Planting the seeds for competition

Competition Bureau submission to Health Canada and the Expert Panel to support the Cannabis Act legislative review

Copyright and permission to reproduce

This book is not a legal document. The purpose is to provide general information and is provided for convenience. For more information, please refer to the full text of each law or contact the Competition Bureau.

Table of Contents

• the purpose
• Summary
• About the competition bureau
• Methodology
• Background Canadian cannabis industry and competition status
  • Canada's walk toward legalization of cannabis
  • Impact on the Canadian economy
  • Cannabis supply chain and its director
  • Status of competition in the Canadian cannabis industry
  • Barrier 1: Costs for license requirements and regulation compliance
  • Barrier 2: THC restrictions for edible cannabis products
  • No barrier 3: Prohibition of cannabis sales, packaging, and display
  • Barrier 4: Family item tax framework
  • Birections 5: Lack of industry standardization
  • Proposal 1: The Ministry of Health of Health should review the approval process of cannabis and the relevant costs for regulatory compliance, and to prevent competition as much as possible.
  • Proposal 2: The Ministry of Health, the Ministry of Health, examines and adjusts the THC restrictions of edible cannabis products as needed so that legal cannabis producers can meet consumer demand and compete well in illegal markets. It should be done.
  • Proposal 3: The Ministry of Health of Canadian Health is to make consumers get enough information and make decisions for purchasing, so that cannabis producers can make more flexible competition and innovation , It is necessary to review the restrictions on display as appropriate and to alleviate.

  Purpose

  In the fall of 2022, the Competition Bureau began a review of competition in the Canadian cannabis industry to respond to the review of the cannabis law by the Ministry of Health.

  In a statement on legislative reviews, one of the goals of cannabis law is to create a diverse, competitive industries consisting of large and small players to drive out illegal markets. He says there is. Footnote 1 This resonated with the bureau as a mission of protecting and promoting competition for the benefit of Canadian consumers and companies, and urged the bureau to review the industry.

  There are three purposes to review the bureau:

  1. To deepen the competitiveness of Canadian cannabis industry.
  2. It determines whether cannabis and related regulations may hinder competition, innovation, and options in the cannabis industry. < SPAN> This book is not a legal document. The purpose is to provide general information and is provided for convenience. For more information, please refer to the full text of each law or contact the Competition Bureau.
  3. the purpose

  Summary

  About the competition bureau

  Methodology

  Executive summary

  Background Canadian cannabis industry and competition status

  Canada's walk toward legalization of cannabis

  Impact on the Canadian economy

  Cannabis supply chain and its director

  • Status of competition in the Canadian cannabis industry
  • Barrier 1: Costs for license requirements and regulation compliance
  • Barrier 2: THC restrictions for edible cannabis products

  No barrier 3: Prohibition of cannabis sales, packaging, and display

  • Barrier 4: Family item tax framework
  • Birections 5: Lack of industry standardization

  Proposal 1: The Ministry of Health of Health should review the approval process of cannabis and the relevant costs for regulatory compliance, and to prevent competition as much as possible.

  1. Proposal 2: The Ministry of Health, the Ministry of Health, examines and adjusts the THC restrictions of edible cannabis products as needed so that legal cannabis producers can meet consumer demand and compete well in illegal markets. It should be done.
  2. Proposal 3: The Ministry of Health of Canadian Health is to make consumers get enough information and make decisions for purchasing, so that cannabis producers can make more flexible competition and innovation , It is necessary to review the restrictions on display as appropriate and to alleviate.
  3. In the fall of 2022, the Competition Bureau began a review of competition in the Canadian cannabis industry to respond to the review of the cannabis law by the Ministry of Health.

  In a statement on legislative reviews, one of the goals of cannabis law is to create a diverse, competitive industries consisting of large and small players to drive out illegal markets. He says there is. Footnote 1 This resonated with the bureau as a mission of protecting and promoting competition for the benefit of Canadian consumers and companies, and urged the bureau to review the industry.

  There are three purposes to review the bureau:

  About the Competition Bureau

  To deepen the competitiveness of Canadian cannabis industry.

  Judge whether cannabis and regulations may hinder competition, innovation, and options in the cannabis industry. This book is not a legal document. The purpose is to provide general information and is provided for convenience. For more information, please refer to the full text of each law or contact the Competition Bureau.

  the purpose

  Methodology

  Summary

  About the competition bureau

  Methodology

  Background: Canada’s cannabis industry and the state of competition

  Background Canadian cannabis industry and competition status

  Canada's walk toward legalization of cannabis

  Impact on the Canadian economy

  Canada’s journey toward cannabis legalization

  Cannabis supply chain and its director

  Status of competition in the Canadian cannabis industry

  Barrier 1: Costs for license requirements and regulation compliance

  Barrier 2: THC restrictions for edible cannabis products

  Figure 1: Canada’s cannabis legalization timeline

  Figure 1: Canada’s cannabis legalization timeline

  • No barrier 3: Prohibition of cannabis sales, packaging, and display

  Sources:

  Barrier 4: Family item tax framework

  Birections 5: Lack of industry standardization

  Proposal 1: The Ministry of Health of Health should review the approval process of cannabis and the relevant costs for regulatory compliance, and to prevent competition as much as possible.

