4) For the purpose of this section, produce does not include obtaining cannabis by cultivating, propagating or harvesting it.

Eligibility and corresponding activities

141 (1) Only a holder of an establishment licence that authorizes the following activities may apply for a cannabis drug licence:

  • (a) if the application is for the possession of cannabis, fabricating, packaging/labelling, distributing, importing, wholesaling or testing a drug containing cannabis, including its examination;
  • (b) if the application is with respect to the production of a drug containing cannabis, fabricating the drug; or
  • (c) if the application is with respect to the sale of a drug containing cannabis, packaging/labelling, distributing, importing or wholesaling the drug.

Location of activity

(2) The address of the building where the activity referred to in the application is proposed to be conducted must be the same as the address of the building at which the applicable activity referred to in subsection (1) is authorized by the establishment licence.

Use of organic solvent

142 Subject to the other provisions of these Regulations, a holder of a cannabis drug licence that authorizes the production of a drug containing cannabis is also authorized to alter or offer to alter the chemical or physical properties of the cannabis by the use of an organic solvent.

Sale

143 (1) Subject to subsection (2), a holder of a cannabis drug licence that authorizes the sale of a drug containing cannabis may sell or distribute the drug only to

  • (a) another holder of a cannabis drug licence;
  • (b) an individual referred to in section 4.
  • (c) a holder of a research licence;
  • (d) a holder of an analytical testing licence;
  • () the holder of a licence from which the holder of the cannabis drug licence received the drug, if the drug is sold or distributed for the purpose of its return;
  • (f) a holder of a licence or a licensed dealer, if the drug is sold or distributed for the purpose of its destruction;
  • (g) a pharmacist;
  • (h) a practitioner;
  • (i) a hospital employee;
  • (j) a person to which an exemption in relation to the drug has been granted under section 140 of the Act; or
  • (k) the Minister.

Written order

(2) A holder of a cannabis drug licence that authorizes the sale of a drug containing cannabis may only sell the drug if

  • (a) they have received a written order that specifies the name and quantity of the drug to be supplied and is signed and dated
    • (i) in the case of a drug to be provided to a hospital employee or a practitioner in a hospital, by the pharmacist in charge of the hospital’s pharmacy or by a practitioner authorized by the individual in charge of the hospital to sign the order, and
    • (ii) in any other case, by the person to which the drug is to be sold; and
  • (b) they have verified the signature, if it is unknown to them.

Exception — pharmacist and practitioner

(3) It is prohibited for a holder of a cannabis drug licence to sell or distribute any drug containing cannabis to

  • (a) a pharmacist who is named in a notice issued under subsection 181(2) or (4); or
  • (b) a practitioner who is named in a notice issued under subsection 189(2) or (4).

Non-application

(4) Subsection (3) does not apply to a holder of a cannabis drug licence to which the Minister has issued a notice of retraction issued under

  • (a) subsection 182(1) in respect of the pharmacist referred to in paragraph (3)(a); or
  • (b) subsection 190(1) in respect of a practitioner referred to in paragraph (3)(b).

Presence of qualified person in charge

144 A holder of a cannabis drug licence may conduct an activity in relation to cannabis, other than its destruction or antimicrobial treatment, at the licensed site only if the qualified person in charge or an alternate qualified person in charge is present at the site.

Antimicrobial treatment

145 A holder of a cannabis drug licence may conduct antimicrobial treatment of cannabis at a location other than the licensed site if

  • (a) they ensure that the cannabis that is at the location is, at all times, in the presence of an individual referred to in paragraph 146(3)(a); and
  • (b) the cannabis is subsequently returned to the licensed site or distributed in accordance with this Part.

Destruction — holder of a cannabis drug licence

146 (1) A holder of a cannabis drug licence is authorized to destroy cannabis only

  • (a) in accordance with a method that
    • (i) complies with all federal, provincial and municipal environmental protection legislation applicable to the location where it is to be destroyed, and
    • (ii) does not result in any individual being exposed to cannabis smoke or cannabis vapour;
  • (b) in the presence of a witness referred to in paragraph (3)(a) and another witness referred to in subsection (3); and
  • (c) in the case where the cannabis is destroyed at a location other than the licensed site, if the holder ensures that the cannabis that is at the location is, at all times, in the presence of at least one witness referred to in paragraph (3)(a).

Destruction — licensed dealer

(2) The licensed dealer is authorized to destroy cannabis only

  • (a) in accordance with a method that
    • (i) complies with all federal, provincial and municipal environmental protection legislation applicable to the location at which it is to be destroyed, and
    • (ii) does not result in any individual being exposed to cannabis smoke or cannabis vapour; and
  • (b) in the presence of a witness referred to in paragraph (4)(a) and another witness referred to in subsection (4).

Witness — holder of a cannabis drug licence

(3) The following individuals are qualified to witness the destruction of cannabis by a holder of a cannabis drug licence:

  • (a) the senior person in charge, the qualified person in charge or the alternate qualified person in charge; and
  • (b) an employee of the holder.

Witness — licensed dealer

(4) The following individuals are qualified to witness the destruction of cannabis by a licensed dealer:

  • (a) the qualified person in charge, as defined in subsection 2(1) of the Narcotic Control Regulations, or the alternate qualified person in charge designated under paragraph 8.3(1)(b) of those Regulations; and
  • (b) an employee of the licensed dealer.

Statement by witnesses

(5) For each instance that they destroy cannabis, the holder of a cannabis drug licence or the licensed dealer, as the case may be, must obtain a statement signed and dated by two of the witnesses referred to in paragraph (1)(b) or (2)(b) stating that they witnessed the destruction and that the cannabis was destroyed in accordance with a method referred to in paragraph (1)(a) or (2)(a).

Record

(6) With respect to cannabis that they destroy, the holder of a cannabis drug licence or the licensed dealer, as the case may be, must prepare a record that sets out

  • (a) a description of the cannabis, its form and quantity;
  • (b) in the case of a drug containing cannabis, the brand name of the drug and its strength per unit;
  • (c) the address of the location at which the cannabis is destroyed;
  • (d) a brief description of the method and the date of destruction; and
  • (e) the names of the individuals who witnessed the destruction and were qualified to do so under paragraph (1)(b) or (2)(b) and the basis on which they were qualified under subsection (3) or (4).

Retention period

(7) The holder of a cannabis drug licence and the licensed dealer must retain the record and the statement for at least two years after the day on which the cannabis is destroyed.

Licence Issuance

Licence — content

147 A cannabis drug licence must set out the following information:

  • (a) the name of the holder of the licence;
  • (b) the licence number;
  • (c) the address of the site where the activity is authorized and, if applicable, of each building within the site;
  • (d) the authorized activity at the site and, if applicable, the authorized activity that may be conducted at each building within the site;
  • (e) the security measures to be implemented to comply with the requirements of either the Security Directive or Part 4;
  • (f) any conditions that the Minister considers appropriate;
  • (g) the effective date of the licence; and
  • (h) the date of expiry of the licence.

Amendment

148 A holder of a cannabis drug licence must submit an application to amend the licence if they propose to make any of the following changes:

  • (a) a change to the name of the holder;
  • (b) a change to the authorized activity at the site or the authorized activity at each building within the site; and
  • (c) a change to the security measures implemented to comply with the requirements of either the Security Directive or Part 4.
Individuals in Charge

Senior person in charge

149 The holder of a cannabis drug licence must retain the services of one individual as a senior person in charge who has overall responsibility for the management of the activities, with respect to cannabis, that are authorized under the licence.

Qualified person in charge

150 (1) A holder of a cannabis drug licence must retain the services of one individual as a qualified person in charge who is responsible for supervising the activities with respect to cannabis that are authorized under the licence and for ensuring, on behalf of the holder, that those activities comply with these Regulations.

Alternate qualified person in charge

(2) A holder of a cannabis drug licence may designate an individual as an alternate qualified person in charge who is authorized to replace the qualified person in charge.

Qualifications

(3) Only an individual who meets the following requirements may be a qualified person in charge or an alternate qualified person in charge:

  • (a) they work at the site specified in the licence;
  • (b) they
    • (i) are entitled to practise a profession that is relevant to their duties, such as that of pharmacist, practitioner, pharmacy technician or laboratory technician,
    • (ii) hold a diploma, certificate or credential that is awarded by a post-secondary educational institution in Canada in a field or occupation that is relevant to their duties, such as pharmacy, medicine, dentistry, veterinary medicine, pharmacology, chemistry, biology, pharmacy technician, laboratory technician, pharmaceutical regulatory affairs or supply chain management or security, or
    • (iii) hold a diploma, certificate or credential that is awarded by a foreign educational institution in a field or occupation referred to in subparagraph (ii) and
      • (A) an equivalency assessment as defined in subsection 73(1) of the Immigration and Refugee Protection Regulations, or
      • (B) an equivalency assessment issued by an organization or institution that is responsible for issuing equivalency assessments and is recognized by a province;
  • (c) they have sufficient knowledge of and experience with the use and handling of drugs to properly carry out their duties; and
  • (d) they are familiar with the provisions of the Act and these Regulations that apply to the holder of the licence.

Exception

(4) A holder of a cannabis drug licence may retain the services of an individual as a qualified person in charge or designate an alternate qualified person in charge who does not meet any of the requirements of paragraph (3)(b) if

  • (a) no other individual working at the site specified in the licence meets those requirements;
  • (b) those requirements are not necessary for the activities that are authorized under the licence; and
  • (c) the individual possesses knowledge — acquired from a combination of education, training and work experience — that is sufficient to enable them to properly carry out their duties.

Ineligibility

151 (1) An individual is not eligible to be a senior person in charge, a qualified person in charge or an alternate qualified person in charge if, in the past 10 years,

  • (a) in respect of a designated offence, a controlled substance offence, or any other offence referred to in subsection (2), the individual
    • (i) was convicted as an adult, or
    • (ii) was a young person who received an adult sentence, as those terms are defined in subsection 2(1) of the Youth Criminal Justice Act; or
  • (b) in respect of an offence committed outside Canada that, if committed in Canada, would have constituted a designated offence, a controlled substance offence or any other offence referred to in subsection (2),
    • (i) the individual was convicted as an adult, or
    • (ii) if they committed the offence when they were at least 14 years old but less than 18 years old, the individual received a sentence that was longer than the maximum youth sentence that could have been imposed under the Youth Criminal Justice Act for such an offence.

Other offences

(2) The other offences for the purpose of subsection (1) are the following:

  • (a) an offence involving the financing of terrorism referred to in any of sections 83.02 to 83.04 of the Criminal Code;
  • (b) an offence involving fraud referred to in any of sections 380 to 382 of the Criminal Code;
  • (c) the offence of laundering proceeds of crime referred to in section 462.31 of the Criminal Code;
  • (d) an offence involving a criminal organization referred to in any of sections 467.11 to 467.13 of the Criminal Code; and
  • (e) a conspiracy or an attempt to commit, being an accessory after the fact in relation to, or any counselling in relation to, an offence referred to in any of paragraphs (a) to (d).
Changes

Minister’s approval

152 (1) A holder of a cannabis drug licence must obtain the Minister’s approval before making the following changes:

  • (a) replacing the senior person in charge;
  • (b) replacing the qualified person in charge; or
  • (c) designating or replacing an alternate qualified person in charge.

Application — content

(2) The holder must, for the purpose of obtaining the Minister’s approval, submit an application that includes the following:

  • (a) a description of the change;
  • (b) in the case of the replacement of the senior person in charge,
    • (i) a declaration signed and dated by the proposed individual attesting that they are not ineligible for a reason specified in section 151,
    • (ii) a document issued by a Canadian police force indicating whether, during the 10 years before the day on which the application is submitted, the individual was convicted as specified in subparagraph 151(1)(a)(i) or received a sentence as specified in subparagraph 151(1)(a)(ii), and
    • (iii) if the individual has ordinarily resided in a country other than Canada during the 10 years before the day on which the application is submitted, a document issued by a police force of that country indicating whether in that period that they were convicted as specified in subparagraph 151(1)(b)(i) or received a sentence as specified in subparagraph 151(1)(b)(ii); and
  • (c) in the case of the designation of an alternate qualified person in charge or in the case of the replacement of the qualified person in charge or an alternate qualified person in charge
    • (i) the declaration and the documents referred to in subparagraphs (b)(i) to (iii),
    • (ii) a declaration, signed and dated by the senior person in charge, attesting that the proposed individual has the knowledge and experience required under paragraphs 150(3)(c) and (d), and
    • (iii) if the proposed individual does not meet the requirement of subparagraph 150(3)(b)(i), either
      • (A) a copy of the individual’s diploma, certificate or credential referred to in subparagraph 150(3)(b)(ii) or (iii) and a copy of the course transcript for it, or
      • (B) a detailed description of the individual’s education, training or work experience required under paragraph 150(4)(c), together with supporting evidence, such as a copy of a course transcript or an attestation by the person who provided the training.

Additional information

(3) The Minister may, on receiving an application for approval, require the submission of any additional information that pertains to the information contained in the application and that is necessary for the Minister to consider the application.

Approval issued

(4) The Minister must approve the change on completion of the review of the application if the applicable requirements referred to in subsections 150(3) and (4) and section 151 are met.

Notification — various changes

153 (1) A holder of a cannabis drug licence must notify the Minister of any of the following changes within five days after the change occurs:

  • (a) a change to the mailing address, telephone number, email address and facsimile number of the holder; and
  • (b) a change to the plan of the licensed site that does not require different security measures to be implemented in order to comply with Part 4.

Notification — content

(2) The notification must include

  • (a) a description of the change; and
  • (b) a declaration, signed and dated by the senior person in charge, indicating that all information provided in support of the notification is correct and complete to the best of their knowledge.

Cessation of activities

154 (1) A holder of a cannabis drug licence that intends to cease conducting all the activities authorized by the licence — whether before or on the date of expiry of the licence — must provide to the Minister a written notice to that effect at least 30 days before the day on which those activities cease.

Content of notice

(2) The notice must be signed and dated by the senior person in charge and contain the following information:

  • (a) the date on which activities are expected to cease;
  • (b) a description of the manner in which any cannabis remaining at the site as of the date referred to in paragraph (a) will be disposed of by the holder, including
    • (i) if the cannabis will be sold or distributed, in whole or in part, the name and address of the person to which it will be sold or distributed, and
    • (ii) if it will be destroyed, in whole or in part, the day on which and the location at which the destruction is to take place;
  • (c) the address of the location at which the holder’s records, reports, electronic data and other documents that are required to be retained under the Act by the holder, will be retained after activities have ceased; and
  • (d) the name, address, telephone number and, if applicable, facsimile number and email address of a person from which the Minister may obtain further information after activities have ceased.

Update

(3) After having ceased the activities, the holder must submit to the Minister an update of the information referred to in paragraphs (2)(a) to (d), if it differs from what was set out in the notice submitted under subsection (1). The update must be signed and dated by the senior person in charge.

Refusal, suspension and revocation

Other grounds for refusal

155 For the purpose of paragraph 62(7)(h) of the Act, the other grounds for refusing to issue, renew or amend a cannabis drug licence are as follows:

  • (a) the establishment licence referred to in section 141 is suspended or cancelled;
  • (b) the holder of the cannabis drug licence applies for an amendment to change the location of the site where an activity that is authorized by the licence may be conducted; and
  • (c) in respect of the renewal or amendment of the licence, the holder of the licence does not hold the cannabis licence issued under subsection 14(1.1) of the Excise Act, 2001, if it is required;

Suspension — other circumstance

156 For the purpose of paragraph 64(1)(b) of the Act, other circumstances for the suspension of a cannabis drug licence are the following:

  • (a) the establishment licence referred to in section 141 is suspended; and
  • (b) the cannabis licence issued to the holder of the cannabis drug licence under subsection 14(1.1) of the Excise Act, 2001 is suspended under subsection 23(2) of that Act.

Revocation — other circumstances

157 For the purpose of paragraph 65(h) of the Act, other circumstances for the revocation of a cannabis drug licence are the following:

  • (a) the licence that has been suspended is not reinstated because the reasons for the suspension still exist or the holder of the licence has not demonstrated to the Minister that the suspension is unfounded;
  • (b) the holder of the licence has requested its revocation in writing;
  • (c) the establishment licence referred to in section 141 is suspended or cancelled; and
  • (d) the holder of the licence no longer holds the cannabis licence referred to in subsection 14(1.1) of the Excise Act, 2001, if it is required.
Security

Security obligations

158 A holder of a cannabis drug licence must

  • (a) take reasonable steps to protect the cannabis they possess against theft or loss;
  • (b) if they experience a theft of cannabis or a loss of cannabis that cannot be explained on the basis of normally accepted operations,
    • (i) notify a police force within 24 hours after becoming aware of its theft or loss, and
    • (ii) notify the Minister, in writing, within 10 days after becoming aware of its theft or loss; and
  • (c) take any steps that are necessary to ensure the safekeeping of cannabis when distributing it.

DIVISION 2

Possession, Pharmacists, Practitioners and Hospitals

General Provisions

Possession — Person

159 The following persons, if they have obtained a drug containing cannabis either in accordance with these Regulations, or from a person that is exempt under section 140 of the Act from the application of subsections 9(1) and (2) and 10(1) and (2) of the Act with respect to that drug, are authorized to possess the drug:

  • (a) a pharmacist, a practitioner who is entitled to practise in the province in which they possess the drug or a holder of a cannabis drug licence, if they require the drug for their business or profession;
  • (b) a practitioner who is entitled to practise in a province other than the province in which they possess the drug and their possession is for emergency medical purposes only;
  • (c) a hospital employee or a practitioner in a hospital;
  • (d) an individual who possesses a quantity of the drug that exceeds the applicable limit under the Act and has obtained the drug for their own use or for their animal from a practitioner or in accordance with a prescription that was not issued or obtained in contravention of these Regulations;
  • (e) an individual who possesses a quantity of the drug that exceeds the applicable limit under the Act and has reasonable grounds to believe that the drug was obtained by another individual in accordance with paragraph (d) if the possession is for the purpose of its return or destruction;
  • (f) a licensed dealer, if the possession is for the purpose of its destruction;
  • (g) a person to which an exemption has been granted under section 140 of the Act with respect to the possession of that drug, if the possession is for a purpose set out in the exemption; or
  • (h) the Minister.

Possession — quantity allowed

160 Any quantity of drug containing cannabis that an individual is authorized to possess under paragraph 159(d) or (e) is in addition to any other quantity of cannabis that the individual is authorized to possess under the Act.

Authorization

161 Subject to the other provisions of these Regulations, an individual referred to in paragraph 159(d) or (e) is authorized to distribute a drug containing cannabis to a pharmacist for its destruction.

Promotion — communication of brand name, etc.

162 Subject to the other provisions of these Regulations, a person is authorized to promote a prescription drug by communicating the brand name, the proper name, the common name, the price or the quantity of the drug.

Exemption — section 21 of Act

163 A person is exempt from the application of section 21 of the Act if they display, refer to or otherwise use the brand name of a prescription drug, or the name of the holder of the drug identification number assigned in accordance with subsection C.01.014.2(1) of the Food and Drug Regulations for a prescription drug, directly or indirectly in a promotion that is used in the sponsorship of a person, entity, event, activity or facility.

Exemption — section 22 of Act

164 A person is exempt from the application of section 22 of the Act if they display on a facility, as part of the name of the facility or otherwise, if the facility is used for a sports or cultural event or activity, the brand name of a prescription drug or the name of the holder of the drug identification number assigned in accordance with subsection C.01.014.2(1) of the Food and Drug Regulations for a prescription drug.

Exemption — subsection 23(1) of Act

165 A person is exempt from the application of subsection 23(1) of the Act if they publish, broadcast or otherwise disseminate, on behalf of another person, with or without consideration, any promotion that is authorized under sections 162 to 164.

Authorization — drug for veterinary use

166 Subject to the other provisions of these Regulations, a person that is authorized to sell a prescription drug for veterinary use may sell it in a package or with a label that sets out a depiction of a real or fictional animal that corresponds to the species of the animal for which the drug is intended.

Authorization — drug appealing to young person

167 Subject to the other provisions of these Regulations, a person is authorized to sell a drug containing cannabis that has an appearance, shape or other sensory attribute or a function that there are reasonable grounds to believe could be appealing to young persons.

Authorization — drug not in Schedule 4

168 Subject to the other provisions of these Regulations, a person authorized to sell a drug containing cannabis may sell a drug that is of a class that is not referred to in Schedule 4 to the Act.

Authorization — drug containing a substance in Schedule 5

169 Subject to the other provisions of these Regulations, a person is authorized to sell a drug containing cannabis that contains any substance that is referred to in column 1 of Schedule 5 to the Act.

Pharmacists

Record keeping

170 A pharmacist who receives a prescription drug from a holder of a cannabis drug licence must enter the following in a record retained for such purposes:

  • (a) the name and quantity of the drug received;
  • (b) the date the drug was received; and
  • (c) the name and address of the holder.

Sale, distribution and administration

171 Subject to the other provisions of these Regulations, a pharmacist is authorized to sell, distribute or administer a prescription drug to a person:

  • (a) if the person is exempted under section 140 of the Act with respect to the possession of that drug; or
  • (b) if the pharmacist sells, distributes or administers the drug
    • (i) in accordance with a written order or prescription signed and dated by a practitioner, and
    • (ii) after verifying the signature, if it is unknown to the pharmacist.

Return and destruction

172 (1) Subject to the other provisions of these Regulations, a pharmacist is authorized to sell or distribute a prescription drug, other than a drug referred to in section 173, in accordance with a written order, to

  • (a) the holder of a cannabis drug licence from which the pharmacist received the drug, if the drug is sold or distributed for the purpose of its return; and
  • (b) a holder of a cannabis drug licence or a licensed dealer, if the drug is sold or distributed for the purpose of its destruction.

Written order

(2) The written order must contain

  • (a) the name, quantity and strength per unit of the drug; and
  • (b) if the sale or distribution is for the purpose of its destruction, a written statement that affirms that the sole purpose of the order is the destruction of the drug and that is signed and dated by, or on behalf of, the holder of the cannabis drug licence or the licensed dealer, as the case may be.

Record keeping

(3) The pharmacist must prepare a record with respect to the drug that sets out

  • (a) its brand name, form, quantity and strength per unit;
  • (b) the address of the person to which it was sold or distributed; and
  • (c) the date on which it was sold or distributed.

Drug given by individual

173 (1) A pharmacist is authorized to sell or distribute to a licensed dealer a prescription drug that the pharmacist received from an individual referred to in paragraph 159(d) or (e) for the purpose of its destruction, if the drug is in a container that prevents the removal of the drug from the container and is marked in a manner that is sufficient to identify the container.

Record keeping — pharmacist

(2) The pharmacist must prepare a record, with respect to the drug, that sets out

  • (a) the number of containers distributed;
  • (b) the date on which each container is distributed;
  • (c) the identifying mark of each container; and
  • (d) the name and address of the licensed dealer to which each container is distributed.

Record keeping — licensed dealer

(3) The licensed dealer must prepare a record, with respect to the drug, that sets out

  • (a) the number of containers received;
  • (b) the date on which the container is received;
  • (c) the identifying mark of the container; and
  • (d) the name and address of the pharmacist from whom the container is received.

Retention period

(4) The pharmacist and the licensed dealer must retain the record for at least two years after the day on which the pharmacist distributes the drug or the licensed dealer receives the drug, as the case may be.

Prohibited activities

174 (1) Despite section 171, subsection 172(1) and section 175, it is prohibited for a pharmacist to

  • (a) sell or distribute a prescription drug to a pharmacist who is named in a notice issued under subsection 181(2) or (4);
  • (b) sell or distribute a prescription drug to a practitioner who is named in a notice issued under subsection 189(2) or (4); or
  • (c) fill a prescription or order for a prescription drug from such a practitioner.

Non-application

(2) Subsection (1) does not apply to a pharmacist to whom the Minister has issued a notice of retraction under

  • (a) subsection 182(1), in respect of a pharmacist who is named in a notice issued under subsection 181(2) or (4); or
  • (b) subsection 190(1), in respect of a practitioner who is named in a notice issued under subsection 189(2) or (4).

Distribution — hospital

175 (1) Subject to subsection (2), a pharmacist may distribute a prescription drug to a hospital employee or a practitioner in a hospital in accordance with a written order signed and dated by

  • (a) the pharmacist in charge of the hospital’s pharmacy; or
  • (b) a practitioner who is authorized by the individual in charge of the hospital to sign the order.

Signature

(2) Before distributing the prescription drug, the pharmacist receiving the order must verify the signature on the order, if it is unknown to them.

Security obligations

176 A pharmacist must, with respect to a drug containing cannabis on their premises or for which the pharmacist is responsible,

  • (a) take reasonable steps to protect it against theft or loss; and
  • (b) notify the Minister, in writing, within 10 days after becoming aware of its theft or loss.

Record keeping

177 If, in accordance with a written order or prescription, a pharmacist dispenses a prescription drug, the pharmacist must retain a record of the following information:

  • (a) their name or initials;
  • (b) the name, initials and address of the practitioner who issued the order or prescription;
  • (c) the name and address of the person for whom the drug was dispensed;
  • (d) the name, quantity and form of the drug;
  • (e) the date on which the pharmacist dispensed the drug; and
  • (f) the number assigned to the order or prescription.

Sale and distribution for emergency purposes

178 (1) A pharmacist may sell or distribute a prescription drug for emergency purposes to another pharmacist in accordance with a written order that is signed and dated by the other pharmacist.

Record keeping — selling and distributing

(2) A pharmacist must, after selling or distributing a prescription drug under subsection (1) or after receiving such a drug under subsection (1) or subsection 193(3), enter the details of the transaction in a record retained for such purposes.

Record keeping — removing, transporting and transferring

(3) A pharmacist must, after removing, transporting or transferring a prescription drug from one place of business operated by the pharmacist to another, enter the details of the transaction in a record retained for such purposes.

Retention period

179 A pharmacist must retain the records which the pharmacist is required to retain under these Regulations for at least two years after the day on which they are prepared.

Factual information

180 The Minister must provide in writing any factual information about a pharmacist with respect to cannabis that has been obtained under the Act or the Controlled Drugs and Substances Act to the provincial professional licensing authority that is responsible for the authorization of individuals to practise their profession

  • (a) in the province in which the pharmacist is or was entitled to practise if
    • (i) the authority submits to the Minister a written request that sets out the pharmacist’s name and address, a description of the information being requested and a statement that the information is required for the purpose of assisting an investigation by the authority, or
    • (ii) the Minister has reasonable grounds to believe that the pharmacist has
      • (A) contravened, in relation to cannabis, a rule of conduct established by the authority,
      • (B) been convicted of a designated offence or a controlled substance offence in relation to cannabis,
      • (C) contravened these Regulations, or
      • (D) has contravened the Narcotic Control Regulations in relation to cannabis; or
  • (b) in a province in which the pharmacist is not entitled to practise, if the authority submits to the Minister
    • (i) a written request that sets out the pharmacist’s name and address and a description of the information requested, and
    • (ii) a document that shows that
      • (A) the pharmacist has applied to that authority to practise in that province, or
      • (B) the authority has reasonable grounds to believe that the pharmacist is practising in that province without being authorized to do so.

Notice — prohibition to sell or distribute

181 (1) A pharmacist may make a written request to the Minister to send a notice advising that the following persons must not sell or distribute any prescription drug to the pharmacist:

  • (a) all holders of a cannabis drug licence; and
  • (b) all pharmacies in the province in which the pharmacist who is named in the notice is entitled to practise.

Recipients

(2) The Minister must, in the circumstances set out in subsection (3), issue the notice referred to in subsection (1) to the following persons and authorities:

  • (a) the pharmacist who is named in the notice;
  • (b) all holders of a cannabis drug licence;
  • (c) all pharmacies in the province in which the pharmacist is entitled to practise;
  • (d) the applicable provincial professional licensing authority for the province in which the pharmacist is entitled to practise; and
  • (e) on request, the applicable provincial professional licensing authority for any province other than the province referred to in paragraph (d).

Mandatory notice

(3) The notice must be issued if the pharmacist

  • (a) made a request to the Minister in accordance with subsection (1);
  • (b) contravened a rule of conduct, in relation to cannabis, established by the provincial professional licensing authority for the province in which the pharmacist is practising and that provincial professional licensing authority has requested the Minister in writing to issue the notice;
  • (c) has been convicted of any of the following:
    • (i) a designated offence,
    • (ii) a controlled substance offence in relation to cannabis, or
    • (iii) an offence under the Narcotic Control Regulations in relation to cannabis; or
  • (d) the Minister has reasonable grounds to believe that the pharmacist has contravened this Part or Part 9.

Optional notice

(4) The Minister may issue the notice to the persons and authorities referred to in subsection (2) if the Minister, on reasonable grounds, believes that the pharmacist named in the notice

  • (a) has contravened section 171, subsection 172(1) or (2) or 173(1), section 174, 175 or 176 or subsection 178(1);
  • (b) has, on more than one occasion, self-administered a prescription drug contrary to accepted pharmaceutical practice;
  • (c) has, on more than one occasion, distributed or administered a prescription drug to their spouse, common-law partner, parent or child, including a child adopted in fact, contrary to accepted pharmaceutical practice; or
  • (d) is unable to account for the quantity of prescription drugs for which the pharmacist was responsible under this Part or Part 9.

Prerequisite

(5) Before issuing a notice under subsection (4), the Minister must

  • (a) consult with the provincial professional licensing authority for the province in which the pharmacist to whom the notice relates is entitled to practise;
  • (b) send to the pharmacist a written notice that indicates the reasons why a notice is being considered and give them an opportunity to present reasons why the notice should not be issued; and
  • (c) consider
    • (i) any reasons that have been presented by the pharmacist under paragraph (b),
    • (ii) the compliance history of the pharmacist in respect of the Act and its regulations, the Controlled Drugs and Substances Act and the Narcotic Control Regulations with respect to cannabis, and
    • (iii) whether the actions of the pharmacist pose a significant risk to public health or public safety, including the risk of any prescription drug being diverted to an illicit market or activity.

Retraction of notice

182 (1) The Minister must retract a notice that was issued under subsection 181(2) or (4) if

  • (a) the pharmacist who is named in the notice has requested in writing that it be retracted;
  • (b) the pharmacist has provided a letter from the applicable provincial professional licensing authority for the province in which the pharmacist is entitled to practise that states that the authority consents to the retraction of the notice; and
  • (c) in the case where the notice was issued at the request of the pharmacist, one year has elapsed since the notice was issued.

Obligation to notify

(2) If the Minister retracts a notice, he or she must notify, in writing, the persons and authorities to which the notice was issued under subsection 181(2) or (4).

Practitioners

Sale, distribution and administration

183 Subject to the other provisions of these Regulations, a practitioner is authorized to administer a drug containing cannabis to an individual or animal, or sell or distribute it for an individual or animal if

  • (a) the individual or the animal is under their professional treatment; and
  • (b) the drug is required for the condition for which the individual or animal is receiving treatment.

Return and destruction

184 (1) A practitioner is authorized to sell or distribute a drug containing cannabis, in accordance with a written order, to

  • (a) the holder of a cannabis drug licence from which the practitioner received the drug, if the drug is sold or distributed for the purpose of its return; and
  • (b) a holder of a cannabis drug licence or a licensed dealer, if the drug is sold or distributed for the purpose of its destruction.

Written Order

(2) The written order must contain

  • (a) the name, quantity and strength per unit of the drug; and
  • (b) if the sale or distribution is for the purpose of its destruction, a written statement that affirms that the sole purpose of the order is the destruction of the drug and that is signed and dated by, or on behalf of, the holder of the cannabis drug licence or the licensed dealer, as the case may be.

Record keeping

(3) The practitioner must prepare a record with respect to the drug that sets out

  • (a) its brand name, form, quantity and strength per unit;
  • (b) the address of the person to which it was sold or distributed; and
  • (c) the date on which it was sold or distributed.

Security obligations

185 A practitioner must, with respect to a drug containing cannabis that they possess,

  • (a) take reasonable steps to protect it against theft or loss; and
  • (b) notify the Minister, in writing, within 10 days after becoming aware of its theft or loss.

Record keeping

186 A practitioner who sells or distributes a prescription drug to an individual for self-administration or for administration to an animal must, whether or not the practitioner charges for the drug, retain a record showing the name and quantity of the drug sold or distributed, the name and address of the individual to whom it was sold or distributed and the date on which it was sold or distributed, if the quantity of the drug exceeds

  • (a) three times the maximum daily dosage set out in the notice of compliance issued under section C.08.004 or C.08.004.01 of the Food and Drug Regulations for the drug; or
  • (b) if the notice of compliance does not set out any maximum daily dosage, three times the generally recognized maximum daily dosage for the drug.

Rentention period

187 A practitioner must retain the records which the practitioner is required to retain under these Regulations for at least two years after the day on which they are prepared.

Factual information

188 The Minister must provide in writing any factual information about a practitioner with respect to cannabis that has been obtained under the Act or the Controlled Drugs and Substances Act to the provincial professional licensing authority that is responsible for the authorization of individuals to practise their profession

  • (a) in a province in which the practitioner is, or was, entitled to practise if
    • (i) the authority submits to the Minister a written request that sets out the practitioner’s name and address, a description of the information requested and a statement that the information is required for the purpose of assisting a investigation by the authority, or
    • (ii) the Minister has reasonable grounds to believe that the practitioner has
      • (A) contravened, in relation to cannabis, a rule of conduct established by the authority,
      • (B) been convicted of a designated offence or a controlled substance offence in relation to cannabis,
      • (C) contravened these Regulations, or
      • (D) contravened the Narcotic Control Regulations in relation to cannabis; or
  • (b) in a province in which the practitioner is not entitled to practise, if the authority submits to the Minister
    • (i) a written request that sets out the practitioner’s name and address and a description of the information requested, and
    • (ii) a document that shows that
      • (A) the practitioner has applied to that authority to practise in that province, or
      • (B) the authority has reasonable grounds to believe that the practitioner is practising in that province without being authorized to do so.

Notice — prohibition

189 (1) A practitioner may make a written request to the Minister to send a notice advising that

  • (a) the following persons must not sell or distribute any prescription drug to the practitioner:
    • (i) all holders of a cannabis drug licence,
    • (ii) all pharmacies in the province in which the practitioner who is named in the notice is entitled to practise, and
    • (iii) all pharmacies in an adjacent province in which a prescription or order from the practitioner who is named in the notice may be filled; and
  • (b) the following individual must not fill a prescription or order written by the practitioner for a prescription drug:
    • (i) all pharmacists in the province in which the practitioner who is named in the notice is entitled to practise, and
    • (ii) all pharmacists in an adjacent province in which a prescription or order from the practitioner who is named in the notice may be filled.

Recipients

(2) The Minister must, in the circumstances set out in subsection (3), issue the notice referred to in subsection (1) to the following persons and authorities:

  • (a) the practitioner who is named in the notice;
  • (b) all holders of a cannabis drug licence;
  • (c) all pharmacies in the province in which the practitioner is entitled to practise;
  • (d) all pharmacies in an adjacent province in which a prescription or order from the practitioner who is named in the notice may be filled;
  • (e) the applicable professional licensing authority for the province in which the practitioner is entitled to practise; and
  • (f) on request, the applicable provincial professional licensing authority for any province other than the province referred to in paragraph (e).

Mandatory notice

(3) The notice must be issued if the practitioner

  • (a) made a request to the Minister in accordance with subsection (1) to issue the notice;
  • (b) contravened a rule of conduct, in relation to cannabis, established by the provincial professional licensing authority for the province in which the practitioner is practising and that provincial professional licensing authority has requested the Minister in writing to issue the notice;
  • (c) been convicted of any of the following:
    • (i) a designated offence,
    • (ii) a controlled substance offence in relation to cannabis,
    • (iii) an offence under the Narcotic Control Regulations in relation to cannabis; or
  • (d) the Minister has reasonable grounds to believe that the practitioner has contravened this Part or Part 9.

Optional notice

(4) The Minister may issue the notice to the persons and authorities referred to in subsection (2) if the Minister, on reasonable grounds, believes that the practitioner named in the notice

  • (a) has contravened section 183, subsection 184(1) or (2) or section 185;
  • (b) has, on more than one occasion, self-administered a prescription drug under a self-directed prescription or order or, in the absence of a prescription or order, contrary to accepted professional practice;
  • (c) has, on more than one occasion, distributed or administered a prescription drug to their spouse, common-law partner, parent or child, including a child adopted in fact, contrary to accepted professional practice; or
  • (d) is unable to account for the quantity of prescription drugs for which the practitioner was responsible under this Part or Part 9.

Prerequisite

(5) Before issuing a notice under subsection (4), the Minister must

  • (a) consult with the applicable provincial professional licensing authority for the province in which the practitioner to whom the notice relates is entitled to practise;
  • (b) send to the practitioner a written notice that indicates the reasons why a notice is being considered and give them an opportunity to present reasons why the notice should not be issued; and
  • (c) consider
    • (i) any reasons that have been presented by the practitioner under paragraph (b),
    • (ii) the compliance history of the practitioner in respect of the Act and its regulations, the Controlled Drugs and Substances Act and the Narcotic Control Regulations with respect to cannabis, and
    • (iii) whether the actions of the practitioner pose a significant risk to public health or public safety, including the risk of any prescription drug being diverted to an illicit market or activity.

Retraction of notice

190 (1) The Minister must retract a notice that was issued under subsection 189(2) or (4) if

  • (a) the practitioner who is named in the notice has requested in writing that it be retracted;
  • (b) the practitioner has provided a letter from the applicable provincial professional licensing authority for the province in which the practitioner is entitled to practise that states that the authority consents to the retraction of the notice; and
  • (c) in the case where the notice was issued at the request of the practitioner, one year has elapsed since the notice was issued.

Obligation to notify

(2) If the Minister retracts a notice, the Minister must notify, in writing, the persons and authorities to which the notice was issued under subsection 189(2) or (4).

Hospitals

Record keeping

191 An individual who is in charge of a hospital must retain a record of the following information:

  • (a) with respect to any prescription drug received by the hospital,
    • (i) the name and quantity of the drug,
    • (ii) the name and address of the person from whom the drug was received, and
    • (iii) the date the drug was received; and
  • (b) with respect to a prescription drug that is dispensed by the hospital,
    • (i) the name of the patient for whom or animal for which the drug was dispensed,
    • (ii) the name of the practitioner who ordered or prescribed the drug, and
    • (iii) the date on which the drug was ordered or prescribed and the form and quantity of the drug.

Security obligations

192 An individual in charge of a hospital must, with respect to a drug containing cannabis for which the hospital is responsible,

  • (a) take reasonable steps to protect it against theft or loss; and
  • (b) notify the Minister, in writing, within 10 days after becoming aware of its theft or loss.

Sale, distribution and administration

193 (1) Subject to the other provisions of these Regulations, it is prohibited for a person to sell, distribute or administer a prescription drug that a hospital possesses without the authorization of the individual in charge of the hospital.

In–patients and out-patients

(2) The individual in charge of a hospital may authorize the sale, distribution or administration of a prescription drug only in accordance with a prescription or a written order, signed and dated by a practitioner and only

  • (a) in the case of administration, to an individual or an animal under treatment as an in-patient or out-patient of the hospital; or
  • (b) in the case of sale or distribution, for the individual referred to in paragraph (a) or to the person in charge of the animal referred to in paragraph (a).

Distribution or sale in an emergency

(3) Despite subsection (2), for emergency purposes, the individual in charge of a hospital may authorize the sale or distribution of a prescription drug without a prescription to

  • (a) an employee of or a practitioner in another hospital, if
    • (i) the drug is sold or distributed in accordance with a written order signed and dated by a pharmacist in charge of the pharmacy in the other hospital or by a practitioner who is authorized by the individual in charge of the other hospital to sign the order, and
    • (ii) if the signature of the pharmacist or the practitioner is known to the person who sells or distributes the drug or has been verified by that person;
  • (b) a pharmacist of another hospital, if
    • (i) the drug is sold or distributed in accordance with a written order signed and dated by the pharmacist, and
    • (ii) the signature of the pharmacist or the practitioner who is authorized by the individual in charge of the other hospital to sign the order is known to the person who sells or distributes the drug or has been verified by that person; and
  • (c) an individual who is exempted under section 140 of the Act with respect to the drug and who is employed in a research laboratory in the hospital for the purpose of research.

Return and destruction

194 (1) Despite subsection 193(2), the individual in charge of a hospital may authorize the sale or distribution of a prescription drug in accordance with a written order to

  • (a) the holder of a cannabis drug licence from which the drug was received, if the drug is sold or distributed for the purpose of its return; and
  • (b) a holder of a cannabis drug licence or a licensed dealer, if the drug is sold or distributed for the purpose of its destruction.

Written Order

(2) The written order must contain

  • (a) the name, the quantity and the strength per unit of the drug; and
  • (b) if the sale or distribution is for the purpose of its destruction, a written statement that affirms that the sole purpose of the order is the destruction of the drug and that is signed and dated by, or on behalf of, the holder of the cannabis drug licence or the licensed dealer, as the case may be.

Record keeping

(3) The individual in charge of the hospital must prepare a record, with respect to the drug for the purpose of its return or destruction, that sets out

  • (a) its brand name, form, quantity and strength per unit;
  • (b) the name and the address of the person to whom it was sold or distributed; and
  • (c) the date on which it was sold or distributed.

Retention period

195 An individual in charge of a hospital must retain the records that the individual is required to retain under these Regulations for at least two years after the day on which they are prepared.

PART 9

Combination Products and Devices

Definitions

196 The following definitions apply in this Part.

brand name has the same meaning as in subsection C.01.001(1) of the Food and Drug Regulations. (nom commercial)

combination product means a product, consisting of a device and a prescription drug, for which a drug identification number has been assigned under subsection C.01.014.2(1) of the Food and Drug Regulations. (produit mixte)

Authorization

197 Subject to the other provisions of these Regulations, a person may promote a combination product by communicating the brand name, proper name, common name, price or quantity of the product.

Exemption — section 21 of Act

198 A person is exempt from the application of section 21 of the Act if they display, refer to or otherwise use the brand name of a combination product, or the name of the holder of the drug identification number assigned in accordance with subsection C.01.014.2(1) of the Food and Drug Regulations for the product, directly or indirectly in a promotion that is used in the sponsorship of a person, entity, event, activity or facility.

Exemption — section 22 of Act

199 A person is exempt from the application of section 22 of the Act if they display on a facility, as part of the name of the facility or otherwise, if the facility is used for a sports or cultural event or activity, the brand name of a combination product or the name of the holder of the drug identification number assigned in accordance with subsection C.01.014.2(1) of the Food and Drug Regulations for the product.

Exemption — subsection 23(1) of Act

200 A person is exempt from the application of subsection 23(1) of the Act if they publish, broadcast or otherwise disseminate, on behalf of another person, with or without consideration, any promotion that is authorized under sections 197 to 199.

Authorization — combination product for veterinary use

201 Subject to the other provisions of these Regulations, a person that is authorized to sell a combination product for veterinary use may sell it in a package or with a label that sets out a depiction of a real or fictional animal that corresponds to the species of the animal for which the product is intended.

Authorization — combination product

202 (1) Subject to the other provisions of these Regulations, a person is authorized to sell a combination product to a young person.

Authorization — device

(2) Subject to the other provisions of these Regulations, a person is authorized to sell a device licensed for use with a prescription drug to a young person if the person

  • (a) has ascertained that there is a written prescription for the young person with respect to the drug; and
  • (b) is entitled under the laws of a province to dispense a prescription drug.

PART 10

Importation and Exportation for Medical or Scientific Purposes

Definitions

Definitions

203 The following definitions apply in this Part.

customs office has the same meaning as in subsection 2(1) of the Customs Act. (bureau de douane)

customs officer has the meaning assigned by the definition officer in subsection 2(1) of the Customs Act. (agent des douanes)

Importation

Import permit

204 (1) A holder of a licence is authorized to import cannabis for medical or scientific purposes if they also hold an import permit for each shipment of cannabis that is imported.

Ancillary activities

(2) A holder of an import permit is also authorized to possess, transfer, transport, send or deliver the shipment of cannabis to the extent necessary to import the cannabis.

Import permit — content

205 The import permit must set out the following information:

  • (a) the name and mailing address of the holder;
  • (b) the permit number and the licence number;
  • (c) in respect of the shipment of cannabis to be imported,
    • (i) the description of the cannabis,
    • (ii) the intended use of the cannabis,
    • (iii) if applicable, the brand name of the cannabis,
    • (iv) quantity of the cannabis, and
    • (v) the percentage of THC w/w and CBD w/w of the cannabis, except in the case of cannabis plants and cannabis plant seeds;
  • (d) the name and address of the exporter in the country of export;
  • (e) the port of entry into Canada;
  • (f) the address of the customs office to which the shipment is to be delivered;
  • (g) each mode of transportation used, the country of export and, if applicable, any country of transit or transhipment;
  • (h) any conditions that the Minister considers appropriate;
  • (i) the effective date of the permit; and
  • (j) the date of expiry of the permit.

Refusal to issue — other grounds

206 For the purpose of paragraph 62(7)(h) of the Act, other grounds for refusing to issue an import permit are the following:

  • (a) the applicant does not hold a licence; and
  • (b) the Minister has reasonable grounds to believe that
    • (i) the shipment to which the permit application pertains would contravene these Regulations or the laws of the country of export or any country of transit or transhipment, or
    • (ii) the importation of the cannabis is for the purpose of exporting it.

