Ontario Cannabis Regulation 468/18
Last week, Ontario published Ontario Regulation 468/18, the Retail Cannabis Regulation, which has been widely awaited by people interested in opening cannabis retail stores in Ontario, Canada’s most populous province. The regulation followed a November 14th press release that outlined key parameters of Ontario’s regulatory framework for retail sale of adult-use (recreational) cannabis (you can read our summary of the press release here, which contains high level details about the regulatory and licensing framework for Ontario). The list below contains items highlighted in the November 14th press release and new details brought forward and clarified in the regulation itself:
- Applications may be submitted starting December 17th and will be submitted online
- Store operators and their affiliates must hold no more than 75 retail licences
- Corporations owned or controlled to a degree of more than 9.9% by licensed producers (LPs) and their affiliates are ineligible to apply for licenses; LPs are permitted one store at their licensed facility
- “Affiliate” is extensively and broadly defined in the regulation; the definition encompasses all parent, sister and subsidiary companies of LPs; all corporations in which the LP has an ownership stake of >10%; corporations in which the LP has >50% of the votes to elect directors or a majority of fair market shares; corporations controlled by the same person/entity; partners; members of the same joint ventures, including informal joint actions; and more
- Cannabis-related criminal offences; illegal cannabis sales after Oct. 17; and associations with organized crime make a person/organization ineligible to apply for a licence.
- 150 m. separation distance required between cannabis retail stores and schools
- No mandated distance between cannabis retail stores (i.e. no concentration limits)
- Individuals under 19 are prohibited from entering stores, and the AGCO has zero-tolerance for any retailer providing cannabis to anyone under the age of 19
- Applications for cannabis retail stores will require demonstration of good financial standing with provincial and federal governments (tax compliance)
- Storefronts must be stand-alone only, meaning they must be enclosed by walls separating the store from any other business or activity and the store must not be accessed by passing through any other business (there is an exception for shopping malls)
- Retail cannabis stores must have their own private shipping/receiving area that is unshared with other businesses and inaccessible to the public
- Permitted product mix is recreational cannabis (purchased from the Ontario Cannabis Retail Corporation, OCRC), cannabis accessories, and shopping bags
- Retail stores may not enter into distribution contracts with entities other than the OCRC
- Provincially-approved training is mandated for retail store owners, cannabis retail managers, and all employees of retail stores
- Opening hours may be between 9 am and 11 pm
- Authorization of retail stores will involve a public notice process
- Licenced retail stores must display Ontario’s cannabis retail seal in an exterior window visible from the store entrance
The regulation document has been written at a high level and the Alcohol and Gaming Commission of Ontario (AGCO) admits much of the licensing process is still in development. Practical guidance for how to apply and details of how a licensed store must be constructed and operated will follow in the AGCO’s Cannabis Retail Application Guide and the AGCO’s Registrars Standards.
The online application process opens December 17th, 2018, giving the AGCO three and a half months to meet their goal of having stores operational by April 1, 2019. If you are looking to open cannabis retail stores in Ontario and need help with the application process, contact our subject matter experts at Cannabis Compliance Inc., and we will help you through the licencing process.