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Cannabis Illicit market could remain strong months into policy shift away from prohibition

Chief Constable Adam Palmer, President of the Canadian Association of Chiefs of Police in Vancouver, Oct. 15, 2018.

JONATHAN HAYWARD/The Canadian Press

Part of cannabis laws and regulations

It was bittersweet business as usual for many of Canada’s remaining illicit cannabis shops as they celebrated the end of prohibition but fretted over their continuing battle to sell the drug.

Police forces and provincial cannabis inspection agencies largely ignored the businesses operating outside of the nascent regulated retail sector on Wednesday, with residents of communities in British Columbia and Ontario still able to illegally purchase the drug out in the open.

Scores of underground internet sites also stayed online, some offering free shipping on a wide variety of edibles and concentrates not for sale by their new competitors – government-run web portals.

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Vancouver police Chief Adam Palmer, president of the Canadian Association of Chiefs of Police, signalled earlier this week he expected forces use a light touch on Day 1, with no plans for raids on the illegal dispensaries.

All these businesses continue to get their supply from unlicensed processors and growers, demonstrating the illicit market could remain strong months into Canada’s massive policy shift away from nearly a century of prohibition.

Neal Galbaransingh, co-owner of the Farm dispensary, is keeping the store open illegally in Vancouver’s Downtown Eastside while it attempts to get a licence from B.C. to sell cannabis. He said Ottawa’s hasty approach to legalization has created a messy mix of winners and losers.

That was made clear, he said, on Tuesday when he met with representatives from two licensed commercial cannabis producers. They were elated that legalization will bring them access to much more capital, while Mr. Galbaransingh was fretting over what to tell his customers – many living on social assistance – if and when he has to drastically increase prices to sell products from licensed producers.

“In 10 years, we’re going to look back and celebrate, but I think it could have been done a little different," he said. "I really think we’re not ready for it.”

Mr. Galbaransingh said he is confident neither the Vancouver police nor inspectors from the upstart provincial cannabis agency will begin shutting down scofflaws until enough retailers become licensed on Canada’s West Coast.

Two dozen dispensaries fighting a City of Vancouver injunction to shut them down are hoping a B.C. Supreme Court judge will soon rule in their favour and overhaul the country’s cannabis laws to allow them to remain selling to medical marijuana patients, who can only get their medicine through the mail directly from the large licensed producers.

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One location of the four-store Eggs Canna chain had a note pasted to its front door telling customers that it was shutting down – after a recent fire sale of its products – so that ownership could pursue an official stamp of approval from B.C.

“We apologize for any inconvenience this may bring however in these changing times, it’s our promise to keep you informed as the Federal and Provincial government applies requirements in relation to sales of non-medical cannabis,” it read.

Perhaps the next biggest hub of unlicensed cannabis stores is in eastern Ontario, where roughly 30 marijuana shops do a brisk trade in the Mohawk community of Tyendinaga.

Tyendinaga Mohawk police Chief Jason Brant said his force is awaiting direction from the chief and council, which met earlier this week and plan to soon issue new rules on how the First Nations community wants to regulate these stores.

Until then, he said his force will monitor the area for drug-impaired drivers and ensure these stores are not selling to minors. As for the droves of out-of-town customers taking advantage of this grey market, he said, they don’t worry him and police couldn’t stop them entering the community if they wanted.

Toronto police Chief Mark Saunders told reporters his officers would be shutting down every dispensary, but not immediately. He declined to give a timeline for when police would ensure any lingering stores were closed.

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“I don’t have the resources to shut everything down all in one day,” he said. “Eventually, all will be shut down.”

Winnipeg police issued one of the country’s first cannabis tickets after legalization, when just after 1 a.m. a motorist found consuming cannabis in their vehicle was handed a $672 fine.

In Edmonton, city officials appealed to residents to be good citizens and asked that because some are uncomfortable with the smell of cannabis, people consuming marijuana should ensure the smoke doesn’t go through the open windows or doors of neighbours.

With reports from Justin Giovannetti in Calgary and Victoria Gibson in Toronto

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