  Proposal 2: The Ministry of Health, the Ministry of Health, examines and adjusts the THC restrictions of edible cannabis products as needed so that legal cannabis producers can meet consumer demand and compete well in illegal markets. It should be done.

  Proposal 3: The Ministry of Health of Canadian Health is to make consumers get enough information and make decisions for purchasing, so that cannabis producers can make more flexible competition and innovation , It is necessary to review the restrictions on display as appropriate and to alleviate.

  In the fall of 2022, the Competition Bureau began a review of competition in the Canadian cannabis industry to respond to the review of the cannabis law by the Ministry of Health.

  In a statement on legislative reviews, one of the goals of cannabis law is to create a diverse, competitive industries consisting of large and small players to drive out illegal markets. He says there is. Footnote 1 This resonated with the bureau as a mission of protecting and promoting competition for the benefit of Canadian consumers and companies, and urged the bureau to review the industry.

  There are three purposes to review the bureau:

  To deepen the competitiveness of Canadian cannabis industry.

  Impact on the Canadian economy

  It determines whether cannabis and related regulations may hinder competition, innovation, and options in the cannabis industry.

  Proposals will be made to strengthen competition and to support the Ministry of Health in order to create a more competitive industries.

  Competition in Canada in the cannabis industry is important. Competition promotes business innovation, gives value creation, and provides profits by providing options and quality to consumers. The important thing is that the benefits of these competitions will lead to further destroying illegal market activities and creating more powerful legal industries. Healthy competition promotes productivity and stimulates economic growth. Therefore, it is essential for industry regulatory authorities and policy proppons (generally as a decisive term) to verify how laws, regulations, and policies (general terms, politicians) form industry competition. It is. If possible, the decisio n-making person should adapt the policy so that both companies and consumers have the maximum competition.

  The cannabis supply chain and its oversight

  The Bureau has fully aware that the proposal in this report must be carefully considered the balance with other important public policy goals, such as public health and safety. The bureau understands that it is not an expert in these issues, but a certain regulation protection measures to protect the Canadian people. For this reason, authorities have decided to make appropriate balance between these purposes and competitive policy considerations, to experts, including the Ministry of Canadian Health.

  The report proposes matters within the jurisdiction of the Ministry of Health, the Ministry of Health, but this complex industry is also involved in other federation, states, and primrose decisions. Therefore, the Ministry of Canadian Health will take measures to promote competitio n-promoting policies if possible, taking into account the impact of competition, innovation, and options to the decisio n-made in all industries. Encourage to take.

  The report investigates the competitiveness of Canadian cannabis industry, exploring potential barriers to competition, innovation, and options, strengthening competition, and suggestions to support more competitive legal industries. Footnote 2 < Span> Proposals are made to strengthen competition and to support the Canadian Ministry of Health to create more competitive industries.

  • Competition in Canada in the cannabis industry is important. Competition promotes business innovation, gives value creation, and provides profits by providing options and quality to consumers. The important thing is that the benefits of these competitions will lead to further destroying illegal market activities and creating more powerful legal industries. Healthy competition promotes productivity and stimulates economic growth. Therefore, it is essential for industry regulatory authorities and policy proppons (generally as a decisive term) to verify how laws, regulations, and policies (general terms, politicians) form industry competition. It is. If possible, the decisio n-making person should adapt the policy so that both companies and consumers have the maximum competition.
  • The Bureau has fully aware that the proposal in this report must be carefully considered the balance with other important public policy goals, such as public health and safety. The bureau understands that it is not an expert in these issues, but a certain regulation protection measures to protect the Canadian people. For this reason, authorities have decided to make appropriate balance between these purposes and competitive policy considerations, to experts, including the Ministry of Canadian Health.
  • The report proposes matters within the jurisdiction of the Ministry of Health, the Ministry of Health, but this complex industry is also involved in other federation, states, and primrose decisions. Therefore, the Ministry of Canadian Health will take measures to promote competitio n-promoting policies if possible, taking into account the impact of competition, innovation, and options to the decisio n-made in all industries. Encourage to take.
  • The report investigates the competitiveness of Canadian cannabis industry, exploring potential barriers to competition, innovation, and options, strengthening competition, and suggestions to support more competitive legal industries. Proposals to strengthen the footnote 2 competition and support the Ministry of Health in order to create a more competitive and legal industry.
  • Competition in Canada in the cannabis industry is important. Competition promotes business innovation, gives value creation, and provides profits by providing options and quality to consumers. The important thing is that the benefits of these competitions will lead to further destroying illegal market activities and creating more powerful legal industries. Healthy competition promotes productivity and stimulates economic growth. Therefore, it is essential for industry regulatory authorities and policy proppons (generally as a decisive term) to verify how laws, regulations, and policies (general terms, politicians) form industry competition. It is. If possible, the decisio n-making person should adapt the policy so that both companies and consumers have the maximum competition.

  The Bureau has fully aware that the proposal in this report must be carefully considered the balance with other important public policy goals, such as public health and safety. The bureau understands that it is not an expert in these issues, but a certain regulation protection measures to protect the Canadian people. For this reason, authorities have decided to make appropriate balance between these purposes and competitive policy considerations, to experts, including the Ministry of Canadian Health.

