Cannabis Law Review: Marijuana Sector Needs Financial AssistanceOUS News



The Canadian cannabis industry is hopeful that a recently initiated legal review that has paved the way for recreational use and marijuana sales will help the sector avert further financial hardship.

The legislative review, launched Thursday by Health Secretary Jean-Yves Duclos and Mental Health and Addictions Minister Carolyn Bennet, will review the Cannabis Act, which places limits on the purchase and possession of 30 grams of dried herb or equivalent, restricts young people’s access to marijuana, and sets requirements safety in the cultivation, sale and transportation of the substance.

The federal government is legally required to conduct a review three years after the law went into effect on October 17, 2018, examining the effects of cannabis on public health, youth, and First Nations communities.

The scope of the review will be expanded beyond what is required by law to include an analysis of the economic, social and environmental impacts of cannabis use by Morris Rosenberg, Canada’s former Deputy Attorney General and Deputy Attorney General, and a panel of four yet to be named experts.

It could also force changes to efficiency and packaging limits, as well as excise tax rules, that the sector has long been worried about, Duclos said.

The industry is disappointed by the launch of the review a year later than anticipated, but is still hopeful that it can result in a sufficient change in restrictions to make it easier to distribute cannabis, attract new customers and prevent further staff and facility cuts.

“The industry is really suffering… Some of the restrictions and lack of clarity in the rules is really making things difficult for many industry players,” said Sherry Boudrum, chief executive and co-founder of consulting business CannDelta Inc. .

“If there is no major change, it will surely hurt the industry.”

The review comes as the industry struggles with the uneven distribution of cannabis stores, making it increasingly difficult for marijuana store owners to turn a profit. Some regions have one store per block, while others have none because their municipalities refused to allow marijuana stores.

At the same time, marijuana growers are laying off staff, reducing capacity and trying to match their production to demand, which is still limited by a powerful illegal industry with no limits on potency and few marketing restrictions.

Boudram hopes the review will eliminate some headwinds if it leads to changes that allow companies to be more creative with their marijuana packaging and take part in events, thereby reducing cannabis stigma, building a personalized brand identity and attracting new customers.

There is currently a ban on packaging that may appeal to young people, depict people, characters, and animals, or evoke “glamour, relaxation, excitement (and) vitality”. There are also restrictions on the display, sale and advertising of cannabis at events.

Eliza Kay, owner of Toronto’s K’s Pot Shop, is witnessing problems with packaging rules when shoppers come in trying to remember a product they bought and loved but can only remember it was in a black can.

Because companies are limited in how they can package goods, many firms sell marijuana in black cans, “then you sit down and play 20 questions with the customer” to determine what they’re looking for, she said.

While she can often end up understanding what the person was looking for, brand loyalty shouldn’t be such a difficult task, and companies shouldn’t be “handcuffed by some overly rigid rules.”

Rick Savone, Senior Vice President of Aurora Cannabis Inc. on international relations with governments, I agree with this.

“Companies not only have to deal with competition rules that make all of our packaging look the same, we are dealing with … illegal cannabis growers who can use any packaging, they want any ingredients they want,” he said.

Illegal sellers can also make any health claims, while licensed manufacturers and shops keep their mouths shut.

“So the competition is much worse,” he said. “It just makes it impossible for us to speak to customers to say, ‘Here’s how you can use this, and these are the potential benefits that you might want to know about.’

High Tide Inc., the cannabis company behind Canna Cabana stores, hopes the review will remove the current 10 milligram limit on edible herbal products.

The restriction “only serves to encourage consumers to buy illegal market products that are not regulated and come in tamper-resistant packaging,” spokesman Omar Khan said.

There is also room to improve the speed at which products move from farms and manufacturing plants to store shelves, Budram said.

She wants Health Canada to reduce the time it takes to review new cannabis products or changes in potency and ingredients from 60 days to much shorter times like 15 or 30 days, especially when minor changes are being analyzed.

Current deadlines, she said, are delaying cannabis production and preventing companies from meeting consumer demand.

“This will cause companies to lose deals because things aren’t moving fast enough for partners,” she said.

Even if the government heeds the advice of Budram and others, it could be years before they see change.

The cannabis law requires the ministry reviewing the law to publish a report, including findings and recommendations, no later than 18 months after the review begins.

Khan said: “We are urging the government to expedite the timing of this review as many smaller players in the industry simply cannot wait 18 months for relief.”

This report by The Canadian Press was first published on September 22, 2022.


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