Competition Bureau urges Cannabis Legislation changes to disrupt illicit market in Canada
Canada's competition watchdog, the Competition Bureau, has expressed its support for changes to cannabis legislation in a submission to Health Canada and a panel reviewing the industry.
The bureau is advocating for adjustments to tetrahydrocannabinol (THC) limits and the relaxation of restrictions on cannabis packaging and marketing to promote competition in the sector.
In its submission, the bureau stated that increased competition would foster innovation, provide consumers with more choices and higher quality products, and help displace illicit market activity.
“The Bureau believes that stronger competition in the cannabis industry would help foster innovation and benefit consumers by providing them with increased choice and quality. Importantly, these benefits would serve to further displace illicit market activity and bolster the legal cannabis industry,” it wrote in a statement.
The move comes as a 2022 survey by Health Canada revealed that nearly half of the respondents who used cannabis exclusively purchased it from legal sources. The cannabis industry has long argued that changes to THC limits and packaging regulations would help combat the illicit market and improve their financial stability.
The bureau also recommended easing restrictions on cannabis promotion, packaging, and labeling to facilitate innovation and informed purchasing decisions.
Furthermore, it called for a reduction in compliance costs associated with the licensing process and suggested reviewing the excise duties framework, which has been seen as a significant barrier to competition in the industry.
Under Canada’s Cannabis Act, the Minister of Health is mandated to conduct a review of the Act and its implementation three years after its enactment. The Minister is then required to present a report to both Houses of Parliament within 18 months of commencing the review.