  The report proposes matters within the jurisdiction of the Ministry of Health, the Ministry of Health, but this complex industry is also involved in other federation, states, and primrose decisions. Therefore, the Ministry of Canadian Health will take measures to promote competitio n-promoting policy reforms, taking into account the impact of competition, innovation, and options to the decisio n-making members of all industries. Encourage to take.

  Figure 2: General overview of Canada’s cannabis supply chain

  Figure 2: General overview of Canada’s cannabis supply chain

  • This report investigates the Canadian cannabis industry competition, exploring potential barriers to competition, innovation, and options, strengthening competition, and suggestions to support more competitive legal industries. Footnote 2
    • The Competition Bureau conducted a survey on the cannabis industry to support the purpose of Canadian cannabis law. The regulations on the cannabis industry are common responsibility of the federal government, state government, and the primary government, but the focus of this review is the jurisdiction of the federal government, especially the Minister of Health and Mental Health and Poisoning Ministers' duties. It is a matter to which it belongs. Therefore, the other matters under the federal government (specific item tax, etc.) and the matters under the supervision of the state and the primary government (the distribution of cannabis, etc.) are not covered by this legislative examination. Footnote 3
    • The Cannabis Bureau believes that the Cannabis Control Law is being considered at an important time. The legalization of entertainment cannabis is still relatively new, but the industry has grown and evolved in the past five years, and has a great possibility to form future directions. Government policies are central to promoting competition, and it is important to identify competitive issues as soon as possible. Since the legalization of entertainment cannabis has been revised how industry policies have progressed, and if necessary, modernizing those policies, the Ministry of Canadian Health will end up in the lon g-term competitiveness and sustainment of the industry. While supporting the possibilities, the purpose of the cannabis method can be achieved. Footnote 4
      1. This report has been reviewed and modernized to members of the Ministry of Health and the Legal Detective Committee (experts) on the Canadian Law (experts). It provides advice based on evidence. Through the survey, the company has identified five competitive barriers in which cannabis cultivation and processors (collectively, cannabis producers) enter and expand the cannabis industry. These barriers affect business productivity, innovation, and consumer options, both in terms of individual and collaboration. Three of these barriers are in the legal framework of cannabis law, which directly affects the way cannabis producers compete in the industry.
      2. License requirements and regulatory compliance costs can be effectively established by cannabis producers, challenging competitive abilities, and entering the legal industries to affect them. < SPAN> The Competition Bureau conducted a survey on the cannabis industry to support the purpose of the Canadian review of Canada. The regulations on the cannabis industry are common responsibility of the federal government, state government, and the primary government, but the focus of this review is the jurisdiction of the federal government, especially the Minister of Health and Mental Health and Poisoning Ministers' duties. It is a matter to which it belongs. Therefore, the other matters under the federal government (specific item tax, etc.) and the matters under the supervision of the state and the primary government (the distribution of cannabis, etc.) are not covered by this legislative examination. Footnote 3
      3. The Cannabis Bureau believes that the Cannabis Control Law is being considered at an important time. Although the legalization of entertainment cannabis is still relatively new, the industry has grown and evolved in the past five years, and has a great possibility to form future directions. Government policies are central to promoting competition, and it is important to identify competitive issues as soon as possible. Since the legalization of entertainment cannabis has been revised how industry policies have progressed, and if necessary, modernizing those policies, the Ministry of Canadian Health will end up in the lon g-term competitiveness and sustainment of the industry. While supporting the possibilities, the purpose of the cannabis method can be achieved. Footnote 4
      4. This report has been reviewed and modernized to members of the Ministry of Health and the Legal Detective Committee (experts) on the Canadian Law (experts). It provides advice based on evidence. Through the survey, the company has identified five competitive barriers in which cannabis cultivation and processors (collectively, cannabis producers) enter and expand the cannabis industry. These barriers affect business productivity, innovation, and consumer options, both in terms of individual and collaboration. Three of these barriers are in the legal framework of cannabis law, which directly affects the way cannabis producers compete in the industry.
    • License requirements and regulatory compliance costs can be effectively established by cannabis producers, challenging competitive abilities, and entering the legal industries to affect them. The Competition Bureau conducted a survey on the cannabis industry to support the purpose of Canadian cannabis law. The regulations on the cannabis industry are common responsibility of the federal government, state government, and the primary government, but the focus of this review is the jurisdiction of the federal government, especially the Minister of Health and Mental Health and Poisoning Ministers' duties. It is a matter to which it belongs. Therefore, the other matters under the federal government (specific item tax, etc.) and the matters under the supervision of the state and the primary government (the distribution of cannabis, etc.) are not covered by this legislative examination. Footnote 3

    The state of competition in Canada’s cannabis industry

    The Cannabis Bureau believes that the Cannabis Control Law is being considered at an important time. The legalization of entertainment cannabis is still relatively new, but the industry has grown and evolved in the past five years, and has a great possibility to form future directions. Government policies are central to promoting competition, and it is important to identify competitive issues as soon as possible. Since the legalization of entertainment cannabis has been revised how industry policies have progressed, and if necessary, modernizing those policies, the Ministry of Canadian Health will end up in the lon g-term competitiveness and sustainment of the industry. While supporting the possibilities, the purpose of the cannabis method can be achieved. Footnote 4

    Key industry players

    This report has been reviewed and modernized to members of the Ministry of Health and the Legal Detective Committee (experts) on the Canadian Law (experts). It provides advice based on evidence. Through the survey, the company has identified five competitive barriers in which cannabis cultivation and processors (collectively, cannabis producers) enter and expand the cannabis industry. These barriers affect business productivity, innovation, and consumer options, both in terms of individual and collaboration. Three of these barriers are in the legal framework of cannabis law, which directly affects the way cannabis producers compete in the industry.

