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New Regulations May Spark Canada’s Craft Cannabis Revolution

With full legalization delayed until the fall, Canadians are enjoying the options that come with micro-licensing.

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New Regulations May Spark Canada’s Craft Cannabis Revolution
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While legalization in Canada is delayed until October 17th, 2018, Canadians are celebrating as micro-licenses are finally coming out, ushering in the second wave of legalization. These micro-licenses are revolutionary for the industry, including smaller cultivators and processors more able to adapt to local consumer demand. Additionally, black-market genetics will finally be regulated, opening up the global floodgates.

Health Canada announced multiple classes of licenses including: processing (micro and standard), producers (micro and standard), nurseries, industrial hemp, research, and analytical testing, in addition to medical sales licenses. The regulations and application guide to apply for new licenses are available by request from Health Canada and will be public online soon. Most notably, there will be no restrictions on how many licenses an individual can possess, opening the door to cannabis co-ops with decentralized diverse distribution systems. While current licensed producers face very few changes as they transition, there are a few game-changing regulations.

With calls for cannabis amnesty reaching the mainstream news, Health Canada finally announced that they will not discriminate against those with previous non-violent cannabis convictions. “Historically anyone with any type of criminal activity in relation to controlled substances could face an automatic rejection from Health Canada,” said cannabis compliance consultant Mathew Columbro, president of Vindica Cannabis Corporation. “Security clearances will now be analyzed on a case-by-case basis to screen out organized crime pre-application.”

Outdoor cultivation is finally legal, and new industrial hemp regulations now permit the sale to processors to extract CBD. Advertising remains strict for recreational cannabis, and Canadian licensed producers continue to be disruptive in the space despite celebrity endorsements and event sponsorship being banned outright. This was par for the course for Health Canada, which previously forbade promoting cannabis using luxury or recreation, and now includes an outright ban on advertising to the general public. Several licensed producers have already been scolded to take down websites for recreational brands scheduled to be launched this fall.

Some of the top genetics companies in the world have already integrated into the existing medical program in Canada.

What no one expected from the new federal recreational cannabis regs was for black-market genetics to be able to register in the new legal recreational market. Similar to Jamaica, Canada is allowing black-market genetics to transfer into the new program through micro-producer licenses (1250 sq/ft max), which are allowed to sell seeds to nurseries and phenotype genetics to bring to market globally. While it’s currently illegal to sell seeds in Canada outside the medical system, the black market for genetics is ripe in Canada, as collectors swap and trade them as “novelty” items across borders. Through the previous designated grower system, some of the best cannabis genetics in the world were developed, but not licensed for commercial sale.

The majority of the original cannabis designated and personal grow licenses were in British Columbia, which is famous around the world for its “BC bud.” These licenses were grandfathered in, allowing designated growers to produce for up to 4 patients, but not sell to dispensaries. The new licensed producers were only able to genetics from the original medical growers for a short period of time in 2014, limiting the genetic pool for patients in the new medical program. This second wave of licensing for recreational will allow the top strains to finally be included in the new cannabis program after years of legal limbo.

According to cannabis lawyer Trina Fraser, “The ability of new cultivators to bring not only starting materials, but flowering plants as well, with them into the legal system shows the federal government’s commitment to encouraging compliance by reducing regulatory burdens.”

A huge barrier to licensed producers has been lifted, leading to the golden age of Canadian cannabis.

International award-winning Canadian master grower Jose Dominguez was elated by the new regulations. He told High Times, “I think the genetic transfer and new regulations for micro and nursery will greatly help the product diversity for the upcoming legalization. Unique strains and phenotypes will be available, and the more choice the better.”

When asked about the challenges of the new regs, Dominguez said, “Competition will be fiercer as lots of [companies] were growing and passing along the same strains. Breeders and expert growers will have more place in this new system that seems more inclusive for individuals that were before left behind. The new types of licenses will create a massive selection of flavors, products, quality, prices, innovations which will more than likely also help medical research.”

Some of the top genetics companies in the world have already integrated into the existing medical program in Canada, including Dinafem, DNA Genetics, Greenhouse Seeds, and as was recently announced, Canada’s international award-winning House of the Great Gardener. Most of the other genetics on the current legal market were imported through a short window in 2014 from designated growers to licensed producers, and the rest are either imported legally or smuggled in through swapping.

A huge barrier to licensed producers has been lifted, leading to the golden age of Canadian cannabis. This is not only monumental for Canadian growers, it’s huge for the world, as several countries, including the U.K., recently approved medical cannabis. Due to prohibition in the U.S., cannabis cannot be exported, but Canadian licensed producers and licensed dealers are allowed to import / export for medical and scientific purposes. It’s expected that many of the world’s top seed companies will relocate to Canada, where products have a global future as, like dominoes falling, countries open their borders to cannabis.

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