Pubdate: Wed, 07 Feb 2018
Source: Globe and Mail (Canada)
Copyright: 2018 The Globe and Mail Company
Authors: Daniel Leblanc and Christina Pellegrini
Page: A1


Ottawa introduces 'transition' period of up to 12 weeks after law
passes for firms to adapt to rules

Canadians will have to wait until late in the summer before they will
be able to legally consume cannabis under a new timeline laid out by
the federal government - even if the Senate votes in favour of the
legislation by May or June.

Ottawa now says it will give industry up to three months to adapt to
strict packaging rules and legally ship their products to provincially
regulated stores. This new timeline, unveiled by Health Minister
Ginette Petitpas Taylor on Tuesday, means adults will not be able to
purchase marijuana for recreational purposes immediately after Bill
C-45 is adopted in Parliament.

Instead, the federal government will wait eight to 12 weeks after the
legislation is passed before officially lifting the 95-year-old
prohibition on cannabis. The Liberal government had initially hoped to
legalize cannabis before July 1, but is now publicly stating that it
hopes to achieve its goal at some point in July. It remains unclear
exactly when Bill C-45 will be adopted, but it is currently in the
early stages of review in the Senate, where it is expected to face
vigorous scrutiny and potential delays.

"There is going to be a transition period because we have to ensure
that provinces and territories have the capacity to get the products
in their shops," Ms. Petitpas Taylor told reporters after appearing in
front of a special meeting of the Senate. "They'll need a period of
time of up to eight to 12 weeks in order to properly ensure that their
retail sales will be prepared."

A number of senators, in addition to provincial officials and
law-enforcement authorities, have called for delays in the
implementation of legalization to ensure that they are ready from the
outset. On Monday, the B.C. government announced that its first
standalone government stores are only expected to be selling cannabis
by "late summer."

Canada's largest medical-cannabis company, which will be able to
supply the recreational market after the product is fully legalized,
said it will be able to adapt to the government's timeline.

"In my mind, I've been thinking August 1. So if it's July 10 or 18, I
really don't care," said Bruce Linton, the chief executive officer at
Canopy Growth Corp. "It's going to be better if it's in the summer
because people are on vacation. But, other than that, every minute
that we have longer just allows us to have more assets available and
to negotiate better deals."

Provinces where cannabis will be sold through government-run stores
have started signing early contracts with growers to supply product to
their shops. Mr. Linton said this is helping his company plan for the
future by allowing Canopy to "start doing our work with a lot less

Others remain concerned by the uncertainty surrounding the new

"It's nerve-wracking, it's unsettling, not knowing what product, what
packaging, what branding, what quantities these different entities
want, not knowing what product mix they want, when they want it and
where we're shipping it to," said Brendan Kennedy, the CEO of Tilray.

Ms. Petitpas Taylor testified in support of Bill C-45 in front of the
Senate on Tuesday alongside Justice Minister Jody Wilson-Raybould,
Public Safety Minister Ralph Goodale and parliamentary secretary Bill

Throughout the two-hour session, senators raised a series of concerns
about the government's plans, including a potential rise in youth
consumption, the eventual legalization of edible cannabis products and
the level of controls on the branding of cannabis products.

The Conservative Leader in the Senate, Larry Smith, said his party
will not act in an "obstructionist manner" during the review of Bill
C-45. Still, he said senators have many concerns over the government's
plans, including measures to reduce cannabis use among kids and teenagers.

"Will you allow for more time to publicly educate our youth on the
enormous risks to their health of using marijuana? If not, what is the
rush?" Mr. Smith asked.

Ms. Petitpas Taylor answered that the current system has failed to
stop the widespread use of cannabis among youth in Canada, adding that
her government has launched a $46-million public-awareness campaign on
the dangers of the drug.

Senator Serge Joyal criticized the fact that a number of licensed
producers of cannabis have investors who are located in tax havens,
where criminal figures can benefit from lax disclosure rules to shield
their identity.

"My preoccupation is that the way Health Canada is granting
[production] permits, the way they screen where the money comes from,
is not sufficient to guarantee Canadian taxpayers that in fact, we're
not allowing through the back door what we are trying to eliminate
through the front door," Mr. Joyal said.

Mr. Goodale responded that as it stands, the entire cannabis industry
in Canada, outside of the medical-marijuana regime, is in the hands of
criminals. He said federal officials will strive to ensure that no one
can avoid the security checks that are part of the licensing process
for producers.
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