    Figure 3: Shares of total revenue by cannabis producer (March 2022 – February 2023)

    Figure 3: Shares of total revenue by cannabis producer (March 2022 – February 2023)

    • License requirements and regulatory compliance costs can be effectively established by cannabis producers, challenging competitive abilities, and entering the legal industries to affect them.
    Delta-9-Tetra Hydrocan Navinol (THC) restricts edible cannabis products, limit consumers' options, making cannabis producers difficult to compete effectively in the market. 。

    The ban on cannabis marketing, packaging, and labeling limits the competitiveness other than the technological innovation and price of cannabis producers.	Although it is out of the Legal Review of the Ministry of Health, the report also mentions the other two barriers to competition. These two problems were widely raised by industry officials, and after all, it hinders the ability of cannabis producers to compete effectively in the industry:
    Canadian goods tax frameworks are particularly difficult for small and mediu m-sized cannabis producers to make profitability and execution in the industry.	7%
    Due to the lack of industry standardization, it is difficult for cannabis producers to put their products into the market and compete beyond state and regional boundaries.	Authories recommend the following to promote more competitive and legal industries:
    The Canadian Ministry of Health should review cannabis approval processes and associated compliance costs and take policies to prevent competition as much as possible.	6%
    The Ministry of Canadian Health should consider and adjust the THC restrictions of edible cannabis products as needed so that legal cannabis producers can meet consumer demand and compete well in illegal markets. be.	5%
    The Canadian Ministry of Health will be able to decide on purchases after consumers with sufficient information, and to review and alleviate the restrictions on cannabis sales, packaging, and display so that cannabis producers can perform competition and innovation. You should consider that.	5%
    Measures to promote competition will allow cannabis producers to compete more effectively, including illegal markets. As a result, business innovation has been promoted, consumers can get a wider range of qualit y-controlled safe cannabis products, and ultimately lead consumers to legal industries.	6%
    The Ministry of Health, the Ministry of Health, is strongly convinced that the recruitment of the Canadian Health can now improve the competitiveness of the legal cannabis industry in Canada. < SPAN> Delta-9-Tetrahydrocan Navinol (THC) restricts edible cannabis products, restricts consumer options, and it is difficult for cannabis producers to effectively compete in the market. I'm doing it.	The ban on cannabis marketing, packaging, and labeling limits the competitiveness other than the technological innovation and price of cannabis producers.

    Source:

    Although it is out of the Legal Review of the Ministry of Health, the report also mentions the other two barriers to competition. These two problems were widely raised by industry officials, and after all, it hinders the ability of cannabis producers to compete effectively in the industry:

    Canadian goods tax frameworks are particularly difficult for small and mediu m-sized cannabis producers to make profitability and execution in the industry.

    How do cannabis producers compete?

    Due to the lack of industry standardization, it is difficult for cannabis producers to put their products into the market and compete beyond state and regional boundaries.

    Authories recommend the following to promote more competitive and legal industries:

    Competition with the illicit market

    The Canadian Ministry of Health should review cannabis approval processes and associated compliance costs and take policies to prevent competition as much as possible.

    Figure 4: Percentage of cannabis consumers accessing illegal cannabis (Q1 2018, Q1 2019, Q4 2020)

    Figure 4: Percentage of cannabis consumers accessing illegal cannabis (Q1 2018, Q1 2019, Q4 2020)

    • The Ministry of Canadian Health should consider and adjust the THC restrictions of edible cannabis products as needed so that legal cannabis producers can meet consumer demand and compete well in illegal markets. be.
    The Canadian Ministry of Health will be able to decide on purchases after consumers with sufficient information, and to review and alleviate the restrictions on cannabis sales, packaging, and display so that cannabis producers can perform competition and innovation. You should consider that.

    Measures to promote competition will allow cannabis producers to compete more effectively, including illegal markets. As a result, business innovation has been promoted, consumers can get a wider range of qualit y-controlled safe cannabis products, and ultimately lead consumers to legal industries.	The Ministry of Health, the Ministry of Health, is strongly convinced that the recruitment of the Canadian Health can now improve the competitiveness of the legal cannabis industry in Canada. Delta-9-Tetra Hydrocan Navinol (THC) restricts edible cannabis products, limit consumers' options, making cannabis producers difficult to compete effectively in the market. 。
    The ban on cannabis marketing, packaging, and labeling limits the competitiveness other than the technological innovation and price of cannabis producers.	Although it is out of the Legal Review of the Ministry of Health, the report also mentions the other two barriers to competition. These two problems were widely raised by industry officials, and after all, it hinders the ability of cannabis producers to compete effectively in the industry:
    Canadian goods tax frameworks are particularly difficult for small and mediu m-sized cannabis producers to make profitability and execution in the industry.	Due to the lack of industry standardization, it is difficult for cannabis producers to put their products into the market and compete across state and regional boundaries.
    Authories recommend the following to promote more competitive and legal industries:	The Canadian Ministry of Health should review cannabis approval processes and associated compliance costs and take policies to prevent competition as much as possible.

