CannTrust’s Unlicensed Crops Could Count as ‘Illicit Cannabis’: Lawyers

Article by Solomon Israel, Leaf News

CannTrust's unlicensed crops could count as 'illicit cannabis': lawyers Cannabis grown in unlicensed areas has been distributed to both medical and recreational markets, CannTrust says By: Solomon Israel CannTrust cannabis destined for the recreational market, as seen at the company's packaging and extraction facility in Vaughan, Ont. in December 2018. (Nathan Denette) StatCan Cannabis Sales 20181221 Statistics Canada says sales at cannabis stores in the two weeks after legalization totalled $43 million. CannTrust employees work with cannabis products at their packaging and extraction facility in Vaughan, Ont., on Wednesday, Dec. 19, 2018. Nathan Denette

Cannabis grown in unlicensed rooms by cannabis producer CannTrust could meet the legal definition of “illicit cannabis,” lawyers say, but an exception in the law means Canadian consumers don’t need to worry about possessing that forbidden weed.

“Illicit cannabis is defined in the (federal) legislation as ‘cannabis that is or was sold produced or distributed by a person prohibited from doing so’ under the (Cannabis) Act,” said Matt Maurer, vice-chairman of the cannabis law group at Torkin Manes LLP in Toronto.

Since the Cannabis Act outlaws commercial cannabis production without a licence attached to a specific production site, Maurer explained, any cannabis grown outside the scope of those licences would technically qualify as illicit.

That’s exactly what appears to have happened at CannTrust, an Ontario-based licensed producer which disclosed Monday that it grew cannabis in five unlicensed rooms of its Pelham, Ont. greenhouse between October 2018 and March 2019.

Those rooms weren’t licensed for cultivation until April 2019. A Wednesday Globe and Mail report quotes a former CannTrust employee who alleges the company concealed thousands of cannabis plants behind fake walls in order to take photographs meant to deceive Health Canada during the licensing process.

Shipped to recreational partners, medical users

Health Canada declined to answer direct questions this week about whether CannTrust’s unlicensed crops count as illicit cannabis. A spokesperson for the federal cannabis regulator acknowledged that cannabis production in an unlicensed area “is considered non-compliance” with the federal regulations that govern cannabis production, and said Health Canada is still waiting for CannTrust to formally respond to its inspection report before taking action.

CannTrust cannabis is widely distributed across Canada, under the CannTrust brand name in the medical market and under the brand names Liiv, Synr.g, Xscape and Peak Leaf in the recreational market. In a statement Thursday, the company said it has recreational cannabis supply agreements with all ten provinces, although it hasn’t yet shipped product to Quebec.

CannTrust also confirmed that some of the cannabis grown in the five unlicensed rooms “would have been shipped to CannTrust (recreational cannabis market) partners after passing quality testing at Health Canada-approved labs and CannTrust’s own quality control processes and safety reviews,” and that some of the unlicensed cannabis was also shipped to medical cannabis consumers after undergoing the same testing regime.

CannTrust declined to comment on whether the cannabis meets the definition of illicit cannabis, but said it was “conducting a full internal investigation and preparing a report to the regulator, including mitigating factors.”

Consumers need not worry

Even though it’s strictly illegal to possess illicit cannabis, any Canadians with CannTrust weed in their stash shouldn’t fear legal consequences — the law only forbids possession of illicit cannabis “that they know is illicit cannabis.”

“No one who purchased from the (Ontario Cannabis Store) or a licensed retailer would have known it was illicit,” explained cannabis industry lawyer Trina Fraser, a partner at Brazeau Seller Law in Ottawa, by email.

Read the full article here.

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