With Contributions from Anna De Paoli & Gino De Paoli
We’re learning more on how Federal, Provincial and Municipal tiers of government will have a hand in the legalisation of cannabis before implementation in the Summer of 2018.
The various governing roles are summarised in the table below:
(Table courtesy of the Government of Alberta)
The Province of Alberta introduced a survey to garner feedback from residents. This survey also acts to educate the public on definitions and drivers for the Provincial activity. Key objectives for the GOA are listed as:
- Limiting the Illegal Market for Cannabis
- Keeping Cannabis Out of the Hands of Children and Youth
- Protecting Public Health
- Promoting Safety on Roads, in Workplaces, and in Public Spaces
Looking at some of the economic drivers of this legalisation there are still many questions.
Legal Distribution: In Alberta, the Government is considering two options; Privately licensed or Government run stores. This second option is the practise for alcohol in some provinces, selling through government controlled liquor stores. In others, the province acts as a central distributor to privately owned liquor stores. The distribution is also in question, will a wholesale grower be able to sell to dispensaries or retailers directly or will there be a central government distributor? How the distribution system is established is a key driver to the successful development of the industry. It will also drive the resulting commodity price. There’s been various press reports that pharmacies such as Shoppers Drug Mart, Pharmasave and Rexall would like to become dispensers. In October 2016, Shoppers Drug Mart applied to dispense marijuana and since then has brokered a deal with CanniMed Therapeutics Inc. for dispensing cannabis.
Taxation: Where in the supply chain will this apply and how much will this tax be? We envisage both business taxes at the municipal level and consumer taxes at the retail level. However, it is not out of the realm of possibility that additional taxes are levied.
Retail Locations & Rules: Leaving zoning up to municipal governments opens the door to a myriad of different regulations throughout the country. Will it be allowed to be in busy community areas or will municipalities permit in only in less desirable locations? Similarly, with hours of operation, differentiation in hours will be an attraction or detractor for businesses locating within a municipality.
Allowance for direct to consumer marketing: Whilst the Federal government will define labelling and packaging requirements, it remains to be seen if and how, direct to consumer marketing will be allowed in the various Provinces. For companies looking to invest in the new cannabis industry, this is a very important part of business planning.
Workplace Safety: Altering workplace rules around cannabis use will be required, as well as potential changes to already complex OH&S rules & regulations.
Impaired Driving: What will the legal limit be for cannabis use or THC levels? How will this be enforced and what will employers be required to do?
In Alberta, once the survey deadline closes on July 31, the government will amass the results and roll-out their legislation for cannabis by the early fall. This then allows municipalities to go through their processes of taxation, zoning and public consumption directions. The timing for this is very short at 8-10 months, if they are to be in place by July 1, 2018. One huge hurdle in the way of this timeline is the 2017 Civic Elections taking place in the fall of 2017. Once the final ballot is tallied on October 16, municipal governments will face challenges as new councillors/officials will become acquainted with procedures and policies and then must review a major new piece of legislation.
We’ll just have to wait and see what the final quarter of 2017 has in store for cannabis on a local platform. Members of the Alberta Urban Municipalities Association (AUMA) have said countless times that they need more time to dig deep into what will be a widely debated topic.
As you can see, there are still many questions in a rapidly evolving landscape. We encourage people to have their say and join in the conversation on regulating a new industry in Canada.