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Provinces have last word on rules for marijuana distribution, sale

Although much attention has been focused on the federal government's plans for the distribution and sale of marijuana, this legislation is only a framework, as each province will ultimately have the power to implement its own rules and restrictions, Calgary business lawyer Cameron MacCarthy and Andrew Wong write in The Lawyer’s Daily.

As MacCarthy, partner with Shea Nerland Law, and Wong, associate with the firm, explain, in order to pass constitutional muster, federal rules and regulations on marijuana need to be seen as preventing or reducing harm to Canadians. This objective, they say, will also play an important role in shaping provincial laws.

“In announcing the suite of legislation on April 13, the federal government acknowledged that each of the provinces has the power to implement its own rules and restrictions in respect of the distribution and sale of marijuana. Practically speaking, this means that the provinces can have the last say on minimum age requirements, method of sale and point-of-sale restrictions.

"However, because distribution and sale rules will determine how the vast majority of Canadians access recreational marijuana, the provinces will need to give consideration to the key objective of the federal legislation — namely, to prevent or reduce harm to Canadians — in deciding their own rules,” write MacCarthy and Wong.

As long as the provinces aren't found to be operationally inconsistent with this objective, they can have the last word on how their residents acquire marijuana, MacCarthy and Wong say.

“For example, this means that while Alberta could raise the minimum age of purchase from the 18 years proposed by the federal government, the province is not likely to increase it to 30 years because doing so arguably frustrates the objective of reducing harm to Canadians by pushing a large segment of users back to unregulated channels and markets,” they explain.

In drafting their laws and regulations on distribution and sale, MacCarthy and Wong say the provinces are expected to rely heavily on the November 2016 report issued by the federal government's Task Force on Cannabis Legalization and Regulation.

One concern raised by the task force, they write, was the risk that dedicated retail locations might normalize the use of marijuana.

“Jurisdictions such as Colorado were a case study in how quickly marijuana dispensaries could proliferate after legalization. This means that dedicated retail locations, of the type most often seen in Vancouver and Toronto, are far from being a sure thing,” MacCarthy and Wong note.

Although the task force recommended that dedicated storefronts be allowed, it says they should be subject to restrictions on number, density and location.

“The type of ‘storefront’ a province opts for, however, is still up in the air and could take the form of Vancouver-type dispensaries, pharmacies, drug stores or liquor stores,” they add.

Ultimately, say MacCarthy and Wong, each province will need to deliberate on how restrictive they make their distribution and sales laws to ensure that the rules won't be rendered inoperative if challenged. Some provinces have announced an intention to engage in formal consultations with stakeholders and municipalities.

“This means that Canadians who are eagerly anticipating July 1, 2018, as the date on which Canada will have an accessible recreational marijuana industry should check their optimism.”

Instead, they say, it is more likely to be phased in on a province-by-province basis over the course of the next few years.

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