Period of validity

207 An import permit is valid until the earliest of the following dates:

  • (a) the date on which the shipment is imported,
  • (b) the date of expiry of the permit or the date of its revocation,
  • (c) the date of expiry of the licence referred to in paragraph 205(b) or the date of its revocation, or
  • (d) the date of revocation of the permit for exportation issued by the competent authority of the country of export that pertains to the shipment.

Provision of copy of import permit

208 A holder of an import permit must provide a copy of the import permit to the customs office at the time of importation.

Information

209 The holder of an import permit must, within 15 days after the date of release of a shipment of cannabis in Canada, provide the Minister with the following information:

  • (a) their name, the number of the licence referred to in paragraph 205(b) and the import permit number issued in respect of the shipment;
  • (b) the date of release of the shipment; and
  • (c) in respect of the shipment of cannabis that is imported,
    • (i) the description of the cannabis,
    • (ii) the intended use of the cannabis,
    • (iii) if applicable, the brand name of the cannabis,
    • (iv) the quantity of the cannabis, and
    • (v) the percentage of THC w/w and CBD w/w of the cannabis, except in the case of cannabis plants and cannabis plant seeds.

Transportation of imported cannabis

210 The holder of an import permit must ensure that, after the imported cannabis is released, it is transported directly to the site set out in the licence referred to in paragraph 205(b).

Revocation — other circumstances

211 For the purpose of paragraph 65(h) of the Act, other circumstances for the revocation of an import permit are the following:

  • (a) the permit holder has requested, in writing, the revocation;
  • (b) the licence referred to in paragraph 205(b) has been revoked;
  • (c) the importation of the cannabis is for the purpose of exporting it; and
  • (d) a permit that has been suspended is not reinstated because the reasons for the suspension still exist or the permit holder has not demonstrated to the Minister that the suspension is unfounded.

Disclosure of information

212 The Minister may, for the purpose of verifying whether an importation of cannabis complies with these Regulations, provide to a customs officer any information provided in the import permit application or referred to in sections 205 and 209 and inform that customs officer whether the import permit has been suspended or revoked.

Exportation

Export permit

213 (1) A holder of a licence is authorized to export cannabis for medical or scientific purposes if they also hold an export permit for each shipment of cannabis that is exported.

Ancillary activities

(2) A holder of an export permit is also authorized to possess, transfer, transport, send, deliver or sell the shipment of cannabis to the extent necessary to export the cannabis.

Export permit — content

214 The export permit must set out the following information:

  • (a) the name and mailing address of the holder;
  • (b) the permit number and the licence number;
  • (c) in respect of the shipment of cannabis to be exported,
    • (i) the description of the cannabis,
    • (ii) the intended use of the cannabis,
    • (iii) if applicable, the brand name of the cannabis,
    • (iv) the quantity of the cannabis, and
    • (v) the percentage of THC w/w and CBD w/w of the cannabis, except in the case of cannabis plants and cannabis plant seeds;
  • (d) the name and address of the importer in the country of import;
  • (e) the port of exit from Canada, the country of import and, if applicable, any country of transit or transhipment;
  • (f) the address of the customs office, sufferance warehouse or bonded warehouse to which the shipment is to be delivered, if applicable;
  • (g) each mode of transportation used;
  • (h) any conditions that the Minister considers appropriate;
  • (i) the effective date of the permit; and
  • (j) the date of expiry of the permit.

Refusal to issue — other grounds

215 For the purpose of paragraph 62(7)(h) of the Act, other grounds for refusing to issue an export permit are the following:

  • (a) the applicant does not hold a licence; and
  • (b) the Minister has reasonable grounds to believe that the shipment to which the permit application pertains
    • (i) would contravene these Regulations or the laws of the country of import or any country of transit or transhipment, or
    • (ii) would not comply with the permit for importation issued by a competent authority of the country of import.

Period of validity

216 An export permit is valid until the earliest of the following dates:

  • (a) the date on which the shipment is exported,
  • (b) the date of expiry of the permit or the date of its revocation,
  • (c) the date of expiry of the licence referred to in paragraph 214(b) or the date of its revocation, or
  • (d) the date of expiry of the permit for importation issued by the competent authority of the country of import that pertains to the shipment or the date of its revocation.

Provision of copy of export permit

217 A holder of an export permit must provide a copy of the export permit to the customs office at the time of exportation.

Information

218 The holder of an export permit must, within 15 days after the date of exportation of a shipment of cannabis, provide the Minister with the following information:

  • (a) their name and the number of the licence referred to in paragraph 214(b) and the export permit number issued in respect of the shipment;
  • (b) the date of exportation of the shipment; and
  • (c) in respect of the shipment of cannabis that is exported,
    • (i) the description of the cannabis,
    • (ii) intended use of the cannabis,
    • (iii) if applicable, the brand name of the cannabis,
    • (iv) the quantity of the cannabis, and
    • (v) the percentage of THC w/w and CBD w/w of the cannabis, except in the case of cannabis plants and cannabis plant seeds.

Revocation — other circumstances

219 For the purpose of paragraph 65(h) of the Act, other circumstances for the revocation of an export permit are the following:

  • (a) the permit holder has requested, in writing, the revocation;
  • (b) the licence referred to in paragraph 214(b) has been revoked; and
  • (c) a permit that has been suspended is not reinstated because the reasons for the suspension still exist or the permit holder has not demonstrated to the Minister that the suspension is unfounded.

Disclosure of information

220 The Minister may, for the purpose of verifying whether an exportation of cannabis complies with these Regulations, provide to a customs officer any information provided in the export permit application or referred to in sections 214 and 218 and inform that customs officer whether the export permit has been suspended or revoked.

PART 11

Retention of Documents and Information

General Provisions

Manner of retention

221 A person that is required to retain a document or information — or that must ensure that a document or information is retained — under these Regulations must ensure that

  • (a) the document or information is retained in a manner that will enable an audit of it to be made in a timely manner;
  • (b) if the person holds a licence, the document or information is available at the site specified in the licence; and
  • (c) if the person does not hold a licence, the document or information is available at their place of business in Canada or, if they do not have such a place of business, at a place of business in Canada.

Requirement to continue to retain

222 If a person ceases to hold a licence, they must, in respect of any document or information that they were required to retain under these Regulations and for which the retention period has not yet ended,

  • (a) ensure that the document or information continues to be retained until the end of the retention period; and
  • (b) provide the Minister with notice in writing of the address of the location at which the document or information is retained and of any subsequent change to the address.

Notices

Retention of notices

223 A holder of a licence, if they send or provide a notice under these Regulations and are not otherwise required to retain a copy, must retain a copy for at least two years after the day on which the notice is sent or provided.

Inventory and Distribution

Inventory — cannabis other than oil

224 (1) A holder of a licence must retain, for each lot or batch of cannabis — other than cannabis oil — that they produce, a document that contains the following information, as applicable:

  • (a) the date on which cannabis plants are propagated by means other than sowing seeds and the number of new plants propagated in this manner;
  • (b) the date on which cannabis plant seeds are sown and their net weight on that date;
  • (c) the date on which cannabis is harvested and its net weight on that date;
  • (d) the date on which drying processes are completed for the cannabis and its net weight on that date;
  • (e) the date on which dried or fresh cannabis is put into a discrete unit form, the net weight of cannabis in each unit and the number of units; and
  • (f) the date on which cannabis that is not of a class of cannabis set out in Schedule 4 to the Act is produced and its net weight or volume on that date.

Packaging

(2) A holder of a licence must retain, for each lot or batch of cannabis — other than cannabis oil — that they package, a document that contains the following information:

  • (a) a description of the cannabis, including, if applicable, the brand name;
  • (b) the date on which the cannabis is packaged and its net weight on that date; and
  • (c) in the case of a drug containing cannabis, the strength per unit of the drug.

Retention period

(3) The documents must be retained for at least two years after the day on which they are prepared.

Inventory — cannabis oil

225 (1) A holder of a licence must retain, for each lot or batch of cannabis oil that they produce, a document that contains the following information:

  • (a) the date on which the cannabis oil is produced and its net weight or volume on that date;
  • (b) if applicable, the date on which the cannabis oil is put into a discrete unit form, the net weight or volume of the oil in each unit and the number of units; and
  • (c) in respect of the cannabis that was used to produce the cannabis oil, its description, its net weight or volume, its lot or batch number and the date on which it was produced.

Packaging

(2) A holder of a licence must retain, for each lot or batch of cannabis oil that they package, a document that contains the following information:

  • (a) a description of the cannabis oil, including the brand name, if applicable;
  • (b) the date on which the cannabis oil is packaged and its net weight or volume on that date; and
  • (c) in the case of a drug containing cannabis, the strength per unit of the drug.

Retention period

(3) The documents must be retained for at least two years after the day on which they are prepared.

Receipt of cannabis

226 (1) A holder of a licence must, if they receive cannabis, retain a document that contains the following information:

  • (a) the name of the person from which it is received;
  • (b) the address of the location at which it is received and, if known, from which it is received;
  • (c) the date on which it is received;
  • (d) the quantity that is received;
  • (e) a description of the cannabis, including, if applicable, the brand name;
  • (f) if known, the lot or batch number of the cannabis;
  • (g) in the case of a drug containing cannabis, the form of the drug and its strength per unit; and
  • (h) in the case of cannabis plants, cannabis plant seeds or cannabis that is not of a class of cannabis set out in Schedule 4 to the Act, the intended use.

Retention period

(2) The document must be retained for at least two years after the day on which it is prepared.

Sale, distribution and export of cannabis

227 (1) A holder of a licence, if they sell, distribute or export cannabis, must retain a document that contains the following information:

  • (a) the name of the person to which it is sold, distributed or exported;
  • (b) the address of the location from which it is sold, distributed or exported and the place to which it is sent or delivered;
  • (c) the date on which it is sold, distributed or exported;
  • (d) the quantity that is sold, distributed or exported;
  • (e) a description of the cannabis, including, if applicable, the brand name;
  • (f) its lot or batch number;
  • (g) in the case of a drug containing cannabis, the form of the drug and its strength per unit;
  • (h) in the case of cannabis plants, cannabis plant seeds or cannabis that is not of a class of cannabis set out in Schedule 4 to the Act, the intended use, if known; and
  • (i) in the case of a cannabis accessory that is a cannabis product, a description of the cannabis accessory.

Exceptions

(2) The obligation set out in subsection (1) does not apply if the cannabis is sold or distributed to

  • (a) an individual who has placed a purchase order for it under subsection 289(1); or
  • (b) an individual, other than an individual referred to in paragraph (a), who does not hold a licence and who is obtaining the cannabis for their personal use.

Retention period

(3) The document must be retained for at least two years after the day on which it is prepared.

Antimicrobial treatment

228 (1) A holder of a licence, if they conduct antimicrobial treatment of cannabis at a location other than the site specified in the licence, must retain a document that contains the following information:

  • (a) a description of the cannabis, including, if applicable, the brand name;
  • (b) the date on which the cannabis leaves the site specified in the licence and the quantity that leaves the site;
  • (c) the name of the person that receives the cannabis at the location where the treatment is to be conducted;
  • (d) the address of the location referred to in paragraph (c);
  • (e) the name of the person from which the cannabis is received after the treatment;
  • (f) the address of the site to which the cannabis is returned, or of the location to which it is distributed, after the treatment; and
  • (g) the date on which the cannabis is received at the site or location referred to in paragraph (f) and the quantity that is received.

Retention period

(2) The document must be retained for at least two years after the day on which it is prepared.

Destruction

Destruction of cannabis

229 (1) A holder of a licence other than a cannabis drug licence, if they destroy cannabis or cause it to be destroyed, must retain a document that contains the following information:

  • (a) a description of the cannabis, including, if applicable, the brand name;
  • (b) the date on which the cannabis is destroyed and its pre-destruction net weight — or in the case of cannabis oil, its pre-destruction net weight or volume — on that date;
  • (c) the address of the location at which the cannabis is destroyed;
  • (d) a brief description of the method of destruction; and
  • (e) the names of the individuals who witness the destruction and are qualified to do so under paragraph 43(1)(b), together with the basis on which they are qualified under subsection 43(2).

Statement by witnesses

(2) The holder must obtain, for each instance in which cannabis is destroyed, a statement signed and dated by two of the witnesses referred to in paragraph (1)(e) stating that they witnessed the destruction and that the cannabis was destroyed in accordance with a method referred to in paragraph 43(1)(a).

Retention period

(3) The document referred to in subsection (1) and the statement referred to in subsection (2) must be retained for at least two years after the day on which the cannabis is destroyed.

Security

Organizational security plan

230 A holder of a licence must retain a copy of any organizational security plan that they submit to the Minister — including any updated plan referred to in section 45 — for at least two years after the day on which the plan is replaced by an updated plan or, if the plan has not been replaced, at least two years after the day on which the licence expires or is revoked.

Production

Good production practices

231 (1) A holder of a licence other than a cannabis drug licence must

  • (a) for each lot or batch of cannabis any portion of which has been sold or exported, retain a document demonstrating that the cannabis was produced, packaged, labelled, distributed, stored, sampled and tested in accordance with the provisions of Part 5;
  • (b) if applicable, maintain a list of the brand names of cannabis — of any class of cannabis set out in Schedule 4 to the Act — that the holder has produced, packaged, labelled, distributed, stored, sampled or tested;
  • (c) in respect of each instance in which a substance — including a pest control product and a fertilizer but excluding water — is applied directly or indirectly to cannabis, retain a document that contains the following information:
    • (i) the name of the substance and the quantity used,
    • (ii) the method and date of application, and
    • (iii) the rationale for the use of the substance;
  • (d) in respect of any testing conducted under Part 5 or to meet the requirements set out in Part 6,
    • (i) maintain a document that describes the validated methods used, and
    • (ii) for each lot or batch of cannabis that is tested, retain a document that contains the test results;
  • (e) in the case of a licence for processing, retain
    • (i) a document that describes the qualifications of the quality assurance person — and of any alternate quality assurance person — in respect of the matters referred to in subsection 19(1), and
    • (ii) a document concerning every complaint received in respect of the quality of the cannabis and of any corrective or preventative measures taken; and
  • (f) in the case of a licence for analytical testing, retain a document that describes the qualifications of the head of laboratory in respect of the matters referred to in subsection 23(2).

Retention periods

(2) The following documents must be retained for the following periods:

  • (a) a document referred to in paragraph (1)(a), for at least two years after the day on which the last sale or export of any portion of the lot or batch takes place;
  • (b) a document referred to in paragraph (1)(c), for at least two years after the day on which it is prepared;
  • (c) a document referred to in subparagraph (1)(d)(ii), for at least two years after the day on which the last sale or export of any portion of the lot or batch takes place;
  • (d) a document referred to in subparagraph (1)(e)(i) or paragraph (f), for the period during which the quality assurance person, the alternate quality assurance person or the head of laboratory acts in that capacity and at least two years after the day on which they cease to do so; and
  • (e) a document referred to in subparagraph (1)(e)(ii), for at least two years after the day on which it is prepared.

Retention periods — previous versions

(3) The holder must retain

  • (a) each version of the list referred to in paragraph (1)(b), for at least two years after the day on which it is replaced by a new version or, if it has not been replaced, at least two years after the day on which the licence expires or is revoked; and
  • (b) each version of the document referred to in subparagraph (1)(d)(i), for at least two years after the day on which the validated methods are replaced or, if the methods have not been replaced, two years after the day on which licence expires or is revoked.

Standard operating procedures and sanitation program

232 (1) A holder of a licence other than a cannabis drug licence must maintain documentation describing

  • (a) the standard operating procedures referred to in section 80 that are in use at the site set out in the licence; and
  • (b) the sanitation program referred to in section 87 that is in use at the site set out in the licence.

Retention period

(2) The holder must retain each version of the documentation for at least two years after the day on which it is replaced by a new version or, if it has not been replaced, at least two years after the day on which the licence expires or is revoked.

Packaging and Labelling

Packages and labels

233 A holder of a licence other than a cannabis drug licence must retain the following samples and copies for at least two years after the day on which they are made:

  • (a) a sample or copy of each distinct package for a cannabis product that the holder makes available for sale; and
  • (b) a copy of each distinct label that relates to a cannabis product that the holder makes available for sale.

Cannabis Accessories

Cannabis accessories

234 A holder of a licence must maintain a list of the names and types of the cannabis accessories that they sell and must retain each version of the list for at least two years after the day on which it is replaced by a new version or, if it has not been replaced, at least two years after the day on which the licence expires or is revoked.

System of Control for Recalls

System of control

235 (1) A holder of a licence other than a cannabis drug licence must retain, for each lot or batch of cannabis that they sell or distribute, a document that contains the information that is necessary for the system of control referred to in section 46.

Retention period

(2) The document must be retained for at least two years after the day on which the last sale or distribution of any portion of the lot or batch takes place, other than for destruction.

Documentation

(3) The holder must maintain documentation concerning the system of control and retain each version of the documentation for at least two years after the day on which it is replaced by a new version or, if it has not been replaced, at least two years after the day on which the licence expires or is revoked.

Promotion

Promotion

236 A holder of a licence must retain

  • (a) a document that contains the information referred to in subparagraphs 245(1)(a)(i) and (ii) and (2)(a)(i) and (ii) for at least two years after the date by which the information must be provided to the Minister;
  • (b) if applicable, a document that contains any information that is provided to the Minister under subsection 43(4) of the Act for at least two years after the day on which the information is provided; and
  • (c) a sample or copy of any promotional materials for at least two years after the last day on which the promotion in question takes place.

Research and Development

Research and development

237 (1) A holder of a licence, if they undertake research and development activities, must retain a document that contains the following information:

  • (a) in respect of any cannabis that is used in the activities,
    • (i) its description, including, if applicable, its brand name,
    • (ii) the quantity used and, if applicable, the lot or batch number,
    • (iii) the date on which it is used, and
    • (iv) the purpose and a brief description of the activity;
  • (b) in respect of any cannabis that is produced in the course of the activities,
    • (i) its description,
    • (ii) the quantity produced,
    • (iii) the date on which it is produced,
    • (iv) if applicable, the date on which it is used for testing and the quantity used, and
    • (v) if applicable, the date on which it is placed in inventory intended for sale and the quantity placed in inventory; and
  • (c) any other information that can be used to reconcile the quantities of cannabis referred to in paragraphs (a) and (b).

Retention period

(2) The document must be retained for at least two years after the day on which it is prepared.

Limit for Micro-processing Licence

Limit — micro-processing licence

238 A holder of a licence for micro-processing must maintain documentation that demonstrates that they comply with the limit set out in subsection 21(1) and retain each version of the documentation for at least two years after the day on which it is replaced by a new version or, if it has not been replaced, for at least two years after the day on which the licence expires or is revoked.

Import and Export

Import of cannabis

239 A holder or former holder of an import permit must retain a document that contains the information that they provided to the Minister under section 209 — together with a copy of the relevant export permit that was issued by a competent authority in the country of export — for at least two years after the day on which the information is provided.

Export of cannabis

240 A holder or former holder of an export permit must retain a document that contains the information that they provided to the Minister under section 218 — together with a copy of the relevant import permit issued by a competent authority in the country of final destination — for at least two years after the day on which the information is provided.

Key Investors

Record of key investors

241 (1) A holder of a licence for cultivation, processing or sale must maintain a record that contains the following information in respect of each key investor:

  • (a) the key investor’s name and mailing address;
  • (b) a detailed description of the means by which the key investor exercises, or is in a position to exercise, control over the holder;
  • (c) details regarding the transaction by virtue of which the key investor became such an investor, including
    • (i) if they provided money directly or indirectly to the holder, the amount provided, the date on which it was provided and the terms and conditions under which it was provided, and if the money was provided in the form of a loan, the interest rate and term, and
    • (ii) if they provided goods or services directly or indirectly to the holder, a description of the goods or services, their fair market value at the time they were provided, the date on which they were provided and the terms and conditions under which they were provided;
  • (d) details regarding each instance in which the key investor provides money, goods or services directly or indirectly to the holder, including
    • (i) in the case of money, the amount provided, the date on which it is provided and the terms and conditions under which it is provided, and if the money is provided in the form of a loan, the interest rate and term, and
    • (ii) in the case of goods or services, a description of the goods or services, their fair market value at the time at which they are provided, the date on which they are provided and the terms and conditions under which they are provided;
  • (e) details regarding any benefit that the key investor receives from the holder as a result of
    • (i) having provided money, goods or services to the holder, or
    • (ii) holding an ownership interest or other right or interest in, or in respect of, a business operated by the holder or, if the holder is an organization, in or in respect of the organization;
  • (f) details regarding each instance in which money is repaid or goods are returned to the key investor, including
    • (i) in the case of money, the amount repaid and the date on which it is repaid, and
    • (ii) in the case of goods, a description of the goods, their fair market value at the time they are returned and the date on which they are returned;
  • (g) if known, an indication of whether any ownership interest or other right or interest held by the key investor in, or in respect of, a business operated by the holder — or, if the holder is an organization, in or in respect of the organization — has been assigned, pledged, mortgaged, hypothecated or sold, in whole or in part, to any person;
  • (h) if known, an indication of whether an agreement has been entered into under which any right or interest referred to paragraph (g) will or could be assigned, pledged, mortgaged, hypothecated or sold, in whole or in part, to any person; and
  • (i) if known, the name and mailing address of any person referred to in paragraph (g) or (h).

Exception — published market

(2) Subsection (1) does not apply to a holder that is an organization if their equity securities are, or a class of those securities is, listed on a published market.

Exception — key investors before issuance

(3) The holder is not required to include the information referred to in paragraph (1)(c) in respect of a key investor that became such an investor before the day on which the licence was issued.

Exception — continued licences

(4) If the licence has been continued in force by virtue of subsection 158(1) of the Act, the holder is not required to include the information referred to in paragraph (1)(c) in respect of a key investor that became such an investor before the day on which these Regulations come into force.

Requirements regarding content

(5) The holder must not delete any information from the record and must indicate the effective date of the event in respect of which new information is added to the record.

Former key investors

(6) For greater certainty, the information that has been included in the record in respect of a key investor must continue to be retained in the record even if the person ceases to be such an investor.

Annual reporting

(7) The holder must, no later than January 31 in any given year, provide the Minister with

  • (a) a copy of the record; and
  • (b) if any person ceased to be a key investor during the previous calendar year, a document containing details regarding how and when they ceased to be such an investor.

Maintenance and retention of record

(8) The holder must ensure that the record is

  • (a) maintained in a manner that will enable an audit of it to be made in a timely manner;
  • (b) available at the site specified in the licence; and
  • (c) retained for at least two years after the day on which the holder ceases to be required to maintain it.

Definitions

(9) The following definitions apply in this section.

key investor means, in respect of the holder of a licence, a person that exercises, or is in a position to exercise, direct or indirect control over the holder by virtue of

  • (a) having provided money, goods or services directly or indirectly to the holder; or
  • (b) holding an ownership interest or other right or interest in, or in respect of, a business operated by the holder or, if the holder is an organization, in or in respect of the organization. (investisseur-clé)

published market means a market inside or outside Canada on which equity securities are traded, if the prices at which the securities are traded are regularly published either electronically or in a newspaper or financial or business publication of general circulation. (marché publié)

PART 12

Reporting and Disclosure

Documents and Information Provided to Minister

Form and manner

242 Except as otherwise provided in these Regulations, documents that are required to be provided to the Minister under this Part, Part 8, subsection 241(7) or section 297 must be provided in the form and manner specified in the document entitled Form and Manner Requirements – Documents Provided to the Minister of Health under the Cannabis Act, as amended from time to time and published by the Government of Canada on its website.

Request by Minister

243 (1) A person that is required to ensure the retention of documents or information under these Regulations and that is not authorized under the Act to conduct activities in relation to cannabis may be required by the Minister to provide the documents or information to the Minister if the Minister has reasonable grounds to believe that the documents are, or the information is, necessary to address an issue of public health or public safety or to verify compliance or prevent non-compliance with the provisions of the Act or of these Regulations. If the person is required to provide the documents or information to the Minister, they must do so as soon as feasible.

Import and export permits

(2) A person that has ceased to hold a licence and that is required to retain documents — including copies of permits — under section 239 or 240 may be required by the Minister to provide the documents to the Minister if the Minister has reasonable grounds to believe that they are necessary for a purpose specified in subsection (1). If the person is required to provide the documents to the Minister, they must do so as soon as feasible.

Exception — urgent issues

(3) A document or information that must be provided under subsection (1) or (2) to address an issue of public health or public safety must be provided without delay if the Minister has reasonable grounds to believe that the issue must be addressed urgently and so indicates in the request.

Notice — new cannabis product

244 (1) A holder of a licence for processing, at least 60 days before making available for sale a cannabis product — except cannabis plants or cannabis plant seeds — that they have not previously sold in Canada, must provide the Minister with a written notice that contains the following information:

  • (a) the class of cannabis set out in Schedule 4 to the Act to which the cannabis product belongs;
  • (b) a description of the cannabis product, including the brand name; and
  • (c) the date on which the cannabis product is expected to be made available for sale.

Retention period

(2) The holder must retain a copy of the notice for at least two years after the date referred to in paragraph (1)(c).

Information related to promotion

245 (1) For the purpose of subsection 43(1) of the Act,

  • (a) the information that a person referred to in that subsection must provide to the Minister in respect of the promotion of cannabis is
    • (i) the total amount of money that the person spent in a given calendar year on promotion that is directed at consumers who purchase cannabis at the retail level in Canada, together with a description of the types of promotion on which the money was spent, and
    • (ii) the total amount of money that the person spent in a given calendar year on promotion conducted in Canada that is not directed at consumers referred to in subparagraph (i), together with a description of the types of promotion on which the money was spent; and
  • (b) the information must be provided, in writing, no later than March 31 of the year after the year to which the information relates.

Cannabis accessories and services

(2) For the purpose of subsection 43(2) of the Act,

  • (a) the information that a person referred to in that subsection must provide to the Minister, in respect of the promotion of cannabis accessories that they sell or distribute or a service related to cannabis that they provide, is
    • (i) the total amount of money that the person spent in a given calendar year on promotion that is directed at consumers who purchase cannabis at the retail level in Canada, together with a description of the types of promotion on which the money was spent, and
    • (ii) the total amount of money that the person spent in a given calendar year on promotion conducted in Canada that is not directed at consumers referred to in subparagraph (i), together with a description of the types of promotion on which the money was spent; and
  • (b) the information must be provided, in writing, no later than March 31 of the year after the year to which the information relates.

Exemption

(3) A person referred to in subsection 43(1) or (2) of the Act is exempt from the requirement to provide the information referred to in subsection (1) or (2) if they do not hold a licence.

Prior promotions

(4) The information referred to in subsections (1) and (2) is not required to be provided in respect of any promotion that is conducted before the day on which these Regulations come into force.

Theft or loss of cannabis

246 (1) A holder of a licence other than a cannabis drug licence must, if they experience a theft of cannabis or a loss of cannabis that cannot be explained on the basis of normally accepted business activities,

  • (a) notify a police force within 24 hours after becoming aware of its theft or loss; and
  • (b) provide the Minister with a written notice within 10 days after becoming aware of its theft or loss.

Retention period

(2) The holder must retain a copy of the notice provided to the Minister for at least two years after the day by which the Minister must be notified.

Voluntary recall

247 (1) A holder of a licence must, before commencing a voluntary recall of a cannabis product that has been sold or distributed in Canada, provide the Minister with a document that contains the following information:

  • (a) a description of the cannabis product, including the brand name;
  • (b) the number of each lot or batch of the cannabis product to be recalled, together with, if known, the number of any lot or batch of cannabis that was used to make the cannabis product;
  • (c) if known, the name and address of each person that
    • (i) produced or imported into Canada the cannabis that is, or is contained in, the cannabis product,
    • (ii) packaged or labelled the cannabis referred to in subparagraph (i) before it became, or became part of, the cannabis product,
    • (iii) in the case of a cannabis accessory that is a cannabis product, produced or imported into Canada the cannabis accessory or any component of it, or
    • (iv) packaged or labelled the cannabis product;
  • (d) the reasons for commencing the recall;
  • (e) if the cannabis that is, or is contained in, the cannabis product was produced or imported into Canada by the holder, the quantity of cannabis that was produced or imported;
  • (f) the quantity of the cannabis product that was sold or distributed by the holder in Canada;
  • (g) if applicable, the quantity of the cannabis product that is affected by the problem or potential problem underlying the recall and that remains in the possession of the holder;
  • (h) the number of persons to which the holder sold or distributed the cannabis product in Canada;
  • (i) the period during which the holder sold or distributed the cannabis product in Canada;
  • (j) the time and manner in which the recall is to be carried out, including
    • (i) the expected date for the commencement of the recall,
    • (ii) how and when the Minister will be informed of the progress of the recall, and
    • (iii) the date by which the recall is expected to be completed;
  • (k) a description of any other measure that the holder is taking, or intends to take, in respect of the recall; and
  • (l) contact information for a representative who will be responsible for the recall.

Recall — exported cannabis

(2) A holder of a licence must, before commencing a voluntary recall of cannabis that has been exported from Canada, provide the Minister with a document that contains the following information:

  • (a) a description of the cannabis, including, if applicable, the brand name;
  • (b) the number of each lot or batch of the cannabis;
  • (c) if known, the name and address of each person that
    • (i) produced or imported into Canada the cannabis, and, if applicable, packaged or labelled it, and
    • (ii) in the case where the cannabis is contained in a cannabis accessory, produced or imported into Canada the cannabis accessory or any component of it;
  • (d) the reasons for commencing the recall;
  • (e) if applicable, the quantity of the cannabis that was produced or imported into Canada by the holder;
  • (f) the quantity of the cannabis that was sold or distributed by the holder in foreign countries;
  • (g) if applicable, the quantity of the cannabis that is affected by the problem or potential problem underlying the recall and that remains in the possession of the holder;
  • (h) the number of persons to which the holder sold or distributed the cannabis in foreign countries;
  • (i) the period during which the holder sold or distributed the cannabis in foreign countries;
  • (j) the time and manner in which the recall is to be carried out, including
    • (i) the expected date for the commencement of the recall,
    • (ii) how and when the Minister will be informed of the progress of the recall, and
    • (iii) the date by which the recall is expected to be completed;
  • (k) a description of any other measure that the holder is taking, or intends to take, in respect of the recall; and
  • (l) contact information for a representative who will be responsible for the recall.

Risk evaluation

(3) The holder must, within 72 hours after providing the Minister with the document referred to in subsection (1) or (2), provide the Minister with a document that contains an evaluation of the risk associated with the problem or potential problem that underlies the recall.

Report

(4) The holder must, within 30 days after the day on which the recall is completed, provide the Minister with a written report that sets out the results of the recall and the measures taken to prevent a recurrence of the problem.

Extension

(5) Despite subsection (4), the Minister may extend the period for providing the report — to a maximum of 90 days after the day on which the recall is completed — if, for reasons beyond the holder’s control, it is not feasible to provide it within the 30-day period.

Retention periods

(6) The holder must retain

  • (a) a copy of the documents that they provide to the Minister under subsections (1) and (3) for at least two years after the day on which their last sale or distribution of any cannabis product that is the subject of the recall takes place;
  • (b) a copy of the documents that they provide to the Minister under subsections (2) and (3) for at least two years after the day on which their last export of any of the cannabis that is the subject of the recall takes place; and
  • (c) a copy of the report that they provide to the Minister under subsection (4) for at least two years after the day on which the recall is completed.

Adverse reactions

248 (1) A holder of a licence that sells or distributes a cannabis product must

  • (a) within 15 days after becoming aware of a serious adverse reaction to the cannabis product, provide the Minister with a detailed report containing all information in their possession that is associated with the use of the cannabis product by the individual who experienced the reaction; and
  • (b) prepare an annual summary report that contains a concise and critical analysis of all adverse reactions to the cannabis product that the holder became aware of during the previous 12 months.

Retention period

(2) The holder must retain the reports for at least 25 years after the day on which they are prepared.

Definitions

(3) The following definitions apply in this section.

adverse reaction means a noxious and unintended response to a cannabis product. (réaction indésirable)

serious adverse reaction means a noxious and unintended response to a cannabis product that requires inpatient hospitalization or a prolongation of existing hospitalization, causes congenital malformation, results in persistent or significant disability or incapacity, is life-threatening or results in death. (réaction indésirable grave)

Disclosure of Information to Third Parties

Notices to local authorities

249 (1) The Minister may, at the request of the government of a province or any police force or other law enforcement agency in a province, disclose to the government, police force or agency any information set out in a notice that is referred to in section 7 or 35 and that relates to a site located in that province if the disclosure is for a purpose related to verifying compliance or preventing non-compliance with the provisions of

  • (a) the Act;
  • (b) these Regulations;
  • (c) a provincial Act; or
  • (d) regulations made under a provincial Act.

Police investigation

(2) The Minister may disclose any information that is set out in a notice referred to in section 7 or 35 to a Canadian police force, or a member of a Canadian police force, that requests the information in the course of an investigation under the Act.

Use of information

(3) Information that is disclosed under subsection (2) must be used only for the purposes of the investigation or the administration or enforcement of the Act or these Regulations.

Disclosure to province

250 (1) For the purpose of paragraph 83(f) of the Act, information contained in the national cannabis tracking system may be disclosed to the government of a province, at its request, if the disclosure is for a purpose related to the implementation of public health programs or activities that are related to cannabis.

Public health programs and activities

(2) The Minister may, at the request of the government of a province, disclose to the government any information obtained under section 297 if the disclosure is for a purpose related to the implementation of public health programs or activities that are related to cannabis.

International Narcotics Control Board

251 (1) In addition to the information that may be disclosed under sections 83, 128 and 129 of the Act, the Minister may disclose to the International Narcotics Control Board other information that is obtained under the Act if the disclosure is necessary to enable Canada to fulfill its international obligations in relation to cannabis.

Former statute

(2) The Minister may also disclose to the International Narcotics Control Board any information relating to cannabis that was obtained under the Controlled Drugs and Substances Act before the day on which these Regulations come into force if the disclosure is necessary to enable Canada to fulfill its international obligations in relation to cannabis.

Competent authorities

252 The Minister may, for the purposes of the administration or enforcement of the Act or these Regulations or if it is necessary to enable Canada to fulfill its international obligations in relation to cannabis, disclose to a competent authority

  • (a) information obtained from a person that has applied for or that holds an import or export permit;
  • (b) information relating to an activity authorized by
    • (i) an import or export permit, or
    • (ii) a licence held by a person that has applied for or that holds an import or export permit;
  • (c) any document that the holder or former holder of an import or export permit is required to retain, including any document that relates to a licence that they hold or held; and
  • (d) a copy of any import or export permit.

PART 13

Test Kits

Exemption — Division 2 of Part 1 of Act

253 The cannabis that is contained in a test kit that meets the requirements of paragraphs 255(a) and (b) is exempt from Subdivisions A to D of Division 2 of Part 1 of the Act.

Non-application

254 Part 5 and section 137 do not apply to the cannabis that is contained in a test kit.

Sale, importation and exportation

255 A person is authorized to sell, import or export a test kit if

  • (a) a registration number has been issued for the test kit and the number has not been cancelled;
  • (b) the following information is included on the label that is applied to the test kit:
    • (i) the registration number, and
    • (ii) in the case of a test kit that is not subject to the labelling requirements of the Medical Devices Regulations,
      • (A) the name and address of the manufacturer or assembler or, if applicable, the name and address of the person for which the test kit was manufactured or assembled further to a custom order, and
      • (B) its brand name; and
  • (c) the test kit is sold, imported or exported for a medical, laboratory, industrial, educational, law administration or enforcement or research purpose.

Individual — possession and distribution

256 An individual is authorized to conduct the following activities, in relation to one or more test kits that contain a total amount of cannabis that, as determined in accordance with subsection 2(4) of the Act, is equivalent to more than the amount the individual may possess under the Act, if the registration number is included on the label of each test kit

  • (a) possess it in a public place; and
  • (b) distribute it for a medical, laboratory, industrial, educational, law administration or enforcement or research purpose.

Organization — possession and distribution

257 An organization is authorized to conduct the following activities if the label of a test kit includes its registration number:

  • (a) possess the test kit; and
  • (b) distribute the test kit for a medical, laboratory, industrial, educational, law administration or enforcement, or research purpose.

Application for registration number

258 (1) The manufacturer or assembler of a test kit or, if the test kit is manufactured or assembled further to a custom order, the person for which the test kit was manufactured or assembled, may apply for a registration number for the test kit by submitting an application to the Minister containing the following information:

  • (a) the brand name of the test kit;
  • (b) particulars of the design and construction of the test kit;
  • (c) a statement of the proposed use of the test kit;
  • (d) a detailed description of the cannabis contained in the test kit, including
    • (i) the class of cannabis set out in column 1 of Schedule 3 to the Act, and
    • (ii) the quantity of cannabis;
  • (e) if applicable, a detailed description of every other substance contained in the test kit, including
    • (i) the name of each substance,
    • (ii) if the substance is a salt, the name of the salt, and
    • (iii) the quantity of each substance; and
  • (f) the directions for use of the test kit.

Signature and declaration

(2) An application for the registration of a test kit must

  • (a) be signed and dated by an individual authorized by the applicant for that purpose; and
  • (b) include a declaration, signed and dated by that individual, indicating that all the information provided in support of the application is correct and complete to the best of their knowledge.

Additional information

259 The Minister may, on receiving an application referred to in section 258, require the submission of any additional information that pertains to the information contained in the application and that is necessary for the Minister to consider the application.

Issuance of a registration number

260 (1) Subject to subsection (2), the Minister must, after examining the information and documents required under sections 258 and 259, issue a registration number for the test kit to the applicant if the applicant demonstrates that the test kit is designed to be used solely for a medical, laboratory, industrial, educational, law administration or enforcement or research purpose.

Refusal

(2) The Minister must refuse to issue a registration number if he or she has reasonable grounds to believe that

  • (a) the test kit is likely to create a risk to public health or safety, including the risk of cannabis being diverted to an illicit market or activity, because
    • (i) the quantity of cannabis in the test kit is too high, or
    • (ii) the adulterating or denaturing agent in the test kit is not likely to prevent or deter consumption or administration of the cannabis; or
  • (b) the test kit is likely to be used for a purpose other than any of those set out in subsection (1).

Cancellation

261 (1) The Minister must cancel the registration number of a test kit if

  • (a) the Minister receives a notice from the holder of the registration number stating that it has ceased all authorized activities referred to in section 255, 256 or 257 with respect to the test kit;
  • (b) the Minister has reasonable grounds to believe that
    • (i) the test kit is likely to create a risk to public health or safety, including the risk of cannabis being diverted to an illicit market or activity, because
      • (A) the quantity of cannabis in the test kit is too high, or
      • (B) the adulterating or denaturing agent in the test kit is not likely to prevent or deter consumption or administration of the cannabis, or
    • (ii) the test kit is likely to be used for a purpose other than any of those set out in subsection 260(1); or
  • (c) the test kit is a medical device and is no longer authorized for sale in Canada under the Medical Devices Regulations.

Effect of cancellation

(2) When a registration number issued for a test kit is cancelled, the cancelled registration number

  • (a) must not be displayed on the label of any test kit manufactured or assembled further to a custom order after the cancellation; and
  • (b) in the case of a cancellation under paragraph (1)(a), must remain on the label of any existing test kit until all of the test kits with that registration number are disposed of.

Refusal or cancellation

262 If the Minister proposes to refuse to issue or to cancel a registration number, the Minister must

  • (a) send a notice to the applicant or to the holder of the registration number that sets out the reasons for the refusal or cancellation; and
  • (b) give the applicant or holder an opportunity to be heard in respect of the refusal or cancellation.

Application for new number

263 (1) If a registration number issued for a test kit has been cancelled under section 261, the manufacturer or assembler of the test kit or, if the test kit is manufactured or assembled further to a custom order, the person for which the test kit was manufactured or assembled,

  • (a) may apply to the Minister for the issuance of a new registration number in accordance with section 258; and
  • (b) must, in support of the application, provide the Minister with proof that the circumstance that gave rise to the cancellation has been corrected.

New registration number

(2) The Minister, after examining the application and supporting proof referred to in subsection (1), must issue a new registration number for the test kit unless there exists a circumstance set out in paragraph 261(1)(b) or (c).

PART 14

Access to Cannabis for Medical Purposes

Interpretation

Definitions

264 (1) The following definitions apply in this Part.

adult means an individual who is 18 years of age or older. (adulte)

designated person means an individual who is designated by a registered person, in accordance with Division 2 of this Part, to produce cannabis for the medical purposes of the registered person. (personne désignée)

former Marihuana for Medical Purposes Regulations means the regulations made by Order in Council P.C. 2013-645 of June 6, 2013 and registered as SOR/2013-119. (ancien Règlement sur la marihuana à des fins médicales)

health care practitioner means, except as otherwise provided, a medical practitioner or a nurse practitioner. (praticien de la santé)

licence for sale means a licence for sale for medical purposes. (licence de vente)

medical document means a document provided by a health care practitioner to support the use of cannabis for medical purposes. (document médical)

medical practitioner means an individual who

  • (a) is entitled under the laws of a province to practise medicine in that province;
  • (b) is not restricted, under the laws of the province in which they practise, from authorizing the use of cannabis; and
  • (c) is not named in a notice issued under section 335 that has not been retracted. (médecin)

named responsible adult means, in respect of a client, an adult who is named in the client’s registration document under subparagraph 282(2)(a)(iv) or subsection 285(5). (responsable nommé)

nurse practitioner means an individual who

  • (a) is entitled under the laws of a province to practise as a nurse practitioner or an equivalent designation and is practising as a nurse practitioner or an equivalent designation in that province;
  • (b) is not restricted, under the laws of the province in which they practise, from authorizing the use of cannabis; and
  • (c) is not named in a notice issued under section 335 that has not been retracted. (infirmier praticien)

provincial professional licensing authority means

  • (a) except in sections 343 to 345, an authority that is responsible for
    • (i) authorizing the practise of medicine in a province, or
    • (ii) authorizing individuals to practise as nurse practitioners in a province; and
  • (b) in sections 343 to 345, an authority that is responsible for authorizing individuals to practise pharmacy in a province. (autorité provinciale attributive de licences en matière d’activités professionelles)

registered person means an individual who is registered with the Minister under subsection 313(1). (personne inscrite)

registration certificate means a certificate issued by the Minister under subsection 313(1). (certificat d’inscription)

registration document means a document provided under paragraph 282(2)(a) to a client by a holder of a licence for sale. (document d’inscription)

written order means a written authorization given by a health care practitioner that a stated amount of cannabis be dispensed for the individual named in the authorization. (commande écrite)

Equivalent designation — nurse practitioner

(2) For the purpose of paragraph (a) of the definition of nurse practitioner, a designation is equivalent when it designates an individual who

  • (a) is a registered nurse;
  • (b) possesses additional educational preparation and experience related to health care;
  • (c) can autonomously make diagnoses, order and interpret diagnostic tests, prescribe drugs and perform other specific procedures under the laws of a province; and
  • (d) is practising their profession in accordance with one of the following provincial laws, as amended from time to time, or a similar law in another province:
    • (i) the Extended Practice Regulation, Man. Reg. 43/2005, made under The Registered Nurses Act, C.C.S.M., c. R40,
    • (ii) Ontario Regulation 275/94, made under the Nursing Act, 1991, S.O. 1991, c. 32, or
    • (iii) the Regulation respecting the classes of specialization of the Ordre des infirmières et infirmiers du Québec for the activities referred to in section 36.1 of the Nurses Act to be engaged in, CQLR, c. I-8, r. 8, made under the Nurses Act of Quebec, CQLR, c. I-8.

Equivalent quantity — cannabis

(3) In the following provisions, the equivalency of a quantity of cannabis is to be determined in accordance with subsection 2(4) of the Act:

  • (a) subsections 266(2), (3), (4), (6) and (7);
  • (b) subsections 267(2) to (5);
  • (c) paragraph 290(1)(e);
  • (d) subsection 292(4);
  • (e) subsection 293(1);
  • (f) subparagraph 297(1)(e)(iii);
  • (g) paragraph 322(1)(c);
  • (h) paragraph 348(3)(a); and
  • (i) subsection 350(2).

Non-application

Drugs containing cannabis

265 This Part does not apply in respect of a drug containing cannabis.

Possession

Possession in public place — adults

266 (1) The following individuals are authorized to possess, in a public place, cannabis — other than cannabis plants or cannabis plant seeds — that has been obtained under the Act, subject to the applicable maximum amounts and purposes set out in this section:

  • (a) an adult who is registered with a holder of a licence for sale on the basis of a medical document;
  • (b) an adult who is a registered person;
  • (c) an adult who, directly or indirectly, obtained the cannabis as an inpatient or outpatient of a hospital;
  • (d) an adult who is named in a registration document or a registration certificate as being responsible for an individual referred to in paragraph (a) or (b) or 267(1)(a) or (b) and who possesses the cannabis for the medical purposes of that individual;
  • (e) an adult who is responsible for an individual referred to in paragraph (c) or 267(1)(c) and who possesses the cannabis for the medical purposes of that individual; and
  • (f) an adult who possesses the cannabis in the presence of an individual referred to in paragraph (a), (b) or (c) or 267(1)(a), (b) or (c) for the purpose of providing assistance in administering it to the individual.