    The Ministry of Canadian Health should consider and adjust the THC restrictions of edible cannabis products as needed so that legal cannabis producers can meet consumer demand and compete well in illegal markets. be.< 0.05) Return to note * referrer Note † reference category Return to note † referrer Note ‡ significantly different from corresponding estimate for the fourth quarter of 2020 (after legalization) (p < 0.05) Return to note ‡ referrer

    The Canadian Ministry of Health will be able to decide on purchases after consumers with sufficient information, and to review and alleviate the restrictions on cannabis sales, packaging, and display so that cannabis producers can perform competition and innovation. You should consider that.< 0.05).

    Source:

    Measures to promote competition will allow cannabis producers to compete more effectively, including illegal markets. As a result, business innovation has been promoted, consumers can get a wider range of qualit y-controlled safe cannabis products, and ultimately lead consumers to legal industries.

    The Ministry of Health, the Ministry of Health, is strongly convinced that the recruitment of the Canadian Health can now improve the competitiveness of the legal cannabis industry in Canada.

    The Competition Bureau is an independent law execution agency that protects and promotes competition for the benefit of Canadian consumers and companies. As part of the mission, the bureau proposes competition in the regulated economic sector. Note 5

    Competition is a catalyst for growth and technological innovation, which increases corporate productivity, improves the quality of products and services, and reduces prices. Competition also gives consumers by providing various products, services and information necessary for consumers to make purchase decisions based on sufficient information.

    Figure 5: Share of the illicit cannabis market in Canada (non-medical use, Q4 2018 – Q4 2022)

    Figure 5: Share of the illicit cannabis market in Canada (non-medical use, Q4 2018 – Q4 2022)

    • In order to promote competition, government policies are the main focus. As a result, the Bureau cooperates with the policy proprietors to evaluate the impact of new and existing policies in competition, and proposes the important role of competition in the economy.
    The Competition Bureau has collected information and data from various primary information sources and secondary information sources, including public surveys, news sources, and other reports. This report also includes confidential information and data provided to the bureau from various industry officials, such as cannabis businesses, industry organizations, experts, and government agencies. Footnote 6

