The Ontario Cannabis Store is giving LPs until June 28 to respond to "a call for new cannabis product categories including edibles, beverages, topicals, and extracts.” The move suggests that Health Canada may be getting ready to publish its final regulations for Legalization 2.0 in the coming weeks. The governor of Texas has signed the state’s industrial hemp bill into law, while in L.A., legal cannabis companies are asking the city to shut down illegal competition.
– Mark Rendell
Ontario issues call for new cannabis product categories
While Health Canada has yet to finalize its rules around topicals, edibles and extract products like vaporizers, the Ontario Cannabis Store is pushing ahead with a call for new cannabis product categories, suggesting that the federal regulations around Legalization 2.0 may be published shortly.
LPs have until June 28 to “identify their ability to supply new cannabis products, such as cannabis extracts, cannabis beverages, [and] cannabis edibles,” the OCS said on Monday.
“The product call forms the initial stage of the OCS’s regular, open and competitive procurement process. While the OCS anticipates it will take producers some time to develop and produce these new products and receive the necessary licensing amendments from Health Canada, this product call is expected to kick-start the rollout of these important products in Ontario,” the OCS said.
Health Canada, which introduced draft regulations for the new product categories in December, has until Oct. 17 to formalize its regulations. However, as Chad Finkelstein of Dale & Lessmann LLP and Brian Sterling of SCS Consulting wrote in April, “most observers expect to see the final regulations this summer, with enactment occurring just before the federal election in October.”
“By the time that is done, and regulatory approvals have been obtained for the products by those licensed to produce or process cannabis-infused consumables, it will likely be in early 2020 before we see the first commercial products available for purchase by consumers,” Mr. Finkelstein and Mr. Sterling wrote.
As Cannabis Pro’s Jameson Berkow reported in March, the introduction of new regulations is just the first step in getting product to market.
“Producers will first need to apply for an amendment to their existing licences that allows them to launch commercial-scale production of those new classes of cannabis products, and Health Canada staff will then need to personally inspect the first completed batches of those products. Once that process is complete… producers must give the regulator at least 60 days advance notice before making those new cannabis products available for sale.”
Texas governor signs industrial hemp bill into law
Texas governor Greg Abbott has signed a bill legalizing industrial hemp and hemp-derived CBD, adding Texas to a rapidly growing list of states that allow cultivation of the crop. The state-level law is the counterpart to the U.S. Farm Bill, which descheduled hemp and hemp-derived CBD at a national level in December.
The move was lauded by Village Farms, a greenhouse vegetable grower that entered the cannabis industry in 2017 through a joint venture with Emerald Health in British Columbia, and has a large greenhouse complex in Texas.
“In anticipation of the passage of the hemp legislation in Texas, Village Farms has begun conversion of half of its 1.3 million square foot, ultra-high-tech Permian Basin greenhouse... for cultivation of high-CBD hemp and CBD extraction. The Texas Hemp Legislation will require licenses for both the cultivation and processing of hemp and Village Farms plans to apply for the requisite licenses as soon as it is permitted to do so. No time frame has yet been provided by the State of Texas for the licensing process,” the company said in a press release on Tuesday.
Pot industry wants LA crackdown on rogue shops
The legal marijuana industry urged Los Angeles City Hall on Monday to get tougher with illegal shops that are gouging their businesses in open sight.
Illegal pot shops are widespread throughout Los Angeles and typically look like the real thing. And they're thriving — they sell cheaper products than their legal rivals because they don't charge hefty state and local taxes. In a letter Monday, the industry group Southern California Coalition recommended the city consider seizing cannabis inventory and cash from illegal shops that are found to be selling tainted products.
In the legal market, marijuana, concentrates, cookies and other products must be tested by independent labs for consumer safety — a requirement that illegal shops can ignore. The group said that the failure to seize cash and pot products from illegal shops after raids allows the business to quickly reopen.
California's effort to transform its longstanding illegal and medicinal marijuana markets into a unified, multibillion-dollar industry kicked off last year. But the transition has been uneven and it's likely to take years for the legal market to find its footing.
Many communities ban marijuana sales and growing, leaving residents in those places without access to legal shops. Businesses complain about hefty tax rates that can approach 50 per cent in some communities, which they say drive consumers into the tax-free illicit market.
In Los Angeles, the industry group said that many legal shops are being driven toward bankruptcy because they are surrounded by rogue shops undercutting them. Because of taxes and heavy regulatory fees, legal operators “cannot compete with illicit operators,” the group said.
- Associated Press