Client registered on basis of medical document

(2) The maximum amount of cannabis that an adult referred to in paragraph (1)(a) is authorized to possess in a public place, for their own medical purposes, is an amount that is equivalent to the lesser of

  • (a) 30 times the daily quantity of dried cannabis indicated in their registration document or, if they have more than one registration document, 30 times the total of the daily quantities indicated in the registration documents, and
  • (b) 150 g of dried cannabis.

Registered person

(3) The maximum amount of cannabis that an adult referred to in paragraph (1)(b) is authorized to possess in a public place, for their own medical purposes, is an amount that is equivalent to the lesser of

  • (a) 30 times the daily quantity of dried cannabis indicated in their registration certificate, and
  • (b) 150 g of dried cannabis.

Hospital patient

(4) The maximum amount of cannabis that an adult referred to in paragraph (1)(c) is authorized to possess in a public place, for their own medical purposes, is an amount that is equivalent to the lesser of

  • (a) 30 times the daily quantity of dried cannabis indicated on the hospital label that is applied to the container in which the cannabis was provided to or for them, and
  • (b) 150 g of dried cannabis.

Responsible adult

(5) The maximum amount of cannabis that an adult referred to in paragraph (1)(d) or (e) is authorized to possess in a public place, for the medical purposes of the individual for whom they are responsible, is the maximum amount that the individual is authorized to possess under subsection (2), (3) or (4) or 267(2), (3) or (4), as the case may be.

Adult providing assistance

(6) The maximum amount of cannabis that an adult referred to in paragraph (1)(f) is authorized to possess in a public place, for the purpose of providing assistance in administering cannabis to the individual referred to in that paragraph, is an amount equivalent to the lesser of

  • (a) the daily quantity of dried cannabis indicated in the individual’s registration document or registration certificate or on the hospital label that is applied to the container in which the cannabis was provided to or for the individual, as the case may be, or in the case where the individual has more than one registration document, or one or more registration documents and a registration certificate, the total of the daily quantities, and
  • (b) 150 g of dried cannabis.

Exception

(7) This section does not authorize an adult who is referred to in more than one of paragraphs (1)(a) to (c) to possess, for their own medical purposes, more than the equivalent of 150 g of dried cannabis.

Possession — young persons

267 (1) The following young persons are authorized to possess cannabis — other than cannabis plants or cannabis plant seeds — that has been obtained under the Act, subject to the applicable maximum amounts and purposes set out in this section:

  • (a) a young person who is registered with a holder of a licence for sale on the basis of a medical document;
  • (b) a young person who is a registered person; and
  • (c) a young person who, directly or indirectly, obtained the cannabis as an inpatient or outpatient of a hospital.

Client registered on basis of medical document

(2) The maximum amount of cannabis that a young person referred to in paragraph (1)(a) is authorized to possess, for their own medical purposes, is an amount that is equivalent to the lesser of

  • (a) 30 times the daily quantity of dried cannabis indicated in their registration document or, if they have more than one registration document, 30 times the total of the daily quantities indicated in the registration documents, and
  • (b) 150 g of dried cannabis.

Registered person

(3) The maximum amount of cannabis that a young person referred to in paragraph (1)(b) is authorized to possess, for their own medical purposes, is an amount that is equivalent to the lesser of

  • (a) 30 times the daily quantity of dried cannabis indicated in their registration certificate, and
  • (b) 150 g of dried cannabis.

Hospital patient

(4) The maximum amount of cannabis that a young person referred to in paragraph (1)(c) is authorized to possess, for their own medical purposes, is an amount that is equivalent to the lesser of

  • (a) 30 times the daily quantity of dried cannabis indicated on the hospital label that is applied to the container in which the cannabis was provided to or for them, and
  • (b) 150 g of dried cannabis.

Exception

(5) This section does not authorize a young person who is referred to in more than one of paragraphs (1)(a) to (c) to possess, for their own medical purposes, more than the equivalent of 150 g of dried cannabis.

Cumulative quantities

268 Any quantity of cannabis that an individual is authorized to possess under section 266 or 267 is in addition to any other quantity of cannabis that the individual may possess under the Act.

Distribution

Distribution of cannabis

269 (1) In addition to any other quantity of cannabis that they may distribute under the Act, an adult referred to in paragraph 266(1)(d) or (e) is authorized to distribute — but not send or otherwise indirectly make available — to the individual for whom they are responsible, or transport for that individual, a quantity of cannabis, other than cannabis plants or cannabis plant seeds, that does not exceed the maximum amount that the adult is authorized to possess under subsection 266(5).

Assistance by adult

(2) In addition to any other quantity of cannabis that they may distribute under the Act, an adult referred to in paragraph 266(1)(f) is authorized to administer, give, transfer, provide or otherwise directly make available to the individual to whom the assistance is being provided a quantity of cannabis, other than cannabis plants or cannabis plant seeds, that does not exceed the maximum amount that the adult is authorized to possess under subsection 266(6).

Non-application of Section 71 of Act

Non-application of section 71 of Act

270 Despite section 71 of the Act, an authorization to possess, sell, distribute or produce cannabis that is conferred by this Part on an adult referred to in paragraphs 266(1)(a) to (f), a young person referred to in paragraphs 267(1)(a) to (c) or a designated person does not authorize an employee or agent or mandatary of the adult, young person or designated person — or a person who is acting under a contract with the adult, young person or designated person — to do anything that is prohibited by a provision of Division 1 of Part 1 of the Act.

Health Care Practitioners

Prohibition

271 A health care practitioner must not provide a medical document or issue a written order except as authorized under this Part.

Authorization — health care practitioner

272 (1) A health care practitioner is authorized, in respect of an individual who is under their professional treatment and if cannabis is required for the condition for which the individual is receiving treatment,

  • (a) to provide a medical document;
  • (b) while practising in a hospital, to issue a written order;
  • (c) to administer to the individual a cannabis product, other than cannabis plants or cannabis plant seeds; or
  • (d) to transfer to the individual, or to an adult who is responsible for them, a cannabis product, other than cannabis plants or cannabis plant seeds,
    • (i) that has been received from a holder of a licence for sale or a licence for processing, and
    • (ii) in respect of which the quantity of cannabis does not exceed the quantity that the individual or adult is authorized to possess under section 266 or 267, as the case may be.

Possession in public place

(2) A health care practitioner is authorized to possess a cannabis product, other than cannabis plants or cannabis plant seeds, in a public place if they have obtained it under the Act and require it for the practice of their profession in the province where they possess it.

Medical document

273 (1) A medical document that is provided under paragraph 272(1)(a) must indicate

  • (a) the health care practitioner’s given name, surname, profession, business address and telephone number and, if applicable, their facsimile number and email address;
  • (b) the province in which the health care practitioner is authorized to practise their profession and the number assigned by the province to that authorization;
  • (c) the given name, surname and date of birth of the individual who is under the professional treatment of the health care practitioner;
  • (d) the address of the location at which the individual consulted with the health care practitioner;
  • (e) the daily quantity of dried cannabis, expressed in grams, that the health care practitioner authorizes for the individual; and
  • (f) a period of use, specified as a number of days, weeks or months.

Maximum period

(2) The period of use specified in a medical document must not exceed one year.

Signature and statement

(3) A medical document must be signed and dated by the health care practitioner who is providing it and must include a statement confirming that the information in the document is correct and complete.

Validity of medical document

(4) A medical document is valid for the period of use specified in it, which period begins on

  • (a) the date on which the individual referred to in paragraph (1)(c) is registered with a holder of a licence for sale on the basis of the document or, if there have been previous registrations on the basis of the document, the earliest registration date; or
  • (b) if the individual referred to in paragraph (1)(c) uses the document to register with the Minister under Division 2 of this Part and has not previously been registered with a holder of a licence for sale on the basis of the document, the date of the registration with the Minister.

Written order

274 A written order that is issued under paragraph 272(1)(b) must be signed and dated by the health care practitioner and must indicate

  • (a) the health care practitioner’s given name, surname and profession;
  • (b) the given name and surname of the individual who is under the professional treatment of the health care practitioner; and
  • (c) the daily quantity of dried cannabis, expressed in grams, that the health care practitioner authorizes for the individual.

General Prohibitions

Alteration of documents

275 It is prohibited to alter or deface a medical document or other document that is issued or provided under this Part.

Obtaining from more than one source

276 (1) It is prohibited to seek or obtain a cannabis product from more than one source at a time on the basis of the same medical document.

Exception

(2) Despite subsection (1), if a medical document forms the basis for a registration with the Minister under Division 2 of this Part, the registration certificate may be used to obtain

  • (a) cannabis products, other than cannabis plants and cannabis plant seeds, from, or through, a single holder of a licence for sale; and
  • (b) cannabis plants or cannabis plant seeds from one or more holders of a licence for sale.

DIVISION 1

Holders of Licence for Sale

Notice to Licensing Authorities

Notice to licensing authorities

277 (1) A holder of a licence for sale must, within 30 days after the issuance of their licence, provide a written notice to each provincial professional licensing authority and a copy to the Minister.

Content of notice

(2) The notice must contain

  • (a) the name of the holder, the mailing address of the site specified in the licence and, if applicable, the holder’s email address; and
  • (b) the effective date of the licence.
Registration of Clients

Eligibility — client

278 An individual is eligible to be a client of a holder of a licence for sale only if the individual ordinarily resides in Canada.

Registration application

279 (1) Before registering an individual as a client, a holder of a licence for sale must receive a registration application, together with the original of the individual’s medical document or a copy of their registration certificate.

Application on basis of medical document

(2) An application that is submitted on the basis of a medical document must include

  • (a) the applicant’s given name, surname and date of birth;
  • (b) either
    • (i) the address of the place in Canada where the applicant ordinarily resides, as well as, if applicable, their telephone number, facsimile number and email address, or
    • (ii) if the applicant ordinarily resides in Canada but does not ordinarily reside at a specific place, the address as well as, if applicable, the telephone number, facsimile number and email address of a shelter, hostel or similar institution located in Canada that provides them with food, lodging or other social services;
  • (c) the mailing address of the place referred to in paragraph (b) if different from the address provided under that paragraph;
  • (d) if the place referred to in subparagraph (b)(i) is an establishment that is not a private residence, the type and name of the establishment;
  • (e) an indication of whether the shipping address is to be
    • (i) the address referred to in subparagraph (b)(i),
    • (ii) the mailing address of the place referred to in subparagraph (b)(i), or
    • (iii) if the health care practitioner who provided the medical document has consented to receive cannabis products on behalf of the applicant, the address of the health care practitioner;
  • (f) if applicable, the given name, surname and date of birth of one or more adults who are responsible for the applicant; and
  • (g) a statement signed and dated by the applicant, or an adult who is named under paragraph (f), confirming that
    • (i) the applicant ordinarily resides in Canada,
    • (ii) the information in the application is correct and complete,
    • (iii) the medical document that forms the basis for the application has not, to the knowledge of the individual signing the statement, been altered,
    • (iv) the medical document is not being used to seek or obtain cannabis products from another source,
    • (v) in the case where the applicant is signing the statement, they intend to use any cannabis product that is supplied to them on the basis of the application only for their own medical purposes, and
    • (vi) in the case where an adult who is named under paragraph (f) is signing the statement, they are responsible for the applicant.

Application on basis of registration certificate

(3) An application that is submitted on the basis of a registration certificate must include

  • (a) the information referred to in paragraphs (2)(a) to (d), as applicable;
  • (b) an indication of whether the application is being made to obtain
    • (i) cannabis products, other than cannabis plants or cannabis plant seeds,
    • (ii) cannabis plants or cannabis plant seeds, or both, or
    • (iii) cannabis products referred to in both subparagraphs (i) and (ii);
  • (c) if the application is being made to obtain cannabis products, other than cannabis plants or cannabis plant seeds, an indication of which of the addresses referred to in paragraph (2)(e) is to be the shipping address;
  • (d) if the application is being made to obtain cannabis plants or cannabis plant seeds, an indication of whether the shipping address is to be
    • (i) the address of the place where the applicant ordinarily resides,
    • (ii) the address of the place where the designated person, if any, ordinarily resides, or
    • (iii) the address of the site for the production of cannabis that is specified in the registration certificate; and
  • (e) a statement signed and dated by the applicant, or an adult who is named in the registration certificate under paragraph 313(2)(c), confirming that
    • (i) the applicant ordinarily resides in Canada,
    • (ii) the information in the application is correct and complete,
    • (iii) the copy of the registration certificate is an accurate reproduction of the original,
    • (iv) if the application is being made to obtain cannabis products other than cannabis plants or cannabis plant seeds, the registration certificate is not being used to seek or obtain the cannabis products from another source,
    • (v) in the case where the applicant is signing the statement, they intend to use any cannabis product that is supplied to them on the basis of the application only for their own medical purposes, and
    • (vi) in the case where an adult who is named in the registration certificate is signing the statement, they are responsible for the applicant.

Applicant without ordinary residence

(4) If an institution’s address is included in the application in accordance with subparagraph (2)(b)(ii), the application must include a statement that is signed and dated by a manager of the institution confirming that it provides food, lodging or other social services to the applicant.

Health care practitioner’s consent

280 (1) If an application referred to in section 279 includes, as a shipping address, the address of the health care practitioner who provided the applicant with the medical document, the application must include a statement, signed and dated by the health care practitioner, consenting to receive cannabis products, other than cannabis plants and cannabis plant seeds, on the applicant’s behalf.

Withdrawal of consent

(2) If the applicant becomes a client of a holder of a licence for sale under this Division and the health care practitioner ceases to consent to receive cannabis products on the behalf of the client, the health care practitioner must send a written notice to that effect to the client and the holder.

Verification of medical document

281 (1) A holder of a licence for sale that intends to register an applicant whose application is based on a medical document must

  • (a) verify that the medical document meets the requirements set out in subsections 273(1) to (3);
  • (b) verify that, at the time the medical document was provided to the applicant, the individual who provided the document was a health care practitioner who was entitled to practise their profession in the province in which the applicant consulted with them; and
  • (c) verify with the office of the individual referred to in paragraph (b) that the applicant consulted the individual and that the information set out in the medical document is correct and complete.

Exception

(2) The holder is not required to do the verification referred to in paragraph (1)(c) if the signature of the health care practitioner who provided the medical document is known to the holder.

Uncertainty — previous registration

(3) The holder must, if it appears that the applicant was previously registered on the basis of the medical document but the information referred to in subsection 288(1) does not appear on the medical document,

  • (a) take reasonable steps to determine whether the applicant was previously registered on the basis of the medical document; and
  • (b) in the case where they determine that the applicant was previously registered on the basis of the medical document,
    • (i) take reasonable steps to determine the date on which the applicant was first registered on that basis; and
    • (ii) if they determine the date referred to in subparagraph (i), ensure that it appears on the medical document in accordance with subsection 288(1).

Date illegible or incomplete

(4) The holder must, if a date of registration appears on the medical document but the date is illegible, incomplete or there is reason to doubt that it is accurate,

  • (a) take reasonable steps to determine the date on which the applicant was first registered on the basis of the medical document; and
  • (b) if they determine the date referred to in paragraph (a), ensure that it appears on the medical document in accordance with subsection 288(1) unless there are reasonable grounds to believe that the date that already appears on the medical document has been falsified.

Unknown date

(5) If the holder is, after taking the steps referred to in subparagraph (3)(b)(i) or paragraph (4)(a), unable to determine the date on which the applicant was first registered on the basis of the medical document, they must, if they proceed to register the applicant, indicate on the medical document the information referred to subsection 288(1) in accordance with the requirements set out in that subsection.

Registration of client

282 (1) A holder of a licence for sale may, subject to section 284, register an applicant as a client.

Registration document and other information

(2) A holder that registers an applicant as a client must provide them with

  • (a) a registration document that contains the following information:
    • (i) the name of the holder,
    • (ii) the client’s given name, surname and date of birth,
    • (iii) the given name and surname of the health care practitioner who provided the client’s medical document,
    • (iv) the given name, surname and date of birth of any adults named in the application under paragraph 279(2)(f) or in the registration certificate under paragraph 313(2)(c), as the case may be,
    • (v) an indication of whether the registration is based on a medical document or a registration certificate,
    • (vi) the daily quantity of dried cannabis, expressed in grams, indicated in the medical document or registration certificate,
    • (vii) in the case of a registration that is based on a medical document, the shipping address indicated in the application under paragraph 279(2)(e),
    • (viii) in the case of a registration that is based on a registration certificate, the shipping address or addresses indicated in the application under paragraph 279(3)(c) or (d), or both, as applicable, and
    • (ix) the date of expiry of the registration;
  • (b) information that will permit them to use a unique identifier for the purpose of ordering cannabis; and
  • (c) the current version of the document entitled Consumer Information — Cannabis, published by the Government of Canada on its website.

Expiry of registration

283 A client’s registration with a holder of a licence for sale expires

  • (a) if it is based on a medical document, at the end of the period of validity of the document, as determined in accordance with subsection 273(4); or
  • (b) if it is based on a registration certificate, when the registration with the Minister expires.

Refusal to register

284 (1) A holder of a licence for sale must refuse to register an applicant as a client if

  • (a) the application does not meet the requirements set out in section 279 or, if applicable, subsection 280(1);
  • (b) the holder has reasonable grounds to believe that false or misleading information has, or false or falsified documents have, been provided in, or in support of, the application;
  • (c) the requirements set out in subsection 281(1) have not been met;
  • (d) the medical document that forms the basis for the application is no longer valid;
  • (e) the registration with the Minister that forms the basis for the application has expired or been revoked;
  • (f) the given name, surname or date of birth of the applicant is different from the given name, surname or date of birth that appears on the medical document or the copy of the registration certificate that has been submitted; or
  • (g) the health care practitioner who provided the medical document to the applicant notifies the holder in writing that the use of cannabis by the applicant is no longer supported for clinical reasons.

Verification requirement

(2) The holder must not refuse to register an applicant on the basis that there are reasonable grounds to believe that the medical document is false or falsified unless the holder has contacted the office of the health care practitioner whose name appears in the medical document to ask about the matters referred to in paragraph 281(1)(c).

Notice of intention to refuse

(3) If the holder proposes to refuse an applicant for a reason referred to in subsection (1) or a business reason, the holder must, without delay, send the applicant a written notice that sets out the reason for the proposed refusal.

Opportunity to be heard

(4) If the holder sends a notice under subsection (3), they must not refuse to register the applicant unless the applicant has had 10 days after the day on which the applicant receives the notice to provide reasons why the refusal is unfounded.

Notice of refusal to register

(5) If the holder is provided with reasons under subsection (4), they must, if they refuse to register the applicant, send the applicant a written notice of the refusal.

Return of medical document

(6) If the holder refuses to register an applicant whose application is based on a medical document, the holder must, without delay, return the medical document unless

  • (a) it is clear that the document is false or falsified; or
  • (b) the registration is refused for a reason referred to in paragraph (1)(d) or (g).

Notice to Minister

(7) If the holder refuses to register an applicant whose application is based on a registration certificate, the holder must, as soon as feasible, provide the Minister with a notice that includes the following information:

  • (a) the given name, surname and date of birth of the registered person named in the certificate;
  • (b) the registration number indicated in the certificate;
  • (c) the date of the refusal; and
  • (d) the reasons for the refusal.
Amendment to Registration

Amendment to registration

285 (1) If there is a change in respect of any of the information provided under section 279, the client — or, if applicable, an adult who is responsible for them — must, without delay, submit an application to amend the registration to the holder of the licence for sale unless the client has ceased to ordinarily reside in Canada.

Content of application

(2) The application must include the following information and documents:

  • (a) the new information;
  • (b) if there has been a change to the information referred to in paragraph 279(2)(a), proof of the change;
  • (c) if applicable, the statement of the health care practitioner consenting to receive cannabis products on behalf of the client, as required by subsection 280(1);
  • (d) if the application is being submitted by an adult who is responsible for the client but who is not a named responsible adult, the given name, surname and date of birth of the adult; and
  • (e) a statement, signed and dated by the individual who is submitting the application, confirming that
    • (i) the client ordinarily resides in Canada,
    • (ii) the information included in the application is correct and complete,
    • (iii) in the case where the individual who is signing the statement is not the client, they are responsible for the client, and
    • (iv) in the case where the individual who is signing the statement is neither the client nor a named responsible adult, the client and any named responsible adults have been notified of the application.

Condition

(3) The new information that is included in the application under paragraph (2)(a) must meet the applicable requirements set out in section 279.

Obligation to amend

(4) The holder of the licence for sale must, if they receive an application that complies with subsections (2) and (3), amend the client’s registration and provide them with an updated registration document.

New responsible adult

(5) If a registration is amended on the basis of an application that is signed by an adult who is neither the client nor a named responsible adult, the name of the adult who signed the application must be included in the updated registration document.

Revocation of Registration

Revocation of registration

286 (1) A holder of a licence for sale must, without delay, revoke a client’s registration if

  • (a) the client — or, if applicable, a named responsible adult — requests it;
  • (b) the medical document that forms the basis for the registration is transferred to another holder of a licence for sale under section 287;
  • (c) the holder has reasonable grounds to believe the client has ceased to ordinarily reside in Canada or ceased to have a shipping address in Canada;
  • (d) the holder has reasonable grounds to believe that
    • (i) the registration was made on the basis of false or misleading information provided in, or false or falsified documents provided in support of, the registration application, or
    • (ii) false or misleading information was, or false or falsified documents were, provided in, or in support of, an amendment application under section 285;
  • (e) the health care practitioner who provided the medical document notifies the holder in writing that the use of cannabis by the client is no longer supported for clinical reasons;
  • (f) if the registration is based on a registration certificate, the holder becomes aware that the registration with the Minister has been revoked; or
  • (g) the client dies.

Revocation for business reason

(2) A holder of a licence for sale may revoke a client’s registration for a business reason.

Revocation of all registrations

(3) A holder of a licence for sale whose licence is revoked must, without delay, revoke the registrations of all of their clients and send each client a written notice that sets out the reason for the revocation.

Notice

(4) Before revoking a registration under subsection (1) or (2), the holder must send the client a written notice that sets out the reason for the proposed revocation unless

  • (a) the client has requested that the registration be revoked or that the medical document that forms the basis for the registration be transferred;
  • (b) the named responsible adult, if any, who signed the most recent statement that was included in an application that was submitted under section 279 or 285 to the holder in respect of the client has requested that the registration be revoked or that the medical document that forms the basis for the registration be transferred;
  • (c) the client — or, if applicable, the named responsible adult referred to in paragraph (b) — has consented to the transfer of the medical document that forms the basis for the registration;
  • (d) the client has died; or
  • (e) the holder has received a notice of revocation referred to in subsection 319(1) in respect of the client.

Opportunity to be heard

(5) If the holder sends a notice under subsection (4), the holder must not revoke the registration unless the client has had 10 days after the day on which they receive the notice to provide reasons why the revocation is unfounded.

Medical document

(6) If the holder revokes a registration that is based on a medical document, they must, without delay, return the document to the client unless

  • (a) it is clear that the document is false or falsified; or
  • (b) the registration is revoked for a reason referred to in paragraph (1)(b), (e) or (g).

Notice to Minister

(7) If the holder revokes a registration that is based on a registration certificate, they must, as soon as feasible, provide the Minister with a notice that includes the following information:

  • (a) the given name, surname and date of birth of the registered person named in the certificate;
  • (b) the registration number indicated in the certificate;
  • (c) the date of the revocation; and
  • (d) the reason for the revocation.
Transfer of Medical Documents

Transfer of medical document

287 (1) A holder of a licence for sale must, without delay, transfer the medical document that forms the basis for a client’s registration to another holder of a licence for sale if

  • (a) the client — or, if applicable, a named responsible adult — requests, or consents to, the transfer;
  • (b) the holder to which the document is to be transferred consents to the transfer; and
  • (c) no revocation of the registration is pending for a reason referred to in any of paragraphs 286(1)(c) to (g).

Requirement to send information

(2) The holder that transfers the medical document must send the information contained in the client’s registration document to the holder to which the document is transferred.

Requirement to register

(3) The holder to which the medical document is transferred must, after receiving the information referred to in subsection (2), register the client and comply with the requirements set out in subsection 282(2).

Indication of Date of Registration

Requirement to indicate date of registration

288 (1) A holder of a licence for sale must, before returning a medical document under subsection 286(6) or transferring such a document under section 287, indicate the following information on the document in indelible ink if no date of registration appears on the document:

  • (a) the date on which the client was registered, in the order of day, month and year, preceded by the words “date of registration” or “date d’inscription”; and
  • (b) the name of the holder.

Previously registered clients

(2) For greater certainty, the obligation in subsection (1) applies in respect of the medical document of an individual who was not registered under this Part but who is a client of the holder by virtue of subsection 158(7) of the Act.

Sale of Cannabis to Clients

Authorization to sell

289 (1) Subject to the other provisions of these Regulations, a holder of a licence for sale is authorized to sell cannabis products to a client — or, if applicable, to a named responsible adult — if the holder has received from the client or the named responsible adult

  • (a) a written purchase order that complies with subsection (2); or
  • (b) a verbal purchase order that has been recorded in accordance with subsection (3).

Written purchase order

(2) A written purchase order must contain the following information:

  • (a) the date on which it is placed;
  • (b) the given name, surname and date of birth of the client;
  • (c) the given name and surname of the individual placing the order;
  • (d) the shipping address specified in the client’s registration document for the cannabis products that are being ordered;
  • (e) the client’s unique identifier; and
  • (f) the names assigned by the holder of the licence for sale to the cannabis products being ordered, the quantities desired and the brand names.

Verbal purchase order

(3) The record of a verbal purchase order must be in writing and contain the following information:

  • (a) the information referred to in paragraphs (2)(a) to (f);
  • (b) an order number; and
  • (c) the name of the individual with whom the order was placed.

New medical document or registration certificate

(4) For greater certainty,

  • (a) the authorization to sell cannabis products that is conferred by subsection (1) applies only in respect of the medical document or registration certificate that forms the basis for the client’s registration;
  • (b) if the client wishes to obtain cannabis products from the holder on the basis of a different medical document or registration certificate, they must submit to the holder a new registration application that meets the requirements set out in section 279 and be registered on the basis of that document or certificate; and
  • (c) sections 280 to 284 apply in respect of a registration application referred to in paragraph (b).

Refusal — purchase order

290 (1) A holder of a licence for sale must refuse to fill a purchase order — and must not ask a holder of a licence for processing or cultivation to fill it — if

  • (a) the order does not meet the requirements of section 289;
  • (b) any of the information referred to in paragraph 289(2)(b), (c) or (d) does not correspond to the information set out in the client’s registration document;
  • (c) the client’s unique identifier referred to in paragraph 289(2)(e) is not correct;
  • (d) the client’s registration has expired or been revoked;
  • (e) the order specifies cannabis products, other than cannabis plants or cannabis plant seeds, in respect of which the quantities of cannabis exceed the equivalent of 150 g of dried cannabis;
  • (f) in the case of a client who is registered on the basis of a medical document, the order specifies a quantity of cannabis plants or cannabis plant seeds;
  • (g) the order specifies a total quantity of cannabis plants or cannabis plant seeds that, taking into account the seed-to-plant ratio specified in subsection (2), exceeds the maximum number of plants, determined in accordance with section 325, that are authorized to be under production by virtue of the client’s registration with the Minister; or
  • (h) the order has been previously filled.

Seed-to-plant ratio

(2) For the purpose of paragraph (1)(g), three cannabis plant seeds are equivalent to one cannabis plant.

Notice of refusal

(3) If the holder of the licence refuses to fill a purchase order, they must, except in the case of a refusal for a reason referred to in paragraph (1)(d), send the client a written notice that sets out the reason for the refusal.

Sending or delivery — client

291 (1) A holder of a licence for sale that sells a cannabis product under section 289 is authorized to send or deliver it to the relevant shipping address that is specified in the client’s registration document unless, in the case where the shipping address is the address of a health care practitioner,

  • (a) the holder has received a written notice from the health care practitioner indicating that they have ceased to consent to receive cannabis products on the client’s behalf; or
  • (b) the holder has received a notice issued by the Minister under section 335 that names the health care practitioner and that has not been retracted.

Prohibition

(2) A holder of a licence for sale that receives a notice referred to in paragraph (1)(a) or (b) must not ask a holder of a licence for processing to send or deliver cannabis products to a client whose shipping address is the address of the health care practitioner who sent the notice or is named in it, as the case may be.

Notice to holder of processing licence

(3) A holder of a licence for sale that has asked a holder of a licence for processing to send or deliver cannabis products to the address of a health care practitioner must, without delay, provide the holder of the processing licence with a written notice if, within 48 hours after making the request, the holder of the sale licence receives

  • (a) a notice referred to in paragraph (1)(a) from the health care practitioner; or
  • (b) a notice referred to in paragraph (1)(b) that names the health care practitioner.

Prohibition — licence for processing

(4) A holder of a licence for processing that receives a notice under subsection (3) must not send or deliver the cannabis products that they had been asked to send or deliver.

Return and Replacement of Cannabis

Return of cannabis products

292 (1) An individual to whom cannabis products are sold under section 289 — or a designated person to whom cannabis plants or cannabis plant seeds are sent or delivered under section 291 — may return the cannabis products if the holder of the licence for sale accepts the return.

Manner of return

(2) The individual who is returning the cannabis products must, subject to subsection (3), send them or have them delivered to the holder of the licence for sale or the holder of a licence for processing or cultivation, as indicated by the holder of the licence for sale.

Health care practitioner

(3) In the case of cannabis products that were transferred to the individual by a health care practitioner who had consented under subsection 280(1) to receive them, the individual who is returning the cannabis products may, with the consent of the health care practitioner, give them, send them or have them delivered to the health care practitioner.

Parcel — requirements

(4) The individual who is returning the cannabis products must, if they are sending or having delivered cannabis plants — or other cannabis products in respect of which the total quantity of cannabis exceeds the equivalent of 30 g of dried cannabis,

  • (a) prepare the parcel in a manner that ensures the security of its contents, such that
    • (i) it will not open or permit the escape of its contents during handling and transportation,
    • (ii) it is sealed so that it cannot be opened without the seal being broken,
    • (iii) except in the case of cannabis plants, it prevents the escape of cannabis odour, and
    • (iv) it prevents its contents from being identified without it being opened; and
  • (b) use a method that ensures the tracking and safekeeping of the parcel during transportation.

Return by health care practitioner

(5) A health care practitioner must ensure that the requirements set out in paragraphs (4)(a) and (b) are met if they are sending or having delivered cannabis products referred to in subsection (4) that have been returned to them under subsection (3).

Replacement of returned cannabis

293 (1) A holder of a licence for sale to which cannabis products, other than cannabis plants or cannabis plant seeds, are returned in accordance with section 292 may replace them with cannabis products, other than cannabis plants or cannabis plant seeds, in respect of which the total quantity of cannabis does not exceed the equivalent of 150 g of dried cannabis.

Plants or seeds

(2) A holder of a licence for sale to which cannabis plants or cannabis plant seeds are returned in accordance with section 292 may replace them with a quantity of cannabis plants or cannabis plant seeds, or both, that does not exceed, taking into account the seed-to-plant ratio specified in subsection 290(2), the maximum number of plants, determined in accordance with section 325, that are authorized to be under production under the client’s registration with the Minister.

Processing licence

(3) A holder of a licence for processing may replace cannabis products that have been returned in accordance with section 292 with cannabis products in respect of which the total quantity of cannabis, according to information provided by the holder of the licence for sale, does not exceed the applicable quantity of cannabis referred to in subsection (1) or (2).

Cultivation licence

(4) A holder of a licence for cultivation may replace cannabis plants or cannabis plant seeds that have been returned in accordance with section 292 with a quantity of cannabis plants or cannabis plant seeds, or both, that, according to information provided by the holder of the licence for sale, does not exceed the quantity of cannabis plants or cannabis plant seeds that could be replaced by the holder of the licence for sale under subsection (2).

Sale, Display and Promotion to Young Persons

Sale of cannabis accessories to young persons

294 A holder of a licence for sale is authorized to sell a cannabis accessory — other than a cannabis accessory referred to in section 31 of the Act or a device referred to in subsection 202(2) — to a young person if the holder takes reasonable steps to ensure that the young person is authorized to possess cannabis under section 267.

Display — young persons

295 (1) A holder of a licence for sale is authorized to display a cannabis product, or a package or label of a cannabis product, in a manner that may result in the cannabis product, package or label being seen by a young person if the holder takes reasonable steps to ensure that any such young person is authorized to possess cannabis under section 267.

Cannabis accessories — young persons

(2) A holder of a licence for sale that sells a cannabis accessory is authorized to display it, or its package or label, in a manner that may result in the cannabis accessory, package or label being seen by a young person if the holder takes reasonable steps to ensure that any such young person is authorized to possess cannabis under section 267.

Promotion of cannabis products — young persons

296 (1) A holder of a licence for sale that promotes a cannabis product by means of informational promotion or brand-preference promotion that is communicated by means of a telecommunication is exempt from the condition set out in paragraph 17(2)(c) of the Act if they have taken reasonable steps to ensure that the promotion cannot be accessed by a young person other than a young person who is authorized to possess cannabis under section 267.

Promotion of cannabis accessories — young persons

(2) A holder of a licence for sale that promotes a cannabis accessory by means of informational promotion or brand-preference promotion that is communicated by means of a telecommunication is exempt from the condition set out in paragraph 17(3)(c) of the Act if they have taken reasonable steps to ensure that the promotion cannot be accessed by a young person other than a young person who is authorized to possess cannabis under section 267.

Reports to Minister

Monthly reports

297 (1) A holder of a licence for sale must, on or before the 15th day of each month, provide the Minister with a report that contains the following information:

  • (a) the number of clients who had a valid registration on the last day of the previous month;
  • (b) the number of clients who, in the previous month, had their medical document transferred to another holder of a licence for sale or returned to them at their request or at the request of a named responsible adult;
  • (c) in respect of the medical documents that formed the basis for registrations that were valid on the last day of the previous month,
    • (i) the average daily quantity of dried cannabis, expressed in grams,
    • (ii) the median daily quantity of dried cannabis, expressed in grams, and
    • (iii) the highest daily quantity of dried cannabis, expressed in grams;
  • (d) the number of applicants whom the holder refused to register during the previous month, including the number of them who were refused for each of the following reasons:
    • (i) the application was incomplete,
    • (ii) the holder had reasonable grounds to believe that false or misleading information was, or false or falsified documents were, provided in, or in support of, the application, and
    • (iii) the medical document or registration certificate that formed the basis for the application was not valid;
  • (e) the number of purchase orders referred to in subsection 289(1) that the holder refused to fill during the previous month, including the number of them that were refused for each of the following reasons:
    • (i) the purchase order was incomplete,
    • (ii) the client’s registration had expired or been revoked,
    • (iii) the purchase order specified cannabis products, other than cannabis plants or cannabis plant seeds, in respect of which the quantities of cannabis exceeded the equivalent of 150 g of dried cannabis, and
    • (iv) the cannabis product specified in the purchase order was unavailable;
  • (f) the given name, surname, profession and business address of each health care practitioner who provided a medical document referred to in paragraph (c), together with the province in which the health care practitioner was authorized to practise their profession at the time they signed the document and the number assigned by the province to that authorization; and
  • (g) the number of medical documents referred to in paragraph (c) that were signed by each health care practitioner referred to in paragraph (f).

Definition of health care practitioner

(2) In this section, health care practitioner means an individual who is, or was, a medical practitioner or nurse practitioner.

Disclosure to Third Parties

Disclosure to police

298 (1) A holder of a licence for sale must, if they are provided with an individual’s given name, surname, and date of birth by a member of a Canadian police force who requests information in the course of an investigation under the Act, disclose the following information to the police force as soon as feasible and no later than 72 hours after receiving the request:

  • (a) an indication of whether the individual is a client of the holder or a named responsible adult in respect of such a client;
  • (b) in the case where the individual is an individual referred to in paragraph (a),
    • (i) an indication of whether the client is a registered person and, if so, the classes of cannabis that the client is permitted to obtain by virtue of their registration with the holder, and
    • (ii) the daily quantity of dried cannabis that is specified in the client’s registration document in accordance with subparagraph 282(2)(a)(vi).

Use of information

(2) Information provided under this section must be used only for the purposes of the investigation or the administration or enforcement of the Act or these Regulations.

Disclosure to licensing authority

299 (1) A holder of a licence for sale must disclose, in writing and as soon as feasible, factual information about a health care practitioner — in relation to cannabis — that they have obtained under the Act or the Controlled Drugs and Substances Act to

  • (a) the provincial professional licensing authority for a province in which the health care practitioner is, or was, entitled to practise if the licensing authority submits to the holder a written request that sets out the health care practitioner’s name and address, a description of the information being requested and a statement that the information is required for the purpose of assisting an investigation by the authority; or
  • (b) the provincial professional licensing authority for a province in which the health care practitioner is not entitled to practise if the licensing authority submits to the holder
    • (i) a written request that sets out the health care practitioner’s name and address and a description of the information being requested, and
    • (ii) a document that shows that
      • (A) the health care practitioner has applied to the licensing authority to practise in that province, or
      • (B) the licensing authority has reasonable grounds to believe that the health care practitioner is practising in that province without being authorized to do so.

Factual information

(2) The factual information that may be requested includes information — including patient information — contained in, or in respect of, any medical document that was signed by the health care practitioner.

Exception

(3) Despite subsection (2), the factual information that may be requested does not include information relating to an individual who

  • (a) is or was registered as a client of the holder on the basis of a registration with the Minister under Division 2 of this Part; or
  • (b) in the case where the holder was a licensed producer under the former Access to Cannabis for Medical Purposes Regulations, was registered as a client of the licensed producer under section 133 of those Regulations on the basis of a registration with the Minister under Part 2 of those Regulations.

Secure transmission

(4) The holder must ensure that the information that they disclose under this section is securely transmitted in an electronic format that is accessible to the provincial professional licensing authority.

Definition of health care practitioner

(5) In this section, health care practitioner means an individual who is, or was, a medical practitioner or nurse practitioner.

Quarterly reports

300 (1) A provincial professional licensing authority may submit a written request to a holder of a licence for sale to obtain information, on a quarterly basis, in respect of each client who is registered with the holder on the basis of a medical document that was signed by a health care practitioner who

  • (a) was, at the time that they signed the medical document, entitled to practise the profession regulated by the licensing authority in the province in question; and
  • (b) was consulted in that province.

Report

(2) A holder that has received a request referred to in subsection (1) must, after the end of each quarter and in accordance with subsection (3), provide the provincial professional licensing authority with a report containing the following information in respect of each client referred to in subsection (1) who was validly registered at any time during the relevant quarter, together with details of any changes to the information that occurred during the quarter:

  • (a) the client’s given name, surname and date of birth;
  • (b) the postal code for the address that was provided under paragraph 279(2)(b), together with the province specified in the address;
  • (c) the given name, surname and business address of the health care practitioner who signed the medical document, together with the number assigned by the province to the health care practitioner’s authorization to practise;
  • (d) the daily quantity of dried cannabis specified in the medical document;
  • (e) the period of use specified in the medical document;
  • (f) the date on which the medical document was signed by the health care practitioner; and
  • (g) for each shipment of cannabis products that was sent or delivered during the quarter,
    • (i) the date it was sent or delivered,
    • (ii) the quantity of cannabis that was sent or delivered, expressed in grams, and
    • (iii) the class of cannabis set out in Schedule 4 to the Act to which the cannabis products belong.

Quarterly deadlines

(3) The report must be provided to the provincial professional licensing authority no later than

  • (a) April 30 of a given year for the quarter beginning on January 1 and ending on March 31 of that year;
  • (b) July 31 of a given year for the quarter beginning on April 1 and ending on June 30 of that year;
  • (c) October 31 of a given year for the quarter beginning on July 1 and ending on September 30 of that year; and
  • (d) January 31 of a given year for the quarter beginning on October 1 and ending on December 31 of the previous year.

First report

(4) For greater certainty, the first quarter in respect of which a report must be provided is the quarter in which the request is received from the provincial professional licensing authority.

Notice

(5) If the holder has no information to include in a report for a quarter, they must send a notice to that effect to the provincial professional licensing authority by the relevant deadline referred to in subsection (3).

Cessation of activities

(6) If the holder ceases to conduct activities, they must, despite subsection (3), provide the provincial professional licensing authority with the report for the quarter in which the activities cease within 30 days after ceasing them.

Cancellation

(7) The provincial professional licensing authority may, at any time, send the holder a notice cancelling the request referred to in subsection (1), in which case the final quarter in respect of which a report must be provided is the one that precedes the quarter in which the notice is received.

Transmission and format

(8) A holder, or former holder, that provides a report to a provincial professional licensing authority under this section must transmit it securely in an electronic format that is accessible to the licensing authority.

Retention of Documents

Verifications

301 (1) A holder of a licence for sale must, each time that they do verifications under subsection 281(1), retain a document that contains details of the verifications and of any measures taken under subsections 281(3) to (5).

Retention period

(2) The document must be retained for at least two years after the day on which it is prepared.

Documents relating to registration

302 (1) A holder of a licence for sale must retain

  • (a) each registration application that they receive under subsection 279(1), together with
    • (i) in the case of an application that is based on a medical document, the original of the medical document or, in the case where the medical document has been returned under subsection 284(6) or 286(6) or transferred under subsection 287(1), a copy of it that includes, if applicable, the information referred to in section 288, and
    • (ii) in the case of an application that is based on a registration certificate, the copy of the certificate;
  • (b) a copy of each registration document that they provide under paragraph 282(2)(a) and of each updated registration document that they provide under subsection 285(4);
  • (c) each amendment application referred to in section 285 that they receive;
  • (d) a copy of each notice that they send or provide under subsection 284(3), (5) or (7), 286(3), (5) or (7), 290(3) or 291(3);
  • (e) each notice referred to in paragraph 291(1)(a) or (b) that they receive; and
  • (f) each notification referred to in paragraph 284(1)(g) or 286(1)(e) that they receive.

Retention periods

(2) The documents referred to in subsection (1) must be retained

  • (a) in the case of documents referred to in paragraphs (1)(a), (c), (e) and (f), for at least two years after the day on which they are received; and
  • (b) in the case of the copies referred to in paragraphs (1)(b) and (d), for at least two years after the day on which the registration document or notice was provided or sent.

Steps — young persons

303 A holder of a licence for sale must maintain documentation as to the steps that they take to satisfy the conditions set out in sections 294 to 296 and retain each version of the documentation for at least two years after the day on which it is replaced by a new version or, if it has not been replaced, for at least two years after the day on which the licence expires or is revoked.

Purchase orders

304 (1) A holder of a licence for sale must retain, in respect of each purchase order referred to in section 289 that they fill or cause to be filled, a document that contains the following information:

  • (a) the given name, surname and date of birth of the client;
  • (b) the given name and surname of the individual who placed the purchase order;
  • (c) the date on which the purchase order was placed;
  • (d) the names they have assigned to the cannabis products that are sent or delivered and the brand names;
  • (e) the quantity of cannabis that is sent or delivered;
  • (f) the date on which the cannabis products are sent or delivered; and
  • (g) the address to which the cannabis products are sent or delivered.

Retention period

(2) The holder must retain the document — together with the relevant written purchase order or, in the case of a verbal purchase order, the record referred to in subsection 289(3) — for at least two years after the day on which the document is prepared.

Communications with licensing authorities

305 (1) A holder of a licence for sale must retain

  • (a) a copy of each notice that they provide to a provincial professional licensing authority under section 277, together with the copy that they provide to the Minister under that section;
  • (b) in respect of each request that they receive from a provincial professional licensing authority under subsection 299(1),
    • (i) a copy of the request, together with any supporting documentation received,
    • (ii) a written record of the date on which the request and any documentation are received,
    • (iii) a copy of the information that they disclose in response to the request,
    • (iv) a written record of the date on which the information is disclosed, and
    • (v) a written record of the steps that are taken to ensure that the information is securely transmitted to the authority;
  • (c) a copy of each request or notice referred to in section 300 that they receive from a provincial professional licensing authority, together with a written record of the date on which it is received;
  • (d) a copy of each report that they provide to a provincial professional licensing authority under section 300, together with a written record of the date on which it is provided and the steps that are taken to ensure that it is securely transmitted; and
  • (e) a copy of any notice that they send to a provincial professional licensing authority under subsection 300(5).

Retention periods

(2) The documents referred to in subsection (1) must be retained for at least two years after

  • (a) in the case of the documents referred to in paragraph (1)(a), the day on which the notice is provided to the licensing authority;
  • (b) in the case of the documents referred to in paragraph (1)(b), the day on which the information is disclosed to the licensing authority;
  • (c) in the case of documents referred to in paragraph (1)(c), the day on which the request or notice is received from the licensing authority;
  • (d) in the case of documents referred to in paragraph (1)(d), the day by which the holder is required to provide the report to the licensing authority; and
  • (e) in the case of a notice referred to in paragraph (1)(e), the end of the quarter to which the notice relates.

DIVISION 2

Registration with Minister

Interpretation

Adjacent land

306 For the purposes of paragraphs 312(3)(g) and 326(1)(b), a parcel of land is considered to be adjacent to another parcel of land if its boundary has at least one point in common with the boundary of the other parcel of land.