    Measures to promote competition will allow cannabis producers to compete more effectively, including illegal markets. As a result, business innovation has been promoted, consumers can get a wider range of qualit y-controlled safe cannabis products, and ultimately lead consumers to legal industries.	I would like to thank all stakeholders who have spent time in these interviews and provided information and data to proceed with this important work.
    Canada is a pioneer in entertainment cannabis legalization, and has a model of cannabis policy on the international stage.	In Canada, medical cannabis legal frameworks have been developed since 2001. Footnote 7 However, in 2018, Canada became the second largest in the world, the first G7 legalized taste cannabis. Footnote 8 Since then, the Canadian entertainment cannabis industry has grown and developed.
    Canadian goods tax frameworks are particularly difficult for small and mediu m-sized cannabis producers to make profitability and execution in the industry.	The path to Canada legalization has been long, including many steps in the past 100 years. Footnote 10 < Span> Competition Bureau is an independent law execution agency that protects and promotes competition for the benefits of Canadian consumers and companies. As part of the mission, the bureau proposes competition in the regulated economic sector. Note 5
    Competition is a catalyst for growth and technological innovation, which increases corporate productivity, improves the quality of products and services, and reduces prices. Competition also gives consumers by providing various products, services and information necessary for consumers to make purchase decisions based on sufficient information.	In order to promote competition, government policies are the main focus. As a result, the Bureau cooperates with the policy proprietors to evaluate the impact of new and existing policies in competition, and proposes the important role of competition in the economy.
    The Competition Bureau has collected information and data from various primary information sources and secondary information sources, including public surveys, news sources, and other reports. This report also includes confidential information and data provided to the bureau from various industry officials, such as cannabis businesses, industry organizations, experts, and government agencies. Footnote 6	The bureau interviewed more than 20 industry officials from November 2022 to March 2023.
    I would like to thank all stakeholders who have spent time in these interviews and provided information and data to proceed with this important work.	Canada is a pioneer in entertainment cannabis legalization, and has a model of cannabis policy on the international stage.
    In Canada, medical cannabis legal frameworks have been developed since 2001. Footnote 7 However, in 2018, Canada became the second largest in the world, the first G7 legalized taste cannabis. Footnote 8 Since then, the Canadian entertainment cannabis industry has grown and developed.	This section introduces the outline of the Canadian cannabis industry (footnotes 9), such as the road to legalization, the effects of legalization on cannabis consumption, and the effects on a wider Canadian economy. We will also verify the situation of competition in the industry, which is the foundation of the proposal to be made in the latter half of this report.
    The path to Canada legalization has been long, including many steps in the past 100 years. Footnote 10 Competition Bureau is an independent law execution agency that protects and promotes competition for the benefit of Canadian consumers and companies. As part of the mission, the bureau proposes competition in the regulated economic sector. Note 5	Competition is a catalyst for growth and technological innovation, which increases corporate productivity, improves the quality of products and services, and reduces prices. Competition also gives consumers by providing various products, services and information necessary for consumers to make purchase decisions based on sufficient information.
    In order to promote competition, government policies are the main focus. As a result, the Bureau cooperates with policy proprietors to evaluate the impact of new and existing policies in competition, and propose important roles in the economy.	The Competition Bureau has collected information and data from various primary information sources and secondary information sources, including public surveys, news sources, and other reports. This report also includes confidential information and data provided to the bureau from various industry officials, such as cannabis businesses, industry organizations, experts, and government agencies. Footnote 6
    Authories recommend the following to promote more competitive and legal industries:	I would like to thank all stakeholders who have spent time in these interviews and provided information and data to proceed with this important work.
    Canada is a pioneer in entertainment cannabis legalization, and has a model of cannabis policy on the international stage.	In Canada, medical cannabis legal frameworks have been developed since 2001. Footnote 7 However, in 2018, Canada became the second largest in the world, the first G7 legalized taste cannabis. Footnote 8 Since then, the Canadian entertainment cannabis industry has grown and developed.
    This section introduces the outline of the Canadian cannabis industry (footnotes 9), such as the way to legalization, the effects of legalization on cannabis consumption, and the impact on a wider Canadian economy. We will also verify the situation of competition in the industry, which is the foundation of the proposal to be made in the latter half of this report.	The path to Canada legalization has been long, including many steps in the past 100 years. Footnote 10
    Canada made cannabis illegal in 1923, but only 20 years ago, a legal cannabis was legalized. It led to the enactment of the Medical Assess To Marijuana Regulations, which was enforced in 2001. Footnote 13	The Cannabis Law was enforced on October 17, 2018, and legalized the legal recreational cannabis, possession, production, and distribution were legalized throughout Canada. In the first waves of entertainment cannabis legalization based on cannabis methods, adults were able to purchase dry and raw cannabis, cannabis, and cannabis from approved retailers. Footnote 15 The sales of edible cannabis, cannabis extracts, and local cannabis were legalized in the second wave (2019) of the legalization of the footnote 15 entertainment. Footnote 16
    For more information about Canada's journey to cannabis legalization, see Figure 1. Canada regarded cannabis in 1923, but only 20 years ago, the legal cannabis was legalized. Footnote 12 This enacted the Medical Access to Marijuana Regulations in 2001. Footnote 13	The Cannabis Law was enforced on October 17, 2018, and legalized the legal recreational cannabis, possession, production, and distribution were legalized throughout Canada. In the first waves of entertainment cannabis legalization based on cannabis methods, adults were able to purchase dry and raw cannabis, cannabis, and cannabis from approved retailers. Footnote 15 The sales of edible cannabis, cannabis extracts, and local cannabis were legalized in the second wave (2019) of the legalization of the footnote 15 entertainment. [...]
    For more information about Canada's journey to cannabis legalization, see Figure 1. Canada regarded cannabis in 1923, but only 20 years ago, the legal cannabis was legalized. Footnote 12 This enacted the "Cannabis Medical Access Rules" in 2001. Footnote 13	The cannabis law was enforced on October 17, 2018, and lega l-based sales, possessions, production, and distribution of legal entertainment were legalized throughout Canada. In the first waves of entertainment cannabis legalization based on cannabis methods, adults were able to purchase dry and raw cannabis, cannabis, and cannabis from approved retailers. Footnote 15 The sales of edible cannabis, cannabis extracts, and local cannabis were legalized in the second wave (2019) of the legalization of the footnote 15 entertainment. Footnote 16
    Figure 1 can see the details of Canada's path to cannabis legalization.	Explanation in Fig. 1 1923: Cannabis is illegal by the gun and the drug Control Law. 1960: The growing popularity of dru g-use increases the demand for reform. 1969: The Investigation Committee (Le Dan Committee) on no n-medical use of drugs is established. 1972: The Le Dan Committee publishes the "Cannabis Report" and recommends a simple possession of cannabis for personal purposes and a no n-crime of cultivation. 2000: Ontario's Appeals Court is unconstitutional to ban dry cannabis for medical purposes. 2001: A medical cannabis has been enacted, and obtaining the dry cannabis for medical purposes is legalized. 2013: Medical cannabis rules are enforced, and regulations on the production and distribution of medical cannabis are created. 2015: The Canadian Supreme Court is unconstitutional for the ban on the possession of cannabis (Edible and Temicals) for medical purposes. Figure 1 Fig. 1 Note A: Access regulations on medical cannabis are enforced, and access to medical cannabis products in a wider wider category is legalized. Figure 1 Figure 1 Note B: Work on legalization and regulations. 2017: The bill C-45 (cannabis method) is submitted to the Diet. 2018: The cannabis law is enforced, and a legal framework of the cannabis industry is built.
    1923: Robin Mackay and Karin Phillips, Library of Parlliament (2016), The Legal Regulation of Marijuana in Canada and Selected Other Countries.	1960: Canadian Senate (2002), cannabis: Our position for Canada Public Public Policy, the Special Committee of the Senate illegal drugs, a summary report.
    1969: The Canadian Drug Policy Coalition (2023), the History of Drug Policy in Canada.	1972: Investigation committee on non-medical use of drugs (Commission of InQuire Into The Non-Medical USE of Drugs), 1972, "Cannabis"

    Source:

    Making the case for competition

    2000: R. V. Parker (2000), 2000 CANLII 5762 (in Ca).

    2001: Senate of Canada, Senate Select Committee on Illegal Drugs (2001), Chapter 13: Regulating the Therapeutic Use of Cannabis, Health Canada (2016) (2020); the constitutional right to marijuana in Canada: R v. Parker.

