Article by Mark Rendell, Financial Post
Even as the number of legal cannabis growers has grown rapidly, the federal government has denied three licence applications for every one it has accepted.
As of Feb. 1, Health Canada, which oversees the legal medical marijuana program, had granted 89 licences and rejected 268, according to data provided by Health Canada. The number of licensed producers (LPs) has since grown to 93.
The application process under the Access to Cannabis for Medical Purposes Regulations can be a gruelling multi-year process and people are rejected for a wide range of reasons, said Deepak Anand, vice-president of government relations for consulting company Cannabis Compliance Inc. Much of that comes down to not passing a security clearance.
“It’s a very stringent background check. It’s not like one of the corporate TSX-guy checks, where they go through your criminal record … In many cases they go talk to your neighbours, they figure out what you’re doing,” said Anand.
“Their biggest concern is making sure that there’s no possible involvement of the black market or organized crime, or even you diverting products to anyone,” he added.
The rate of rejection appears to vary considerably from province to province. In B.C., for example, 100 applications were rejected, while only 18 were granted. Ontario saw 96 refusals, but had a much higher success rate, with 48 licences granted.
“Anyone who might be selling to a dispensary currently is diverting a controlled substance. And if Health Canada can, beyond a reasonable doubt, prove that, then they will refuse your application,” said Anand. “B.C. has a lot of illegal growers, and so that’s why the number in B.C. is really heavy.”