General Provisions

Signature and statement

307 (1) An application that is submitted under this Division must be signed and dated by the individual who is submitting it and must include a statement by the individual confirming that the information included in the application is correct and complete.

Responsible adult

(2) If the application is signed by an adult who is responsible for the applicant, it must include a statement by the adult confirming that they are responsible for the applicant.

Additional information

308 The Minister may, on receiving an application under this Division, require the submission of any additional information that pertains to the information contained in the application and that is necessary for the Minister to consider the application.

SUBDIVISION A

Registration, Renewal, Amendment and Revocation

Eligibility – registered person

309 (1) An individual is eligible to be a registered person only if they ordinarily reside in Canada.

Eligibility – production for own medical purposes

(2) An individual is eligible to produce cannabis for their own medical purposes as a registered person only if they are an adult.

Prior offences

(3) An individual is not eligible to produce cannabis for their own medical purposes as a registered person if, within the preceding 10 years, they have been convicted, as an adult, of

  • (a) a sale, distribution or export offence that was committed while they were authorized to produce cannabis under this Division;
  • (b) a designated cannabis offence that was committed while they were authorized under the Controlled Drugs and Substances Act — other than under the former Marihuana Medical Access Regulations — to produce a substance that was referred to in item 1 of Schedule II to that Act, as that item read immediately before the coming into force of subsection 204(1) of the Act;
  • (c) a designated marihuana offence that was committed while they were authorized to produce marihuana
    • (i) under the Controlled Drugs and Substances Act, other than under the former Access to Cannabis for Medical Purposes Regulations, or
    • (ii) by virtue of an injunction order issued by a court; or
  • (d) an offence committed outside Canada that, if committed in Canada, would have constituted an offence referred to in any of paragraphs (a) to (c).

Definitions

(4) The following definitions apply in this section.

designated cannabis offence means

  • (a) an offence — in relation to a substance that was referred to in item 1 of Schedule II to the Controlled Drugs and Substances Act, as that item read immediately before the coming into force of subsection 204(1) of the Act — under section 5 of the Controlled Drugs and Substances Act, or under section 6 of that Act except with respect to importation; or
  • (b) a conspiracy or an attempt to commit, being an accessory after the fact in relation to, or any counselling in relation to, an offence referred to in paragraph (a). (infraction désignée relativement au chanvre indien)

designated marihuana offence means

  • (a) an offence, in relation to marihuana, under section 5 of the Controlled Drugs and Substances Act, or under section 6 of that Act except with respect to importation; or
  • (b) a conspiracy or an attempt to commit, being an accessory after the fact in relation to, or any counselling in relation to, an offence referred to in paragraph (a). (infraction désignée relativement à la marihuana)

former Marihuana Medical Access Regulations means the regulations made by Order in Council P.C. 2001-1146 of June 14, 2001 and registered as SOR/2001-227. (ancien Règlement sur l’accès à la marihuana à des fins médicales)

marihuana means the substance referred to as “Cannabis (marihuana)” in subitem 1(2) of Schedule II to the Controlled Drugs and Substances Act, as that subitem read immediately before the coming into force of subsection 204(1) of the Act. (marihuana)

sale, distribution or export offence means

  • (a) an offence under subsection 9(1) or (2), 10(1) or (2) or 11(1) or (2) of the Act, with the exception of an offence under subsection 11(1) with respect to importation;
  • (b) an offence under subsection 14(1) of the Act in respect of the commission of an offence referred to in paragraph (a); or
  • (c) a conspiracy or an attempt to commit, being an accessory after the fact in relation to, or any counselling in relation to, an offence referred to in paragraph (a) or (b). (infraction relative à la vente, à la distribution ou à l’exportation)

Single registration

310 An individual is not eligible to be registered under this Division more than once at any one time.

Eligibility — designated person

311 (1) An individual is eligible to be a designated person only if they are an adult who ordinarily resides in Canada.

Prior offences

(2) An individual is not eligible to be a designated person if, within the preceding 10 years, they

  • (a) have been convicted, as an adult, of a designated offence or a controlled substance offence;
  • (b) have been convicted, as an adult, of an offence committed outside Canada that, if committed in Canada, would have constituted an offence referred to in paragraph (a);
  • (c) were a young person who received an adult sentence, as those terms are defined in subsection 2(1) of the Youth Criminal Justice Act, in respect of an offence referred to in paragraph (a); or
  • (d) received a sentence — for an offence they committed outside Canada when they were at least 14 years old but less than 18 years old that, if committed in Canada, would have constituted an offence referred to in paragraph (a) — that was longer than the maximum youth sentence that could have been imposed under the Youth Criminal Justice Act for such an offence.

Registration application

312 (1) Before registering an individual under this Division, the Minister must receive an application for registration and the original of the individual’s medical document.

Basic information

(2) The registration application must contain

  • (a) the applicant’s given name, surname and date of birth;
  • (b) unless the applicant intends to produce cannabis for their own medical purposes, either
    • (i) the address of the place in Canada where the applicant ordinarily resides, as well as, if applicable, their telephone number, facsimile number and email address, or
    • (ii) if the applicant ordinarily resides in Canada but does not ordinarily reside at a specific place, the address, as well as, if applicable, the telephone number, facsimile number and email address of a shelter, hostel or similar institution, located in Canada, that provides them with food, lodging or other social services;
  • (c) the mailing address of the place referred to in paragraph (b) if different from the address provided under that paragraph;
  • (d) if the place referred to in subparagraph (b)(i) is an establishment that is not a private residence, the type and name of the establishment;
  • (e) if applicable, the given name, surname and date of birth of one or more adults who are responsible for the applicant, including any adult who is signing the application;
  • (f) an indication that the individual who is signing the application will
    • (i) comply with the possession limit referred to in section 266 that applies to them, and
    • (ii) if they are not the applicant, take reasonable steps to ensure that the applicant will comply with the possession limits that apply to them;
  • (g) an indication of whether
    • (i) the applicant intends to produce cannabis for their own medical purposes,
    • (ii) cannabis is to be produced for the medical purposes of the applicant by a designated person, or
    • (iii) cannabis will not be produced under the registration; and
  • (h) if the applicant intends to produce cannabis for their own medical purposes, or to have it produced by a designated person, an indication that the individual who is signing the application will
    • (i) take reasonable steps to ensure the security of the cannabis in their possession that they are authorized to produce, or that is produced for the medical purposes of the applicant, under this Division, and
    • (ii) if they are not the applicant, ensure that the applicant takes reasonable steps to ensure the security of the cannabis in the applicant’s possession that has been produced under this Division.

Production for own medical purposes

(3) If the applicant intends to produce cannabis for their own medical purposes, the application must also include

  • (a) the address of the place in Canada where they ordinarily reside, as well as, if applicable, their telephone number, facsimile number and email address;
  • (b) if applicable, the information referred to in paragraphs (2)(c) and (d) as it relates to the place referred to in paragraph (a);
  • (c) an indication that, within the 10 years preceding the application, they have not been convicted, as an adult, of an offence referred to in subsection 309(3);
  • (d) an indication that they will comply with the limit on the number of cannabis plants under production, as specified in the registration certificate to be issued under subsection 313(1);
  • (e) the full address of the site where the proposed production of cannabis plants is to be conducted;
  • (f) an indication of whether the proposed production area is
    • (i) entirely indoors,
    • (ii) entirely outdoors, or
    • (iii) partly indoors and partly outdoors; and
  • (g) if there is to be any outdoor production, an indication that the site referred to in paragraph (e) is not adjacent to a school, public playground, daycare facility or other public place frequented mainly by individuals under 18 years of age.

Production by designated person

(4) If cannabis is to be produced by a designated person, the application must include a declaration by the designated person that contains

  • (a) the information referred to in paragraph (2)(a) and subparagraph (2)(b)(i) — and, if applicable, paragraphs (2)(c) and (d) — in respect of that person;
  • (b) the information referred to in paragraphs (3)(e) to (g);
  • (c) an indication that
    • (i) within the 10 years preceding the day on which the declaration is made, they have not been convicted of an offence referred to in paragraph 311(2)(a) or (b) or received a sentence referred to in paragraph 311(2)(c) or (d),
    • (ii) they will take reasonable steps to ensure the security of the cannabis in their possession that they produce under this Division, and
    • (iii) they will comply with the limit on the number of cannabis plants under production, as specified in the document to be provided under subsection 313(3); and
  • (d) a document, issued by a Canadian police force within the 90 days preceding the date on which the application is submitted, establishing that, within the 10 years preceding the date on which the document is issued, the designated person has not been convicted of an offence referred to in paragraph 311(2)(a) or received a sentence referred to in paragraph 311(2)(c).

Signature and statement — designated person

(5) The declaration must be signed and dated by the designated person and must include a statement by them confirming that the information contained in the declaration is correct and complete.

Consent of owner

(6) If the proposed site for the production of cannabis plants is not the ordinary place of residence of, and is not owned by, the applicant or, if applicable, the designated person, the application must include

  • (a) the full name, address and telephone number of the owner of the site; and
  • (b) a declaration, signed and dated by the site’s owner — or, if the owner is a corporation, by an authorized representative of the owner — consenting to the production of cannabis at the site.

Applicant without ordinary residence

(7) If an institution’s address is included in the application in accordance with subparagraph (2)(b)(ii), the application must include a statement that is signed and dated by a manager of the institution confirming that it provides food, lodging or other social services to the applicant.

Registration with Minister

313 (1) If the requirements set out in section 312 are met, the Minister must, subject to section 317, register the applicant and issue them a registration certificate.

Registration certificate

(2) The registration certificate must contain the following information:

  • (a) the given name, surname and date of birth of the registered person and, if applicable, the designated person;
  • (b) the address specified in the application under paragraph 312(2)(b) and, if applicable, the address of the place where the designated person ordinarily resides;
  • (c) the given name, surname and date of birth of any adults who are named in the application under paragraph 312(2)(e);
  • (d) a unique registration number;
  • (e) the name of the health care practitioner who provided the medical document that forms the basis for the registration;
  • (f) the daily quantity of dried cannabis, expressed in grams, that is specified in the medical document that forms the basis for the registration;
  • (g) the maximum quantity of dried cannabis, expressed in grams, that the registered person is authorized to possess by virtue of the registration, as determined in accordance with subsection 266(3) or 267(3), as the case may be;
  • (h) the effective date of the registration;
  • (i) the date of expiry of the registration, the date of which must correspond to the end of the period of validity of the medical document that forms the basis for the registration, as determined in accordance with subsection 273(4);
  • (j) if applicable, the type of production that is authorized, namely, production by the registered person or production by a designated person;
  • (k) if applicable, the full address of the site where the production of cannabis plants is authorized by virtue of the registration;
  • (l) if applicable, an indication of whether the authorized production area is entirely indoors, entirely outdoors or partly indoors and partly outdoors; and
  • (m) if applicable, the maximum number of cannabis plants, determined in accordance with section 325, that may be under production at the production site by virtue of the registration and, if applicable, the maximum number of plants for each indoor and outdoor production period.

Document for designated person

(3) If a designated person is named in the registration certificate, the Minister must provide them with a document containing information relating to the production of cannabis that is authorized, including the information referred to in paragraphs (2)(g) to (m) and the given name and surname of any adults who are named in the registration certificate under paragraph (2)(c).

Application to renew registration

314 (1) To renew a registration, the registered person, or an adult who is responsible for them, must

  • (a) submit an application to the Minister that includes the registration number and the information and documents required under subsections 312(2) to (7); and
  • (b) ensure that a new medical document is sent to the Minister.

Extension of registration

(2) If the Minister has received an application and medical document under subsection (1) but has not notified the applicant of the Minister’s decision in respect of the application before the current registration expires, the registration remains valid until the Minister notifies the applicant — and, in the case of a refusal to renew the registration, the designated person, if any — of the decision.

Renewal

(3) If a renewal application has been submitted in accordance with paragraph (1)(a) and the Minister has received a new medical document under paragraph (1)(b), the Minister must, subject to section 317,

  • (a) renew the registration;
  • (b) provide the registered person with a new registration certificate; and
  • (c) if there is a designated person, provide them with an updated version of the document referred to in subsection 313(3).

Effect of renewal

(4) For greater certainty, a renewed registration replaces the previous one.

Application to amend registration

315 (1) Subject to subsection (2), to amend any of the information in a registration certificate, the registered person, or an adult who is responsible for them, must submit an application to the Minister that includes

  • (a) the registration number;
  • (b) a description of the proposed amendment and the supporting reasons for it;
  • (c) the information and documents referred to in section 312 that are relevant to the proposed amendment;
  • (d) the effective date of the event that has necessitated the application; and
  • (e) if there has been a change to the given name or surname of an individual who is named in the registration certificate under paragraph 313(2)(a) or (c), proof of the change.

New medical document

(2) An amendment application cannot be submitted in respect of a new medical document.

Amendment

(3) If an application is submitted in accordance with subsection (1), the Minister must, subject to section 317,

  • (a) amend the registration;
  • (b) provide the registered person with an amended registration certificate; and
  • (c) if there is a designated person, provide them with an updated version of the document referred to in subsection 313(3).

Consequences of renewal or amendment

316 (1) If, as a result of the renewal or amendment of a registration, an individual ceases to be a designated person, the Minister must notify them of the loss of their authorization to produce cannabis under the registration.

Change of location

(2) If, as a result of a renewal or amendment, the location of the authorized site for the production of cannabis plants — or the place of residence of the registered person or designated person — is changed, the Minister may specify the period during which the registered person or, if applicable, the designated person is authorized to transport cannabis from the former site or place of residence to the new site or place of residence.

Refusal to register, renew or amend

317 (1) The Minister must refuse to register an applicant or to renew or amend a registration if

  • (a) the applicant is not eligible under subsection 309(1) or section 310;
  • (b) the medical document that forms the basis for the application does not meet all of the requirements of section 273 or is no longer valid;
  • (c) at the time the medical document was provided to the applicant, the individual who provided it
    • (i) was not a health care practitioner, or
    • (ii) was not entitled to practise their profession in the province in which the applicant consulted with them;
  • (d) the given name, surname or date of birth of the applicant is different from the given name, surname or date of birth that appears on the medical document;
  • (e) the health care practitioner who provided the medical document notifies the Minister in writing that the use of cannabis by the applicant is no longer supported for clinical reasons;
  • (f) the Minister has reasonable grounds to believe that false or misleading information has, or false or falsified documents have, been provided in, or in support of, the application;
  • (g) the registration, renewal or amendment would result in the applicant or, if applicable, the designated person being authorized to produce cannabis plants under more than two registrations;
  • (h) the registration, renewal or amendment would result in the proposed site for the production of cannabis plants being authorized under more than four registrations;
  • (i) in the case where the applicant intends to produce cannabis for their own medical purposes, the applicant is not eligible under subsection 309(2) or (3); and
  • (j) in the case where cannabis is to be produced by a designated person, the individual who has been designated is not eligible under section 311.

Power to refuse

(2) The Minister may refuse to register an applicant or renew or amend a registration if, in the case where cannabis is to be produced by the applicant or a designated person, the registration, renewal or amendment is likely to create a risk to public health or public safety, including the risk of cannabis being diverted to an illicit market or activity.

Notice and opportunity to be heard

(3) Before refusing to register an applicant or refusing to amend or renew a registration, the Minister must send the applicant a written notice that sets out the reason for the proposed refusal and give them an opportunity to be heard.

Revocation of registration

318 (1) The Minister must revoke a registration if

  • (a) the registered person is not eligible under section 309;
  • (b) the designated person is not eligible under section 311;
  • (c) the registration was issued, amended or renewed on the basis of false or misleading information or false or falsified documents;
  • (d) the health care practitioner who provided the medical document that forms the basis for the registration notifies the Minister in writing that the use of cannabis by the registered person is no longer supported for clinical reasons;
  • (e) the registered person — or an adult who is named in the registration certificate under paragraph 313(2)(c) — requests, in writing, that the registration be revoked; or
  • (f) the registered person dies.

Revocation of excess registrations

(2) If a site for the production of cannabis plants is authorized under more than four registrations, the Minister must revoke the excess registrations.

Power to revoke

(3) The Minister may revoke a registration if, in the case where the registered person or designated person is authorized to produce cannabis, the Minister has reasonable grounds to believe that the revocation is necessary to protect public health or public safety, including to prevent cannabis from being diverted to an illicit market or activity.

Conditions of revocation

(4) Before revoking a registration, the Minister must

  • (a) in the case where it is to be revoked for a reason set out in any of paragraphs (1)(a) to (d) or subsection (2) or (3),
    • (i) send the registered person a written notice that sets out the reason for the proposed revocation, and
    • (ii) give them an opportunity to be heard; and
  • (b) if applicable, send the designated person a written notice of the proposed revocation.

Effect of revocation

(5) For greater certainty, if a registration is revoked, the activities that were previously authorized under Subdivision B by virtue of the registration cease to be authorized.

Notice of revocation

319 (1) If a registration is revoked and the Minister is aware that the registration has formed the basis for a registration with a holder of a licence for sale under Division 1 of this Part, the Minister must provide the holder with a notice of revocation that includes the following information:

  • (a) the given name, surname and date of birth of the individual whose registration has been revoked;
  • (b) the registration number of the revoked registration; and
  • (c) the date of the revocation.

Requirement to notify

(2) A holder of a licence for sale that is notified under subsection (1) must, if within the previous 48 hours they have asked a holder of a licence for processing or cultivation to send or deliver cannabis products to, or for, the individual whose registration has been revoked, notify the holder of the licence for processing or cultivation, in writing, without delay.

Prohibition

(3) A holder of a licence for processing or cultivation that is notified under subsection (2) must not send or deliver the cannabis products that they had been asked to send or deliver.

SUBDIVISION B

Production

Definition of production site

320 (1) In this Subdivision, production site means

  • (a) in respect of a registered person, the site, if any, for the production of cannabis plants that is specified in their registration certificate under paragraph 313(2)(k); and
  • (b) in respect of a designated person, the site for the production of cannabis plants that is specified in the document that the person receives under subsection 313(3).

Cumulative quantities

(2) For greater certainty,

  • (a) the quantities of cannabis that a registered person is authorized to obtain by cultivation, propagation and harvesting, or to send, deliver, transport or possess, by virtue of a registration under this Division are in addition to any other quantities that they are permitted to obtain by cultivation, propagation and harvesting, or to send, deliver, transport or possess, under the Act; and
  • (b) the quantities of cannabis that a designated person is authorized to obtain by cultivation, propagation and harvesting, or to send, deliver, transport, sell or possess, by virtue of a registration under this Division are in addition to any other quantities that they are permitted to obtain by cultivation, propagation and harvesting, or to send, deliver, transport, sell or possess, under the Act.

Production by registered person

321 (1) A registered person who is registered to produce cannabis for their own medical purposes is, in accordance with the registration and the provisions of this Division, authorized to

  • (a) obtain by cultivation, propagation and harvesting at the production site a quantity of cannabis plants that does not exceed the maximum number of plants that is specified in the registration certificate under paragraph 313(2)(m);
  • (b) if the production site is different from the place where the registered person ordinarily resides,
    • (i) subject to subsection 326(2), transport directly from the place of residence to the production site a total quantity of cannabis plants and cannabis plant seeds that, taking into account the seed-to-plant ratio specified in subsection 290(2), does not exceed the equivalent of the maximum number of plants that is specified in the registration certificate under paragraph 313(2)(m), and
    • (ii) transport cannabis, other than cannabis plants or cannabis plant seeds, directly from the production site to the place of residence; and
  • (c) if the registration has been renewed or amended and, as a result, the location of the production site or the place of residence of the registered person is changed, transport cannabis directly from the former production site or place of residence to the new production site or place of residence within any period that the Minister may specify under subsection 316(2).

Possession of cannabis

(2) A registered person referred to in subsection (1) is authorized to possess the cannabis that they are authorized to obtain by cultivation, propagation and harvesting or to transport under that subsection.

Production by designated person

322 (1) A designated person is, in accordance with the registration and the provisions of this Division, authorized to

  • (a) obtain by cultivation, propagation and harvesting at the production site a quantity of cannabis plants that does not exceed the maximum number of plants that is specified in the document that the designated person receives under subsection 313(3);
  • (b) if the production site is different from the place where the designated person ordinarily resides,
    • (i) subject to subsection 326(2), transport directly from the place of residence to the production site a total quantity of cannabis plants and cannabis plant seeds that, taking into account the seed-to-plant ratio specified in subsection 290(2), does not exceed the equivalent of the maximum number of plants that is specified in the document that the designated person receives under subsection 313(3), and
    • (ii) transport cannabis, other than cannabis plants or cannabis plant seeds, directly from the production site to the place of residence;
  • (c) send, deliver, transport or sell to the registered person — or an adult who is named in the document that the designated person receives under subsection 313(3) — a quantity of cannabis, other than cannabis plants or cannabis plant seeds, that does not exceed the equivalent of the maximum quantity of dried cannabis that is specified in the document; and
  • (d) if the registration has been renewed or amended and, as a result, the location of the production site or the place of residence of the designated person is changed, transport cannabis directly from the former production site or place of residence to the new production site or place of residence within any period that the Minister may specify under subsection 316(2).

Parcel — requirements

(2) A designated person who sends or has cannabis delivered under paragraph (1)(c) must

  • (a) prepare the parcel in a manner that ensures the security of its contents, such that
    • (i) it will not open or permit the escape of its contents during handling or transportation,
    • (ii) it is sealed so that it cannot be opened without the seal being broken,
    • (iii) it prevents the escape of cannabis odour, and
    • (iv) it prevents the contents from being identified without it being opened; and
  • (b) use a method that ensures the tracking and safekeeping of the parcel during transportation.

Possession of cannabis

(3) A designated person is authorized to

  • (a) possess the cannabis plants and cannabis plant seeds that they are authorized to obtain by cultivation, propagation and harvesting or to transport under paragraph (1)(a), (b) or (d); and
  • (b) possess in a public place the cannabis, other than cannabis plants or cannabis plant seeds, that they are authorized to send, deliver, transport or sell under paragraphs (1)(b) to (d).

Participation by registered person

323 If a designated person is specified in a registration certificate, the registered person may, if they are an adult, participate in the activities that the designated person is authorized to conduct under subsection 322(1).

Former designated person

324 An individual who ceases to be a designated person may, within seven days after ceasing to be designated, conduct the activities referred to in paragraph 322(1)(c) in accordance with that paragraph unless the registration has expired or has been revoked.

Maximum number of plants

325 (1) If the production area is entirely indoors, the maximum number of cannabis plants that may be under production at a production site by virtue of a registration is determined by the formula

[(A × 365) ÷ (B × 3C)] × 1.2

where

  • is the daily quantity of dried cannabis, expressed in grams, indicated in the medical document that forms the basis for the registration;
  • is 30 g, being the expected yield of dried cannabis per plant; and
  • is a constant equal to 1, representing the growth cycle of a cannabis plant from seeding to harvesting.

Outdoor production only

(2) If the production area is entirely outdoors, the maximum number of cannabis plants that may be under production at a production site by virtue of a registration is determined by the formula

[(A × 365) ÷ (B × C)] × 1.3

where

  • is the daily quantity of dried cannabis, expressed in grams, indicated in the medical document that forms the basis for the registration;
  • is 250 g, being the expected yield of dried cannabis per plant; and
  • is a constant equal to 1, representing the growth cycle of a cannabis plant from seeding to harvesting.

Indoor and outdoor production

(3) If the production area is partly indoors and partly outdoors, the maximum number of cannabis plants that may be under production at a production site by virtue of a registration is determined

  • (a) for the indoor production period, by the formula

[(A × 182.5) ÷ (B × 2C)] × 1.2

  • where
    • is the daily quantity of dried cannabis, expressed in grams, indicated in the medical document that forms the basis for the registration,
    • is 30 g, being the expected yield of dried cannabis per plant, and
    • is a constant equal to 1, representing the growth cycle of a cannabis plant from seeding to harvesting; and
  • (b) for the outdoor production period, by the formula

[(A × 182.5) ÷ (B × C)] × 1.3

  • where
    • is the daily quantity of dried cannabis, expressed in grams, indicated in the medical document that forms the basis for the registration,
    • is 250 g, being the expected yield of dried cannabis per plant, and
    • is a constant equal to 1, representing the growth cycle of a cannabis plant from seeding to harvesting.

Rounding

(4) If the maximum number of cannabis plants determined under this section is not a whole number, it is to be rounded to the next highest whole number.

Prohibition — production of plants

326 (1) An individual who is authorized to produce cannabis plants under this Division must not cultivate, propagate or harvest them

  • (a) indoors and outdoors at the same time; or
  • (b) outdoors if the production site is adjacent to a school, public playground, daycare facility or other public place frequented mainly by individuals under 18 years of age.

Time limit — transportation of plants

(2) If the production site of an individual who is authorized to produce cannabis plants under this Division is different from the place where the individual ordinarily resides, the individual must not transport to the production site cannabis plants that were ordered in accordance with section 289 if it has been more than seven days after the individual received the plants at their place of residence.

SUBDIVISION C

Security Obligations

Security of cannabis and documents

327 (1) A registered person who is authorized to produce cannabis, or for whom cannabis may be produced by a designated person, under this Division — or, if applicable, any adult who is named in the registration certificate of the registered person — must

  • (a) take reasonable steps to ensure the security of
    • (i) the cannabis in their possession that was produced under this Division, and
    • (ii) the registration certificate, if they possess it;
  • (b) report the theft or loss of anything referred to in paragraph (a) to a police force within 24 hours after becoming aware of the theft or loss; and
  • (c) report the theft or loss of anything referred to in paragraph (a) to the Minister, in writing, within 72 hours after becoming aware of the theft or loss and include confirmation that the requirement set out in paragraph (b) has been complied with.

Designated person

(2) The requirements set out in subsection (1) also apply to a designated person in respect of

  • (a) cannabis in their possession that they produced under this Division; and
  • (b) the document referred to in subsection 313(3).

SUBDIVISION D

Disclosure of Information

Disclosure to licensing authorities

328 (1) At any time after receiving a medical document that forms the basis for an application under this Division, the Minister may disclose, in respect of the health care practitioner who is named in the medical document, the following information to the provincial professional licensing authority for the province identified in the medical document under paragraph 273(1)(b):

  • (a) the given name, surname and business address of the health care practitioner, together with the number assigned by the province to the health care practitioner’s authorization to practise;
  • (b) the daily quantity of dried cannabis that is specified in the medical document; and
  • (c) the name of the province that is specified in the application under paragraph 312(2)(b).

Disclosure after registration

(2) At any time after registering an individual under this Division, the Minister may disclose, in respect of the health care practitioner who is named in the medical document that forms the basis for the registration, the following information to the provincial professional licensing authority for the province identified in the document under paragraph 273(1)(b):

  • (a) the given name, surname and date of birth of the individual who is or was registered with the Minister;
  • (b) the postal code for the address of the place indicated in the medical document as the place where the individual ordinarily resides;
  • (c) the period of use that is specified in the medical document; and
  • (d) the date on which the medical document was signed by the health care practitioner.

Definition of health care practitioner

(3) In this section, health care practitioner means an individual who is, or was, a medical practitioner or nurse practitioner.

Disclosure to police

329 The Minister may disclose any of the following information to a Canadian police force, or a member of a Canadian police force, that requests the information in the course of an investigation under the Act, on condition that the information is used only for the purposes of the investigation or the administration and enforcement of the Act or these Regulations:

  • (a) in respect of a named individual, whether the individual is a registered person, a designated person or an adult who is named in a registration certificate under paragraph 313(2)(c);
  • (b) in respect of a specified address, whether the address is
    • (i) the place where a registered person or designated person ordinarily resides and, if so, the name of that person and the registration number, or
    • (ii) the site where the production of cannabis plants is authorized under a registration and, if so, the registration number, the name of the individual who is authorized to produce and, if that individual is a designated person and the registered person is an adult, the name of the registered person; and
  • (c) in respect of a registration,
    • (i) the given name, surname and date of birth of the registered person and, if applicable, the designated person and any adult who is named in the registration certificate under paragraph 313(2)(c),
    • (ii) the full address of the place where the registered person and, if applicable, the designated person ordinarily reside,
    • (iii) the registration number,
    • (iv) the maximum quantity of dried cannabis that the registered person is authorized to possess, as indicated in the registration certificate,
    • (v) the effective date and date of expiry of the registration,
    • (vi) if the registration remains valid by virtue of subsection 314(2), the status of the renewal application,
    • (vii) the full address of the site where the production of cannabis plants is authorized,
    • (viii) whether the authorized production area is indoors, outdoors or partly indoors and partly outdoors, and
    • (ix) the maximum number of cannabis plants that may be produced at the production site and, if applicable, the maximum number of cannabis plants that may be produced for each indoor and outdoor production period.

DIVISION 3

Health Professionals and Hospitals

Health Care Practitioners

Security of cannabis products

330 A health care practitioner must, in respect of cannabis products that they possess for the practice of their profession,

  • (a) take reasonable steps to protect them from theft or loss; and
  • (b) report any theft or loss to the Minister within 10 days after becoming aware of the theft or loss.

Returned cannabis products

331 (1) A health care practitioner must, if they accept cannabis products that are returned under subsection 292(3), retain a document that contains the following information:

  • (a) the name of the individual who is returning the cannabis products;
  • (b) the address of the location at which the cannabis products are received;
  • (c) the date on which they are received;
  • (d) the quantity of cannabis that is received; and
  • (e) a description of the cannabis products, including their brand names.

Exceptions

(2) The health care practitioner is not required to include the information referred to in paragraphs (1)(d) and (e) if

  • (a) they are unable to ascertain the information without unsealing a parcel that meets the requirements of paragraph 292(4)(a) and the parcel is subsequently sent or delivered to the holder of the licence that originally sold or distributed the cannabis products to or for the client; or
  • (b) in the case of a cannabis accessory that contains cannabis, they are unable to ascertain the information.

Retention period

(3) The document must be retained for at least two years after the day on which it is prepared.

Former health care practitioner

332 If an individual ceases to be a health care practitioner, they must, in respect of any document that they were required to retain under this Part and for which the retention period has not yet ended,

  • (a) ensure that the document continues to be retained until the end of the retention period; and
  • (b) notify the Minister, in writing, of the address of the place of business at which the document is retained and of any subsequent change to the address.

Disclosure to licensing authority

333 The Minister must disclose, in writing, factual information about a health care practitioner — in relation to cannabis — that has been obtained under the Act or the Controlled Drugs and Substances Act to

  • (a) the provincial professional licensing authority for a province in which the health care practitioner is, or was, entitled to practise if
    • (i) the licensing authority submits to the Minister a written request that sets out the health care practitioner’s name and address, a description of the information being requested and a statement that the information is required for the purpose of assisting an investigation by the authority,
    • (ii) the Minister has reasonable grounds to believe that the health care practitioner has contravened, in relation to cannabis, a rule of conduct established by the licensing authority,
    • (iii) the Minister becomes aware that the health care practitioner has been convicted of
      • (A) a designated offence,
      • (B) a controlled substance offence in relation to cannabis,
      • (C) a contravention of the former Access to Cannabis for Medical Purposes Regulations or the former Marihuana for Medical Purposes Regulations, or
      • (D) a contravention of the Narcotic Control Regulations in relation to cannabis, or
    • (iv) the Minister has reasonable grounds to believe that the health care practitioner has contravened this Part or the former Access to Cannabis for Medical Purposes Regulations, the former Marihuana for Medical Purposes Regulations or — in relation to cannabis — the Narcotic Control Regulations; and
  • (b) the provincial professional licensing authority for a province in which the health care practitioner is not entitled to practise if the licensing authority submits to the Minister
    • (i) a written request that sets out the health care practitioner’s name and address and a description of the information being requested, and
    • (ii) a document that shows that
      • (A) the health care practitioner has applied to the licensing authority to practise in that province, or
      • (B) the licensing authority has reasonable grounds to believe that the health care practitioner is practising in that province without being authorized to do so.

Definition of health care practitioner

334 In sections 335 to 337, health care practitioner means

  • (a) an individual who is entitled under the laws of a province to practise medicine in that province; or
  • (b) an individual who meets the requirements of paragraph (a) of the definition nurse practitioner in subsection 264(1).

Notice from Minister

335 (1) The Minister must, in the circumstances set out in subsection (2), issue a notice to the persons and pharmacies specified in subsection (3) advising them, as applicable, that

  • (a) the holders of a licence for sale and the holders of a licence for processing that receive the notice must not send cannabis products to the health care practitioner who is named in the notice;
  • (b) any medical document that is signed by the health care practitioner who is named in the notice must not form the basis for registering a client if the medical document is signed after the day on which the notice is issued; and
  • (c) pharmacists practising in the notified pharmacies must not distribute or sell cannabis products on the basis of a medical document signed by, or a written order issued by, the health care practitioner who is named in the notice if the medical document is signed, or the written order is issued, after the day on which the notice is issued.

Circumstances — mandatory issuance

(2) The notice must be issued if

  • (a) the health care practitioner who is named in the notice has asked the Minister, in writing, to issue it;
  • (b) the health care practitioner who is named in the notice has contravened, in relation to cannabis, a rule of conduct established by the provincial professional licensing authority for the province in which the health care practitioner is practising and the licensing authority has asked the Minister, in writing, to issue the notice;
  • (c) the health care practitioner who is named in the notice has been convicted of
    • (i) a designated offence,
    • (ii) a contravention of these Regulations,
    • (iii) a controlled substance offence in relation to cannabis,
    • (iv) a contravention of the former Access to Cannabis for Medical Purposes Regulations or the former Marihuana for Medical Purposes Regulations, or
    • (v) a contravention of the Narcotic Control Regulations in relation to cannabis; or
  • (d) the health care practitioner who is named in the notice has been named in a notice issued under subsection 189(2) or (4).

Recipients of notice

(3) A notice that is issued under this section must be issued to

  • (a) the health care practitioner who is named in the notice;
  • (b) all holders of a licence for sale and holders of a licence for processing;
  • (c) all hospital pharmacies in the province in which the health care practitioner who is named in the notice is entitled to practise and is practising;
  • (d) the provincial professional licensing authority for the province in which the health care practitioner who is named in the notice is entitled to practise; and
  • (e) on request, the provincial professional licensing authority for any province other than the province referred to in paragraph (d).

Power to issue notice

(4) The Minister may issue a notice referred to in subsection (1) if he or she has reasonable grounds to believe that the health care practitioner who is named in the notice

  • (a) has conducted an activity referred to in section 272 other than in accordance with that section;
  • (b) has provided a medical document, or issued a written order, that contains false or misleading information;
  • (c) has, on more than one occasion, provided themselves with a medical document or issued a written order for themselves, contrary to accepted medical practice;
  • (d) has, on more than one occasion, conducted an activity referred to in section 272 in respect of their spouse, common-law partner, parent or child, including a child adopted in fact, contrary to accepted medical practice; or
  • (e) is unable to account for a quantity of cannabis for which they were responsible under this Part, the Narcotic Control Regulations or the former Access to Cannabis for Medical Purposes Regulations.

Preconditions

(5) Before issuing a notice under subsection (4), the Minister must

  • (a) consult with the provincial professional licensing authority for the province in which the health care practitioner to whom the notice relates is entitled to practise;
  • (b) send to the health care practitioner a written notice that sets out the reasons why a notice is being considered and give him or her an opportunity to present reasons why the notice should not be issued; and
  • (c) consider
    • (i) any reasons that have been presented by the health care practitioner under paragraph (b),
    • (ii) the compliance history of the health care practitioner in respect of the Act, the Controlled Drugs and Substances Act and the regulations made or continued under either Act, and
    • (iii) whether the actions of the health care practitioner pose a significant risk to public health or public safety, including the risk of cannabis being diverted to an illicit market or activity.

Retraction of notice

336 (1) The Minister must retract a notice that was issued under section 335 if

  • (a) the health care practitioner who is named in the notice has requested in writing that it be retracted;
  • (b) the health care practitioner has provided a letter from the provincial professional licensing authority for the province in which the health care practitioner is entitled to practise that states that the authority consents to the retraction of the notice;
  • (c) in the case where the notice was issued at the request of the health care practitioner, one year has elapsed since the notice was issued; and
  • (d) in the case where the notice was issued in the circumstance referred to in paragraph 335(2)(d), the notice that was issued under subsection 189(2) or (4) has been retracted under subsection 190(1).

Requirement to notify

(2) If the Minister retracts a notice issued under section 335, he or she must notify, in writing, the persons and pharmacies to which it was issued.

Pharmacists

Prohibitions — notified pharmacies

337 (1) A pharmacist who is practising in a pharmacy that has received a notice issued under section 335 must not distribute or sell cannabis products on the basis of a medical document signed, or a written order issued, by the health care practitioner who is named in the notice unless the medical document is signed, or the written order is issued, before the day on which the notice is issued.

Prohibition — pharmacist named in notice

(2) A pharmacist who is practising in a pharmacy that has received a notice issued under section 344 must not distribute or sell cannabis products to the pharmacist who is named in the notice.

Effect of retraction

(3) The prohibitions referred to in subsections (1) and (2) cease to apply if the notice is retracted.

Prohibition — dispensing

338 A pharmacist must not use an order — including a written order — to dispense a cannabis product if the quantity of cannabis that would be dispensed, when added to the quantity of cannabis that has already been dispensed under the order, would exceed the quantity of cannabis specified in the order.

Hospital pharmacists

339 (1) Subject to section 337, a pharmacist who is practising in a hospital may, if authorized by the individual in charge of the hospital,

  • (a) distribute, sell or return, in accordance with paragraph 348(2)(b) or subsection 348(4) or (7), cannabis products, other than cannabis plants or cannabis plant seeds, that have been received from a holder of a licence for sale or a holder of a licence for processing; or
  • (b) distribute — but not send — or sell cannabis products, other than cannabis plants or cannabis plant seeds, to an employee of the hospital or a health care practitioner practising in the hospital, on receipt of an order, in writing, that has been signed and dated by
    • (i) the pharmacist in charge of the hospital’s pharmacy, or
    • (ii) a health care practitioner who is authorized by the individual in charge of the hospital to sign the order.

Verification of signature

(2) Before distributing or selling cannabis products under paragraph (1)(b), the pharmacist receiving the order must verify the signature on the order, if it is unknown to them.

Prohibition

(3) A pharmacist must not conduct the activities referred to in subsection (1) if the pharmacist has been named in a notice that has been issued under section 344 and that has not been retracted.

Definition of distribute

(4) In this section, distribute does not include administering.

Retention of documents

340 (1) A pharmacist who receives cannabis products from a person must retain a document that contains the following information:

  • (a) the quantity of cannabis that is received;
  • (b) a description of the cannabis products, including their brand names;
  • (c) the date on which the cannabis products are received; and
  • (d) the name and mailing address of the person from which the cannabis products are received.

Sale or distribution

(2) A pharmacist who distributes or sells cannabis products on the basis of a medical document or written order must retain a document that contains the following information:

  • (a) the pharmacist’s name or initials;
  • (b) the name, initials and address of the health care practitioner who provided the medical document or issued the written order;
  • (c) the name and mailing address of the individual for whom the cannabis products are distributed or sold;
  • (d) the quantity of cannabis that is distributed or sold;
  • (e) a description of the cannabis products, including their brand names;
  • (f) the date on which the cannabis products are distributed or sold; and
  • (g) the number that the pharmacist has assigned to the medical document or written order.

Emergency transfer

(3) A pharmacist who distributes or sells cannabis products for emergency purposes on the basis of an order made in accordance with subsection 348(4) must retain a document that contains the following information:

  • (a) the name and address of the pharmacist or health care practitioner who signed the order;
  • (b) the name and address of the individual to whom the cannabis products are distributed or sold;
  • (c) the quantity of cannabis that is distributed or sold;
  • (d) a description of the cannabis products, including their brand names; and
  • (e) the date on which the cannabis products are distributed or sold.

Return of cannabis products

(4) A pharmacist who returns cannabis products must retain a document that contains the following information:

  • (a) the name and address of the person to which the cannabis products are returned;
  • (b) the quantity of cannabis that is returned;
  • (c) a description of the cannabis products, including their brand names; and
  • (d) the date on which the cannabis products are returned.

Retention period

(5) The documents must be retained for at least two years after the day on which they are prepared.

Former pharmacists

341 If an individual ceases to be a pharmacist, they must, in respect of any document that they were required to retain under this Part and for which the retention period has not yet ended,

  • (a) ensure that the document continues to be retained until the end of the retention period; and
  • (b) notify the Minister, in writing, of the address of the place of business at which the document is retained and of any subsequent change to the address.

Security of cannabis products

342 The pharmacist in charge of a hospital’s pharmacy must, in respect of cannabis products that are on the pharmacy premises or for which the pharmacist is responsible,

  • (a) take reasonable steps to protect them from theft or loss; and
  • (b) report any theft or loss to the Minister within 10 days after becoming aware of the theft or loss.

Disclosure to licensing authority

343 The Minister must disclose, in writing, factual information about a pharmacist — in relation to cannabis — that has been obtained under the Act or the Controlled Drugs and Substances Act to

  • (a) the provincial professional licensing authority for a province in which the pharmacist is, or was, entitled to practise if
    • (i) the licensing authority submits to the Minister a written request that sets out the pharmacist’s name and address, a description of the information being requested and a statement that the information is required for the purpose of assisting an investigation by the authority,
    • (ii) the Minister has reasonable grounds to believe that the pharmacist has contravened, in relation to cannabis, a rule of conduct established by the licensing authority,
    • (iii) the Minister becomes aware that the pharmacist has been convicted of
      • (A) a designated offence,
      • (B) a controlled substance offence in relation to cannabis,
      • (C) a contravention of the former Access to Cannabis for Medical Purposes Regulations, or
      • (D) a contravention of the Narcotic Control Regulations in relation to cannabis, or
    • (iv) the Minister has reasonable grounds to believe that the pharmacist has contravened these Regulations, the former Access to Cannabis for Medical Purposes Regulations or — in relation to cannabis — the Narcotic Control Regulations; and
  • (b) the provincial professional licensing authority for a province in which the pharmacist is not entitled to practise if the licensing authority submits to the Minister
    • (i) a written request that sets out the pharmacist’s name and address and a description of the information being requested, and
    • (ii) a document that shows that
      • (A) the pharmacist has applied to the licensing authority to practise in that province, or
      • (B) the licensing authority has reasonable grounds to believe that the pharmacist is practising in that province without being authorized to do so.

Notice from Minister

344 (1) The Minister must, in the circumstances set out in subsection (2), issue a notice to the following persons and pharmacies advising them that holders of a licence for sale, holders of a licence for processing and pharmacists practising in the notified pharmacies must not distribute or sell cannabis products to the pharmacist who is named in the notice:

  • (a) the pharmacist who is named in the notice;
  • (b) all holders of a licence for sale and all holders of a licence for processing;
  • (c) all hospital pharmacies in the province in which the pharmacist who is named in the notice is entitled to practise and is practising;
  • (d) the provincial professional licensing authority for the province in which the pharmacist who is named in the notice is entitled to practise; and
  • (e) on request, the provincial professional licensing authority for any province other than the province referred to in paragraph (d).

Circumstances — mandatory issuance

(2) The notice must be issued if

  • (a) the pharmacist who is named in the notice asks the Minister, in writing, to issue the notice;
  • (b) the pharmacist who is named in the notice has contravened, in relation to cannabis, a rule of conduct established by the provincial professional licensing authority for the province in which the pharmacist is practising and the licensing authority has asked the Minister, in writing, to issue the notice;
  • (c) the pharmacist who is named in the notice has been convicted of an offence referred to in subparagraph 343(a)(iii); or
  • (d) the pharmacist who is named in the notice has been named in a notice issued under subsection 181(2) or (4).

Power to issue notice

(3) The Minister may issue a notice referred to in subsection (1) if he or she has reasonable grounds to believe that the pharmacist who is named in the notice

  • (a) has conducted an activity referred to in section 339 other than in accordance with that section;
  • (b) has, on more than one occasion, distributed or sold a cannabis product to their spouse, common-law partner, parent or child, including a child adopted in fact, contrary to accepted pharmaceutical practice; or
  • (c) is unable to account for a quantity of cannabis products for which they were responsible under this Part, the Narcotic Control Regulations or the former Access to Cannabis for Medical Purposes Regulations.

Preconditions

(4) Before issuing a notice under subsection (3), the Minister must

  • (a) consult with the provincial professional licensing authority for the province in which the pharmacist to whom the notice relates is entitled to practise;
  • (b) send to the pharmacist a written notice that sets out the reasons why a notice is being considered and give him or her an opportunity to present reasons why the notice should not be issued; and
  • (c) consider
    • (i) any reasons that have been presented by the pharmacist under paragraph (b),
    • (ii) the compliance history of the pharmacist in respect of the Act, the Controlled Drugs and Substances Act and the regulations made or continued under either Act, and
    • (iii) whether the actions of the pharmacist pose a significant risk to public health or public safety, including the risk of cannabis being diverted to an illicit market or activity.

Retraction of notice

345 (1) The Minister must retract a notice that was issued under section 344 if

  • (a) the pharmacist who is named in the notice has requested in writing that it be retracted;
  • (b) the pharmacist has provided a letter from the provincial professional licensing authority for the province in which the pharmacist is entitled to practise that states that the authority consents to the retraction of the notice;
  • (c) in the case where the notice was issued at the request of the pharmacist, one year has elapsed since the notice was issued; and
  • (d) in the case where the notice was issued in the circumstance referred to in paragraph 344(2)(d), the notice that was issued under subsection 181(2) or (4) has been retracted under subsection 182(1).