    2015 R. V. Smith, 2015 SCC 34 (CANLII), [2015] 2 SCR 602.

    Notes

    Barriers to competition

    2024: Exact date to be determined. Report expected within 18 months of commencement of legislative review. See Health Canada (2022), Government of Canada Launches Legislative Review of Cannabis Act; Health Canada (2023), Expert Panel: Legislative Review of Cannabis Act.

    Since recreational cannabis was legalized in 2018, many consumers have shifted away from illegal cannabis purchases. Footnotes 17 With more consumers turning to legal sources, the industry has grown significantly. Footnote 18 In 2017, the year before recreational cannabis was legalized, Statistics Canada estimated that Canadian households spent more than $5. 5 billion on cannabis (medical and non-medical). In 2022, Statistics Canada estimates that Canadian households will spend nearly $8 billion on cannabis (medical and non-medical), more than 40% more than before legalization. Footnote 19 Footnote 20 .--& amp; gt?

    According to a study by Deloitte and the Ontario Cannabis Store, after recreational cannabis was legalized, the industry contributed $43. 5 billion to Canada's gross domestic product and helped create 151 jobs. It created 151, 000 jobs nationwide. It also contributed significantly to government tax revenues. Between 2018 and 2021, the cannabis industry, including medical and non-medical cannabis, is estimated to contribute $15. 1 billion in government tax revenues in Canada. Footnote 20

    Barrier 1: Licensing requirements and regulatory compliance costs

    Given the importance of the cannabis industry to the Canadian economy, the federal government committed in Budget 2022 to foster dialogue with cannabis businesses and stakeholders and identify areas of collaboration to support the growth of the legal industry. Footnote 21

    How do licensing requirements and regulatory compliance costs act as barriers to competition for cannabis producers?

    The regulations of the cannabis industries are under the supervision of the federal, state government, and primary government. The federal government is mainly under the jurisdiction of cannabis production (that is, cultivation and processing), while the state and the primary government have jurisdiction over other aspects of the cannabis industry, such as wholesale sales and retail sales in the entertainment industry. Footnote 22

    Canada's cannabis supply chain (see Fig. 2) begins with cannabis seeds, cannabis, raw cannabis, and dried cannabis. Producers usually supplied the product to the Maoka industrial, and the processor processes and wraps the product for retail sales. Hemp producers with a maoka mechanic license (see below) can also process and pack products for retail sales. In the 2 3-footed report, it is called cannabis producer, as a cannabis producer, as a whole, for simplification.

    In order to work in the legal cannabis industry, cannabis producers must have a license. Cannabis producers can have various types of licenses:

    A microculture license for the production of plants, seeds, raw hemp and dried hemp with a cultivation area of ​​200 m2.

    Cultivation of flowering plants and germination cannabis, up to 50 m2 cultivation area, a nurse for selling to other license holders as a primary raw material for the production of plants and seeds.

    Standard cultivation license for the production of cannabis and seeds, raw cannabis and dried cannabis without limit to the cultivation area

    Micro processing license for processing, packaging, and labeling for harvested cannabis and industrial cannabis.

    What are the approximate minimum costs necessary to become and operate as a licensed cannabis producer?

    One standard processing license for processing, packaging, and labeling of the harvested cannabis and industrial cannabis.

    The State and the Presence Government are responsible for the way to distribute and sell entertainment cannabis in jurisdiction. Note 25 In general, when products are wrapped and can be sold retail, they are sold to states and primrose wholesalers. Note 26) However, cannabis producers may be able to directly supply retailers and adult consumers. Footnote 28 < SPAN> The regulations of the cannabis industries are under the supervision of the federal, state government, and primary government. The federal government is mainly under the jurisdiction of cannabis production (that is, cultivation and processing), while the state and the primary government have jurisdiction over other aspects of the cannabis industry, such as wholesale sales and retail sales in the entertainment industry. Footnote 22

    1. Canada's cannabis supply chain (see Fig. 2) begins with cannabis seeds, cannabis, raw cannabis, and dried cannabis. Producers usually supplied the product to the Maoka industrial, and the processor processes and wraps the product for retail sales. Hemp producers with a maoka mechanic license (see below) can also process and pack products for retail sales. In the 2 3-footed report, it is called cannabis producer, as a cannabis producer, as a whole, for simplification.
    2. In order to work in the legal cannabis industry, cannabis producers must have a license. Cannabis producers can have various types of licenses:
    3. A microculture license for the production of plants, seeds, raw hemp and dried hemp with a cultivation area of ​​200 m2.
    Cultivation of flowering plants and germination cannabis, up to 50 m2 cultivation area, a nurse for selling to other license holders as a primary raw material for the production of plants and seeds.

    Standard cultivation license for the production of cannabis and seeds, raw cannabis and dried cannabis without limit to the cultivation area

    Micro processing license for processing, packaging, and labeling for harvested cannabis and industrial cannabis.

    One standard processing license for processing, packaging, and labeling of the harvested cannabis and industrial cannabis.

