It’s only been a few a weeks since Canada legalized recreational marijuana by passing the Cannabis Act, but government officials are already working on rules for the adult-use marketplace. Prime Minister Justin Trudeau announced that on October 17th Canadian dispensaries can commence selling so legislators are wasting no time in drafting regulations.
Unfortunately the regulations in their entirety will not be available until late July when the Canada Gazette will publish them. For now, Canadian dispensaries must request information regarding regulations via email or telephone. However, there are five major regulations that will be responsible for shaping the landscape of the new recreational cannabis market.
New regulations stipulate that no additional THC can be added to dried marijuana flower. However there is no limit when it comes to the THC or CBD percentage that is naturally occuring in the plant. This regulation is designed to create a competitive market for cannabis cultivators now that it will be legal to grow and sell. Flower that contains a high percentage of THC will fetch a higher retail price but cannot be altered to do so.
While flower will not be regulated when it comes to THC potency, many of the manufactured cannabis products will have a THC limit. The Canadian government has decided that all ‘discrete unit’ products will only be allowed to contain 10 milligrams of THC. While the ‘discrete unit’ product description is a bit vague it does apply to all products that can be “administered orally, rectally, vaginally, or topically.”
In an effort to prevent cannabis products from appealing to children, new regulations will require cannabis to be in very plain packaging. Canadian dispensaries will only be allowed to sell marijuana in packaging that adheres to strict guidelines regarding color, branding, and logos. The packaging must also display specific labelling that provides specific product information, the universal cannabis symbol, and a health warning.
Almost all legal states have stringent record keeping regulations for cannabis retailers and Canadian dispensaries will be required to do the same. Canada’s record keeping regulations will mandate that any licensed cultivator, manufacturer, or retailer provide financial transaction information on majority investors. This could discourage some angel investors as they will be subject to federal oversight when it comes to their business engagements will cannabis businesses.
While large grow operations will likely spring up to meet the demand of Canadian dispensaries, the provinces will be issuing business licenses for micro-businesses. This is exciting news for micro-cultivators who are wizards at growing boutique strains, however they will only be allow to farm in an area of 200 square meters or less. Micro-processors will only be allowed to process less than 600 kilos of dried cannabis but this should be sufficient to sustain a healthy business model.