Requirement to notify

(2) If the Minister retracts a notice issued under section 344, he or she must notify, in writing, the persons and pharmacies to which it was issued.

Hospitals

Definition of distribute

346 In sections 347, 348, 350 and 351, distribute does not include administering.

Security of cannabis products

347 An individual in charge of a hospital must, in respect of cannabis products that they permit to be administered, distributed or sold,

  • (a) take reasonable steps to protect them from theft or loss; and
  • (b) report any theft or loss to the Minister within 10 days after becoming aware of the theft or loss.

Administration, distribution and sale

348 (1) An individual in charge of a hospital must not permit cannabis products to be administered, distributed or sold, except in accordance with this section.

Hospital patients

(2) An individual in charge of a hospital may permit cannabis products, other than cannabis plants and cannabis plant seeds, received from a holder of a licence for sale or a holder of a licence for processing to be

  • (a) administered, on receipt of a medical document or written order, to an inpatient or outpatient of the hospital; or
  • (b) distributed — but not sent — or sold, on receipt of a medical document or written order, to an individual referred to in paragraph (a) or an adult who is responsible for them.

Requirements — distribution or sale

(3) An individual in charge of a hospital must, if they permit cannabis products to be distributed or sold under paragraph (2)(b), ensure that

  • (a) the quantity of cannabis that is distributed or sold does not exceed the equivalent of the lesser of
    • (i) 30 times the daily quantity of dried cannabis that is specified in the medical document or written order, and
    • (ii) 150 g of dried cannabis;
  • (b) the cannabis products are distributed or sold in the container in which they were received from the holder of the licence for sale or the holder of the licence for processing;
  • (c) a label is applied to the container in which the cannabis products were received indicating
    • (i) the given name, surname and profession of the health care practitioner who signed the medical document or written order,
    • (ii) the given name and surname of the patient,
    • (iii) the daily quantity of dried cannabis that is specified in the medical document or written order, and
    • (iv) the date on which the cannabis products are distributed or sold;
  • (d) the patient or responsible adult is provided with the current version of the document entitled Consumer Information — Cannabis, published by the Government of Canada on its website; and
  • (e) the patient or responsible adult is provided with a separate document containing the information referred to in paragraph (c).

Emergency purposes

(4) An individual in charge of a hospital may permit cannabis products, other than cannabis plants and cannabis plant seeds, received from a holder of a licence for sale or a holder of a licence for processing to be distributed or sold for emergency purposes to an employee of or a health care practitioner in another hospital on receipt of an order, in writing, that has been signed and dated by a pharmacist in the other hospital or a health care practitioner who is authorized by the individual in charge of the other hospital to order cannabis products.

Verification of signature

(5) An individual in charge of a hospital must not permit cannabis products to be distributed or sold under subsection (4) unless the signature on the order has been verified by the individual who distributes or sells the cannabis products, if it is unknown to them.

Distribution for research purposes

(6) An individual in charge of a hospital may permit cannabis products, other than cannabis plants and cannabis plant seeds, to be distributed for research purposes to an individual who is employed in a research laboratory in the hospital and who holds a licence for those purposes.

Return or destruction

(7) An individual in charge of a hospital may permit cannabis products to be

  • (a) returned to the holder of the licence for sale or the holder of the licence for processing from which the cannabis products were received, on receipt of a written request for the cannabis products that has been signed and dated by, or on behalf of, the holder; or
  • (b) distributed or sold, for destruction, to a holder of a licence for sale, or a holder of a licence for processing, that is authorized to destroy cannabis that they did not produce, sell or distribute, on receipt of a written request for the cannabis products that has been signed and dated by, or on behalf of, the holder.

Possession — hospital employees

349 A hospital employee is authorized to possess cannabis products, other than cannabis plants or cannabis plant seeds, if

  • (a) the cannabis products have been obtained in accordance with section 348 or 350; and
  • (b) the employee requires the cannabis products for the purposes of, and in connection with, their employment.

Return and replacement

350 (1) An individual to whom cannabis products are distributed or sold under paragraph 348(2)(b) may return them to a hospital employee who is authorized to distribute or sell cannabis products if the employee accepts the return.

Return of more than 30 g

(2) The individual returning the cannabis products must comply with the requirements set out in subsection 292(4) if they are returning more than the equivalent of 30 g of dried cannabis and are sending the cannabis products or having them delivered to the hospital.

Replacement of cannabis products

(3) The individual in charge of the hospital may, subject to the limit referred to in paragraph 348(3)(a), permit cannabis products that have been returned to be replaced.

Retention of documents

351 (1) An individual who is in charge of a hospital must ensure that documents that contain the following information are retained:

  • (a) in respect of cannabis products that are received at the hospital,
    • (i) the class of cannabis set out in Schedule 4 to the Act to which the cannabis products belong and their brand names,
    • (ii) the quantity of cannabis that is received,
    • (iii) the name and address of the person from which the cannabis products are received, and
    • (iv) the date on which the cannabis products are received;
  • (b) in respect of cannabis products that are distributed or sold for a patient,
    • (i) the given name and surname of the patient,
    • (ii) the given name, surname and profession of the health care practitioner who signed the relevant medical document or written order, together with the date on which it was signed,
    • (iii) the daily quantity of dried cannabis that is specified in the medical document or written order referred to in subparagraph (ii) and, if applicable, the period of use that is specified,
    • (iv) the class of cannabis set out in Schedule 4 to the Act to which the cannabis products belong,
    • (v) the quantity of cannabis that is distributed or sold, and
    • (vi) the date on which the cannabis products are distributed or sold; and
  • (c) in respect of cannabis products that are distributed or sold to a person that is authorized to sell or distribute such products — other than an adult referred to in paragraph 266(1)(d) or (e) — or that are returned under subsection 348(7),
    • (i) the name of the person to which the cannabis products are distributed, sold or returned,
    • (ii) the date on which the cannabis products are distributed, sold or returned,
    • (iii) the quantity of cannabis that is distributed, sold or returned,
    • (iv) the brand names of the cannabis products, and
    • (v) in the case of cannabis products that are distributed, sold or returned under subsection 348(7), the address of the person to which they are distributed, sold or returned.

Retention period

(2) The individual in charge of the hospital must ensure that the documents are retained for at least two years after the day on which they are prepared.

Cessation of operations — hospital

352 If a hospital ceases operations, the individual who was in charge of the hospital must, in respect of any document that they were required to retain under this Part and for which the retention period has not yet ended,

  • (a) ensure that the document continues to be retained until the end of the retention period; and
  • (b) notify the Minister, in writing, of the address of the place of business at which the document is retained and of any subsequent change to the address.
Nurses

Disclosure to nursing statutory body

353 (1) The Minister must disclose, in writing, factual information about a nurse — in relation to cannabis — that has been obtained under the Act or the Controlled Drugs and Substances Act to

  • (a) the nursing statutory body for a province in which the nurse is, or was, entitled to practise if
    • (i) the nursing statutory body submits to the Minister a written request that sets out the nurse’s name and address, a description of the information being requested and a statement that the information is required for the purpose of assisting an investigation by the body,
    • (ii) the Minister has reasonable grounds to believe that the nurse has contravened, in relation to cannabis, a rule of conduct established by the nursing statutory body,
    • (iii) the Minister becomes aware that the nurse has been convicted of
      • (A) a designated offence,
      • (B) a controlled substance offence in relation to cannabis,
      • (C) a contravention of the former Access to Cannabis for Medical Purposes Regulations or the former Marihuana for Medical Purposes Regulations, or
      • (D) a contravention of the Narcotic Control Regulations in relation to cannabis, or
    • (iv) the Minister has reasonable grounds to believe that the nurse has contravened this Part, the former Access to Cannabis for Medical Purposes Regulations, the former Marihuana for Medical Purposes Regulations or — in relation to cannabis — the Narcotic Control Regulations; and
  • (b) the nursing statutory body for a province in which the nurse is not entitled to practise if the nursing statutory body submits to the Minister
    • (i) a written request that sets out the nurse’s name and address and a description of the information being requested, and
    • (ii) a document that shows that
      • (A) the nurse has applied to the nursing statutory body to practise in that province, or
      • (B) the nursing statutory body has reasonable grounds to believe that the nurse is practising in that province without being authorized to do so.

Definitions

(2) The following definitions apply in this section.

nurse means an individual — other than a nurse practitioner — who is authorized by a nursing statutory body to practise nursing. (infirmier)

nursing statutory body means the authority that is responsible for authorizing individuals to practise nursing in a province. (organisme régissant la profession d’infirmier)

PART 15

Transitional Provisions

Licences — former Access to Cannabis for Medical Purposes Regulations

354 A licence issued under the former Access to Cannabis for Medical Purposes Regulations, as set out in column 1 of the table to this section, is deemed to be a licence of the class set out in column 2, and one of the licences of the subclass set out in column 3 if the holder of the licence meets the requirements, if any, in that column for that subclass.

TABLE

Item Column 1

Licence issued under section 35 of the former Access to Cannabis for Medical Purposes Regulations

Column 2

Class of licence

Column 3

Subclass of licence and requirements

1 Licence authorizing the production of fresh or dried marihuana, or marihuana plants or seeds Licence for cultivation Licence for standard cultivation if the requirements in Division 1 of Part 4 are met
Licence for micro-cultivation if the requirements in sections 13 and 74 are met
Licence for a nursery if the requirements in sections 16 and 74 are met
2 Licence authorizing the production of cannabis oil or cannabis resin Licence for processing Licence for standard processing if the requirements in Division 1 of Part 4 are met
Licence for micro-processing if the requirements in sections 21 and 74 are met
3 Licence authorizing the activities referred to in subsection 22(4) or (5) of the former Access to Cannabis for Medical Purposes Regulations Licence for sale Licence for sale for medical purposes

Licences — Narcotic Control Regulations

355 (1) A licence issued under the Narcotic Control Regulations as they read immediately before the day on which these Regulations come into force, as set out in column 1 of the table to this section, is deemed to be a licence of the class set out in column 2 and, if applicable, one of the licences of the subclass set out in column 3 if the holder of the licence meets the requirements in that column and, despite subsections 159(1) and (4) of the Act, continues in force until December 31, 2019, unless it is revoked before that date.

Licences not set out in table

(2) A licence issued under section 9.2 of the Narcotic Control Regulations, as they read immediately before the day on which these Regulations come into force, that is not set out in column 1 of the table to this section is deemed to be a licence for processing.

Sale

(3) The holder of a licence referred to in subsection (2) is not authorized to sell cannabis to any person unless they are authorized to do so as a condition of their licence.

TABLE

Item Column 1

Licence issued under the Narcotic Control Regulations as they read immediately before the day on which these Regulations come into force

Column 2

Class of licence

Column 3

Subclass of licence and requirements

1 Licence issued under section 9.2 authorizing the cultivation of marihuana for scientific purposes Licence for research
2 Licence issued under section 9.2 authorizing the obtaining of extracts from samples of cannabis for the analysis of cannabinoids Licence for analytical testing
3 Licence issued under section 9.2 authorizing the production, making or assembly of a test kit containing cannabis Licence for processing Licence for standard processing if the requirements in Division 1 of Part 4 are met
Licence for micro-processing if the requirements in sections 21 and 74 are met
4 Licence issued under section 9.2 authorizing the production of cannabis for the purpose of conducting testing to determine its chemical characterization Licence for processing Licence for standard processing if the requirements in Division 1 of Part 4 are met
Licence for micro-processing if the requirements in sections 21 and 74 are met
5 Licence issued under section 9.2 authorizing the possession, sale or distribution of a drug containing cannabis Cannabis drug licence
6 Licence issued under section 67 authorizing the cultivation, gathering or production of cannabis for scientific purposes Licence for research

Non-application — sections 12, 15, 23 and 38

356 (1) For a three-month period that begins on the day on which these Regulations come into force, sections 12, 15, 23 and 38 do not apply to a holder of a licence set out in column 3 of the table to section 354 or in items 1 to 4 and 6, column 2, of the table to section 355.

Name of individuals to Minister

(2) The holder of the licence must, within that period, provide the Minister with the names of the individuals who will be designated for the positions referred to in section 12, 15, 23 or 38, as the case may be.

Quality assurance person

357 Every quality assurance person designated under paragraph 75(1)(a) of the former Access to Cannabis for Medical Purposes Regulations by the holder of a licence set out in column 1 of the table to section 354 is deemed to be a quality assurance person under subsection 19(1).

Senior person in charge

358 Every senior person in charge designated under paragraph 32(1)(a) of the former Access to Cannabis for Medical Purposes Regulations by the holder of a licence set out in column 1 of the table to section 354 is deemed to be a responsible person under subsection 37(1).

Security clearance

359 (1) A holder of a licence set out in column 3 of the table to section 354 or in column 2 of the table to section 355 must, within three months after the day on which these Regulations come into force,

  • (a) provide the Minister with the name and position of any individual who does not hold a security clearance, but is required to do so under section 50; and
  • (b) ensure that any individual referred to in paragraph (a) submits an application for a security clearance.

Non-application — section 50

(2) An individual referred to in paragraph (1)(a) who is not ineligible to apply for a security clearance by virtue of section 61 is not required to comply with section 50 until the occurrence of one of the following events:

  • (a) the three-month period that begins on the day on which these Regulations come into force expires without the individual having submitted an application for a security clearance;
  • (b) the Minister grants a security clearance to the individual;
  • (c) the individual is notified under subsection 55(2) that the Minister has refused to grant the security clearance; or
  • (d) the individual withdraws their application for the security clearance before the Minister makes a decision in respect of it.

Packaging and labelling

360 For a six-month period that begins on the day on which these Regulations come into force, section 106 does not apply to a holder of a licence for sale for medical purposes, as set out in item 3, column 3, of the table to section 354, that sells, sends or delivers a cannabis product under section 289 or 291, if the holder complies with sections 80 to 86 and sections 90 and 91 of the former Access to Cannabis for Medical Purposes Regulations and the sale of that cannabis product would have been permitted under those Regulations.

Individual in charge of premises

361 (1) Every individual in charge of the premises to which a licence that is referred to in item 5, column 1, of the table to section 355 applies is deemed to be a senior person in charge under section 149.

Qualified person in charge

(2) Every qualified person in charge designated under paragraph 8.3(1)(a) of the Narcotic Control Regulations, as they read immediately before the day on which these Regulations come into force, by a holder of a licence referred to in item 5, column 1, of the table to section 355 is deemed to be the qualified person in charge under subsection 150(1).

Alternate qualified person in charge

(3) Every alternate qualified person in charge designated under to paragraph 8.3(1)(b) of the Narcotic Control Regulations, as they read immediately before the day on which these Regulations come into force, by a holder of a licence referred to in item 5, column 1, of the table to section 355 is deemed to be an alternate qualified person in charge under subsection 150(2).

Registration document

362 For a six-month period that begins on the day on which these Regulations come into force, paragraph 282(2)(a) does not apply to a holder of a licence for sale for medical purposes, as set out in item 3, column 3, of the table to section 354, that registers an applicant as a client, if the holder complies with section 87 and paragraph 133(2)(a) of the former Access to Cannabis for Medical Purposes Regulations.

Exemptions — Controlled Drugs and Substances Act

363 Despite subsection 156(1) of the Act, an exemption referred to in that subsection that expires before December 31, 2018 continues in force until December 31, 2018, unless it is revoked before that date.

Retention — Controlled Drugs and Substances Act

364 A person referred to in section 157 of the Act must

  • (a) ensure that any record, report, electronic data or other document referred to in that section is retained until the end of the applicable retention period imposed under the Controlled Drugs and Substances Act; and
  • (b) if the person is or was the holder of a licence that was issued under the Controlled Drugs and Substances Act, notify the Minister, in writing, of any change to the address of the location at which the document is retained.

Extension of time for compliance

365 For the purposes of subsection 241(1), the information that the holder of a licence that is deemed by section 354 or 355 to be a licence for cultivation, processing or sale would otherwise be required to include in the record referred to in that subsection in the first 90 days after the day on which these Regulations come into force is not required to be included until the 91st day after that day.

PART 16

Consequential Amendments and Coming into Force

Consequential Amendments
Food and Drug Regulations

366 Subsection C.01.048(1) of the Food and Drug Regulations footnote1 is replaced by the following:

C.01.048 (1) If a physician, dentist, veterinary surgeon or pharmacist registered and entitled to practise their profession in a province has signed an order specifying the proper name or common name, the brand name and the quantity of a drug, other than the following, the person who receives the order may distribute the drug as a sample to the physician, dentist, veterinary surgeon or pharmacist if the drug is labelled in accordance with these Regulations:

  • (a) narcotic as defined in the Narcotic Control Regulations;
  • (b) controlled drug as defined in subsection G.01.001(1);
  • (c) a new drug in respect of which a notice of compliance has not been issued under section C.08.004; or
  • (d) prescription drug as defined in subsection 1(2) of the Cannabis Regulations.

367 The definition wholesaler in subsection C.01A.001(1) of the Regulations is amended by striking out “or” at the end of paragraph (b), by adding “or” at the end of paragraph (c) and by adding the following after paragraph (c):

  • (d) a drug containing cannabis as defined in subsection 2(1) of the Cannabis Act. (grossiste)

368 Subsection C.01A.004(3) of the Regulations is replaced by the following:

(3) No person shall carry on an activity referred to in subsection (1) unless the person holds

  • (a) in respect of a narcotic as defined in the Narcotic Control Regulations, a licence for that narcotic under those Regulations;
  • (b) in respect of a controlled drug as defined in subsection G.01.001(1), a licence for that drug under Part G; or
  • (c) in respect of a drug containing cannabis as defined in subsection 2(1) of the Cannabis Act, a licence for that drug to conduct that activity under the Cannabis Regulations.

369 Subparagraph C.01A.005(j)(i) of the Regulations is replaced by the following:

  • (i) for each narcotic as defined in the Narcotic Control Regulations, each controlled drug as defined in subsection G.01.001(1) or each drug containing cannabis as defined in subsection 2(1) of the Cannabis Act for which the licence is requested, and

370 Item 6 of Table II to section C.01A.008 of the Regulations is replaced by the following:

Item Categories of drugs
6 Drugs that are prescription drugs, controlled drugs as defined in subsection G.01.001(1), narcotics as defined in the Narcotic Control Regulations and drugs containing cannabis as defined in subsection 2(1) of the Cannabis Act
Medical Devices Regulations

371 Subsection 3(2) of the Medical Devices Regulations footnote2 is replaced by the following:

(2) Subsection (1) does not apply to a drug, as defined in subsection 1(2) of the Cannabis Regulations, containing cannabis, as defined in subsection 2(1) of the Cannabis Act, or a drug listed in Schedule E or F to the Act, in the schedule to Part G or J of the Food and Drug Regulations, in the schedules to the Controlled Drugs and Substances Act or in the schedule to the Narcotic Control Regulations.

Natural Health Products Regulations

372 Schedule 2 to the Natural Health Products Regulations footnote3 is amended by adding the following after item 6:

Item Substances
7 Cannabis as defined in subsection 2(1) of the Cannabis Act, except for a derivative or a product made from a derivative that is exempt from the application of the Cannabis Act under the Industrial Hemp Regulations and that does not contain an isolated or concentrated phytocannabinoid or a synthetic duplicate of that phytocannabinoid
8 Anything referred to in Schedule 2 to the Cannabis Act that contains more than 10 μg/g THC, an isolated or concentrated phytocannabinoid or a synthetic duplicate of that phytocannabinoid
Cannabis Exemption (Food and Drugs Act) Regulations

373 Sections 1 to 3 of the Cannabis Exemption (Food and Drugs Act) Regulations footnote4 are replaced by the following:

Exemption

Cannabis, as defined in subsection 2(1) of the Cannabis Act and in relation to which an activity is conducted in accordance with the Cannabis Act, is exempt from the application of the Food and Drugs Act, unless the cannabis

  • (a) is manufactured, sold or represented for use in the diagnosis, treatment, mitigation or prevention of a disease, disorder or abnormal physical state, or its symptoms, or in restoring or correcting organic functions, in human beings or animals;
  • (b) is represented for use in modifying organic functions in human beings or animals;
  • (c) is manufactured, sold or represented for use in disinfection in premises in which food is manufactured, prepared or kept;
  • (d) is an active pharmaceutical ingredient as defined in subsection C.01A.001(1) of the Food and Drug Regulations;
  • (e) is a food or a cosmetic that does not contain cannabis other than a derivative, or a product made from that derivative, that is exempt from the application of the Cannabis Act under the Industrial Hemp Regulations; or
  • (f) is sold to be used for the purpose of a clinical trial, as defined in section C.05.001 of the Food and Drug Regulations, or an experimental study, as defined in section C.08.013 of those Regulations.

Cannabis for medical purposes

Despite paragraph 1(a), cannabis that is manufactured or sold in accordance with the Cannabis Regulations is exempt from the application of the Food and Drugs Act from the time it is manufactured or sold by any of the following persons, unless it is represented for a use referred to in that paragraph:

  • (a) a person to which a licence, other than a cannabis drug licence, was issued under subsection 62(1) of the Cannabis Act; and
  • (b) designated person as defined in Part 14 of the Cannabis Regulations.
Cannabis Regulations

374 Subsection 4(4) of the Cannabis Regulations footnote5 is replaced by the following:

Authorized activities — accredited laboratory

(4) Individuals who are involved in the testing of cannabis as a requirement of their duties at a laboratory that is designated as an accredited laboratory under section 2.1 of the Seeds Act are authorized to conduct the activities referred to in paragraphs (1)(a) and (c), and to offer to conduct the activity referred to in paragraph (1)(c), to the extent necessary to conduct the testing.

Coming into Force

S.C. 2018, c. 16

375 (1) Subject to subsections (2) to (4), these Regulations come into force on the day on which subsection 204(1) of the Cannabis Act comes into force, but if they are registered after that day, they come into force on the day on which they are registered.

Bill C-74

(2) If Bill C-74, introduced in the 1st session of the 42nd Parliament and entitled Budget Implementation Act, 2018, No. 1, has not received royal assent on the day on which these Regulations are in force, then paragraphs 29(b), 30(c), 31(d), 155(c), 156(b) and 157(d) of these Regulations come into force on the day on which Bill C-74 receives royal assent.

Six months after registration

(3) Section 102 comes into force on the day that, in the sixth month after the month in which these Regulations are registered, has the same calendar number as the day on which they are registered or, if that sixth month has no day with that number, the last day of that sixth month.

S.C. 2012, c. 24

(4) Section 374 comes into force on the day on which section 90 of the Safe Food for Canadians Act comes into force.

REGULATORY IMPACT ANALYSIS STATEMENT

(This statement is not part of the regulations.)

Executive summary

Issues: In the 2015 Speech from the Throne, the Government of Canada committed to legalizing, strictly regulating, and restricting access to cannabis. Based in large part on the expert advice provided by the Task Force on Cannabis Legalization and Regulation (the Task Force), the Act respecting cannabis and to amend the Controlled Drugs and Substances Act, the Criminal Code and other Acts (the Cannabis Act) creates the foundation for a comprehensive national framework to provide restricted access to regulated cannabis, and to control its production, distribution, sale, importation, exportation, and possession. Following parliamentary review, the Cannabis Act received royal assent on June 21, 2018. A robust regulatory framework is needed to support the implementation of the Cannabis Act and to appropriately address the public health and public safety risks associated with cannabis.

Description: In general, the regulatory framework will establish the rules and standards that will apply to the authorized production, distribution, sale, importation and exportation of cannabis, as well as other related activities respecting the classes of cannabis (i.e. dried cannabis, fresh cannabis, cannabis oil, cannabis plants, and cannabis seeds) that will be permitted to be sold by a person authorized under the Cannabis Act when the Act and its regulations come into force. In order to continue to provide patients with reasonable access to cannabis for medical purposes, the Cannabis Regulations will substantively incorporate the regulatory framework of the Access to Cannabis for Medical Purposes Regulations (ACMPR). The medical access framework will remain substantively the same as it currently exists, with certain changes made to create consistency with rules for non-medical use, improve patient access, and reduce the risk of abuse of the system.

Regulations pertaining to cannabis that currently exist under the Controlled Drugs and Substances Act (CDSA) (i.e. the ACMPR and the Industrial Hemp Regulations) will be repealed. The Cannabis Regulations will be made pursuant to subsection 30(1) of the Food and Drugs Act, subsection 55(1) of the Controlled Drugs and Substances Act and subsection 139(1) and section 161 of the Cannabis Act. The new Industrial Hemp Regulations (IHR 2018), and the Qualifications for Designation as Analyst Regulations (Cannabis) will be made under the authority of subsection 139(1) of the Cannabis Act. Amendments to the Narcotic Control Regulations and the New Classes of Practitioners Regulations under the CDSA will also be made to remove references to cannabis.

As cannabis will continue to meet the definition of a drug under the Food and Drugs Act (FDA), regulatory amendments will coordinate the application of the FDA, the Cannabis Act, and both of the statutes’ regulations, to ensure that health products containing cannabis that fall under the FDA can continue to be developed and sold subject to the appropriate rules and requirements in a manner that practically maintains the status quo with respect to these products. More specifically, the Medical Devices Regulations, the Natural Health Products Regulations (NHPR), the Cannabis Exemption (Food and Drugs Act) Regulations and the Food and Drug Regulations will be amended.

Cost-benefit statement: The findings of a costbenefit analysis demonstrate that the new Cannabis Act regulatory framework is expected to create a net benefit to Canadians. The anticipated benefit is $9.1 billion in net present value (PV) over 10 years. The nonquantifiable benefits of the proposal are anticipated to be significant, creating a strong regulatory foundation for the protection of public health and public safety in Canada following the coming into force of the Cannabis Act, as a legal, regulated non-medical cannabis industry is established. Over time, criminals and organized crime’s ability to benefit from activities with cannabis will be curtailed. It is also anticipated that the regulatory framework will reduce the appeal of cannabis products to youth and restrict their access to products while providing adults with access to qualitycontrolled cannabis products of known potency.

Most of the quantifiable benefits are expected to come from the new IHR 2018. The IHR 2018 are estimated to generate a net benefit of $9.9 billion, primarily as a result of authorizing the sale of the flowers, leaves and branches (whole plant) of industrial hemp plants. The Cannabis Regulations are estimated to result in a net cost of $107.2 million. These costs are associated with the regulatory requirements for, but not limited to, physical security, good production practices, packaging and labelling, as well as record keeping and reporting. Total costs to government for the administration of the Cannabis Regulations are estimated to be $636.3 million.

“One-for-One” Rule and small business lens: The incremental decrease in administrative cost for industry resulting from the repeal of existing regulations and the implementation of new regulations under the Cannabis Act is estimated at $2.1 million PV (or $299,905 annually) over a 10-year period (2012 dollars).

The needs of small businesses, which can play an important role in the displacement of the illegal cannabis market, have been considered throughout the development of the Cannabis Regulations. It is intended that new micro-scale licence classes will help enable a diverse, competitive legal industry comprised of both large and small players in regions across the country. Furthermore, as a significant majority of existing and new licence holders are small businesses, they are expected to benefit from additional flexibility. Licences issued under the Cannabis Act will be valid for a period of no more than five years as part of the planned implementation approach. This is anticipated to generate cost savings of approximately $38,000 PV to licence holders that have been identified as small businesses.

Domestic and international coordination and cooperation: There is no change from the status quo with respect to exports and imports of cannabis. Each importation or exportation of cannabis would require a permit issued by the Minister of Health. As set out in the Cannabis Act, import or export permits will only be available for medical or scientific purposes, or in respect of industrial hemp. As the non-medical use of cannabis is currently illegal at the national level in other Organisation for Economic Co-operation and Development member states, opportunities for regulatory alignment are highly limited. Nevertheless, given the scope of this national initiative, the regulatory framework has been informed by best practices and lessons learned from other jurisdictions, including a number of states of the United States (U.S.), which have legalized and regulated access to cannabis for non-medical purposes.

Given the overlap in responsibilities for providing access to quality-controlled cannabis to adults in Canada, provincial and territorial governments have been, and will continue to be, engaged extensively throughout the development and implementation of the Cannabis Regulations. Building on the advice provided by the Task Force, Health Canada has maintained regular and ongoing contact with provinces and territories as they have developed their legislative and regulatory frameworks for the safe and efficient distribution and sale of cannabis products.

Background

At present, cannabis is subject to both the Controlled Drugs and Substances Act (CDSA) and the Food and Drugs Act (FDA). The CDSA and its regulations set out Canada’s framework for the control of substances that can alter mental processes and can have significant negative impacts to the health and well-being of Canadians if used problematically or diverted to an illegal market. Under the CDSA, activities with cannabis are prohibited except as authorized under the regulations or through an exemption for medical or scientific purposes or if an exemption is otherwise in the public interest. Under the CDSA, the Access to Cannabis for Medical Purposes Regulations (ACMPR) set out a framework to provide individuals with access to cannabis for medical purposes and the Industrial Hemp Regulations (IHR 1998) establish the conditions under which certain cannabis plants (industrial hemp) may be produced for commercial purposes. As well, a number of other regulations under the CDSA, including the Narcotic Control Regulations (NCR), the New Classes of Practitioners Regulations and the Qualifications for Designations as Analysts Regulations support the cannabis regulatory framework as it exists today.

The FDA and its regulations regulate the safety, efficacy and quality of health products, such as prescription or non-prescription drugs, natural health products, and medical devices. Health products can only be sold if they have been approved by Health Canada following a scientific review. Cannabis meets the definition of a drug under the FDA, which includes any substance intended to diagnose, treat, mitigate, or prevent health issues in humans or animals or that is sold to modify organic functions. To date, cannabis itself has not been authorized as a therapeutic product in Canada or in any other country. However, there are two drugs containing cannabis that have undergone the market authorization process under the FDA, and one is available for sale in Canada with a prescription from a health care professional. The Cannabis Exemption (Food and Drugs Act) Regulations under the FDA play an important role in the cannabis regulatory framework by exempting cannabis produced in accordance with the ACMPR from the application of the Food and Drug Regulations (FDR).

In the 2015 Speech from the Throne, the Government of Canada committed to legalizing, strictly regulating, and restricting access to cannabis. The Minister of Justice and Attorney General of Canada, the Minister of Public Safety and Emergency Preparedness, and the Minister of Health were mandated by the Prime Minister to implement this commitment. In June 2016, the three Ministers established the Task Force on Cannabis Legalization and Regulation (the Task Force) of nine distinguished experts in public health, substance use, law enforcement and justice to consult broadly with Canadians and to provide advice on the design of a new legislative and regulatory framework.

The Task Force consulted extensively on a detailed discussion paper with provinces and territories, Indigenous governments and organizations and experts in relevant fields, including public health, substance use, criminal justice, law enforcement and industry as well as with youth. The Task Force received more than 30 000 responses to its public consultation and more than 300 written submissions from organizations or individuals. It delivered its final report, A Framework for the Legalization and Regulation of Cannabis in Canada, to the Ministers and the public on December 13, 2016. In it, the Task Force made 85 recommendations for the establishment of a comprehensive framework for the legalization and regulation of cannabis across five themes: minimizing harms of use; establishing a safe and responsible supply chain; enforcing public safety and protection; medical access; and implementation.

On April 13, 2017, the Government of Canada introduced Bill C-45 (the Cannabis Act) in the House of Commons. Based in large part on the advice provided by the Task Force, the Cannabis Act creates the foundation for a comprehensive national framework to provide restricted access to regulated cannabis, and to control its production, distribution, sale, importation, exportation, and possession. Following parliamentary review, the Cannabis Act received royal assent on June 21, 2018.

As set out in section 7 of the Cannabis Act, the purpose of the Act is to protect public health and public safety and in particular to

  • protect the health of young persons by restricting their access to cannabis;
  • protect young persons and others from inducements to use cannabis;
  • provide for the legal production of cannabis to reduce illegal activities in relation to cannabis;
  • deter illegal activities in relation to cannabis through appropriate sanctions and enforcement measures;
  • reduce the burden on the criminal justice system in relation to cannabis;
  • provide access to a quality-controlled supply of cannabis; and
  • enhance public awareness of the health risks associated with cannabis use.

To achieve these objectives, the Cannabis Act will do the following:

  • Create a general control framework for cannabis by establishing a series of criminal prohibitions, while providing for exceptions or authorizations to permit persons to engage in otherwise prohibited activities. For example, the Cannabis Act will prohibit any person from selling cannabis, unless explicitly authorized to do so under that act or its regulations. The Cannabis Act will also prohibit individuals aged 18 years or older from possessing more than 30 grams of dried cannabis or its equivalent in public. Provinces and territories, together with municipalities, can also tailor certain rules in their own jurisdiction (for example setting a higher minimum age or more restrictive limits on possession).
  • Provide for the oversight and licensing of a legal cannabis supply chain. Licences and other authorizations issued under the Cannabis Act will set parameters for the operation of a legal cannabis industry. Federal and provincial/territorial governments will share responsibility for the oversight and licensing of the cannabis supply chain. The federal Minister of Health will be responsible for licensing, among other activities, the production of cannabis (cultivation and processing), while provincial and territorial governments can authorize the distribution and retail sale of cannabis in their respective jurisdictions, should they choose to do so.
  • Establish national standards to protect public health and safety. The Cannabis Act will set a number of clear legal requirements intended to protect against the public health and public safety risks associated with cannabis, in line with the government’s objectives. For example, the Cannabis Actprohibits the sale of products appealing to youth, and sets out a comprehensive framework to restrict promotion to protect young persons and others from inducements to use cannabis.

Issues

A robust regulatory framework is needed to support the implementation of the Cannabis Act and to appropriately address the public health and public safety risks associated with cannabis. It is also important to note that many of the recommendations made by the Task Force related to potential regulatory requirements for a new cannabis framework.

Public Health

According to the World Health Organization’s 2016 report, The Health and Social Effects of Nonmedical Cannabis Use, youth are particularly vulnerable to the effects of cannabis on brain development and function. This is because one of the compounds in cannabis that is responsible for the psychoactive effects, delta-9-tetrahydrocannabinol (THC), affects the same components in the brain that direct brain development, and research has shown that adolescence is a critical time for brain development. Canada’s rates of cannabis consumption by youth and young adults continue to be some of the highest in the world. According to the United Nations Children’s Fund (UNICEF) 2013 Innocenti Report Card 11, Canada had the highest rate of past-year cannabis use (28%) by youth amongst the developed countries included in the report. Similarly, Health Canada’s Canadian Tobacco Alcohol and Drugs Survey results from 2015 indicate that cannabis is the most commonly used substance after alcohol in Canada, with youth (aged 15–19) and young adults (aged 20–24) having the highest rates of past-year cannabis use at 21% and 30%, respectively, in comparison to adults aged 25 years or older at 10%.

There are both short and long-term effects associated with cannabis use. Some of the short-term effects can include difficulty paying attention and concentrating, memory loss and a slowing of reaction time which can affect the ability to drive safely. Some of the long-term effects can include impacts on memory, concentration, and the ability to think and make decisions and as well as physical or psychological dependence (addiction). These effects appear to be worse if cannabis use begins during adolescence, is frequent and continues over a long period of time. footnote6

Other health risks associated with cannabis use include risks associated with the consumption of contaminants that come from growing cannabis under poor, unregulated conditions found in illegal operations. These contaminants can include heavy metals, pesticides, herbicides, fungicides, growth hormones, moulds, and bacteria, as well as toxic solvents, which can all pose various health risks to individuals. footnote7footnote8footnote9

Public Safety

Criminals and organized crime have benefited from the illegal production and sale of cannabis. In Canada, the illegal trade of cannabis generates significant revenues for criminals and organized crime. According to Statistics Canada’s Cannabis Economic Account, 1961 to 2017, the illegal production of cannabis was worth $4.6 billion in 2017. The majority of household spending on cannabis (90%) was conducted outside of the authorized cannabis for medical purposes framework, with revenues and profits directed solely to illegal players. In a 2017 report, Measuring Organized Crime in Canada: Results of a Pilot Project, Statistics Canada found 32% of cannabis-related incidents (i.e. trafficking and production) to be for the benefit of organized crime. It is reasonable to anticipate that criminals and members of organized crime will continue to seek opportunities to maintain profits generated through illegal activities by attempting to infiltrate the new legal cannabis market, or to illegally move cannabis into or out of it.

Objectives

The regulatory framework, which includes the Cannabis Regulations, the new Industrial Hemp Regulations, and the Cannabis Exemption (Food and Drugs Act) Regulations, as well as a number of related amendments and repeals, is intended to support the implementation of the Cannabis Act and its fundamental purposes as articulated in section 7. Taken as a whole, the regulatory framework is intended to support the government’s public health and public safety goals of restricting youth access to cannabis, minimizing the harms of cannabis use, and preventing criminals and organized crime from profiting from the production of cannabis.

Description

In general, the regulatory framework will establish the rules and standards that will apply to the authorized production, distribution, sale, importation and exportation of cannabis, as well as other related activities respecting the classes of cannabis (i.e. dried cannabis, fresh cannabis, cannabis oil, cannabis plants, and cannabis seeds) that will be permitted to be sold by a person authorized under the Cannabis Act when the Act and its regulations come into force.

The Cannabis Act will apply to cannabis, including industrial hemp and health products and cosmetics containing cannabis. Regulations pertaining to cannabis that currently exist under the CDSA (i.e. the ACMPR and the IHR) will be repealed. The Cannabis Regulations will be made pursuant to subsection 30(1) of the Food and Drugs Act, subsection 55(1) of the Controlled Drugs and Substances Act and subsection 139(1) and section 161 of the Cannabis Act. The new Industrial Hemp Regulations (IHR 2018), and the Qualifications for Designation as Analyst Regulations (Cannabis) will be made under the authority of subsection 139(1) of the Cannabis Act.

As cannabis will continue to meet the definition of a drug under the FDA, regulatory amendments will coordinate the application of the FDA, the Cannabis Act, and both of the statutes’ regulations, to ensure that health products containing cannabis that fall under the FDA can continue to be developed and sold subject to the appropriate rules and requirements in a manner that practically maintains the status quo with respect to these products. More specifically, the Medical Devices Regulations, the Natural Health Products Regulations (NHPR), the Cannabis Exemption (Food and Drugs Act) Regulations and the Food and Drug Regulations will be amended.

Amendments to the Narcotic Control Regulations and the New Classes of Practitioners Regulations under the CDSA have also been made to remove references to cannabis.

The Cannabis Regulations

The Cannabis Regulations are comprised of 16 parts that will establish rules for federally licensed cannabis producers; regulate cannabis products (dried and fresh cannabis, cannabis oil, as well as cannabis plants and seeds); maintain a distinct medical access framework; and set out rules for prescription drugs containing cannabis and medical devices containing cannabis or to be used with cannabis.

The Cannabis Regulations will define key terms used in the Cannabis Act and its Regulations, identify circumstances in which the Cannabis Regulations do not apply (e.g. with respect to industrial hemp, which will be subject to the IHR 2018), and describe a limited number of general authorizations for activities that would otherwise be prohibited under the Cannabis Act (such as allowing adult individuals to send cannabis to a licensed lab for testing).

Licensing

The Cannabis Regulations will create six classes of licences (cultivation, processing, sale, analytical testing, research, and cannabis drug licences) that will authorize specific activities with cannabis. The Cannabis Regulations create subclasses of licences for cultivation (standard cultivation, micro-cultivation, and nursery) and processing (standard processing, and micro-processing). The cannabis drug licence class, whose applicable requirements are described further in a separate section below, require the holding of an establishment licence under the FDR to conduct activities with cannabis.

Those who hold the appropriate licences will also require permits to authorize the importation or exportation of cannabis for medical or scientific purposes. Consistent with the ACMPR, the Cannabis Regulations will require certain licence applicants to notify the local government, the local fire authority, and the local police force or the Royal Canadian Mounted Police detachment that is responsible for providing policing services to that area prior to submitting their application. Licence holders may only possess cannabis if it has been obtained in accordance with the Cannabis Act and its regulations (i.e. from a licence holder or imported with a valid permit). To enable the orderly introduction of new plant genetics into the regulated industry, new cultivation licence holders (including nurseries) will be authorized to possess any cannabis seeds and plants that are in their possession on the effective date of the licence if, as part of their licence application, they have made a declaration of the number of plants and/or seeds that will be in their possession at that time.

The Cannabis Regulations will authorize cultivation licence holders to cultivate, propagate and harvest cannabis plants, and to sell the harvested material to other licence holders. Licensed cultivators will be authorized to package and label cannabis plants and seeds for sale to authorized sellers or distributors. footnote10 In addition, they will be able to ship purchased plants and seeds on behalf of authorized sellers and distributors. A micro-cultivation licence will authorize the cultivation of cannabis within a clearly delineated area of no more than 200 square metres. This threshold is based on plant canopy area, such that if plants are stacked or tiered in a growing area, each stack or tier would count towards the calculation of the total growing area. A nursery licence will authorize the cultivation of juvenile plants, and will limit the cultivation of budding or flowering cannabis within a clearly delineated area of no more than 50 square metres, and only for the purposes of seed production. Nursery licences will not authorize the harvest of other plant material or the production of any cannabis products other than cannabis plants or seeds. The Cannabis Regulations do not include any size limits for standard cultivation licences. All cultivation licence holders must have a “master grower,” and will be permitted to have one alternate individual for this position.

The Cannabis Regulations will authorize processing licence holders to alter cannabis to manufacture intermediary or finished products, and to sell cannabis to other processors. All processing licence holders will be authorized to sell and distribute finished cannabis products (those that are packaged and labelled in accordance with the Cannabis Regulations) to authorized sellers and distributors. In addition, they will be able to ship purchased cannabis products on behalf of authorized sellers and distributors. Copies of a consumer information document, developed by Health Canada and made available on its website, must be included with every shipment of cannabis products in an amount equal to the number of packages in the shipment. This requirement does not apply if the authorized seller or distributor provides written confirmation that they will obtain the document through other means and will provide it to consumers when they purchase the products. A micro-processing licence will authorize the processing of no more than 600 kilograms of dried cannabis (or its equivalent as specified in the Cannabis Regulations) per year. If the licence holder also holds a micro-cultivation licence for the same site, the total annual output generated under that micro-cultivation licence may be processed even if it exceeds 600 kilograms. All processing licence holders must have a “quality assurance person,” and are permitted to have up to two alternate individuals for this position.

The Cannabis Regulations set out the activities that a holder of a licence for sale for medical purposes will be authorized to undertake, including activities relating to intra-industry sale and distribution of cannabis. Details on requirements pertaining to the sale of cannabis for medical purposes to individuals, including requirements for client registration, are set out in Part 14 of the Cannabis Regulations (which deals with access to cannabis for medical purposes, and is further described below).

The Cannabis Regulations also set out the activities that holders of a research licence or analytical testing licence will be authorized to undertake. The Cannabis Regulations will provide general authorizations for licensed researchers to possess, produce, distribute and sell cannabis. Additional restrictions may be included in the terms and conditions of licence and tailored to the research undertaken. Holders of analytical testing licences must have a “head of laboratory,” and are permitted to have one or more alternate individuals for this position, provided they meet the qualifications specified in the Cannabis Regulations. All cannabis sent to licensed analytical testing laboratories must be destroyed within the time period prescribed in the Cannabis Regulations.

All licence holders will be required to have a “responsible person,” who has overall responsibility for the activities conducted under the licence. All licence holders, with the exception of research and analytical testing licences, must have a head of security and are required to submit an organizational security plan and update it at the request of the Minister of Health (the Minister). With the exception of licences for research, analytical testing, and sale for medical purposes where cannabis is not on-site, all licence holders will be required to have a security-cleared person physically present on-site whenever activities with cannabis are conducted in an operations or storage area at the approved site.

Licensed activities will not be permitted to take place in a “dwelling-house” (a term for a private residence which is defined in the Criminal Code) and — with the exception of destruction, antimicrobial treatment (e.g. irradiation), and distribution — can only take place at the approved site. Both indoor and outdoor cultivation of cannabis will be permitted for all subclasses of cultivation licences. All licence holders will be required to store, test, process, and package or label cannabis indoors after it has been harvested. Indoor areas where cannabis is present will be required to have reasonable measures in place to prevent the escape of odours. The Cannabis Regulations identify other measures that must be taken by licence holders including oversight during destruction and antimicrobial treatment, and safekeeping of cannabis while it is being distributed (including during transportation).

The Cannabis Regulations will establish grounds for the Minister to refuse to issue, renew or amend a licence, and identify situations that would require a licence holder to notify the Minister and local authorities of certain changes to their operations or to seek an amendment to their licence(s). For example, the Minister may refuse to issue, renew or amend certain licences if the application deals with an already licensed site, or to renew or amend a licence if the licence holder does not hold a licence as required under the Excise Tax Act, 2001.

Personnel security clearances

The Cannabis Regulations list positions whose occupants will be required to hold a valid security clearance granted by the Minister of Health, including, but not limited to, an individual licence holder, directors and officers of the licence holder and any organization that controls the licence holder, the key positions identified by licence class (e.g. master grower, quality assurance person, head of security), and any individual or position specified by the Minister pursuant to subsection 67(2) of the Cannabis Act. A licence may be refused if individuals occupying the specified positions do not hold a valid security clearance. General security clearance requirements will apply to all cultivation, processing, and federal sale for medical purposes licence holders. With respect to all licences issued under the Cannabis Act, the Minister will have the discretion to require any individual or occupant of a position to hold a clearance, depending on the activities being undertaken and the potential risks posed to public health and public safety.

