Ontario to only allow 25 cannabis stores at launch

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The provincial government will only be licencing 25 stores to sell cannabis products when the veil is lifted on retail outlets in April, citing ongoing supply issues as the cause for the limit. 

On December 13, Attorney General Caroline Mulroney and Minister of Finance Vic Fedeli released the following statement on changes being made to the licensing process for recreational retail cannabis stores in Ontario: “It is the federal government’s responsibility to oversee cannabis production and to provide a viable alternative to the illegal market by ensuring there is sufficient supply to meet consumer demand. Yet, we continue to see severe supply shortages across the country in legal, licenced recreational cannabis stores.”

The shortage has impacted other provincial jurisdictions and the online stores as well.

The Progressive Conservative government of Doug Ford decided to scrap the government OCS stores planned by his Liberal predecessors in favour of private enterprise retail outlets.

According to a provincial government release, “taking into consideration the required investments for a prospective Ontario private legal retailer, we cannot in good conscience issue an unlimited number of licences to businesses in the face of such shortages and the federal government’s failure to provide certainty around future supply.”

So in response, Ontario will open retail stores in phases with the initial phase seeing “up to 25 licences issued so operators can open for business on April 1, 2019 and stay open.”

According to the release, to ensure a fair and transparent process the Alcohol and Gaming Commission of Ontario (AGCO) will implement a lottery system to determine who is eligible for the initial licences to legally operate a store in Ontario. 

The release notes that all interested parties will be able to submit an expression of interest form online to the AGCO from January 7 to January 9. Those expressions of interest will be put into a lottery pool for a draw that will be conducted on January 11. The results will be posted on the AGCO’s website within 24 hours.

The lottery process will be overseen by a third-party “fairness monitor.” According to the province this will “ensure equality and transparency in the treatment of the expressions of interest, as well as an appropriate distribution of stores in each region of the province, which is set out in the regulation.”

Further details on the lottery system will be available on the AGCO website.

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