By Noah White and Andy Andersen
Health Canada announced in late June 2018 the creation of rules and regulations, such as micro-business licenses, outdoor cultivation and the use of industrial hemp, for the legalization of cannabis set for Oct. 17, 2018. Canada has developed a thriving cannabis industry well ahead of national legalization; what are people in the trade doing to prepare for adult-use sales?
Marijuana.com spoke with Deepak Anand, vice president of government relations and business development for Cannabis Compliance Inc., to discuss the significance of these regulation changes.
Anand said that one of the primary objectives of the new regulations was to improve genetic diversity of plants within the legal market..
“This essentially allows the black market to now become a part of the legal industry,” Anand said. “It’s twofold: On one end it allows for diversity, and the other allows inclusion.”
In addition, outdoor cannabis cultivation has been prohibited for the past five years. The recent change to allow outdoor cultivation will open up a new sector of the legal cannabis market for both medical and non-medical operators.
“Well, so far we haven’t seen outdoor cultivation permitted, so this is quite significant in that it allows for different mechanisms for licensed producers to grow their crops.”
Strictly enforced regulations have limited the THC dosage for medical products. Now that the industry has been opened to include their recreational market, Health Canada has allowed for fewer restrictions on THC potency, in part to be able to keep up with the illegal market, which has no restriction on any products.
“While there may still be a limit on oils and edibles and vapes and concentrates or any non-dried version, the fact that there isn’t a limit on dried flower is quite significant especially when you look at prerolls,” he said.
” Anand explained that the legal industry will have a better opportunity to flourish if it can replace illicit products and the market for them.
“One of the bigger winners of legalization and the new cannabis act is actually the hemp industry in many ways,“ he said. Under the new Health Canada cannabis regulations, industrial hemp now can be used to make CBD oil, something new to Canada. “We never equated hemp with anything cannabis or anything CBD, which is quite archaic if you look at what’s happening around the world.”
New categories of licenses also have the potential to change how the legal industry develops. Health Canada now allows for a range of different activities with cannabis to enable a diverse, competitive legal industry comprising both large and small players in regions across the country.
Prior to the new rules, medical cannabis businesses had to be vertically integrated, managing every aspect of production from seed to sale. Now individuals, small business, or large corporations have a variety of licensing options to choose from, including licenses for cultivation and processing of cannabis, micro-business licenses, industrial hemp, research, and analytical testing.
“This really breaks down that forced vertical integration that was in place for the past five years by virtue of our previous regulations,” Anand said. “Another massive option for our industry here.”