The Cannabis Regulations will authorize the Minister to conduct checks to determine whether an applicant for or a holder of a security clearance poses a risk to public health or public safety, including after a security clearance has been granted. These checks may include, but will not be limited to, criminal record checks and checks of relevant files of law enforcement agencies. The Cannabis Regulations identify factors that the Minister could consider to determine whether or not an applicant for a security clearance poses an unacceptable risk to public health or public safety, including the risk of cannabis being diverted to an illicit market or activity. These factors include, but are not limited to: the circumstances of any events or convictions, along with their seriousness, number and frequency, and the date of the most recent event; associations with organized crime; involvement in or contribution to an act of violence or threat of violence; or whether there are reasonable grounds to suspect that the applicant could be induced to commit an act that might constitute a risk to public health or public safety. The Cannabis Regulations will not limit the Minister to considering only the listed factors, and the Minister could refuse to grant a clearance based on a factor not listed in the regulations, if the Minister believes that the individual poses an unacceptable risk to public health or public safety. The Cannabis Regulations will also establish a process that would need to be followed in the event that a security clearance is refused, suspended, or cancelled by the Minister to provide procedural fairness. For example, an applicant whose security clearance is refused, suspended or cancelled must be notified and given an opportunity to provide additional information that may have a bearing on the decision.

The Cannabis Regulations specify that only those individuals who will be required to hold a security clearance would be eligible to apply for one. An individual who has been refused a security clearance or had their clearance cancelled in the preceding five years would not be eligible to apply for a security clearance unless they could demonstrate a change in the circumstances that led to that decision. The holder of a valid security clearance will be required to notify the Minister if they are charged with any offence under the Criminal Code, the Cannabis Act, or the CDSA. In a change from the ACMPR, the Cannabis Regulationswill not require that a security clearance be automatically cancelled when an individual leaves a licensed entity, which would allow individuals to maintain their valid security clearance when transferring employment between licence holders.

Physical security

The Cannabis Regulations set out physical security requirements that will apply to licensed activities and which vary by licence class. All licence holders, other than analytical testing and research licence holders, will be required to ensure that the site is designed in a manner that prevents unauthorized access.

Standard cultivation and standard processing licences, and licences for sale for medical purposes that authorize the possession of cannabis on-site will be subject to the following requirements:

  • The perimeter of the site will need to be
    • — monitored at all times by a visual recording device that is capable of monitoring the entire perimeter and of making a recording of any attempted or actual unauthorized access; and
    • — secured by an intrusion detection system that is monitored at all times.
  • Access to each operations and storage area will need to be restricted to individuals who require access for their work responsibilities, and each of those areas will need to be
    • — surrounded by a physical barrier that prevents unauthorized access; and
    • — monitored at all times by visual recording devices capable of detecting illicit conduct (there is an exception in the Cannabis Regulations for grow areas, where only the entrance/exit must be monitored).

Each operations and storage area will also need to have an intrusion detection system that is capable of detecting attempted or actual unauthorized access or tampering with the system, as well as unauthorized movement (there is an exception for grow areas, where the system does not need to detect unauthorized movement). Visual recordings will need to be kept for one year, and all other records required as part of the physical security requirements will need to be kept for two years. Storage areas must be contained within another area that meets all of the requirements for the operations and storage area. A record of each individual entering or exiting a storage area will need to be recorded.

For micro-cultivation, micro-processing and nursery licence holders, the Cannabis Regulations will require that the perimeter of the site and each storage area be surrounded by a physical barrier that prevents unauthorized access and that access to storage areas be restricted to individuals who need to be there for their work responsibilities.

Analytical testing licence holders will need to ensure that each storage area is surrounded by a physical barrier that prevents unauthorized access and that access to storage areas is restricted to individuals who need to be there for their work responsibilities. Research licence holders will be required to design their operations areas in a manner that prevents unauthorized access.

To provide for a seamless transition from the ACMPR, the Cannabis Regulations provide that entities who have applied for or hold a licence under the ACMPR as of the date that the regulations come into force and who continue to store cannabis in compliance with the physical security requirements of the ACMPR as they existed prior to being repealed, will not be required to change their operations to comply with the new requirements so long as they remain compliant with the ACMPR rules.

Good production practices

The Cannabis Regulations will establish requirements pertaining to the production and handling of cannabis as a means of controlling the quality of cannabis produced by federal licence holders. Good production practices will be required for all cannabis contained in a cannabis product, and will be consistent with the requirements in the ACMPR.

The Cannabis Regulations will require licence holders to develop and adhere to standard operating procedures for the production, sampling, testing, packaging, labelling, distribution and storage of cannabis. In addition to requirements that will apply to operations and facilities (i.e. sanitation program, general maintenance and cleanliness requirements for facilities and equipment), the Cannabis Regulations will require that cannabis products sold or exported undergo analytical testing to verify that they meet thresholds set out in the regulations for quality indicators (e.g. solvent residues, microbial and chemical contaminants, and the disintegration characteristics of some cannabis products). Testing will also need to be conducted on the quantity or percentage of THC, delta-9-tetrahydrocannabinolic acid (THCA), cannabidiol (CBD) and cannabidiolic acid (CBDA), so that cannabis products can be accurately labelled.

The Cannabis Regulations will prohibit the application of unauthorized pesticides to cannabis. For holders of a processing licence, a quality assurance person must be identified to oversee key facets of operations, including the standard operating procedures and approval of each lot or batch of cannabis made available for sale, and to investigate and take corrective measures in response to complaints.

Cannabis products

Part 6 of the Cannabis Regulations will establish requirements applicable to cannabis and cannabis products that are packaged and labelled for sale at the retail level. footnote11 The Cannabis Regulations include measures that are intended to reduce the appeal of cannabis products to youth and to reduce the risk of accidental consumption of cannabis, all while providing adults with access to quality-controlled cannabis products of known potency.

The Cannabis Regulations will establish the maximum THC content that will be permitted per discrete unit of cannabis (that is, cannabis that has been prepared as an individual unit or units and which is intended to be consumed separately, such as capsule or pre-rolled forms), based on how the product is represented to be consumed. A single unit of a cannabis product intended for oral ingestion (including those comprised of dried cannabis, fresh cannabis or cannabis oil) will not be permitted to contain more than 10 milligrams of THC. For dried cannabis products intended for inhalation, whether by smoking or by vapourization, each unit of these product forms will not be permitted to contain more than one (1.0) gram of dried cannabis. Cannabis oil will be subject to a 30 milligram per millilitre limit on THC concentration. Cannabis oil will not be permitted to contain any additives aside from the carrier oil and other substances that are necessary to preserve the quality or stability of the product. Cannabis oil will not be permitted to contain residues of any solvents other than those classified as Class 3, which are understood to be solvents with low toxic potential to people within the acceptable limits published by the Government of Canada on its website. Any other substances, other than those within permitted thresholds, will be prohibited in fresh and dried cannabis products.

Manufactured products will only be permitted to contain one class of cannabis in a single product. Specific requirements will apply to cannabis accessories that are sold together with cannabis provided that they do not impart a flavour, or alter or enhance the effect of the cannabinoids.

Packaging and labelling

The Cannabis Regulations will establish requirements for the information that will be required to be displayed on the labels of cannabis that will be distributed and sold in Canada, or exported for medical or scientific purposes. With respect to cannabis sold and distributed between licence holders or exported for medical or scientific purposes, basic information requirements will need to be met to allow for the identification of the seller or distributor.

The Cannabis Regulations will establish specific requirements that will apply to cannabis products packaged and labelled for sale at the retail level, including safety features and plain packaging requirements. All cannabis products, except cannabis plants and seeds, will need to be packaged in an opaque or translucent immediate container that is tamper-evident, child-resistant, prevents contamination, and in the case of dried cannabis, keeps it dry. The maximum amount of cannabis permitted in a single package will be 30 grams of dried cannabis, or the equivalent in accordance with subsection 2(4) of the Act.

The Cannabis Regulations will establish strict limits that will apply to the use of colours, images, and brand elements. Among other things, the Cannabis Regulations will require that product packaging (including the immediate container and any outer container, except the shipping container) be a single, uniform colour that is not one of the colours prohibited in the regulations. The Cannabis Regulations specify that the interior and exterior surfaces of a container will be allowed to be different colours, but that each surface must be a single uniform colour. It will be required that packaging have a matte finish without textures, embossing, or other features described in the Cannabis Regulations. The Cannabis Regulations will also prohibit the inclusion of any feature on either the interior or exterior surface of any container, or covering, that becomes visible only through technological means (such as heat-activated ink), or that is designed to change the appearance or surface area of the container. Despite this restriction, features necessary to facilitate the opening and closing of containers, to assist the visually impaired, or to prevent counterfeiting will be permitted.

A standardized cannabis symbol will be required on the label of cannabis products that contain THC in a concentration greater than 10 μg/g. Mandatory health warning messages will also be required to appear on the label, subject to the frequency of rotation requirements set out in the Cannabis Regulations. The label will be required to display the THC and CBD content of the product as well as other information set out in the Cannabis Regulations. Other than the brand name, only one other brand element will be permitted to be displayed. If it is a text element, the font could not be larger than the font of the health warning message, and it would be required to be a single, uniform colour. If the brand element is an image, such as a logo, it could not be larger than the standardized cannabis symbol. The Cannabis Regulations will establish further requirements such as font type and size, colour, background colour, and placement. All information on the label must be in English and French.

The Cannabis Regulations also define tolerance limits for the net weight or volume of cannabis displayed on the label of a packaged cannabis product destined for retail sale.

Drugs containing cannabis

Licensing

Drugs that contain cannabis, including cannabis that is an active pharmaceutical ingredient, will be regulated under both the Cannabis Act and the FDA, in much the same fashion as they are currently subject to both the CDSA and the FDA. The Cannabis Regulations will establish a class of licence known as a “cannabis drug licence,” which is broadly intended to authorize activities in relation to the production, distribution and sale of drugs that contain cannabis that have been authorized under the FDA by entities who already hold a drug establishment licence under the FDR. The Cannabis Regulations will authorize a cannabis drug licence holder to possess cannabis and to produce, distribute and sell a drug that contains cannabis subject to the activities authorized in their drug establishment licence. Licence holders will not be authorized to obtain cannabis by cultivating, propagating or harvesting it (unless they also hold a licence for cultivation). As with other licence holders, the holder of a cannabis drug licence will require permits to authorize the importation or exportation of cannabis for medical or scientific purposes.

As drugs containing cannabis are also regulated under the FDA and the FDR, a drug establishment licence under the FDR will be required for a person to be eligible to apply for a cannabis drug licence. Such drugs will require a Drug Identification Number issued under the FDA. To minimize regulatory duplication, certain requirements that will apply to other cannabis products under the Cannabis Act and the Cannabis Regulations will not apply to drugs containing cannabis or cannabis that is an active pharmaceutical ingredient as defined under the FDR. For example, good production practices under the Cannabis Regulations would not apply because drugs authorized under the FDA are already subject to extensive good manufacturing practices.

While a drug establishment licence is required to fabricate, package and label, test and import an active pharmaceutical ingredient, wholesaling and distribution of active pharmaceutical ingredients are not licensable activities under the FDR. Therefore, those regulated parties will not be eligible for a cannabis drug licence unless they obtain a drug establishment licence under the FDR, or will otherwise be required to hold the appropriate licence under the Cannabis Regulations to conduct these activities.

The Cannabis Regulations identify the physical security, security screening, record keeping and reporting requirements that will apply to these licence holders. The Cannabis Regulations require cannabis drug licence holders to have a “senior person in charge,” who has overall responsibility for management of activities with cannabis, as well as a “qualified person in charge,” who must be present on the licensed site when activities are undertaken with drugs containing cannabis. The Cannabis Regulations allow for the identification of one alternate qualified person in charge. Requirements for these individuals align with existing requirements under the NCR for licensed dealers, including the requirement for a criminal record check.

The Cannabis Regulations will authorize antimicrobial treatment (e.g. irradiation) and destruction of cannabis at an off-site location and the destruction of cannabis by a cannabis drug licence holder or a licensed dealer under the NCR, subject to the requirements set out in the Cannabis Regulations.

The Cannabis Regulations will also establish grounds for the Minister to refuse to issue, renew, amend, revoke or suspend a licence, and identify the situations that require a licence holder to notify the Minister of certain changes to their operations or to seek an amendment to their licence(s). For example, the Minister will be authorized to refuse to issue, renew or amend the cannabis drug licence if the establishment licence is suspended or cancelled.

Cannabis drug licences will also be subject to physical security requirements that will apply to other federal licence holders; however, these licence holders will have the option to follow the physical measures set out in the Directive on Physical Security Requirements for Controlled Substances and Drugs Containing Cannabis (Security Directive) instead. Given that holders of a cannabis drug licence could also hold a dealer’s licence under the Narcotic Control Regulationsand already be following the Security Directive, this option may reduce compliance burden.

Prescription drugs

Prescription drugs containing cannabis will be available in the same way as they are currently under the FDR for human use: through a prescription written by a practitioner, and filled by a pharmacist at a pharmacy, or available to be administered in a hospital or veterinary clinics. The scope of medical professionals who may prescribe a drug containing cannabis has been expanded to include practitioners who are entitled by their province to treat patients with a prescription drug and are practising their profession in that province. As is currently the case, veterinarians would also be authorized to prescribe and administer prescription drugs containing cannabis for their animal patients. An individual’s possession of a prescription drug containing cannabis will not impact the quantity of cannabis that they will be authorized to possess under the Act.

The Cannabis Regulations will establish record keeping and reporting requirements that will apply to practitioners, pharmacists and hospitals in relation to prescription drugs containing cannabis, for example, when they are sold, distributed or administered. These requirements are consistent with existing requirements in the NCR that previously applied to prescription drugs containing cannabis.

The Cannabis Regulations will enable hospitals, veterinary clinics, and pharmacists to sell and distribute cannabis for the purpose of return and destruction of prescription drugs containing cannabis, including those that they obtain from post-consumer returns.

The Minister will be required to disclose factual information in writing about a pharmacist or a practitioner in relation to cannabis if the applicable provincial or territorial licensing authority submits a written request. The Minister will be obligated to disclose this information if she has reasonable grounds to believe that such individuals have contravened a rule of conduct established by the licensing authority in relation to cannabis, or that they have been convicted of an applicable offence relating to cannabis under the Cannabis Act or the CDSA. The Minister will be required to issue notices to the appropriate individuals, the professional licensing authority and to the cannabis drug licence holders, if a pharmacist or practitioner has contravened a rule in relation to cannabis, and if a pharmacist, a practitioner or a professional licensing authority requests it in writing. The purpose of the notice is to restrict the prescribing privileges of the professional named in the notice. The Minister must also issue a notice if a pharmacist or a practitioner has been convicted of an applicable offence relating to cannabis under the Cannabis Act or the CDSA.

The Cannabis Regulations will authorize activities that otherwise would be prohibited under the Cannabis Act in relation to approved prescription drugs containing cannabis. For example, limitations on classes of cannabis that can be sold under the Act will not apply to prescription drugs with cannabis because the precise dosage, route of administration and conditions of use of each of these drugs are subject to Health Canada’s review of each drug. Similarly, pediatric formulations of a prescription drug containing cannabis will be permitted to be presented in a way that helps administer the product to children for therapeutic purposes (e.g. flavour).

The Cannabis Regulations will also permit promotion of a prescription drug containing cannabis by communicating the name, price and quantity of the drug, similar to other prescription drugs. Subject to the requirements of the FDA, it will also be possible to use the brand name of a prescription drug or the name of the holder of the drug identification number in sponsorship and in the naming of a facility.

Prescription drugs containing cannabis will not be subject to the packaging and labelling rules established for other products under the Cannabis Regulations. However, prescription drugs will continue to be subject to the labelling rules under the FDR, as well as the packaging and labelling prohibitions under the Cannabis Act with one exception: prescription veterinary drugs will be permitted to be packaged or labelled with a depiction of a real or fictional animal that corresponds to the species of the animal for which the drug is intended.

Devices

Devices and combination drug-device products are regulated under the FDA. If those devices are to be used in the consumption of cannabis or contain cannabis, they will also be regulated under the Cannabis Act as cannabis accessories. For this reason, the Cannabis Regulations will authorize activities that otherwise would be prohibited under the Cannabis Act in relation to devices licensed for use with prescription drugs containing cannabis, and combination products (a product, consisting of a device and a prescription drug that contains cannabis, for which a drug identification number has been issued). For example, this could include packaging and labelling that sets out a depiction of a real or fictional animal that corresponds to the species of animal for which the drug is intended (limited to prescription veterinary drugs containing cannabis).

Among other things, the Cannabis Regulations will authorize a person entitled under the laws of a province to dispense a prescription drug to sell a device that is licensed for use with a prescription drug containing cannabis to a young person if the young person has a prescription for that drug. In addition, a drug-device combination product containing cannabis can be sold to a young person who holds a prescription.

Importation and exportation for medical or scientific purposes

The Cannabis Regulations will authorize the importation and exportation of cannabis for medical or scientific purposes by a person who holds a licence under the Cannabis Regulations, and who has obtained the applicable permit. They also set out the restrictions and requirements that will apply to these permits. In general, the requirements are consistent with the ACMPR approach. However, the Cannabis Regulations will also allow permits to be issued that would authorize the importation and exportation of cannabis oil for medical and scientific purposes.

Record keeping

The Cannabis Regulations will establish requirements for the retention of record respecting inventories and movements of cannabis and the retention period for such records (two years). These requirements include specific information (e.g. quantities and dates) about the production and processing of each lot or batch of cannabis. Information must also be retained to detail sales or purchases of cannabis (e.g. seller and purchaser, quantities) as well as the transfer of cannabis off-site for antimicrobial treatment.

The Cannabis Regulations will also establish record keeping and retention requirements (typically, two years) for licence holders respecting the following items, among others:

  • — copies of any notices they are required to send;
  • — the destruction of cannabis (e.g. the name of qualified witness to destruction);
  • — a copy of all versions of the organizational security plan submitted to the Minister;
  • — good production practices (e.g. documents relating to testing);
  • — a sample or copy of each distinct package and package label;
  • — a list of the names and types of cannabis accessories they sell;
  • — records pertaining to all promotional activities (including samples or copies of material);
  • — records pertaining to product recall systems;
  • — cannabis used or produced in the course of the research activities;
  • — certain information regarding importation and exportation of cannabis for medical or scientific purposes;
  • — all financial information that is required to be reported to the Minister, including specified details pertaining to investors who provide money, goods, or services (i.e. “investments”) that result in direct or indirect control of the licensed entity; and
  • — reports of adverse reactions (25 years).

Some of the above noted requirements will not apply to holders of cannabis drug licences (e.g. product recall systems, good production practices). Additional requirements that will apply to holders of licences for sale for medical purposes are set out in Part 14 of the Cannabis Regulations and are described below.

Reporting and disclosure

The Cannabis Regulations identify information that must be submitted to the Minister and, if applicable, the time frame within which the information must be provided. This includes the following:

  • — notice of the sale of a new cannabis product (licensed processors only; at least 60 days before commencing sale of the product);
  • — total amount of money spent in a given year on promotion of cannabis and cannabis accessories that is directed at retail customers or others, and a description of the types of promotion (licence holders only);
  • — theft or loss of cannabis (to police within 24 hours, to the Minister within 10 days);
  • — information respecting a voluntary recall of cannabis, such as the product recalled (certain information before commencing the recall, must also provide a report of the results of the recall within 30 days of the recall being completed);
  • — adverse reactions (serious adverse reaction within 15 days; as well as a summary report dealing with all adverse reactions on an annual basis); and
  • — details regarding money, goods, or services that result in direct or indirect control of licence holders whose securities are not publicly traded (annual).

Some of the above noted requirements will not apply to holders of cannabis drug licences (e.g. theft or loss of cannabis). The Cannabis Regulations also identify circumstances in which the Minister could disclose certain information to third parties. These include, but are not limited to, disclosure upon requests by police for the purposes of investigations under the Act, and information requested by a provincial or territorial government for the purpose of implementing public health programs or activities related to cannabis.

Test kits

The Cannabis Regulations will establish authorizations and exemptions to certain parts of the Cannabis Act and Regulations that will apply in relation to test kits that contain cannabis. The sale, importation, exportation, possession and distribution of registered test kits will be authorized by the Cannabis Regulations, which will also establish requirements for their registration.

Access to cannabis for medical purposes

In order to continue to provide patients with reasonable access to cannabis for medical purposes, the Cannabis Regulations will substantively incorporate the regulatory framework of the ACMPR. Certain changes have been made to create consistency with rules for non-medical use, improve patient access, and reduce the risk of abuse of the system.

The Cannabis Regulations will authorize certain individuals, who have a medical document provided by a health care practitioner to support the use of cannabis for medical purposes, to possess and, in some cases, produce cannabis despite the general prohibitions set out in the Cannabis Act. In order to be legally recognized as an authorized medical user, the Cannabis Regulations require that an individual, on the basis of their medical document, register with either a federally licensed seller of cannabis for medical purposes (licensed seller) or the Minister, or obtain the cannabis as a patient in a hospital.

Authorized individuals will be able to possess in public the lesser of 30 times the authorized daily quantity in their medical document or the equivalent of 150 grams of cannabis (taking into account the equivalent amounts as specified in Schedule 3 of the Cannabis Act) in addition to any amount not prohibited by the Cannabis Act. This may include young persons who are registered with a licensed seller or with the Minister, or who have obtained the cannabis as a patient in a hospital. This also applies to an adult who is responsible for a registered individual or who is providing assistance in administering cannabis to that individual. In a change from the ACMPR, the responsible adult must be named on the registration document or certificate (discussed below). Responsible adults will be authorized to transport cannabis to the individual they are responsible for.

The Cannabis Regulations will establish requirements that will apply to health care practitioners with respect to the issuance of a medical document or written orders that support the use of cannabis for medical purposes.

Registration with licensed sellers

The Cannabis Regulations set out a number of requirements that will apply to licensed sellers, including rules governing the sale of cannabis by licensed sellers to registered clients. The Cannabis Regulations will establish requirements that enable registered clients to return cannabis if the licensed seller accepts it. Individuals may register as clients with a licensed seller on the basis of a medical document, or on the basis of a registration certificate issued by the Minister. Licensed sellers must follow the requirements of the Cannabis Regulations in order to issue a registration document to each registered client, which must include the information specified in the regulations. In a change from the ACMPR, the Cannabis Regulations do not require that client labels be affixed to cannabis products. To enable registered individuals to demonstrate authorized possession, licensed sellers are required to provide a registration document which sets out key information identified in the Cannabis Regulations (e.g. details of the client, daily quantity of dried cannabis, expiry date of registration).

Licensed sellers will be able to send or deliver up to 150 g of dried cannabis or its equivalent per shipment to a registered client. In a change from the ACMPR, the Cannabis Regulations will not limit the quantity of cannabis that may be sold to each registered client within a specified time period. The Cannabis Regulations will establish requirements to enable the fulfillment of orders taken by licensed sellers, licensed processors, or licensed cultivators as the case may be.

In a change from the ACMPR, the Cannabis Regulations will require licensed sellers to transfer a client’s medical document and all the information contained in the client’s registration document, to another licensed seller, upon request or for specified reasons if they have the consent of the registered individual (or the named responsible adult). The transfer must take place if the seller to whom the document is being transferred also consents to the transfer and there is no pending cancellation of the registration based on an applicable reason. In another change from the ACMPR, the Cannabis Regulations will establish the validity period of a medical document as the date on which the individual is first registered, not the date that the medical document is signed by the health care practitioner. The Cannabis Regulations require licensed sellers to indicate the date of registration on a medical document before returning it to a client or before transferring the document to another licensed seller.

Holders of licences for the sale of cannabis for medical purposes must retain records of client registration information, filling of orders and refusal to fill orders, medical documents provided by clients, and communications with provincial or territorial health care licensing authorities.

The Cannabis Regulations will provide exemptions to certain prohibitions in the Cannabis Act respecting the sale of cannabis and cannabis accessories, as well as the display of cannabis and the promotion of cannabis and cannabis accessories (including by telecommunication), to young persons who are authorized to possess cannabis for medical purposes. The Cannabis Regulations require that reasonable steps be taken to confirm that the young person is authorized to possess cannabis.

The Cannabis Regulations will establish requirements for licensed sellers respecting information that must be reported to the Minister, the communication of client information (e.g. to police or provincial licensing authorities) and records that must be created and maintained.

Registration with the Minister of Health

The Cannabis Regulations will establish requirements for individuals to apply to register with the Minister on the basis of a medical document, which would enable individuals to produce a limited amount of cannabis themselves for their own medical purposes, or to designate another individual to produce cannabis on their behalf. Individuals may also indicate that they do not intend to produce cannabis or designate someone to produce on their behalf on the basis that they would instead obtain cannabis for medical purposes from another legal source (such as a provincial or territorial retailer licensed to sell cannabis for non-medical purposes). The Minister may refuse to register, renew or amend a registration related to personal or designated production, or to revoke such a registration, if the registration is likely to create a risk to public health or public safety, including the risk of cannabis being diverted to an illicit market or activity. The Cannabis Regulations will specify certain circumstances in which the Minister must refuse to register, or renew or amend a registration. If the requirements of the Cannabis Regulations are met, the Minister must issue a registration certificate, containing specified information, when an individual is registered and, when applicable, issue a document for a designated person. If the Minister receives a renewal application and a new medical document before the expiry of a registration, the registration will continue to be valid until the Minister notifies the applicant of her decision.

The Cannabis Regulations create requirements for the production, transportation and possession of cannabis by registered and designated persons. Individuals who have been authorized to produce cannabis for medical purposes, and those who obtain cannabis from such individuals, must meet the requirements for the security of cannabis, including reporting the loss or theft of cannabis. Other requirements apply to the authorized production of cannabis for medical purposes (e.g. restrictions relating to the proximity of outdoor production sites to schools or playgrounds).

The Minister may share information regarding personal and designated production with law enforcement and provincial health care licensing authorities in certain circumstances described in the Cannabis Regulations. The Minister may share certain information (e.g. name and business address, authorized daily quantity of cannabis, province where the applicant ordinarily resides) in relation to a health care practitioner at any time after receiving a medical document that was issued by him/her which supports an application.

Health care practitioners, pharmacists, hospitals and nurses

The Cannabis Regulations will establish requirements for health care practitioners in relation to cannabis for medical purposes. The Cannabis Regulations will provide that cannabis may be administered, distributed or sold to a patient of a hospital or, to the extent permitted, to an adult responsible for the patient if certain requirements are met. The individual in charge of a hospital may also permit cannabis to be distributed or sold for emergency purposes to a hospital employee or a health care practitioner in another hospital if it is ordered in accordance with the Cannabis Regulations.

The Minister must disclose factual information in writing about a pharmacist or a health care practitioner in relation to cannabis if the applicable provincial or territorial licensing authority submits a written request and the information is for the purposes of assisting an investigation by the authority. The Minister will also be obligated to disclose this information if he has reasonable grounds to believe that such individuals have contravened a rule of conduct established by the licensing authority in relation to cannabis or if she becomes aware that they are convicted of an applicable offence under the Cannabis Act or the CDSA in relation to cannabis.

The Minister must issue notices to the appropriate individuals or organizations if a pharmacist or a health care practitioner requests it in writing, if the concerned individual has contravened a rule of conduct established by a provincial professional licensing authority and the licensing authority requests it in writing, or if such individual has been convicted of a specified offence relating to cannabis under the Cannabis Act or the CDSA. The notice will advise these individuals and organizations that licensed sellers, persons who hold a licence for processing and pharmacists practising in the notified pharmacies must not distribute or sell cannabis products to the pharmacist or health care practitioner named in the notice.

Transitional provisions

The Cannabis Regulations will provide for continuity by authorizing activities that are currently authorized under the CDSA and ACMPR. The Cannabis Actprovides for the transitional authorization of many of these activities under the new regime. However, certain elements require appropriate transitional provisions in the Cannabis Regulations.

Existing licence holders, under both the ACMPR and the NCR, will be aligned with the new licence classes under the Cannabis Regulations. If applicable, the Cannabis Regulations provide these licence holders with three months to identify personnel who require a security clearance, and for those personnel to apply for their security clearance. The Cannabis Regulations also align specific named positions under the ACMPR and NCR to equivalent positions in the Cannabis Regulations.

The Cannabis Regulations will provide a transition period of six months for packaging and labelling of cannabis for medical purposes, though there will not be a transition period for cannabis for non-medical purposes. Also, holders of licences for sale for medical purposes will be permitted to continue to use the old client label and registration document for a six-month period.

The Cannabis Regulations provide a six-month transition period before the provisions limiting the maximum yield quantity of THC per activation of a cannabis accessory come into effect. This will provide regulated parties with sufficient time to adjust their manufacturing practices.

Amendments to the Cannabis Exemption (Food and Drugs Act) Regulations, the Food and Drug Regulations, the Natural Health Products Regulations, and the Medical Devices Regulations

The Cannabis Exemption (Food and Drugs Act) Regulations will exempt cannabis from the application of the Food and Drugs Act, except for cannabis that is represented with a health claim, such as a drug or a natural health product containing hemp seed derivatives that are compliant with the Industrial Hemp Regulations. Cannabis will also continue to be regulated under the FDA if it is an active pharmaceutical ingredient, a drug authorized for clinical trials, or a disinfectant. Also, food and cosmetics containing cannabis will not be exempt from the FDA if they are exempt from the Cannabis Act pursuant to the IHR 2018.

Certain amendments will be made to the Food and Drug Regulations to coordinate certain provisions with those of the Cannabis Regulations as they relate to prescription drugs. Among other things, drug establishment licence holders will be prohibited from carrying on activities with cannabis unless they hold a cannabis drug licence.

Amendments will be made to Schedule 2 of the Natural Health Products Regulations, which lists substances that are not authorized for use in natural health products. The amendments add cannabis to that list but provide certain exemptions. Specifically, the amendments will limit cannabis plant parts in NHPs to those permitted under the IHR 2018. These products do not contain more than 10 ppm of THC and, therefore, do not pose the same safety concerns as other cannabis products. In addition, as plant parts listed in Schedule 2 to the Cannabis Act may contain some cannabinoids (either through contamination or otherwise), amendments to the NHPR will prohibit the isolation or concentration of these substances. Finally, the NHPR amendments seek to provide clarity to industry with respect to permitted contamination limits, by aligning the limit for THC with that in the IHR 2018.

Consequential amendments to the Medical Devices Regulations (MDR) will be made to align with the Cannabis Act and the Cannabis Regulations in relation to in vitro diagnostic devices, which are or contain drugs.

Qualifications for Designation as Analyst Regulations (Cannabis)

The Cannabis Regulations will establish the qualifications of analysts, such as those analyzing suspected controlled substances seized by peace officers, including Canadian police forces and inspectors, in support of the administration and enforcement of the Cannabis Act. These regulations substantively duplicate similar regulations under the CDSA.

New Industrial Hemp Regulations

The Industrial Hemp Regulations (IHR 1998), previously made under the CDSA, will be repealed. New Industrial Hemp Regulations (IHR 2018) will be made under the Cannabis Act. For the most part, the IHR 2018 will maintain key provisions of the previous framework and provide certain new authorities that align with the Cannabis Act.

The IHR 2018 will authorize the production of industrial hemp, defined as a cannabis plant, or any part of that plant, which has been proven to consistently have a concentration of THC that is 0.3% weight by weight or less in the flowering heads and leaves. Those who hold a licence under the IHR 2018 will be authorized to cultivate these plants and to produce and sell seeds and grains (and their derivatives). The Cannabis Act will not apply to anything referred to in Schedule 2 of the Act, including non-viable seeds or mature stalk without any leaf, flower, seed or branch. As such, activities related to these plant parts (such as their processing or sale) will not require a licence under the Act and are not subject to the IHR 2018.

Holders of industrial hemp licences will be authorized to undertake related activities, including possession, and transportation. In a change from the previous regulations, the IHR 2018 authorize the sale of flowering heads, leaves and branches of industrial hemp to a person who holds a licence under the IHR 2018 or a licence under the Cannabis Regulations. Flowering heads, leaves and branches must be stored and transported in a manner that maintains their quality.

Under the IHR 2018, industrial hemp licences authorize the cultivation of approved industrial hemp varieties from pedigreed seeds. THC testing is only required under the IHR 2018 for the purposes of designating new varieties of low-THC cannabis (0.3% or less) as an approved cultivar of industrial hemp to be included in the List of Approved Cultivars published by the Government of Canada on its website, which are the varieties approved for commercial cultivation under an IHR 2018 licence.

Under IHR 2018, industrial hemp will no longer be required to be stored in a locked container or a locked location or on premises to which only authorized persons have access. Other restrictions and conditions have been eliminated. For example, the IHR 2018 no longer require a criminal record check in order to apply for and hold an industrial hemp licence or prohibit cultivation of industrial hemp within one kilometre of any school grounds or any other public place.

Regulatory and non-regulatory options considered

The Government of Canada, informed by the advice of the Task Force on Cannabis Legalization and Regulation, has regularly communicated its objective of strictly regulating cannabis-related activities in order to provide adults in Canada with access to quality-controlled cannabis products. This approach will also safeguard the health and well-being of young Canadians by implementing national restrictions that limit the appeal of products intended for adults.

Health Canada engaged in extensive consultations with stakeholders in the development of the regulatory framework. Based on the feedback received, as well as the recommendations of the Task Force, the Cannabis Regulations reflect a flexible, risk-based approach that allows potential cannabis businesses to seek licences in the categories that allow them to operate successfully and economically as small producers.

The approach balances the aim of displacing the illegal market while ensuring that the public health and safety risks associated with cannabis are addressed to the greatest extent possible. Regulations explicitly identify the specific requirements that must be met by all participants in the market and create operational predictability and an even playing field for all businesses. Since it can be anticipated that many legal businesses would hesitate to participate in the legal cannabis market that is not supported by a stable, well-functioning regulatory system, a non-regulatory option would result in an increased risk of continued market dominance by illegal actors.

In developing the regulatory framework, Health Canada assessed different options for some of the more significant provisions.

Cannabis Regulations

Option 1 — Replicate licensing framework of the ACMPR

Since 2013, Canada has had a world-class regulatory framework to govern the production, distribution and sale of cannabis for medical purposes (first under the Marihuana for Medical Purposes Regulations and subsequently under the ACMPR). One option considered was to completely replicate the licensing framework and corresponding licence requirements for the production, distribution and sale of cannabis for medical purposes set out under the ACMPR, and apply them to the same activities under the Cannabis Act. In doing so, this approach, among other things, would have resulted in the following:

  • A single class of production licence that would not have distinguished between activities (cultivation, processing or sale) or between size (micro and standard scale);
  • Financial information respecting investments and loans resulting in direct or indirect control of licence holders whose securities are not traded on a public market would not be required to be reported to the Minister;
  • Certain forms of dried cannabis products would not be permitted to be manufactured and sold at the retail level (for example certain dosage forms of dried cannabis, such as capsules or dry vapourization cartridges); and
  • No requirements to display health warning messages or a universal cannabis symbol on product packages or labels, or to meet plain packaging restrictions.

This option was not selected for several reasons. Most importantly, many of the Task Force’s recommendations sought a measured and predictable transition from the previous ACMPR to a new approach founded on the legalization and regulation of cannabis. This would not have been achievable if the regulatory approach had been replicated in its entirety. In particular, this option would diverge from the Task Force’s recommendation to use licensing and production controls to encourage a diverse, competitive market that also includes small players or to require plain packaging of cannabis products and to include health warning messages on product labels.

Furthermore, this option would not help the government achieve many of its stated objectives for the legalization and strict regulation of cannabis.

A single licence class would not facilitate the growth of a dynamic market composed of a diverse, competitive legal industry made up of both large and small players in regions across the country. A one-size-fits-all approach that would apply the same regulatory requirements to both small-scale businesses and large sophisticated companies would place the former at a disadvantage and would not reflect the level of risk associated with the scale of the activity.

The absence of clear requirements pertaining to the reporting of financial information of those licence holders whose securities are not traded on a public market would limit the industry’s ability to demonstrate transparency regarding the sources of investments that result in direct or indirect control of a cannabis business. Without these requirements, Health Canada would not be able to access the information required for licensing purposes, or to help to identify suspicious financial arrangements that merit further scrutiny.

Finally, maintaining the packaging and labelling rules established under the ACMPR to cannabis sold for non-medical purposes would fail to use a highly effective policy instrument to meet the government’s objective of protecting Canadians, particularly Canadian youth, from strong inducements to consume cannabis.

Option 2 — Strategic enhancements to the regulatory framework (selected option)

The selected option builds on the foundation of the previous framework established under the ACMPR, but includes strategic enhancements that allows for the stable transition and expansion of the cannabis market from one that exclusively served the medical access system. This option was selected because all of the significant changes that will be made under the Cannabis Regulations are aligned with the recommendations of the Task Force, and will support the implementation of the Cannabis Act and its fundamental purposes.

As outlined above, a principal policy objective underpinning the regulatory framework is the creation of a regulatory system that enables a robust and responsible legal cannabis industry that is capable of displacing the entrenched illegal industry. By providing micro-scale enterprises with the opportunity to cultivate and process cannabis in an economically viable manner, the selected option will provide a meaningful mechanism that can be used to incentivize the participation of small-scale players in the legal system. Furthermore, the different classes of cannabis licences will enable the participation of specialized businesses that can leverage technological innovation and expertise to operate successfully in the legal cannabis market. This approach was supported by a majority of respondents who participated in the November 2017 consultations (described below), and indicated that they support the micro subclasses as they are both responsive to the needs of the new legal industry and the public health and safety concerns of Canadians.

Some of the important aspects of the ACMPR approach (e.g. child-resistant packaging, good production practices, import and export controls) have been transitioned to the new regulatory framework. Additional restrictions and requirements in the Cannabis Regulations are based on the recommendation of the Task Force and are intended to ensure that packaging and labelling are not designed to induce young persons and others to use cannabis. An easy to comprehend standardized cannabis symbol helps mitigate against the risk of accidental consumption by children and those with low literacy by communicating a warning that the product in the package contains THC, a substance that causes psychotropic effects and impairment, and should be avoided by children and youth. Furthermore, other jurisdictions that have legalized and regulated cannabis for non-medical purposes also require a standardized symbol as well as appropriate warnings and product information on packages.

This option was selected because, as demonstrated in the “Benefits and Costs” section below, there is extensive evidence to demonstrate that product packaging and labelling has a significant impact on consumer perceptions and behaviour, given its broad reach and exposure at key time points (such as at the moment of purchase and during use). The youth are particularly susceptible to promotion and branding and are more likely to try or want to use a branded product than a non-branded one. The impact of package branding is not restricted to brand-switching by established users, but is also linked to initiation of use. Furthermore, public health authorities across the country overwhelmingly supported a plain packaging approach during the public consultations on the detailed document outlining the proposed approach to regulating cannabis that began in November 2017, details of which can be found below.

The selected record keeping and reporting requirements pertaining to investors in licence holders whose securities are not traded on a public market address a risk that has been identified during parliamentary consideration of the Cannabis Act and certain stakeholders during the public consultations in November 2017. These measures will help achieve the objective of reducing opportunities for organized crime to infiltrate the legal industry through financial investments and using it to further other criminal activities. These measures allow for the industry to grow in a responsible, accountable and transparent manner. Finally, other changes have been made to allow for the development of new product forms to allow for effective competition with the illegal market.

Industrial Hemp

Option 1 — Destruction of “whole plant”

This option would have continued the previous regulatory requirement to destroy the flowering heads, leaves and branches of industrial hemp plants at the time of harvesting. The IHR were created in 1998 under the CDSA to enable the production of Canadian hemp grain or fibre, which were the parts of the plant that were of primary economic interest at that time.

It was decided not to maintain the requirement to destroy the flowering heads, leaves and branches of industrial hemp for several reasons. Consultations with the hemp industry, beginning in 2013, indicated that the majority of stakeholders wanted to allow the use of the entire hemp plant to permit the extraction and use of cannabinoids from the hemp plant, and to support the development of other new products. In 2016, changes to the regulatory program for industrial hemp were made to reflect the input received through these consultations; however, these changes did not include the removal of the requirement to destroy hemp plant parts. The Task Force heard evidence that, although low in THC, the industrial hemp plant parts destroyed under the previous framework can contain high levels of non-psychoactive CBD. In light of the increasing interest in the therapeutic potential of CBD, requiring these parts to be destroyed upon harvest would remove a significant source of raw material for new and emerging cannabis products from the market. The most recent consultations with the industry have demonstrated again that there is significant interest in moving forward with this change. In addition, given the new context of legalized and regulated access to cannabis under the Cannabis Act, any security risks previously associated with industrial hemp are anticipated to be significantly reduced.

Option 2 — Authorized sale of “whole plant” to licence holders

The selected option authorizes the sale of flowering heads, leaves and branches of industrial hemp only to a holder of a licence under the IHR 2018 or a person who holds a licence under the Cannabis Regulations. This allows for the processing of non-psychoactive cannabinoids, such as CBD, in a manner that complies with the good production practices and other requirements of the Cannabis Regulations. This also provides a strong foundation for the introduction of new products on the market. The economic benefits of the selected option are significant. The quantified benefits of allowing the sale of previously whole plant sale are estimated at almost $9.9 billion PV over the 10-year period, or approximately $1.4 billion PV annualized average benefit. While $900 million PV annualized benefit is anticipated for existing industrial hemp producers, approximately $500 million PV of additional annualized benefit is anticipated for new industrial hemp producers. This approach is aligned with the recommendations of the Task Force, which recommended that a “lighter” regulatory approach should apply to industrial hemp, but that CBD and other compounds derived from hemp should be regulated.

Benefits and costs

The regulatory requirements of the Cannabis Regulations and the new Industrial Hemp Regulations (IHR 2018) will result in a net benefit to Canadians of $9.1 billion (net present value, in 2017 dollars). Most of the benefits are expected to come from the IHR 2018. The IHR 2018 are estimated to provide a net benefit of $9.9 billion to Canadians primarily as a result of the sale of the flowers, leaves and branches (whole plant), while the Cannabis Regulations are estimated to result in a net cost to Canadians of $107.2 million. These costs are associated with the costs to meet the regulatory requirements for, but not limited to, physical security, good production practices, packaging and labelling, and record keeping and reporting. Total costs to government for the administration of the Cannabis Regulations are estimated to be $636.3 million (or $90.6 million annually). Despite the quantitative costs to the Cannabis Regulations, the qualitative benefits attributed to displacing the illegal market and providing adult Canadians access to a quality-controlled cannabis product will outweigh the net cost to Canadians of the Cannabis Regulations.

Overview of cannabis market in Canada

The cannabis market is comprised of two segments: the legal market and the illegal market. The legal market for cannabis was established in 1999, when Canadians were provided access to cannabis for medical purposes through the Marihuana Medical Access Program. Over time, the regulatory framework has evolved, largely in response to a series of court decisions (e.g. Allard v. Canada, 2016 and R. v. Smith, 2015).

Since 2013, the legal market has been supplied by regulated licensed producers of cannabis for medical purposes under the Marihuana for Medical Purposes Regulations (MMPR) and the ACMPR, as well as personal production and designated production of cannabis for medical purposes. The number of registered clients accessing cannabis for medical purposes has grown from 7 914 in June 2014 to 269 502 by the end of December 2017. This growth in the number of registered clients has translated into an increase in the sale of cannabis products for medical purposes by legal producers licensed under the MMPR and ACMPR, from 408 kg in the first quarter of 2014–2015 (April to June) to over 15 000 kg by quarter three of 2017–2018 (October to December).

All cannabis production and sale outside of the legal cannabis market for medical purposes is conducted within the illegal market. According to Statistics Canada’s Cannabis Economic Account, 1961 to 2017, the illegal domestic annual production of cannabis has been growing by an average of over 7% since 1961. In 2017, the value of the illegal production of cannabis for non-medical purposes was estimated to be valued at $4.6 billion. footnote12

One of the primary objectives of the Cannabis Act is to displace the illegal market by replacing it with a wellregulated, diverse and competitive legal market.

Market projections

A. Cannabis

In the lead up to the coming into force of the Cannabis Act, in addition to Statistics Canada estimates, several institutions have undertaken projections of the potential future size of the cannabis market. The Parliamentary Budget Officer (PBO) estimates that the total amount of cannabis consumed by Canadians will potentially increase from 655 metric tons to 734 metric tons from 2018 to 2021. footnote13 PBO estimated the value of the cannabis market in 2018 to be between $4.2 billion and $6.2 billion. In comparison to the PBO report, Deloitte estimated that initially the cannabis market for non-medical purposes could range between $4.9 billion and $8.7 billion once cannabis became legal. footnote14 Finally, CIBC pegged the potential value of the legal cannabis market at around $5 billion. footnote15 Given these projections, it is assumed that the value of the future cannabis market (i.e. output) could range between $4.2 billion and $8.7 billion immediately following the coming into force of the Cannabis Act and its associated regulations. footnote16

B. Industrial hemp

Industrial hemp is one of the oldest cultivated plants in the world. It can be grown as a fibre, seed or dual-purpose crop. On March 12, 1998, the commercial production (including cultivation) of industrial hemp was legalized in Canada and regulated under the IHR 1998. The licences and authorizations were issued by Health Canada. All industrial hemp grown and sold in Canada must contain 0.3% THC or less in the leaves and flowering parts and must come from an approved cultivar. The 0.3% THC concentration level serves as the major dividing line between industrial hemp and cannabis plants with intoxicating levels of THC.

