On June 21, 2018, the Cannabis Act (the “Act“) received Royal Assent, marking a historic milestone for Canada in that it became the first G7 nation to legalize cannabis. On June 27, 2018, Health Canada released new sets of regulations (the “Regulations“), as summarized below, that support and clarify the Act.
When the Act and its Regulations come into force on October 17, 2018, cannabis will no longer be regulated under the Controlled Drugs and Substances Act and will instead be regulated under the Act. As a result, the Access to Cannabis for Medical Purposes Regulations (the “ACMPR“) and the current Industrial Hemp Regulations will be repealed.
The Regulations address, among other things, the legal production, packaging, labeling, distribution, sale, importation and exportation of cannabis for medical or scientific purposes. The Regulations also detail physical and personnel security requirements for all federally licensed production sites as well as the licensing requirements applicable to micro-cultivators, micro-producers, industrial hemp ventures, research and analytical testing businesses. Notably, the Regulations permit the continuation of a separate medical cannabis system that existed under the ACMPR, allowing patients to continue purchasing cannabis from licensed producers rather than, for example, provincially-operated retailers, such as the Ontario Cannabis Store.
Below is a summary of the key Regulations introduced by Health Canada.
Classes of Licenses
The Regulations provide for the following classes of licenses:
Cultivation Licenses
- Authorizing the production of fresh or dried cannabis or cannabis plants or seeds.
- Includes standard cultivation, micro-cultivation and nurseries.
- Holders of a micro-cultivation license are restricted to a plant canopy area of no more than 200 square meters, which equates to a standard North American sized hockey rink.
Holders of a license for a nursery that cultivates cannabis for purpose of obtaining cannabis plant seeds are restricted to a surface area that does not exceed 50 square meters in which all plants must be contained and must not possess more than 5 kilograms of flowering heads harvested from plants.
Processing Licenses
- Authorizing the production of cannabis oil or resin.
- Includes standard processing and micro-processing.
- Holders of a micro-processing license must not process more than 600 kilograms of dried cannabis annually.
Analytical Testing License
- Authorizes the obtaining of extracts from samples of cannabis for the analysis of cannabinoids.
Sale License
- Authorizes the sale of cannabis products for medical purposes.
- Holders of cultivation, processing and cannabis drug licenses are also authorized to sell cannabis products for recreational consumption pursuant to their respective licenses.
Research License
- Authorizes the cultivation, gathering or production of cannabis for scientific purposes.
Cannabis Drug License
- Authorizes the possession, production or sale of a drug containing cannabis.
- Sales of drugs containing cannabis can be made to pharmacists, hospital employees, practitioners (such as doctors, dentists, veterinarians, laboratory technicians), and holders of research licenses and analytical testing licenses, among other parties.
- Accordingly, drugs containing cannabis can be administered to both people and animals.
Physical Security Measures
- Stringent security measures are applicable to the following types of licenses: standard cultivation, standard processing, sale, and cannabis drug licenses if the amount of cannabis sold or distributed to the holder of the license is greater than 600 kilograms of dried cannabis annually.
- The perimeter, operations and storage areas of the site must be monitored at all times by visual recording devices. Only entry and exist points of grow areas must be monitored.
- The perimeter, operations and storage areas must also be secured by an intrusion detection system. This is not required for grow areas.
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