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A handful of Vancouver’s remaining scofflaw cannabis shops are shutting down after losing a three-year court battle over a city injunction, but owners of several longtime operations say they will continue offering cheaper and more varied products to consumers across the country through their unlicensed online dispensaries.
Two weeks ago, a B.C. Court of Appeal judge ruled that nine shops across the city that remained open “nearly five months after they were ordered to cease operations at their non-compliant locations” must close immediately or face contempt of court charges. That decision stems from Vancouver filing 53 injunctions against unauthorized dispensaries in 2016 and a B.C. Supreme Court judge ruling last December against the stores, which were disqualified from getting a municipal business licence because they operate within 300 metres of one another or a school or community centre.
All those storefronts named in the latest judgement appear to have complied and shut down, but longtime illicit entrepreneur Don Briere, owner of four defunct Weeds Glass and Gifts locations, said he will continue shipping a wide variety of products online from his company’s nondescript corporate headquarters in East Vancouver.
“We don’t know how long that’s going to last, because they want to shut that down, too,” Mr. Briere said in a telephone interview, adding that he is in the process of applying for a provincial retail licence for eight locations across B.C.
Still, he said his Weeds chain of dispensaries has had to lay off more than 200 people from its peak of three dozen storefronts in multiple provinces in the lead-up to legalization last fall. And online sales are “not at all lucrative right now” because the underground trade is so crowded.
“There’s so many mail-order operations out there now, because all the people that shut down [illicit dispensaries] are now going to mail order,” Mr. Briere said.
Dana Larsen, a longtime cannabis activist and entrepreneur, said he is converting his Downtown Eastside shop listed in the recent injunction to a drug-testing centre and he is in the midst of applying for a provincial sales licence for his cannabis dispensary in the West End, which remains open pending the permitting process. He is also continuing to offer edibles and concentrates online that recreational and medical consumers can’t get from licensed outlets.
“If [the province] gave me a permit tomorrow – I’d be very hard pressed to know what to do with it,” Mr. Larsen said. “Switching over to the legal system would mean cutting off thousands of our members and our patients.”
John Conroy, one of the lead lawyers for the offending shops, expects an appeal of the city injunction to be heard later this year, but said the city could go back to court in the interim to argue that these online sales represent the pair not complying with the injunction. The illicit dispensaries had argued Canadian cities have no right to limit where medical cannabis can be sold because the storefront sale of the drug is a federal – not a municipal – matter.
There is no data on how many online retailers are selling illicit cannabis across the country. And it is also unclear which agency is spearheading the fight to clamp down on this illegal competition.
Kerry Jang, a former Vancouver city councillor who co-chairs B.C.'s provincial-municipal committee in charge of crafting the province’s cannabis rules, said enforcement against these online portals falls to all levels of government and he expects these unregulated outlets to face further hurdles after access to legal edibles opens up later this year.
Marie-Emmanuelle Cadieux, senior spokesperson for federal Border Security and Organized Crime Reduction Minister Bill Blair, said in an e-mailed statement that Ottawa has taken steps to crack down on unlicensed dispensaries and private online retailers. One of those steps is to provide $113.5-million over the next five years to Public Safety Canada, the RCMP and the Canada Border Services Agency to “deal with illegal production and distribution.”