Between January 1, 2017, and November 24, 2017, there were 1 236 licences to cultivate industrial hemp issued in Canada. The prairie provinces of Alberta, Manitoba, and Saskatchewan contain roughly 74% of all licences issued. The cultivation of industrial hemp associated with these licences is done across 55 854 hectares of land, with roughly 95% coming from the prairie provinces.

The global market for industrial hemp products has grown significantly over the last decade and is estimated to include more than 25 000 products in nine sub-markets: agriculture; textiles; recycling; automotive; furniture; food/nutrition/beverages; paper; construction materials; and personal care. Some of the most common food products made from hemp seeds in Canada include hemp meal and flour, nutritional bars, edible oil, pasta, cookies, beer, lactose-free milk and ice cream. Other non-food products derived from hemp seeds include shampoo and conditioners, moisturizers, aromatherapy and cosmetic products.

Similar to regulated participants wishing to capture part of the legal cannabis market and who will need to meet the requirements of the Cannabis Regulations, industrial hemp producers will need to meet the requirements of the IHR 2018. Costs and benefits associated with industrial hemp are discussed below.

Analytical approach

The Cabinet Directive on Regulatory Management requires departments to determine the impact of regulatory proposals by assessing the benefits and costs of the regulatory approach on affected stakeholders. To measure these impacts, the benefits and costs are estimated by comparing the incremental change from the current regulatory framework (i.e. baseline scenario) to what is anticipated to occur under the new regulatory approach (i.e. regulatory scenario).

Baseline and regulatory scenario

For the purpose of this analysis, the baseline is assumed to be the regulatory framework for cannabis that would have existed in the absence of the Cannabis Act, the Cannabis Regulations and the new Industrial Hemp Regulations. The baseline scenario captures all activities and trends related to cannabis authorized under the CDSA and the following regulations and exemptions. They are as follows:

  • the ACMPR and accompanying section 56 exemptions;
  • the IHR 1998 and accompanying section 56 exemptions; and
  • the NCR.

The regulatory scenario includes the regulatory instruments described in the introduction to the description section of this document. The analysis focuses on incremental changes from the ACMPR, IHR 1998, and NCR to the Cannabis Regulations and IHR 2018. The projected regulatory scenario represents the most likely outcome of the regulatory change based on current information.

Assessing regulatory impacts footnote17

Regulatory impacts in this analysis were estimated using two approaches — quantitative analysis, where possible, and qualitative assessments. For the quantitative analysis, Health Canada gathered data through a series of questionnaires that were distributed to industry stakeholders in February and March 2018. The voluntary questionnaires sought detailed information about each organization’s operations and costs associated with the publicly available provisions of the regulatory proposal (e.g. licensing framework, physical security, industrial hemp). Input from industry, along with internal Health Canada data, was also used to quantitatively estimate the costs and benefits incurred by regulated parties as a result of the requirements from the Cannabis Regulations and IHR 2018. When quantification of estimates was not possible, qualitative assessments were provided.

Following the coming into force of the Cannabis Act and the Cannabis Regulations, a regulated cannabis industry will be established that will be larger than the previous market for cannabis for medical purposes. It is expected that regulated parties (i.e. federal licence holders) will capture an increasing share of the market in the years following implementation of the new legislation, effectively displacing a portion of the illegal production and sale of cannabis. For the purpose of this analysis, the displacement of the illegal market is considered a transfer of cannabis revenue from the illegal actors to regulated parties. Although regulated parties will benefit from this transfer, as they will accrue profits from the sale of cannabis for non-medical purposes, the economy-wide impact is neutral and thus not considered in the quantitative analysis as a benefit.

In order for regulated participants to capture the revenues of the newly created market, they will need to meet all the regulatory requirements and incur the applicable compliance and administrative costs associated with the regulations. These regulatory costs and benefits are discussed below.

As per Treasury Board Secretariat guidelines, footnote18 the CBA only assesses impacts directly related to a regulatory requirement. Any impact that is not associated with a regulatory requirement is considered out of scope for this analysis.

The period of analysis for this CBA covers the 10-year period from 2018–2019 to 2027–2028, with each year starting September 1 and ending on August 31 of the next calendar year. A 7% discount rate is used to estimate the present value of the incremental costs and incremental benefits. footnote19 All values are expressed in 2017 constant dollars and reported for the 10-year period from 2018–2019 to 2027–2028, unless otherwise stated.

Regulated parties under the Cannabis Regulations

The costs and benefits of the Cannabis Regulations incurred by regulated parties were assessed in the areas of licence applications and renewals, physical security, security clearances, good production practices, packaging and labelling, record keeping and reporting, and access to cannabis for medical purposes. The analysis identified the following two key industry groups that would be affected by the Cannabis Regulations: (i) existing licence holders; and (ii) new licence holders.

In the context of this CBA, the category of “existing licence holders” is comprised of licence holders that are in or would have entered the legal cannabis market (for medical purposes only) in the absence of the Cannabis Act and the Cannabis Regulations. For the purpose of this analysis, existing licence holders are categorized into the following two subgroups: (1) those who, as of September 2018, are licensed, or in the process of becoming licensed (i.e. applicants in the “queue”) to conduct cannabis activities under the ACMPR; and (2) those licensed dealers that are authorized to conduct cannabis activities under the NCR (e.g. possession, production, assembling, sale or transportation) and will need to apply for a new licence under the Cannabis Regulations (e.g. processing, cultivation, analytical testing licence). footnote20 Incremental impacts for applicants in the queue are assessed when they obtain their licence.

The baseline scenario for subgroup 1 of existing licence holders are the requirements that must be met under the ACMPR, while the NCR is the baseline for subgroup 2. Since they have already met all of the requirements to be granted a licence under the ACMPR or NCR, existing licence holders, with the exception of some applicants in the queue, have already made all the investments required to become or continue to be operational in compliance with the Cannabis Regulations. Therefore, any reduction in initial capital expenditure requirements resulting from the implementation of the Cannabis Regulations are not considered cost savings for this subgroup as they have already been incurred. In other words, those investments are a sunk cost. Incremental costs and benefits for existing licence holders are examined only with respect to ongoing operational costs.

The applicants in the queue, within subgroup 1, are at various stages of the application process and may not have made all of the initial capital expenditures necessary to be compliant with the requirements of the ACMPR before the Cannabis Regulations come into force. This analysis assumes that some applicants will not have completed construction of their facilities upon coming into force of the Cannabis Regulations and will potentially incur a cost savings due to a reduction in initial capital expenditure (resulting from, for example, changes to physical security requirements).

The CBA classifies “new licence holders” as those individuals who are motivated to enter the cannabis market primarily due to the new licensing framework set out by the Cannabis Regulations, which authorizes a range of activities with cannabis for non-medical purposes. Since new licence holders do not exist in the above-mentioned baseline scenario, they are not subject to any previous requirements and have not borne any regulatory costs associated with becoming operational. Therefore, the full cost of complying with the Cannabis Regulations was calculated for new licence holders as an incremental cost.

Finally, costs incurred by the Government of Canada to administer the Cannabis Regulations are included in this analysis.

Projected number of licence holders

A. The Cannabis Regulations

The CBA projected the number of federal licence holders that will be authorized to conduct cannabis activities over a 10-year analysis period, from 2018–2019 to 2027–2028. Forecast estimates were based on three key variables: the number of applications in the queue, the average duration of the application process, and the projected yearly amount of cannabis supplied by the legal industry. footnote21

The projections used in this analysis are based upon historical experience under the ACMPR, solely for the purpose of conducting a quantified and monetized analysis of impacts. It is acknowledged that any modifications to the licensing process under the new regulatory framework would result in changes to the duration of licence processing, construction of facilities and initiation of business operations, and completion of the first product cycle. The scope of such modifications was not known at the time of this analysis, and, therefore, could not be considered in the forecast. Furthermore, the analysis does not capture any additional entrants into the cannabis market who seek to produce and sell cannabis edibles and concentrates. These entrants will be projected and analyzed in a subsequent CBA for regulations, or regulatory amendments, related to edibles and concentrates that will be completed within 12 months of the coming into force of the Cannabis Act.

Under the baseline scenario, the number of existing licence holders is projected to increase from 321 by the end of 2018–2019 (August 2019) to 520 by the end 2027–2028 (August 2028). The regulatory scenario projects the number of new licence holders, as defined above, to increase from zero to 101 by the end of 2027–2028. The 101 new licence holders include standard, micro, and nursery licences. In total, it is anticipated that by the end of 2027–2028 there will be 621 licence holders authorized to conduct cannabis activities under the Cannabis Regulations.

B. New Industrial Hemp Regulations under the Cannabis Act

Incremental costs and benefits were estimated for the IHR 2018 based on consultation with industry stakeholders and internal Health Canada data on industrial hemp producers (hemp producers). A considerable number of changes to the administration of the IHR 1998 were made in November of 2016 through a section 56 exemption issued under the CDSA, which has limited the scope of impacts associated with the IHR 2018. The exemption better aligned the IHR 1998 with the demonstrated low public health and safety risk of the crop. In the section 56 exemption, Health Canada reduced and simplified the licencing and regulatory requirements placed on growers of industrial hemp. This simplified process will be part of the baseline.

For the purpose of this analysis, hemp producers are categorized into two groups — existing hemp producers, and new hemp producers. For the purposes of the CBA, “existing hemp producers” are those licensed to conduct activities with industrial hemp that have or would have operated under the IHR 1998 and are anticipated to continue to do so under the IHR 2018. Therefore, costs and benefits incurred by existing hemp producers are calculated as incremental to the IHR 1998.

For the purposes of this analysis, the category of “new hemp producers” includes those who are anticipated to enter the industrial hemp market as a result of the new requirements set out by the IHR 2018. In particular, it is anticipated that new requirements enabling the sale of the whole plant (flower, leaves and branches) may entice new cultivators to enter into the industrial hemp market, which they otherwise would not have opted to do. Therefore, all requirements established under the IHR 2018 are calculated as incremental costs to this group.

For the purposes of this analysis, it is anticipated that the number of industrial hemp producers grows at a rate of 20% per year. The first 10% reflects the baseline growth, or the growth rate of the existing hemp producers, and the remaining 10% represents the incremental growth in new producers. In total, it is anticipated that by the end of 2027–2028, there will be 3 381 distinct individuals, partnerships, corporations or cooperatives who hold a licence to conduct activities with industrial hemp. This is an increase from the 655 distinct licence holders in 2018–2019.

In addition to the increase in distinct cultivators of industrial hemp, this analysis assumes that producers will expand the acreage of hemp production to their entire fields given the higher value that can be obtained from the whole plant, than other crops.

Assessment of benefits and costs

A. The Cannabis Regulations

It is estimated that the Cannabis Regulations will result in a total cost to industry of $133.9 million with a total benefit estimated at $26.7 million. Taken together, the Cannabis Regulations are estimated to generate a net cost to industry of $107.2 million PV (or $15.3 million annually) over 10 years. In addition, cost to the government of Canada for the administration of the Cannabis Regulations is estimated to be $636.3 million PV (or $90.6 million annually). In total, the net cost to industry and government is $743.5 million PV (or $105.9 million annually). That being said, once regulated parties have incurred the regulatory costs and are authorized to conduct cannabis activities, they will have access to a cannabis market, as indicated above, that is projected to be between $4.2 billion and $8.7 billion. A detailed breakdown of benefits and costs follows.

Net benefits

Physical security requirements

Physical security requirements under the Cannabis Regulations have changed from the ACMPR to better reflect the risk of cannabis being diverted to the illegal market in the new context of legalized and regulated access to cannabis. For existing licence holders that were previously licensed under the ACMPR, the incremental benefit from the new approach is related to cost savings of not having to maintain or replace the intrusion detection system for grow areas. footnote22Licence holders, who are expected to enter the cannabis market after August 2018 and would have otherwise been licensed under the NCR, will see a cost savings from not being required to follow the Directive on Physical Security Requirements for Controlled Substancesfootnote23 All existing licence holders with their facilities built would already have higher levels of physical security in place, and therefore would not see any benefit. In addition, it is assumed that a proportion of applicants in the queue would still be in the process of building their facility before and following the coming into force of the Cannabis Regulations, thus not yet incurring the one-time cost of installing the intrusion detection system in the grow areas resulting in expected cost savings. Together, the total cost savings experienced by existing licence holders is estimated to be $20.8 million PV (or $3.0 million annually).

New licence holders are subject to the full range of physical security requirements set out in the Cannabis Regulations. As a result, the analysis estimates the incremental costs to new licence holders as the cost to install and maintain visual monitoring and intrusion detection system as required by the Cannabis Regulations, as well as the cost to monitor the visual recordings at all times. The cost to new licence holders is estimated at $4.5 million PV (or $638,500 annually).

Overall, the physical security requirements of the Cannabis Regulations are expected to result in a net benefit of $16.3 million PV (or $2.3 million annually) to all regulated parties.

Record Keeping and Reporting footnote24

The Cannabis Regulations will establish rules and standards for licence holders to maintain detailed records on the inventory, movement, sale, import/export, promotion and production of cannabis, physical and personnel security, research and development, and details regarding money, goods, or services that result in direct or indirect control of the licence holder. Cost savings for existing licence holders is attributed to the new regulatory requirement that visual recordings be kept for one year, rather than two years as required by the ACMPR. The CBA estimates a cost savings of approximately $4.8 million (or $688,800 annually) due to the reduced costs of retaining visual recordings.

Two distinct elements of the record keeping and report requirements are new when assessed against the ACMPR (promotional activity and financial information). Costs associated with these specific requirements are incremental for existing licence holders. In addition, all record keeping and reporting requirements are incremental costs to new licence holders. Therefore, the total cost for record keeping and reporting for all licence holders is expected to be $3.7 million (or $523,100 annually).

In total, incremental impacts of the recording keeping and reporting requirements set out by the Cannabis Regulations are expected to result in a net benefit of $1.2 million PV (or $165,700 annually) over the next 10 years.

Personnel security clearance requirements

The Cannabis Regulations specify individuals within a licensed organization who are required to hold a valid security clearance, including, but not limited to, the individual who holds the licence, directors and officers, and key positions specified in the regulations. The Cannabis Regulations will now allow security clearances to be transferable for security-cleared individuals who move from one licence holder to another. Finally, it will no longer be a requirement for security-cleared persons to be physically present in all areas where cannabis is present.

As a result, the analysis estimates that existing licence holders are expected to see a reduction in the number of individuals who will be required to hold a valid security clearance. The approach to security clearances is anticipated to result in fewer hours being spent by employees to complete and submit security clearance applications to Health Canada. The CBA estimates cost savings of $740,200 PV (or $105,400 annually) for existing licence holders.

New licence holders are expected to incur costs associated with the completion and submission of security clearance applications in compliance with the Cannabis Regulations. The cost for new licence holders relating to the completion and submission of security clearance applications is estimated to be $98,950 PV (or $14,100 annually).

The security clearance requirements of the Cannabis Regulations are expected to provide a net benefit of $641,300 PV (or $91,300 annually) over the next 10 years.

Import and export permits

The Cannabis Regulations increase the maximum validity period of the export and import permits to six months. Currently, there are cases where the permit expires before the permit holder can complete their transaction. In this case, the permit holder is required to re-apply for a permit in order to complete their transaction. It is anticipated that the extension of the validity period for permits will generate cost savings for existing licence holders of $20,900 PV (or $3,000 annually) over the next 10 years.

Qualitative benefits

Public health

Following the coming into force of the Cannabis Act, adult Canadians will have access to quality-controlled cannabis for non-medical purposes that has been produced by a strictly regulated legal industry. As stated earlier, it is expected that the legal market will displace a portion of the illegal market projected to be between $4.2 billion and $8.7 billion. The Cannabis Regulations will establish a number of rules and standards for the commercial industry that support the government’s public health goals of restricting youth access and minimizing the harms of cannabis use, including requirements for good production practices, packaging and labelling, and record keeping and reporting.

Requiring licence holders to develop and adhere to standard operating procedures and a sanitation program will help ensure that every cannabis product is produced, sampled, tested, packaged, labelled, distributed and stored in a manner that maintains quality. These GPP requirements are anticipated to reduce the health risk to adults of consuming cannabis products with potentially harmful pesticides, chemicals, heavy metals or other dangerous substances, which have been found in illegally sourced cannabis, footnote25footnote26footnote27 while also providing access to cannabis products of a known potency.

Under the Cannabis Regulations, testing for the following must be conducted on cannabis products: (a) the residues of solvents used in the production of cannabis oils; (b) microbial and chemical contaminants; (c) dissolution and disintegration, as applicable; and (d) the quantity of THC, THCA, CBD, and CBDA, as the case may be.

Product packaging and labelling requirements would provide adult consumers with health and safety information to allow for informed consumer choice, particularly with respect to the health risks associated with cannabis use. A standardized cannabis symbol on cannabis packages would identify THC products to consumers and others, including children and those with low literacy, thereby limiting accidental consumption of cannabis products. In addition, restrictions around the use of colours and graphics, and other special characteristics on packaging are expected to minimize the appeal of cannabis products to youth and others. Independent studies, spanning at least two decades and multiple countries, have unequivocally demonstrated that plain packaging is perceived as less attractive and less appealing, particularly among youth and young adults. footnote28 Reducing inducements to use cannabis products, by making them less appealing, is expected to help prevent youth and others from initiating cannabis use.

Under the Cannabis Regulations, licence holders will be required to have a recall system in place which will permit the rapid and complete recall of every lot or batch of cannabis that has been sold or distributed. Since all cannabis in a cannabis product must be tested, the risk of recall is lowered. The recall system provides assurances to Canadians that in the rare circumstances where issues are found in a cannabis product (for whatever reason), swift and appropriate action is taken to remove all affected products from the market.

Public safety

Through the licensing framework that will be established in the Cannabis Regulations, a legal industry for cannabis will be authorized to produce cannabis for non-medical purposes destined for retail sale. Previously, cannabis for non-medical purposes was entirely produced and supplied through the illegal market. In 2017, it was estimated that the annual illegal market for cannabis for nonmedical purposes, which benefits criminals and organized crime, was worth approximately $4.6 billion. footnote29 Legal businesses, engaging in activities with cannabis authorized by the Cannabis Regulations, will displace illegal actors over time and benefit from a transfer of profits from those that were operating illegally. It is anticipated that certain risks currently associated with illegal cannabis production (e.g. risk of fire, improper handling/use of dangerous products) would be reduced over time as the illegal market is displaced with legal regulated businesses.

By way of the physical security requirements, the possession and production of cannabis will be conducted in a secure environment that protects against the diversion and theft of legal cannabis. It is expected that curtailing opportunities for diversion or theft into the illegal market will help displace the illegal market over time and reduce opportunities to further other criminal activities.

The requirement for licence holders to keep a detailed record of all cannabis they sell, distribute, import, export, and keep in inventory will also act to prevent diversion of legal cannabis to the illegal market. The records will enable Health Canada inspectors to check actual inventories against what is recorded to verify that there are no anomalies.

The security clearance measures would authorize the Minister to take steps to determine whether an individual associated with a potential licensee poses an unacceptable risk to public health or public safety, considering factors including, but not limited to, associations to organized crime, or involvement in serious drug offences, corruption or violent offences. Ensuring that people in key positions within the business have a valid security clearance reduces the risk that the business will engage in illegal activity.

Additionally, the reporting requirements for financial information will provide the basis for a stronger framework for determining whether criminals or members of organized crime are exercising control over legal cannabis business. The holder of a privately held cultivation, processing or sale licence must maintain a record, and report annually information in respect of each investor that controls the licensee, either directly or indirectly. Information would include the investor’s name and mailing address; if applicable, details regarding the money, goods or services that the investor provided the holder; a detailed description of how the investor controls, or is in a position to control the holder; and whether the interest of the investor has been sold or transferred to another person. This information is intended to allow for the detection of criminal actors having influence over a licence holder.

Improvements to patient access

The Task Force recommended that the Government of Canada continue providing patients with a range of options to access cannabis for medical purposes. In line with the advice of the Task Force, the Cannabis Regulations build upon the requirements in the former ACMPR to remove and reduce administrative requirements that were identified by patients, patient advocates, and healthcare professionals as being unnecessarily burdensome.

The Cannabis Regulations allow registered clients to request the transfer of their medical document from one licensed seller to another without having to request a new medical document from a health care practitioner. This will allow patients additional flexibility to procure cannabis that best meets their individual needs by seeking products that may be offered by different licensed sellers once their medical document has been transferred. Allowing registered clients to have access to cannabis during a period of transition from one licensed seller to another will help ensure that clients continue to have access to cannabis for their medical needs.

Patients also benefit by reducing the number of visits to healthcare practitioners by extending the validity period of the medical document using the date of registration as the first day of the validity period as opposed to the date on which it was issued by the healthcare practitioner.

Broaden the definition of practitioners for prescription drugs

The NCR authorizes a practitioner to sell, prescribe, provide and administer narcotics with prescribed conditions. The scope of the definition of practitioner under the NCR is narrow, and includes practitioner of medicine, dentistry or veterinary medicine, as well as nurse practitioners where authorized in their province. The Cannabis Regulations use the broader definition of practitioner taken from the Food and Drugs Regulations (FDR), which includes any practitioner who is entitled by their province to prescribe a prescription drug. Depending on the province, this could include naturopaths, midwives, podiatrists and more. This expanded definition will result in an increase in the number of practitioners that are able to prescribe prescription drugs that contain cannabis. As a result, patients of prescription drugs that contain cannabis will experience an improvement to access resulting from being able to see a wider range of practitioners to meet their medical access needs.

Environmental

The Cannabis Regulations enable licence holders to cultivate cannabis outdoors, which was prohibited under the ACMPR. Outdoor cultivation would provide licence holders with a less energy-intensive method of cultivation, resulting in licence holders spending less on energy costs while at the same time limiting the carbon footprint on the environment. footnote30

The Cannabis Regulations are expected to minimize potential negative impacts that have been associated with non-regulated outdoor cultivation, such as poor air quality, soil contamination, presence of hazardous wastes, and the use of unauthorized pest control products. footnote31footnote32footnote33 The application of authorized pest control products would need to be carried out in accordance with the Pest Control Products Act, which entails a scientific evaluation of the health and environmental risks of a pest control product and an assessment of whether those risks are acceptable before the pest control product can be registered for use.

Net costs

Licence application and validity period

In order to be authorized to conduct activities with cannabis, licence holders are required to complete the licence application process, which includes collecting and processing information, as well as filling out and submitting the application along with supporting documentation to Health Canada. A similar process was required under the ACMPR; therefore, no additional incremental costs will be incurred by existing licence holders that were previously licensed under the ACMPR.

The validity period of the licence will be extended from three years to up to five years under the Cannabis Regulations. The analysis assumes that all licences will be valid for five years. Increasing the validity period of licences will reduce the number of licence renewals that existing licence holders will have to complete over 10 years, resulting in fewer hours spent on completing and submitting renewal applications to Health Canada. In addition, it is assumed that existing licence holders that were previously licensed under the NCR will need to apply for a new licence under the Cannabis Regulations to conduct cannabis activities, which are estimated to result in costs associated with the application and renewal process. Taken together, the CBA estimates cost savings of $95,200 PV (or $13,600 annually) for existing licence holders.

New licence holders are expected to incur costs associated with the licence application and renewal process. It is estimated that the licence application and renewal process will cost new licence holders $1.1 million PV (or $158,100 annually) over the period of analysis.

In total, the incremental impacts of the licensing structure that will be established by the Cannabis Regulations are expected to result in a net cost of $1.0 million PV (or $145,000 annually).

Packaging and labelling

In order to be compliant with the packaging and labelling requirements, licence holders will need to package their product in an immediate container that is tamper-evident and child resistant. Additionally, any container that contains cannabis products must include specific product information, along with a standardized cannabis symbol and mandatory health warning messages. Existing licence holders will only face incremental costs associated with the standardized cannabis symbol and mandatory health warning messages, as similar packaging and labelling provisions existed under the former ACMPR for product information, tamper-evident and child resistance. Other aspects of the plain packaging approach are not estimated to generate additional costs.

New licence holders will face the full costs of all packaging and labelling requirements. Taken together, it is anticipated that the packaging and labelling requirements will result in a net cost of $104.0 million PV (or $14.8 million annually) for new and existing licence holders.

Good production practices

All authorized activities will need to be in compliance with the applicable good production practices (GPP) that will be established in the Cannabis Regulations. These include, among other things, developing and adhering to standard operating procedures and a sanitation program, as well as testing cannabis products for residues of solvents and contaminants using validated methods. Existing licence holders should already be in compliance with the ACMPR, which include similar GPP provisions. Therefore, only new licence holders will incur incremental costs associated with these provisions. For new licence holders, it is anticipated that complying with GPP requirements will result in a net cost of $19.9 million PV (or $2.8 million annually) over 10 years.

Understanding the regulatory requirements

Once the Cannabis Regulations come into force, certain aspects of the regulatory framework for activities related to cannabis will change. Thus, in order to comply with the Cannabis Regulations, all licence holders will spend time reviewing and understanding the new and revised regulatory requirements that will affect their day-to-day business operations. It is anticipated that the measures taken to understand the Cannabis Regulations will cost $380,500 PV (or $54,200 annually) over the next 10 years for all licence holders.

Costs to Government

The costs to the government of Canada (Health Canada and RCMP) to administer the Cannabis Regulations and the IHR 2018 include costs associated with compliance, enforcement and inspections of the regulatory requirements, licensing, and program management and support. The cost to government is estimated at $636.3 million PV (or $90.6 million annually).

B. New Industrial Hemp Regulations

It is estimated that the IHR 2018 will result in a net benefit to industrial hemp producers of 9.9 billion PV over the 10-year period of analysis (or $1.4 billion PV). A detailed breakdown of estimated benefits and costs follows.

Net benefits

Sale of whole plant

A significant driver of benefits to industrial hemp producers is the authorized sale of the whole plant (flowering heads, leaves and branches of the industrial hemp plant) under the IHR 2018, which provides new opportunities for the sale of high-value plant parts to other licence holders. Under the IHR 1998, industrial hemp producers were required to destroy the flowering heads, leaves and branches of the plant upon harvest. These parts of the plant contain cannabidiol (CBD) that can be extracted by processors and used to make valuable CBD products. CBD, like THC, is a cannabinoid but it does not produce the psychotropic effects or “high” that users would typically feel when using a cannabis product high in THC. CBD products are typically used for health reasons instead of for non-medical purposes.

The IHR 2018 opens up the market of the whole plant for industrial hemp producers, therefore the entire profits generated from their sale is an incremental benefit. According to the Canadian Hemp Trade Alliance (CHTA), in their comments on the proposed Bill C-45, allowing for the harvest, sale and processing of non-psychotropic cannabinoids would bring great financial benefit to Canadian industry, amounting to potential revenues of several hundred million dollars to the industry from a multi-billion dollar CBD market (CHTA, 2017). footnote34 This market is growing annually.

As a result of this change, industrial hemp producers are estimated to accrue incremental benefits estimated at $9.9 billion PV over the 10-year period of analysis (or $1.4 billion PV).

Criminal record check

The IHR 2018 removes the requirement for industrial hemp producers to submit a criminal record check in order to obtain a licence, which is a requirement under the IHR 1998. Two sources of savings associated with this change have been identified for existing industrial hemp producers. First, there is cost savings associated with not completing the criminal record check form and submitting it in person to a local law enforcement agency. This is estimated to result in a cost saving of approximately $2.7 million PV over the 10-year period of analysis. Second, industrial hemp producers will no longer need to pay a $25 fee customarily charged to farmers by local law enforcement agencies to process and administer criminal record checks. This generates costs savings for existing industrial hemp producers of an estimated $511,800 PV (or $72,900 annually) over 10 years, assuming an average of four criminal record checks per licence. Taken together, removing the requirement of the criminal record check is estimated to provide cost savings of $3.2 million over 10 years (or $454,800 annually).

Licence application and validity period

The validity period of licences will be extended from one year to up to five years. The analysis assumes that all licences will be valid for five years. Increasing the validity period of licences will reduce the number of licence renewals that existing industrial hemp producers will have to complete over 10 years, resulting in fewer hours spent on completing and submitting renewal applications to Health Canada. The analysis estimates that this change will generate cost savings of $406,400 PV over 10 years (or $57,900 annually).

All industrial hemp producers will be required to complete and submit a licence application in order to be authorized to produce industrial hemp by Health Canada. Since existing industrial hemp producers already face this requirement under the IHR 1998, only new industrial hemp producers are subject to these incremental costs. The incremental cost to new industrial hemp producers to complete the application process every five years is estimated to be $166,100 PV (or $23,600 annually) over 10 years.

Overall, the licence application process is estimated to provide a net benefit to industrial hemp producers of $240,300 (or $34,200 annually).

Increase validity period of import export permits

Under the IHR 1998, import and export permits were valid for three months. As a result of concerns raised by the hemp industry that three months was too short for contracts and shipping matters to be completed prior to the expiration of a permit, the period of validity is extended to six months.

By increasing the period to six months, industrial hemp producers will be able to complete their import or export transactions prior to the expiration of the permit. If the permit expires prior to the completion of the transaction, the industrial hemp producer must re-apply for a permit in order to complete the transaction. In addition to the added administrative costs of re-applying for a permit, the delay in the transaction would result in an opportunity cost for the producer from not being able to move on to another activity, as well as additional costs to reschedule the shipping and other logistical issues. Additionally, contractual obligations for industrial hemp producers may be affected by the delay resulting from the expiration of the permit. We expect this benefit to be small as it would affect a small subset of hemp producers.

Net costs

Notification after seeding

The IHR 2018 will require licence holders to notify Health Canada of the location of the field where industrial hemp is grown, and the variety of hemp that was sown within 30 days of sowing. The IHR 1998 has similar requirements of notification but requires it within 15 days of sowing. The increase from 15 days to 30 days would be more convenient for existing industrial hemp producers; however, any benefit is expected to be minimal (and not quantifiable) and is therefore not considered. As a result, this incremental cost will only be incurred by new industrial hemp producers. The cost to notify Health Canada of the details surrounding their hemp activity is estimated to be $199,000 PV (or $18,100 annually) over the 10-year period.

Understanding the regulatory requirements

Once the IHR 2018 come into force, certain aspects of the regulatory framework for activities related to industrial hemp will change. Thus, in order to comply with the IHR 2018, industrial hemp producers will spend time reviewing and understanding the new regulatory requirements. This cost affects all industrial hemp producers. As a result, it is anticipated that the measures taken to understand the IHR 2018 will generate a cost of $60,800 PV over 10 years (or $8,700 annually).

Summary: Net benefits of the Cannabis Regulations and the IHR 2018

In summary, the Cannabis Regulations are estimated to generate a net cost to regulated parties of $107.2 million over 10 years, while the IHR 2018 is estimated to provide a net benefit of $9.9 billion (see Table 1). That being said, once regulated parties have incurred the regulatory costs and are authorized to conduct cannabis activities, they will have access to a cannabis market, as previously estimated, that is projected to be between $4.2 billion and $8.7 billion in total revenue. A more detailed cost-benefit statement is provided in Table 2.

Table 1: Net impacts of the Cannabis Regulations and IHR 2018 note1

Total (PV) Annualized Average
2017 constant dollars, CAN$
Net impacts of Cannabis Regulations
Physical security requirements 16,284,432 2,318,537
Record keeping and reporting requirements 1,163,904 165,714
Personnel security clearances 641,329 91,311
Packaging and labelling requirements –104,012,210 –14,808,999
Good production practices requirements –19,910,198 –2,834,764
Licence application process –1,018,077 –144,951
Understanding the Cannabis Regulations requirements –380,457 –54,168
Net impacts of Industrial Hemp Regulations
Whole plant sale 9,861,361,827 1,404,036,070
Criminal record check 3,194,122 454,771
Licence application process 240,285 34,211
Notification after seeding –198,990 –18,128
Understanding the IHR 2018 requirements –60,841 –8,662
Net impact of Cannabis Regulations –107,231,277 –15,267,321
Net impact of Industrial Hemp Regulations 9,864,536,402 1,404,498,262

Table 2: Cost-benefit statement

Base Year:
2018–2019
Year 4:
2021–2022
Year 7:
2024–2025
Year 10:
2027–2028
Total (PV) Annualized Average
A. Quantified impacts (2017 constant dollars, CAN$)
Benefits
Benefits to existing licence holders (cannabis)
Physical security requirements 1,844,618 2,349,268 1,616,666 1,604,137 20,768,771 2,957,006
Record keeping and reporting requirements 351,489 734,217 702,945 697,498 4,837,672 688,776
Personnel security clearances 220,173 220,173 15,895 117,586 960,465 136,749
Licence application process and permits 2,269 5,828 27,764 1,102 132,174 18,819
Total benefits of Cannabis Regulations 2,418,549 3,309,486 2,363,270 2,420,323 26,699,081 3,801,348
Benefits to industrial hemp producers
Whole plant sale 663,707,881 848,663,192 1,084,969,366 1,386,008,955 9,861,361,827 1,404,036,070
Validity period of licence 0 61,577 54,063 –4,019 406,381 57,859
Criminal record check 281,153 305,470 331,891 360,597 3,194,122 454,771
Total benefits of Industrial Hemp Regulations 663,989,034 849,030,239 1,085,355,320 1,386,365,534 9,864,962,330 1,404,548,701
Total benefits 666,407,583 852,339,725 1,087,718,590 1,388,785,856 9,891,661,411 1,408,350,049
Costs
Costs to existing licence holders (cannabis)
Packaging and labelling requirements 4,415,501 10,540,689 10,087,179 9,532,049 92,649,687 13,191,231
Record keeping and reporting requirements 118,407 202,037 160,801 130,992 1,634,444 232,708
Understanding the Cannabis Regulations 133,262 34,320 0 0 251,270 35,775
Personnel security clearances 126,012 –13,522 –4,378 88,305 220,286 31,364
Licence application process 21,475 629 0 10,430 39,669 5,648
Costs to new licence holders (cannabis)
Packaging and labelling requirements 0 1,698,208 1,625,143 1,535,706 11,362,523 1,617,768
Good production practice requirements 0 12,620,925 2,592,430 2,247,185 19,910,198 2,834,764
Physical security requirements 0 777,005 756,908 733,231 4,484,339 638,469
Record keeping and reporting requirements 0 308,044 298,967 259,726 2,039,323 290,354
Licence application process 0 64,955 58,735 14,794 1,110,581 158,122
Personnel security clearances 0 57,726 3,524 5,485 98,850 14,074
Understanding the Cannabis Regulations 0 104,391 5,202 880 129,187 18,393
Costs to industrial hemp producers
Notification after seeding 1,461 8,905 23,881 52,570 198,990 18,128
Licence application process 5,667 9,831 20,772 32,815 166,096 23,648
Understanding the IHR 2018 16,098 3,785 5,338 7,530 60,841 8,662
Costs to Federal Government
Licensing 25,288,200 18,343,075 15,889,906 13,764,819 193,151,562 27,500,437
Inspections 16,852,285 17,673,729 15,310,077 13,262,535 172,177,145 24,514,152
Program management and support 18,598,994 11,045,938 9,568,675 8,288,978 121,407,644 17,285,717
Internal services 8,731,134 5,891,462 5,103,548 4,421,009 62,184,585 8,853,686
Compliance and enforcement 4,635,540 5,901,333 5,112,100 4,428,417 55,432,599 7,892,355
Security screening 3,544,714 3,186,326 2,760,193 2,391,049 31,901,178 4,542,010
Total costs of Cannabis Regulations 4,814,658 26,395,408 15,584,511 14,558,783 133,930,358 19,068,670
Total costs of Industrial Hemp Regulations 23,227 22,521 49,992 92,915 425,927 50,439
Total costs of Industrial Hemp Regulations and Cannabis Regulations 4,837,885 26,417,929 15,634,503 14,651,698 134,356,285 19,119,109
Total costs to Federal Government 77,650,868 62,041,862 53,744,498 46,556,807 636,254,711 90,588,357
Net impact of Cannabis Regulations –2,396,109 –23,085,923 –13,221,241 –12,138,460 –107,231,277 –15,267,321
Net impact of Industrial Hemp Regulations 663,965,807 849,007,718 1,085,305,329 1,386,272,618 9,864,536,402 1,404,498,262
Net impact 583,918,830 763,879,933 1,018,339,589 1,327,577,351 9,121,050,414 1,298,642,584
B. Qualitative impacts
Reduced health risks:

  • Reduced health risk for adult consumers of cannabis for non-medical purposes due to good production practices (GPP).
  • Reduced risk of accidental consumption of cannabis due to the child resistant packages, standardized cannabis symbol and health warning messages.

Enhanced public safety:

  • Reduction in risks associated with illegal production of cannabis as the illegal market is displaced with legal regulated parties.

Improvements to patient access as a result of changes to the medical document:

  • Improvement to patient access as a result of being able to request the return or transfer of their medical document and the period of use starting on the date of registration.

Broader definition of practitioner will improve patient access:

  • As a result of a broader definition of practitioner, an increase in the number of practitioners that are authorized to prescribe prescription drugs that contain cannabis will improve patient access.

Benefits to the environment:

  • Reduction in carbon footprint as licence holders will have the option to cultivate cannabis outdoors.
  • Reduction in costs (e.g. energy costs) for licence holders who choose to cultivate cannabis outdoors.

Benefits of extending the validity period of import and export permits for industrial hemp producers:

  • Increase of import or export permit from three to six month eliminates the need to reapply for a permit if transaction is not completed prior to the expiration of the permit.

Sensitivity analysis

A sensitivity analysis showing estimated net impacts of the Cannabis Regulations and the Industrial Hemp Regulations 2018 was calculated for a 3%, 7%, and 10% discount rate; figures are provided in Table 3. A 3% discount rate would see the net impact (a net benefit) increase to $11.2 billion over 10 years, while a 10% discount rate would see the net impact decrease to $7.9 billion.

Table 3: Sensitivity analysis

3% 7% 10%
Total costs to Federal Government $742,024,673 $636,254,711 $573,259,017
Net impact of Cannabis Regulations –$131,633,387 –$107,231,277 –$92,864,434
Net impact of Industrial Hemp Regulations $12,079,976,399 $9,864,536,403 $8,577,380,251
Net impact $11,206,318,339 $9,121,050,415 $7,911,256,800

Distributional analysis

Over the 10-year period covered by this analysis, the distribution of the Cannabis Regulations’ costs to industry were calculated as follows: 71% are attributable to existing licence holders (i.e. parties that hold a valid licence under the CDSA as well as existing applicants for such licences), and 29% to new licence holders. While the relative attribution of costs change over time as new licence holders are created, the number of existing licence holders and existing applicants at the outset results in this group bearing a greater proportion of the calculated costs.

Of the total incremental cost of the Cannabis Regulations, packaging and labelling requirements account for 78%, with existing licence holders incurring 89% of the total packaging and labelling costs and new licence holders incurring the remaining 11%. GPP requirements accounted for the next highest cost of total costs at almost 15% and are incurred entirely by new licence holders. Finally, the physical security requirements represent roughly 3.3% of total incremental costs of the Cannabis Regulations, and are also borne by new licence holders.

Incremental costs to existing and new licence holders from the licence application process, personnel security clearance and understanding the regulation are each less than 1% of the total cost.

With respect to benefits, all of the quantitative benefits are in the form of cost savings. Since new licence holders do not exist in the baseline scenario, all of the quantitative benefits fall on the existing licence holders. The distribution of quantitative benefits are as follows: physical security requirements (77.8%), record keeping and reporting (18.1%); personnel security clearances (3.6%); and licence application process and permits (0.5%).

Gender-Based Analysis Plus

Sex- and age-related considerations

Canadian surveys of cannabis use suggest there are differences in the prevalence of cannabis use according to age (with youth and young adults having higher rates of use than adults over the age of 25) and sex (with males having higher rates of use than females). According to the 2015 Canadian Tobacco, Alcohol and Drugs Survey (CTADS), footnote35 a biennial general population survey of tobacco, alcohol and drug use among Canadians aged 15 years and older, 21% of youth and young adults (individuals aged 15 to 19) reported past-year cannabis use. This prevalence is markedly higher than that of adults aged 25 and older, only 10% of whom reported past-year cannabis use. The prevalence of past-year cannabis use among males 15 years and older (15%) was higher than among females (10%). However, the prevalence of cannabis use among Canadian females 15 years and older was reported to be higher in 2015 (10%), as compared with a past-year use rate of 7% among females in 2013. footnote36

Results from the 2014–2015 Canadian Student Tobacco, Alcohol and Drugs Survey (CSTADS), footnote37 which collected information on cannabis use (among other substances) by students in grades 7 to 12, suggest that the prevalence of “past 12 months” cannabis use was highest among Canadian students in grades 10 to 12 (as compared with students in grades 7 to 9). The difference in prevalence of use among male and female students has decreased over survey cycles, with a decrease among males from 21% in 2012–2013 to 17% in 2014–2015. Historically, CSTADS has reported a higher prevalence of cannabis use by males as compared with females; however, the 2014–2015 survey marked the first time there was no difference observed between males and females.

Studies suggest that cannabis use during pregnancy is associated with a number of different negative outcomes for children, including low birth weight and poorer longer-term developmental outcomes. Cannabis use that begins early in adolescence, that is frequent and that continues over time has been associated with increased risk of harms. Some of those harms may not be fully reversible. footnote38 As discussed previously, youth are particularly vulnerable to the effects of cannabis because their brains are developing and can be affected to a greater degree by THC during this important phase.

The Cannabis Regulations include measures that are intended to reduce the appeal of cannabis products to youth, such as plain packaging and labelling and child-resistant packages. The Cannabis Regulations will require that mandatory health warning messages appear on the label of cannabis products; out of a total of 14 possible rotating health warning messages, two specifically address the health risks associated with the use of cannabis by pregnant women, while four others address the greater risk of harms from cannabis by young people and adolescents.

Indigenous considerations

Evidence suggests that Indigenous Canadians are at a greater risk of experiencing complex mental health and substance use issues due to a variety of factors, including the intergenerational impacts of Indian Residential Schools and colonialism, which have had lasting effects on many communities and families, as well as social, economic, and cultural inequities that persist today. footnote39 Additionally, those living in rural and remote areas have an increased vulnerability to mental wellness challenges due to their isolation. footnote40 The Regional Health Survey (RHS) is a cross-sectional survey of First Nations living on reserve and in northern communities across Canada.  According to phase 3 of the RHS, footnote41 past-year cannabis use among First Nations adults 18 years of age and older is 30%; approximately 12% of adults reported daily or almost daily use.

All Canadians, including Indigenous peoples and their communities, will benefit from the public health and public safety approach taken to the development of the Cannabis Regulations, and in particular the plain packaging and labelling requirements set out in the Cannabis Regulations. Strict limits on the use of colours, graphics, and other special characteristics of packaging will curtail the appeal of cannabis products, and ensure that information on the health risks of cannabis is prominently displayed on product packages.

Recognizing the unique context, interests and priorities of First Nations, Inuit and Métis across Canada, Health Canada will continue to engage and collaborate with Indigenous leadership, organizations, and communities over the long term as the cannabis regulatory framework is implemented and evolves. This will include sharing information about legalization and regulation, ensuring public education and awareness activities are effective, and ensuring that these interests are being fully considered. Health Canada will also continue to work together with government partners such as Indigenous Services Canada and Crown Indigenous Relations and Northern Affairs Canada to support Indigenous organizations with expertise in mental wellness and substance use to lead key engagement and public education activities, and to support those interested in economic development and partnerships in the legal cannabis industry.

Future opportunities for sex- and gender-based analysis (SGBA)

There is growing interest in applying a SGBA lens to research on cannabis. In 2017, the Canadian Institutes of Health Research (CIHR) launched a health policy-research partnership funding opportunity that resulted in the funding of a project to apply a gendered lens to cannabis risk perceptions, public education and awareness. Further, the 2017 CIHR cannabis catalyst grant competition featured a priority area for funding to understand how specific groups may be impacted by the legalization and regulation of cannabis including Indigenous peoples, and how sex and/or gender may further affect the impact of cannabis legalization and regulation on health and other outcomes. Three project proposals which included a sex and gender component received funding under that competition.

Health Canada will continue to monitor health research as it evolves following the coming into force of the Cannabis Act and will develop evidence-informed measures to address population-specific needs as required.

“One-For-One” Rule

The Cannabis Regulations were finalized after extensive consultations with impacted and interested stakeholders, partners including provincial, territorial and municipal authorities, Indigenous peoples, the cannabis industry (existing and prospective licensees), public health organizations, law enforcement, patients, and patient advocates. As a result of their input, the Cannabis Regulations were developed to minimize, to the extent possible, administrative burden while respecting the government’s public health and safety goals of restricting youth access to cannabis, minimizing the harms of cannabis use, and preventing criminals and organized crime from profiting from the illegal production of cannabis.

As per the requirements of the Red Tape Reduction Act and the Red Tape Reduction Regulations, the reduction in administrative burden costs on all affected industry stakeholders is estimated over a 10-year period (2018–2019 to 2027–2028) and discounted to 2012 using a 7% real discount rate. The “One-for-One” Rule applies and the new regulations will be an OUT.

The incremental decrease in administrative cost for industry resulting from the repeal of the ACMPR and IHR 1998, and the introduction of the new regulatory framework is estimated at $2.1 million PV (or $299,905 annually) over a 10-year period (2012 dollars). The coming into force of the Cannabis Regulations is estimated to result in a decrease in administrative burden of $491,540 (or $69,985 annually) to licence holders, while the IHR 2018 is estimated to provide a decrease administrative burden by $1.6 million PV (or $229,920 annually) to industrial hemp producers. These cost savings are expected to be generated through the shortened time period for the retention of visual recordings and, to a lesser extent, changes to the licence application process.

Small business lens

The perspectives of small businesses, which are expected to play an important role in the long-term displacement of the illegal cannabis market, have been sought and considered throughout the development of the Cannabis Regulations. Members of the industry were not specifically asked to identify the size of their organization when providing comments on the regulatory consultation paper published in November 2017. However, a significant number of comments received as part of that process are believed to accurately represent the views of small businesses due to the fact that a high number of such entities operate in the legal cannabis market, as described below. Additionally, Health Canada captured the feedback of small businesses as part of other consultation and data collection activities that informed the analysis in this document, such as the voluntary industry questionnaire that was completed for the purposes of the cost-benefit analysis.

The small business lens applies to regulatory proposals that affect small business and would impose a nationwide cost over $1 million annually. The Treasury Board Secretariat (TBS) defines a small business as any business, including its affiliates, that has fewer than 100 employees or between $30,000 and $5 million in annual gross revenues. It is estimated that the majority of business entities that will be authorized to undertake cannabis activities will meet the definition of small business as defined by TBS. Through internal Health Canada data and input from responses to questionnaires that were distributed to industry stakeholders, it is assumed that 90% of licence holders will be classified as small business throughout the period from 2018–2019 to 2027–2028, or 559 licence holders.

Health Canada has taken steps to ensure that the Cannabis Regulations are designed to facilitate the participation of small-scale producers in the legal cannabis industry. The new micro-scale licence classes will help enable a diverse, competitive legal industry comprised of both large and small players in regions across the country.

As the majority of existing and new licence holders are assumed to be small businesses, they are expected to also benefit from additional flexibility that will be built into the implementation framework. While the Cannabis Regulations will not set out the duration of licences issued under the Cannabis Act, Health Canada has communicated that all licences issued under the Cannabis Act will be valid for a period of no more than five years as part of the implementation approach. Under the initial option considered by Health Canada, the existing ACMPR licence validity period of no more than three years would have continued to apply to licences issued under the Cannabis Regulations. Since no significant public health and public safety issues were identified in relation to the licence validity period, the flexible option has been selected to reduce the burden associated with the licence renewal process. This is anticipated to generate cost savings of approximately $38,000 PV to licence holders who have been identified as small businesses.

Flexibility analysis
Initial option Flexible option (selected)
Transition period 3 Year validity period for licences 5 Year validity period for licences
Number of licence holders 559 559
Present Value Annualized Average Present Value Annualized Average
Compliance cost $0 $0 $0 $0
Administrative cost $81,662 $11,627 $44,139 $12,342
Cost per company $146 $21 $79 $22
Total costs of all options $81,662 $11,627 $44,139 $5,546

Consultation

The Cannabis Regulations were finalized following several rounds of extensive consultations with impacted and interested stakeholders, partners including provincial, territorial and municipal authorities, Indigenous peoples, the cannabis industry (existing and prospective licensees), public health organizations, law enforcement, patients, and patient advocates. The process of engaging stakeholders and interested parties began with the work of the Task Force on Cannabis Legalization and Regulation (the Task Force), continued through the development and parliamentary review of the Cannabis Act, and was targeted in scope during the public consultation on the detailed consultation paper on the proposed approach to the regulations in November 2017.

Task Force on Cannabis Legalization and Regulation

Following the Government’s commitment in the 2015 Speech from the Throne, the Task Force was formed in June 2016 to consult broadly with Canadians and to provide advice on the design of a new legislative and regulatory framework to support the legalization and strict regulation of cannabis in Canada. The Task Force engaged in extensive cross-country consultations with provincial, territorial and municipal governments, experts, patients, advocates, Indigenous organizations, youth, employers and industry. The Task Force also heard from many other Canadians, including many young people, who participated in an online public consultation that generated nearly 30 000 responses from individuals and organizations. It also received more than 300 written submissions from organizations.

Based in part upon the input received during its consultations, the Task Force issued its final report, A Framework for the Legalization and Regulation of Cannabis in Canada, which made 85 recommendations for the establishment of a comprehensive framework for the legalization and regulation of cannabis. The Task Force’s report has informed the development of the Cannabis Act as well as the regulatory framework described in this document.

60-day consultation on the proposed approach to the regulation of cannabis

On November 21, 2017, Health Canada launched a 60-day public consultation to solicit public input and views on the approach to these regulations. A related Notice of intent to develop regulations under the proposed Cannabis Act was published on November 25, 2017, in the Canada Gazette, Part I.

To support the consultation, Health Canada published a detailed consultation paper entitled Proposed Approach to the Regulation of Cannabis. The consultation paper outlined a comprehensive series of regulatory proposals to help achieve the government’s public health and safety goals of restricting youth access to cannabis, minimizing the harms of cannabis use, and preventing criminals and organized crime from profiting from the illegal production, distribution and sale of cannabis.

The online portal generated 3 218 responses and Health Canada received 450 written submissions. The majority of respondents (85%) identified themselves as individuals, while the remainder identified themselves as a representative of a group or organization.

A total of seven in-person roundtables were held in Toronto, Montreal, Ottawa, and Vancouver, which included general sessions with interested parties, as well as focused sessions with current licensed producers of cannabis for medical purposes, patients and patient advocates, and prospective licensees. In total, 192 interested parties participated in these in-person roundtables. A further 343 interested parties participated in webinars hosted by Health Canada, including licensed producers, the hemp industry, prospective licensees, and current licensed dealers (i.e. holders of a dealer’s licence under the Narcotic Control Regulations). In addition, Health Canada held both multilateral and bi-lateral meetings with representatives of all provinces and territories to collect their feedback on the proposed regulatory approach.

As part of its ongoing, long-term engagement with Indigenous Governments and representative organizations on cannabis legalization and regulation, Health Canada also held a series of focused meetings with First Nations, Inuit and Métis to seek their feedback on the proposed regulatory framework. In recognition that Indigenous interests in cannabis legalization and regulation go beyond the regulatory approach, broader engagement meetings were an important part of the regulatory consultations.

In general, the feedback received indicated support for the overarching proposal, recognizing that one of the core objectives of the Cannabis Regulations is to strike a balance between the goal to protect public health and public safety with the need to minimize regulatory burden and facilitate compliance in an emerging legal industry that can displace illegal actors. A more detailed examination of feedback on the themes that emerged as part of the consultations is provided below.

Licences

One of the areas where Health Canada specifically sought the input of stakeholders and partners was what an appropriate threshold should be to distinguish micro-scale licensees from standard-scale cultivators and processors. Respondents provided a broad range of opinions and perspectives on how best to define micro-cultivators. Many respondents and industry experts engaged in a thoughtful and extensive debate, during the roundtables hosted by Health Canada, in written submissions, and on social media. Despite the extensive dialogue, no clear consensus emerged on the best means for defining micro-cultivators. The two most popular options for the basis of a definition were the number of plants (approximately 25% of respondents) and growing area (or canopy area; approximately 20% of respondents). In terms of total size, opinions on the number of plants that could be grown by a micro-cultivator ranged from less than 50 to over 1000 plants. For growing area, opinions ranged from 9 square metres (100 square feet) to 1 858 square metres (20 000 square feet).

While a significant number of respondents provided specific feedback on how a micro-cultivator should be defined, most respondents did not provide similar feedback on how to define a micro-processor. However, it was generally acknowledged that a micro-processor should be large enough to be capable of processing the production of a single micro-cultivator.

Health Canada took the views of current and prospective licence holders into account as it finalized the regulations. The Cannabis Regulations reflect a balanced approach that facilitates the participation of small-scale growers and processors in the legal cannabis industry. In order to be effective, these licence categories must be able to support a viable small business. Establishing a threshold that is too low could jeopardize the sustainability of such businesses, making such ventures uneconomical and potentially create an incentive to produce cannabis outside of the regulated framework. At the same time, the thresholds, and what they mean in terms of expected facility size, number of employees and the quantity of cannabis stored on site, should be low enough to align with the physical security requirements for micro-scale licences. Finally, it is equally important that the thresholds be established in such a manner that there is an opportunity for small businesses to enter the regulated industry at a scale that does not create too great a burden on federal compliance and enforcement resources (e.g. inspections of licensed production facilities).

The consultation paper asked whether the proposed categories of licences would help achieve the objective of enabling a diverse, competitive legal industry comprised of both large and small players in regions across the country. Of those respondents who answered this question, 65% agreed with the proposal, while 30% disagreed. A strong majority of prospective licence applicants (i.e. those who were not already licensed producers under the ACMPR) were supportive of the licensing architecture. A number of those who disagreed with the proposal indicated that they were concerned about the prospect of small-scale businesses’ ability to succeed over the long term. The hemp industry also expressed strong support for the proposed regulatory requirements for licences to cultivate industrial hemp. Industrial hemp producers expressed concerns about the potential burden associated with the continuation of certain reporting requirements in the context of the new risk-based approach under the Cannabis Act.

Health Canada has determined that the licensing architecture enables the creation of a diverse, competitive legal industry comprised of both large and small players in regions across the country. To the extent possible, regulatory flexibility has been built into the regulatory framework so that new entrants interested in new licence categories, such as “micro” or “nursery” licences, can benefit from lower start-up costs associated with the risk-based regulatory approach, which reflects differences in the level of risk related to the limited scale of the operation. Following an assessment of the feedback received, Health Canada has removed reporting requirements for industrial hemp producers who grow and harvest the plants. Holders of licences under the Cannabis Regulations, such as processing licences, who process harvested industrial hemp, will be responsible for meeting the applicable reporting requirements.

Many stakeholders and respondents commented on the potential authorization of outdoor cannabis cultivation. Approximately 70% of respondents who commented on outdoor cultivation supported allowing it, while roughly 30% opposed or had concerns. Those who agreed generally were of the view that outdoor cultivation was the most economical and environmentally sustainable way to grow cannabis. In addition, it was noted that outdoor cultivation would allow producers to take advantage of natural elements including sunlight, water, and soil. However, some respondents questioned whether there is a potential impact on adjacent agricultural crops (including industrial hemp) and whether outdoor cultivation presents a greater risk of theft and diversion. Others also asked how good production practices would be satisfied outdoors and how odour could be managed during flowering.

Health Canada has followed the advice of the Task Force, which strongly supported the enabling of outdoor cultivation because of both environmental and economic considerations. It should be noted that other regulatory requirements, particularly those related to product quality, will apply equally to cannabis products derived from cannabis cultivated outdoors, as will risk-based physical security requirements. Agricultural practices in Canada are governed by statutory requirements and policies developed and administered by multiple orders of government, which all cultivators would need to comply with. As part of its ongoing commitment to monitoring the effectiveness of regulations throughout the regulatory lifecycle, Health Canada will continue to monitor developments in this area and will consider further regulatory action if it is deemed appropriate.

Security clearances

The consultation paper proposed that the regulations would require that any shareholder who owned more than 25% of a licensed organization (if privately held) or more than 25% of a privately held parent company hold a security clearance, as part of a suite of comprehensive proposals to prevent criminals and organized crime from infiltrating the legal industry and using it to further other criminal activities.

While respondents agreed with the government’s objective and supported transparency and scrutiny around shareholders, a number argued that the proposed requirement would be difficult to enforce. In response to this feedback, Health Canada developed an alternative approach to reduce the risk of organized crime establishing a financial relationship with legal cannabis producers in order to further their criminal activities. The Cannabis Regulations are designed to address this risk by requiring that licence holders whose securities are not publicly traded maintain and report information to the Minister respecting money, goods, or services that result in direct or indirect control of the organization. It is anticipated that this requirement will eliminate the potential burden associated with security clearances for a potentially significant number of shareholders without undermining the effectiveness of the overall approach. Privately held licence holders will be accountable for reporting information about investors who are able to control them directly or indirectly.

The consultation paper proposed that select personnel associated with certain licences issued under the Cannabis Act be required to hold a valid security clearance issued by the Minister of Health. The consultation paper proposed that the regulations would enable the Minister to refuse to grant a clearance to individuals with associations to organized crime, or with past convictions for, or an association with, drug trafficking, corruption or violent offences.

With respect to whether individuals with histories of non-violent, lower-risk criminal activity should be able to obtain a security clearance and participate in the legal cannabis industry, a strong majority of respondents agreed that they should. Respondents reinforced that allowing certain individuals currently involved in the illegal production of cannabis — and who are not associated with organized crime — to participate in the legal industry is a necessary component of the government’s efforts to displace the illegal market. Many felt that failing to provide an opportunity for these individuals to work in the legal industry could result in them continuing their illegal activities. As well, some respondents highlighted that greater flexibility in the issuance of security clearances would be required to avoid creating a barrier to entering the legal industry for racialized or marginalized communities, who, according to respondents, often have more frequent encounters with law enforcement and the criminal justice system.

Health Canada has taken the viewpoints of stakeholders into account in developing the security clearance provisions of the Cannabis Regulations. The security clearance provisions of the Cannabis Regulations have been developed to minimize the risk that individuals associated with organized crime can infiltrate the legal industry and use their position to benefit criminal organizations, financially or otherwise. Generally speaking, security clearances will be required for those who are in a position to direct or control a licensed organization (e.g. directors and officers) and make significant operational decisions. The Cannabis Regulations require the Minister to determine that each applicant does not pose an unacceptable risk to public health or safety by taking into account factors including a history of convictions for serious and violent crimes. However, the Cannabis Regulations also enable the Minister to consider the circumstances of any events or convictions that are relevant to the determination, the seriousness of those events or convictions, and other factors in determining the level of risk to public health or public safety.

Cannabis products

Overall, a strong majority of those who responded to the consultation question regarding cannabis product forms agreed that the regulations should not restrict the types of product forms that the legal industry would be able to manufacture and sell. In fact, many respondents urged the government to allow the sale of cannabis edibles and concentrates immediately upon coming into force of the Cannabis Act (rather than enabling their sale within 12 months as per section 193.1 of the Act). These respondents cited the need for the legal industry to be able to offer the same range of products that are currently available through the illegal market in order to be able to successfully compete, and also suggested that a broader range of products would provide alternatives to smoking cannabis. At the same time, many participants in the consultation acknowledged that the additional regulatory provisions are required to address the unique public health risks associated with cannabis edibles and concentrates, which would address issues such as quality control, THC limits, portion sizes, and specific packaging and labelling requirements.

With respect to the THC limit for cannabis oil and the limit on the amount of THC that could be in a single unit or serving, feedback was mixed. In general, most participants in the consultation supported the final THC limit of 10 milligrams per unit or serving of a cannabis product intended for ingestion. These respondents viewed the proposal as a prudent safeguard against accidental overconsumption, which would facilitate public education and awareness.

There were mixed views on the final concentration limit of 30 milligrams of THC per millilitre of cannabis oil. On the one hand, many respondents did not support the proposed limit, suggesting that it was either too low or that there should not be a limit at all. These views largely reflected the desire of many stakeholders to have the Cannabis Regulations permit the production and sale of concentrates, including liquids suitable for vaping, immediately upon the coming into force of the Cannabis Act. In contrast, other respondents saw the proposed limit as a prudent safeguard to reduce the risk of accidental or overconsumption of a product class primarily intended for ingestion. The feedback received did not include scientific evidence to support the regulations establishing a different, specific THC concentration limit for cannabis oil.

Health Canada recognizes that some stakeholders seek the authorization of cannabis concentrates and cannabis edibles as soon as possible in order to reduce the appeal of products available on the illegal market. Nevertheless, at this time, only the classes of cannabis that are listed in Schedule 4 to the Cannabis Act will be permitted to be sold when the Cannabis Regulations come into force. In keeping with the risk-based principles that have informed the development of the Cannabis Regulations, the requirements for products authorized for sale have been determined based in part on each product’s represented method of consumption. The legal sale of cannabis edible products and concentrates will be permitted no later than 12 months following the coming into force of the Cannabis Act. Regulations are, therefore, required to address unique risks associated with these classes of cannabis. Health Canada intends to consult with Canadians on the development of regulations for cannabis edibles and concentrates in 2018.

Packaging and labelling

A clear majority of those who provided views on the proposed packaging and labelling requirements expressed support for the proposals, while a minority disagreed with the proposed requirements. The vast majority of health care associations or public health organizations that responded to the proposal agreed with the proposal. Among those who expressed support, many suggested additional information that they felt should be required to be on the label. Beyond information related specifically to the product, there was a subset of respondents who wanted to ensure that the health warning messages covered specific topics, such as cautioning against the use of cannabis while pregnant, or while operating a vehicle. Among the majority of respondents who generally supported the proposed requirements, opinions were mixed on whether the regulations should require “plain packaging” and restrict the use of colours and branding. Some respondents expressed general support, but felt that some branding should be allowed, while others advocated for strict requirements that would prohibit the display of any branding or logos.

Among the minority of respondents who disagreed with the proposed packaging and labelling requirements, a strong majority indicated the proposal was too strict. Of these respondents, a subset specifically indicated that packaging requirements should allow branding and marketing by producers. These respondents felt that the ability for the legal industry to brand their products was necessary to allow them to differentiate their products from their competitors, including illegal producers operating outside of the legal framework.

Overall, respondents expressed strong support for the requirement that all packages be child-resistant. However, a few industry stakeholders felt that the requirement that all packages be opaque was not warranted, and indicated that translucent packages would also meet the government’s objectives and provide adults with important information (such as how much cannabis oil is left in a bottle).

Industry stakeholders were nearly unanimous in stating that, in order to prepare products that are compliant with the packaging and labelling rules in time for the coming into force of the legislation, they needed certainty as soon as possible on what the regulations would require. Health Canada responded to these concerns by publishing detailed and technical information about those proposed requirements in March 2018.

Health Canada is of the view that the primary purpose of the regulatory requirements is to restrict packaging and labelling that is designed to induce young persons and others to use cannabis, and to provide information on the health risks of cannabis. There is extensive evidence to demonstrate that product packaging and labelling has a significant impact on consumer perceptions and behaviour, given its broad reach and exposure at key time points (such as at point of purchase and during use). The Cannabis Regulations will balance the concerns of stakeholders by restricting the use of packaging and labelling characteristics that could induce the use of cannabis while allowing the industry to communicate with consumers regarding their products so long as the applicable requirements are met. They will also require key information to be communicated on the label, such as THC and CBD concentration. The Cannabis Regulations are consistent with the Task Force’s recommendation to require plain packaging of cannabis products through strict requirements related to the use of branding, logos, and colours. To address stakeholder feedback, translucent packages will be permitted.

Cannabis for medical purposes

In general, respondents to the consultation expressed support for the regulatory provisions that enable access to cannabis for medical purposes under the Cannabis Act. In particular, respondents were supportive of the proposed adjustments to improve patient access, namely allowing individuals to transfer their valid medical document to a different federally licensed seller of cannabis for medical purposes, and that registration would begin on the date of initial registration and not on the date the medical document was signed by their health care practitioner.

Some participants recommended that cannabis for medical purposes should be treated as an approved health products and drugs and receive Health Canada’s approval so that it would be eligible for coverage under private health plans; that it should be accessible through other distribution means than the current system of secure ordering online and delivery by mail or by courier, such as through pharmacies; and that cannabis for medical purposes should not have to display mandatory health warning messages. Some participants in the consultation raised other matters that fell outside the scope of the Cannabis Regulations, such as matters related to taxation.

In Canada, health products are only authorized for sale once they have successfully gone through Health Canada’s drug review process. This process is the means by which applications are reviewed by scientists at Health Canada to assess the safety, efficacy and quality of a drug. Health Canada is of the view that the Cannabis Regulations maintain a pathway for cannabis or drugs containing cannabis to undergo the drug review process. The health warning messages are intended to enhance public awareness, including among users of cannabis for medical purposes, of potential health risks associated with cannabis use. The Cannabis Act recognizes that provincial and territorial governments may authorize the sale of cannabis in their respective jurisdictions, provided that their laws authorizing such sale contain the legislative measures referred to in subsection 69(3) of the Act. So long as these conditions are met, the provinces and territories are free to design and implement their distribution and retail framework to meet their priorities. There is nothing in the Cannabis Act that would expressly require provinces and territories to authorize the sale of cannabis for non-medical purposes only.

Health products and cosmetics with cannabis

In general, a majority of respondents to the consultation expressed support for the proposed approach to the regulation of health products and cosmetics containing cannabis as outlined in the consultation document, while a minority of respondents disagreed or were unsure. In particular, stakeholders agreed that any claims made with respect to the therapeutic benefits of cannabis must be evidence-based, verified, and independently validated by Health Canada. Among those who did not support the proposals, opinions were split between those that felt the proposed regulations were too restrictive, and those that felt more regulations are required.

A significant proportion of stakeholders asked questions and sought further details on how the regulations and Health Canada would approach the approval of natural health products and non-prescription drugs containing cannabis. Issues raised included potential limits on the amount of cannabinoids (such as THC or CBD) in different products, where these products could be sold, how they could be promoted, and whether or not pediatric formulations could be marketed.

The Cannabis Regulations will maintain the proposed approach outlined in the regulatory consultation document. Health Canada will continue to accept new applications through the current approval process for drugs containing cannabis, devices used for consuming cannabis for medical/therapeutic purposes, as well as NHPs and VHPs that contain permitted cannabis parts and no more than 10 ppm THC. For these types of products, the Cannabis Regulations will set out the applicable requirements under the Cannabis Act. To support an uninterrupted transition to the new licensing system, current dealers licences authorized under the NCR will remain valid until they expire, subject to the transitional provisions set out in Part 15 of the Cannabis Regulations.

While prescription drugs with cannabis will be subject to certain prohibitions in the Cannabis Act with respect to packaging, labelling and promotion, additional consideration was given to appropriate promotional controls for these products in the Cannabis Regulations. Under this regulatory framework, prescription drugs with cannabis will not be subject to the packaging and labelling requirements in the Cannabis Regulations, as they will be subject to the requirements of the FDA and its regulations. The Cannabis Regulations will also authorize the promotion of these products by communicating about their name, price and quantity. Subject to other rules under the FDA, it will also be possible to use the brand name of a prescription drug or the name of the holder of the drug identification number in sponsorship and in the naming of a facility.

As proposed in the consultation paper, medical devices represented for use in consuming cannabis and prescription drugs containing cannabis will be subject to the restrictions for cannabis accessories under the Cannabis Act. This would mean that combination products could only be provided to a young person who has a prescription. The Cannabis Regulations will clarify how devices combined with, or for use with, prescription drugs will be overseen.

Perspectives of Indigenous peoples and communities

Health Canada is committed to a renewed, nation-to-nation relationship with Indigenous peoples, based on recognition of rights, respect, co-operation and partnership. It has continued to engage with Indigenous governments, organizations and communities throughout the development of the Cannabis Act and the Cannabis Regulations. The Task Force consulted national Indigenous organizations and Indigenous community representatives across the country to inform its report. Federal, provincial and territorial Ministers of Health also met with Indigenous leaders at the Health Ministers Meeting in Edmonton in October 2017. A number of Indigenous community leaders and organizational leaders made submissions during parliamentary review of the Cannabis Act.

To help ensure that the unique perspectives of Canada’s Indigenous peoples and their communities were reflected in the development of the regulatory framework, the questionnaire that accompanied the November 2017 consultation paper invited participants to self-identify as Indigenous. Leading up to the 60-day consultation period, the Minister of Health gave advance notice of the consultations to the Assembly of First Nations, Inuit Tapiriit Kanatami and Métis National Council. Health Canada received feedback from several Indigenous organizations, and individual representatives of Indigenous organizations and communities on the effect of the proposed regulatory framework on Indigenous peoples. To broaden the reach of its consultation efforts, Health Canada officials sought further opportunities for engagement through bilateral meetings with national and regional Indigenous organizations. These discussions confirmed that First Nations, Inuit and Métis want a broader conversation, beyond the proposed regulatory approach, about cannabis legalization and regulation. First Nations raised public health and safety, effective public education, economic development, regulatory jurisdiction, law-making authority, taxation and revenue sharing as priority areas, while Inuit and Métis are primarily focused on protecting public health and effective public education.

As part of these consultation efforts, Health Canada received feedback from Indigenous stakeholders regarding the potential general impacts of the proposed regulatory framework on Indigenous peoples. A number of suggestions were provided to help communities access the legal cannabis industry. Other notable concerns related to the typically higher rates of substance use in Indigenous communities relative to the general population, which would need to be addressed through resources and programs to minimize potential negative health impacts.

Health Canada has taken these comments into account and will continue to engage in dialogue with interested Indigenous governments, organizations and communities as the regulations are implemented in the coming years. Long-term engagement activities are aimed at sharing information, responding to requests for information and meetings, and working collaboratively to address key areas of interest, such as public health education.

Perspectives of Provinces, Territories, and Municipalities

In general, provincial, territorial and municipal governments that commented during the consultation period requested additional details on the final regulatory provisions as soon as possible before the regulations come into effect. Other areas of discussion focused for the most part on the implementation strategy for the legalization and regulation of cannabis, including compliance and enforcement capacity.

Health Canada has engaged actively and regularly with all provinces and territories. It will continue to engage these partners as the regulations are implemented and will review the alignment of the regulatory framework with those of its partners across the country. Furthermore, Health Canada has implemented a collaborative approach to work with other governments in Canada to promote public education and awareness measures related to cannabis.

In May 2016, the Federal/Provincial/Territorial (F/P/T) Senior Officials Working Group on Cannabis Legalization and Regulation was struck to enable F/P/T governments to exchange information on important issues about the legalization and regulation of cannabis throughout the consultation, design and implementation of the legislation, regulations, and non-regulatory activity. Specifically, the objectives of the group are the following:

  • Provide a forum for collaboration, information sharing, and discussion of programs, policies and issues, including those linked to the division of jurisdictional responsibilities, to health and to public safety;
  • Inform the development of the F/P/T responses to the federal commitment to legalize, regulate and restrict access to cannabis;
  • Explore opportunities to coordinate and align possible federal, provincial and territorial activities consistent with jurisdictional responsibilities; and
  • Facilitate complementarity and reduce duplication of work.

Publication of the summary of comments received during the public consultation

In March 2018, Health Canada published a document intended to provide a summary of the feedback received during the 60-day public comment period, and to provide additional details or outline potential changes to the regulatory proposals that Health Canada was considering in response. In particular, recognizing the previously communicated needs of regulated parties to have timely access to certain anticipated regulatory requirements in order to manufacture and prepare legally compliant cannabis products in time for the coming into force of the proposed Cannabis Act, the summary report provided technical information, supported by a detailed rationale, for packaging and labelling requirements. Also, the recommended regulatory thresholds that would distinguish “micro” cultivation and processing licences from “standard” ones were communicated to stakeholders.

The summary report did not indicate any significant deviations from the approach to other areas of the regulatory framework as originally proposed in November 2017.

While the objectives of the summary report were to highlight the key findings of the regulatory consultations and to clarify specific regulatory requirements that were necessary in order to allow for the timely national implementation of the Cannabis Act, Health Canada received a number of inquiries following the publication of the summary report and responded to them based on the latest available information. The anticipated thresholds for micro class licences as well as packaging and labelling requirements were the subject of a number of follow-up inquiries from existing and prospective licence holders. Many of those who contacted Health Canada sought proactive clarification on detailed operational matters in order to be compliant with the regulations immediately upon their coming into force. Health Canada provided as much guidance as possible in light of the fact that the regulations had not yet been made. Additional clarification is provided below in the “Implementation, enforcement and service standards” section.

Regulatory cooperation

The Cannabis Regulations are part of a new, globally unique approach to controlling risks associated with cannabis on a national scale. Canada has actively engaged international partners to promote understanding of the overarching public health and safety objectives of the Cannabis Act. As the non-medical use of cannabis is currently illegal at the national level in other Organisation for Economic Co-operation and Development member states, opportunities for regulatory alignment are highly limited. Nevertheless, given the scope of this national initiative, the regulatory framework has been informed by best practices and lessons learned from other jurisdictions, including a number of U.S. states, which have legalized and regulated access to cannabis for non-medical purposes. Health Canada will continue to engage with these jurisdictions in order to collect and share public health information and best practices in this field.

Given the overlap in responsibilities for providing access to quality-controlled cannabis to adults in Canada, provincial and territorial governments have been, and will continue to be, engaged extensively throughout the development of the Cannabis Regulations. In particular, Health Canada has held bilateral and multilateral meetings with representatives of every province and territory to gather input and facilitate domestic regulatory alignment throughout the regulatory development process. In developing the regulations, Health Canada has considered the input of public health and other officials from municipal, provincial and territorial governments. Building on the advice provided by the Task Force, Health Canada has maintained regular and ongoing contact with provinces and territories as they have developed their legislative and regulatory frameworks for the safe and efficient distribution and sale, as well as the consumption of, cannabis products.

Rationale

Since 2015, the Government of Canada has conducted extensive, and progressively more detailed, consultations on the regulatory framework for cannabis production in Canada. Canadians, stakeholders and partners have expressed support for the overarching objectives of the regulatory framework, which has, in large part, been informed by the advice of the Task Force on Cannabis Legalization and Regulation.

The regulatory framework is consistent with the fundamental purpose of the Cannabis Act in that it will establish clear rules that allow for the protection of public health and public safety. The Cannabis Regulations are informed by the best available information and evidence, which includes the federal government’s experience regulating cannabis under the CDSA and the FDA, as well as other harmful substances, such as tobacco, and the experience of other jurisdictions in regulating cannabis. They appropriately reflect the risks that regulated parties and activities pose to achieving the Government’s objectives. Finally, the framework minimizes regulatory burden and facilitates compliance among regulated parties while supporting the fundamental objectives of the Cannabis Act.

The findings of a cost-benefit analysis demonstrate that the approach is expected to create a substantial net benefit to Canadians. The anticipated net benefit present value to Canadians is $9.1 billion over 10 years. The nonquantifiable benefits of the proposal are anticipated to be significant, expanding opportunities to promote and protect public health and public safety in Canada. Over time, criminals and organized crime’s ability to benefit from activities with cannabis will be curtailed. It is also anticipated that the regulatory framework will reduce the appeal of cannabis products to youth and restrict their access to products while providing adults with access to quality-controlled cannabis products of known potency. The Cannabis Regulations will require that industry provide adult consumers with the information they need to make healthy decisions when they choose to consume cannabis for non-medical purposes. Canadians who require reasonable access to cannabis for medical purposes will be able to continue to access cannabis in much the same way as before, with certain improvements to facilitate certain aspects of their interactions with health care professionals, registered sellers, and Health Canada. The development and marketing of health products containing cannabis will continue to follow a safe, scientific, and evidence-based path. Industrial hemp producers will be able to supply a newly expanded market and benefit from a significant reduction in regulatory burden.

Implementation, enforcement and service standards

It is Health Canada’s intention that the transition between regulatory regimes be as seamless as possible. The Cannabis Act includes transitional provisions to enable licence holders and applicants under the current regulatory frameworks to transition to the new framework without disruption. For example, any licences issued under the ACMPR will continue to be valid until expiry or cancellation. This also applies to any personal or designated registrations, import and export permits and personnel security clearances. Similarly, any applications submitted to the Department under the ACMPR framework will be considered to be applications under the new Cannabis Act framework.

In addition to the transitional provisions in the Cannabis Act, the Cannabis Regulations will include transitional provisions to allow current regulated parties to meet new regulatory requirements. For example, there will be a six-month transition period following the coming into force of the Cannabis Act for the packaging and labelling requirements of cannabis for medical purposes. During this time, cannabis products delivered to patients will be required to meet either the requirements under the ACMPR or the new requirements under the Cannabis Regulations. This transition period is intended to allow sufficient time for industry to make the necessary updates to their labels and exhaust any existing stocks of labels already printed to comply with the ACMPR requirements. All products sold for non-medical purposes will be required to immediately meet the new packaging and labelling requirements.

Health Canada intends to monitor its administration of the regulatory program closely with a view to establishing service standards in a variety of areas such as licensing and licence amendments. This will support transparency and accountability over the next few years as the requirements of the cannabis regulatory program normalize. A cannabis tracking system will be implemented to enable industry and departmental staff to effectively monitor the status of and efficiently process applications. The performance data collected through the system will help inform the establishment of relevant service standards, and will support the objectives set out in the Cannabis Act of preventing diversion by monitoring inventory across the supply chain.

Health Canada is committed to providing industry and stakeholders relevant and timely information. Existing external guidance will be updated and new guidance will be developed to facilitate transition, including guidance relating to licensing application requirements.

Compliance and enforcement

In alignment with the departmental compliance and enforcement policy framework, Health Canada will provide oversight to verify that the cannabis industry and other regulated parties are aware of and adhere to new legislative and regulatory requirements.

The Cannabis Act

Compliance and enforcement activities will be in accordance with a compliance and enforcement policy, whereby actions undertaken will follow a risk-based approach, which includes identifying, assessing and mitigating any public health and public safety risks. Health Canada will take timely actions respecting individuals and businesses whose cannabis products or activities with cannabis pose an unacceptable public health and/or public safety risk.

There are a number of enforcement measures that will be available to Health Canada upon the coming into force of the Cannabis Act. Many of these measures will maintain the same delivery approach as the current cannabis program, which ranges from activities intended to educate and prevent non-compliance through compliance promotion, to measures intended to correct non-compliance or address a risk to public health or public safety. Enforcement measures can include, but are not limited to: warnings, product recall, product seizure, placing conditions on a federal licence, suspending or revoking a federal licence or permit, and prosecution. Two new compliance tools will be available to the compliance and enforcement program, including the ability to issue a ministerial order to address issues of concern (e.g. recall), and the authority to issue administrative monetary penalties (up to one million dollars). These tools are similar to those available to other compliance programs delivered by the Department. To support its compliance objectives, Health Canada will also collaborate with other partners including law enforcement, provincial and territorial authorities, the Canada Border Services Agency and the Canada Revenue Agency. Supported by the provisions in the Cannabis Act related to information disclosure, Health Canada may also disclose relevant information obtained under the Act where the disclosure is necessary to protect public health or public safety.

Compliance promotion is an effective tool in advancing compliance with the Act and its regulations. Health Canada promotes compliance through educational activities and information sharing on legislative and regulatory matters, including policies and guidance documents. Such proactive measures are intended to increase cannabis industry awareness of the new legislative and regulatory requirements and to promote and facilitate sustained compliance by the industry. Compliance promotion efforts will be linked to outreach activities to ensure that information is effectively disseminated to all interested parties, including the cannabis industry, federal, provincial and territorial partners and authorities, non-governmental organizations, and the public.

The Food and Drugs Act

Health Canada’s national compliance and enforcement approach for health products under the FDA and its regulations will continue to apply, including promoting and verifying compliance with the Act and its regulations, and working towards preventing non-compliance.

The enforcement measures available under the FDA and its regulations will be used to address non-compliance with the FDA requirements and to mitigate risks associated with a health product containing cannabis or for use with cannabis.

In alignment with the Health Canada compliance and enforcement policy framework and informed by the circumstances of each case, Health Canada will choose the most appropriate tool to achieve compliance and mitigate risks as the circumstances demand to promote, compel, or induce compliance.

Performance measurement and evaluation

Health Canada will develop a new Performance Information Profile (PIP) that will track and measure results for the Cannabis Program in order to support ongoing program improvement and informed decision making; facilitate corporate reporting; provide evidence for evaluations, audits, and strategic reviews; and comply with Treasury Board accountability requirements. The PIP will specify expected results, performance indicators, the methods selected for ongoing monitoring and measurement, performance targets, and data sources.

Health Canada will report to Canadians on expected results and the performance of the Cannabis Program through the Departmental Plan and the Departmental Results Report, the Horizontal Initiative, as well as information posted on the Government of Canada InfoBase and the Mandate Letter Tracker.

The Department will also continue to report publicly on prevalence indicators through publications on the healthycanadians.gc.ca website and will continue to make survey data available for public use. Information related to inspections and consumer/industry reports will be collected internally on a regular basis and will be made available to the public through the Regulatory Transparency and Openness Framework, as appropriate.

Health Canada is committed to reporting on progress in a transparent and proactive manner. Performance information will be tracked in accordance with the systems and processes established under the TBS Policy on Results. In addition, the Program will undergo regular assessments, as per Health Canada’s multi-year audit and evaluation plan. This will allow Health Canada to determine whether the program is meeting its objectives, and to make adjustments as needed.

The Task Force noted that flexibility would be required in implementing the new framework. To this end, Health Canada is committed to ongoing monitoring of the effectiveness of the regulatory framework throughout its implementation, and to quickly adapting the new framework as required.

Contact

Eric Costen
Director General
Strategic Policy
Cannabis Legalization and Regulation Branch
Address locator: 0602E
Health Canada
Ottawa, Ontario
K1A 0K9
Email: cannabis@canada.ca

Small Business Lens Checklist

1. Name of the sponsoring regulatory organization:

Health Canada

2. Title of the regulatory proposal:

Regulations to Support Coming Into Force of the Cannabis Act

3. Is the checklist submitted with a RIAS for the Canada Gazette, Part I or Part II?

☐ Canada Gazette, Part I ☑ Canada Gazette, Part II

A. Small business regulatory design

I Communication and transparency Yes No N/A
1. Are the proposed regulations or requirements easily understandable in everyday language?
The regulations utilize clear language in line with other similar statutory instruments, and are structured in a way that facilitates understanding by regulated parties.
2. Is there a clear connection between the requirements and the purpose (or intent) of the proposed regulations?
The regulations are intended to support implementation of the Cannabis Act and its fundamental purposes as articulated in section 7 of that act (i.e. protection of public health and public safety).
3. Will there be an implementation plan that includes communications and compliance promotion activities, that informs small business of a regulatory change and guides them on how to comply with it (e.g. information sessions, sample assessments, toolkits, websites.)?
Health Canada is committed to providing stakeholders with relevant and timely information. Existing external guidance will be updated and new guidance will be developed to facilitate transition, including with respect to licensing application requirements and facilitating compliance with the new regulatory framework.
4. If new forms, reports or processes are introduced, are they consistent in appearance and format with other relevant government forms, reports or processes?
Forms and processes will be elaborated upon in administrative and guidance documents. These will be similar to other government forms that gather information for regulatory compliance purposes or provide guidance for those seeking authorization to engage in a regulated activity.
II Simplification and streamlining Yes No N/A
1. Will streamlined processes be put in place (e.g. through BizPaL, Canada Border Services Agency single window) to collect information from small businesses where possible?
A web-based Cannabis Tracking System (the online system) has been developed for use by all cannabis businesses, and is intended to make their use of the online system as efficient and intuitive as possible. The online system will enable licence applicants to view the progress of their licence application or security clearance application by logging into the system. Additionally, the system will provide two options for reporting (either through direct entry in the system or by compiling and submitting data in compatible formats). Small business owners will be able to choose the reporting method that is preferable for them.
2. Have opportunities to align with other obligations imposed on business by federal, provincial, municipal or international or multinational regulatory bodies been assessed?
Health Canada has worked with partners, including the CRA, Statistics Canada, and other orders of government, to develop a system that lends itself to simplified integration of information collected for a variety of purposes to the extent permitted by applicable legislation.
3. Has the impact of the proposed regulations on international or interprovincial trade been assessed?
Neither the Cannabis Act nor its regulations will have an impact in interprovincial trade. The Act enables provinces and territories to oversee the distribution and retail aspects of the cannabis supply chain, and to tailor certain rules in their respective jurisdiction. The regulations are focused on areas that are under federal responsibility, including licensing, importing or exporting, packaging and labelling, and product quality.

There is no change from the status quo with respect to exports and imports of cannabis. Each importation or exportation of cannabis would require a permit issued by the Minister of Health. As set out in the Cannabis Act, import or export permits will only be available for medical or scientific purposes, or in respect of industrial hemp.

4. If the data or information, other than personal information, required to comply with the proposed regulation is already collected by another department or jurisdiction, will this information be obtained from that department or jurisdiction instead of requesting the same information from small businesses or other stakeholders? (The collection, retention, use, disclosure and disposal of personal information are all subject to the requirements of the Privacy Act. Any questions with respect to compliance with the Privacy Act should be referred to the department’s or agency’s ATIP office or legal services unit.)
The data or information collected from businesses and individuals working in those businesses will be used for specific purposes as set out in the regulations (i.e. public health and public safety). This information would be available through other sources because no other department or jurisdiction is responsible for the matters addressed in this regulatory framework.
5. Will forms be pre-populated with information or data already available to the department to reduce the time and cost necessary to complete them? (Example: When a business completes an online application for a licence, upon entering an identifier or a name, the system pre-populates the application with the applicant’s personal particulars such as contact information, date, etc. when that information is already available to the department.)
The online system includes pre-populated information to the extent possible. By logging into the online system using the account ID of a corporation or individual, pre-populated information will appear. Furthermore, information saved under their personal profile and corporate profile will be saved in the system and can be reused to apply for additional licences should an applicant choose to apply for more than one licence.
6. Will electronic reporting and data collection be used, including electronic validation and confirmation of receipt of reports where appropriate?
The online system will permit electronic reporting and data collection upon initial rollout for inventory tracking and licensing purposes. Two reporting methods will be available to licence holders, who will have the flexibility to select the option that is best suited to their needs. Over the long term, it is anticipated that other record keeping and reporting requirements would be integrated within the online system.
7. Will reporting, if required by the proposed regulations, be aligned with generally used business processes or international standards if possible?
Reporting has been aligned with best practices in an industry that produces and distributes a controlled substance, for example, through inventory tracking and loss mitigation measures.
8. If additional forms are required, can they be streamlined with existing forms that must be completed for other government information requirements?
The data or information collected from businesses and individuals working in those businesses will be used for specific purposes as set out in the Cannabis Act and the Cannabis Regulations. This information would not be available through other sources. With respect to applicants for and holders of cannabis drug licences who are required to hold other licences under the Food and Drugs Act, processes are being put in place that would allow for the streamlined collection of required information through the online system.
III Implementation, compliance and service standards Yes No N/A
1. Has consideration been given to small businesses in remote areas, with special consideration to those that do not have access to high-speed (broadband) Internet?
Given the evolving and dynamic nature of the cannabis industry, it is anticipated that a minimum level of technological infrastructure is required to operate successfully. Accommodations may be made on a case-by-case basis.
2. If regulatory authorizations (e.g. licences, permits or certifications) are introduced, will service standards addressing timeliness of decision making be developed that are inclusive of complaints about poor service?
Service standards are being developed and will be communicated to stakeholders in the near future.
3. Is there a clearly identified contact point or help desk for small businesses and other stakeholders?
All businesses will have access to support. Health Canada currently provides and will continue to provide licence holders with regular learning opportunities, and operates a call centre that can respond to requests for support. In particular, Indigenous applicants for licences under the Cannabis Act can utilize a navigator service offered by Health Canada, which provides the ongoing support and guidance of a dedicated licensing professional throughout the licensing process.

B. Regulatory flexibility analysis and reverse onus

IV Regulatory flexibility analysis Yes No N/A
1. Does the RIAS identify at least one flexible option that has lower compliance or administrative costs for small businesses in the small business lens section?

Examples of flexible options to minimize costs are as follows:

  • Longer time periods to comply with the requirements, longer transition periods or temporary exemptions;
  • Performance-based standards;
  • Partial or complete exemptions from compliance, especially for firms that have good track records (legal advice should be sought when considering such an option);
  • Reduced compliance costs;
  • Reduced fees or other charges or penalties;
  • Use of market incentives;
  • A range of options to comply with requirements, including lower-cost options;
  • Simplified and less frequent reporting obligations and inspections; and
  • Licences granted on a permanent basis or renewed less frequently.
2. Does the RIAS include, as part of the Regulatory Flexibility Analysis Statement, quantified and monetized compliance and administrative costs for small businesses associated with the initial option assessed, as well as the flexible, lower-cost option?
3. Does the RIAS include, as part of the Regulatory Flexibility Analysis Statement, a consideration of the risks associated with the flexible option? (Minimizing administrative or compliance costs for small business cannot be at the expense of greater health, security, safety or environmental risks for Canadians.)
4. Does the RIAS include a summary of feedback provided by small business during consultations?
A significant majority of current licence holders are classified as small businesses. While members of the industry were not asked to identify the size of their organization when providing comments on the regulatory consultation paper published in November 2017, it is reasonable to assume that the feedback of small businesses has been received and addressed.
V Reverse onus Yes No N/A
1. If the recommended option is not the lower-cost option for small business in terms of administrative or compliance costs, is a reasonable justification provided in the RIAS?
The selected option is the lower cost option.

See source here.

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