    The State and the Presence Government are responsible for the way to distribute and sell entertainment cannabis in jurisdiction. Note 25 In general, when products are wrapped and can be sold retail, they are sold to states and primrose wholesalers. Note 26) However, cannabis producers may be able to directly supply retailers and adult consumers. Footnote 28 The regulations of the 28 cannabis industries are under the supervision of the federal government, state government, and primary government. The federal government is mainly under the jurisdiction of cannabis production (that is, cultivation and processing), while the state and the primary government have jurisdiction over other aspects of the cannabis industry, such as wholesale sales and retail sales in the entertainment industry. Footnote 22

    Canada's cannabis supply chain (see Fig. 2) begins with cannabis seeds, cannabis, raw cannabis, and dried cannabis. Producers usually supplied the product to the Maoka industrial, and the processor processes and wraps the product for retail sales. Hemp producers with a maoka mechanic license (see below) can also process and pack products for retail sales. In the 2 3-footed report, it is called cannabis producer, as a cannabis producer, as a whole, for simplification.

    In order to work in the legal cannabis industry, cannabis producers must have a license. Cannabis producers can have various types of licenses:

    Balancing regulation and competition

    A microculture license for the production of plants, seeds, raw hemp and dried hemp with a cultivation area of ​​200 m2.

    Cultivation of flowering plants and germination cannabis, up to 50 m2 cultivation area, a nurse for selling to other license holders as a primary raw material for the production of plants and seeds.

    Standard cultivation license for the production of cannabis and seeds, raw cannabis and dried cannabis without limit to the cultivation area

    Micro processing license for processing, packaging, and labeling for harvested cannabis and industrial cannabis.

    Diversity and inclusion in Canada’s cannabis industry

    One standard processing license for processing, packaging, and labeling of the harvested cannabis and industrial cannabis.

    The State and the Presence Government are responsible for the way to distribute and sell entertainment cannabis in jurisdiction. Note 25 In general, when products are wrapped and can be sold retail, they are sold to states and primrose wholesalers. Note 26) However, cannabis producers may be able to directly supply retailers and adult consumers. Footnote 28

    From the wholesale stage, the products are distributed to cannabis retailers (including brick-and-mortar and online). Medical cannabis sales are under federal jurisdiction, while non-medical sales are under provincial and territorial jurisdiction. Footnote 29 Retail sales models vary by province and territory. Most provinces and territories have adopted a hybrid sales model in which both provinces/territories and private players play a role in recreational cannabis sales. Footnote 30

    Explanation of Figure 2 This diagram provides an overview of the cannabis supply chain and shows the various players involved in cannabis production, distribution, and sales in Canada.

    Barrier 2: THC limits for edible cannabis products

    In the Canadian framework, cannabis production and medical sales are regulated by the federal government, while wholesale distribution and recreational retail are regulated by the provinces.

    Broadly speaking, there are four ways that recreational cannabis can move from cannabis producers to adult consumers:

    Cannabis producers can sell some packaged cannabis products directly to adult consumers.

    Cannabis producers sell some packaged cannabis products directly to recreational retailers.

    Cannabis producers provide products to wholesalers, who sell the products to adult consumers through government-owned provincial or territorial retailers.	Cannabis producers supply products to wholesalers, who in turn supply the products to licensed private recreational retailers.	Note that there are some differences in the supply chains across jurisdictions.
    While many cannabis producers operate in the Canadian cannabis industry, the number of competitors is not the only indicator of industry competitiveness. Footnote 31 In this report, the Department discusses many barriers to competition under the current regulatory framework. These barriers impose significant costs on cannabis producers and stifle innovation. Reducing these barriers could enhance competitiveness for operators and produce better outcomes for small and medium-sized cannabis producers and consumers.	There are many small, medium and large cannabis producers in the Canadian cannabis industry. Market share varies by product line and province, but data obtained by the agency indicates that the Canadian recreational cannabis industry as a whole is characterized by a few large cannabis producers and a large number of small cannabis producers. While the industry is emerging and evolving, some consolidation has already occurred, footnote 32, and stakeholders interviewed by the agency expect further consolidation. Therefore, it is difficult to predict how the industry will continue to evolve in the future. Currently, according to data from Headset. io, the largest cannabis producers have a market share of just over 10% overall, indicating increasing fragmentation (see Figure 3).	There are many small, medium and large cannabis producers in the Canadian cannabis industry. Market share varies by product line and province, but data obtained by the agency indicates that the Canadian recreational cannabis industry as a whole is characterized by a few large cannabis producers and a large number of small cannabis producers. While the industry is emerging and evolving, some consolidation has already occurred, footnote 32, and stakeholders interviewed by the agency expect further consolidation. Therefore, it is difficult to predict how the industry will continue to evolve in the future. Currently, according to data from Headset. io, the largest cannabis producers have a market share of just over 10% overall, indicating increasing fragmentation (see Figure 3).
    Cannabis producers' share of total revenue	Cannabis producers	Share of total revenue
    Pure Sunfarms	Cannabis producers	Cannabis producers

    One standard processing license for processing, packaging, and labeling of the harvested cannabis and industrial cannabis.

    Owsley

    Green Organic Dutchman

    Empowering consumers through choice

    Organizational chart

    Other

    60%

    Leveling the playing field

    All data from Headset. Based on data from British Columbia, Alberta, Saskatchewan and Ontario.

    Note: Tilray's market share in Figure 3 includes HEXO Corp. after the companies announced a strategic alliance on April 12, 2022. On April 10, 2023, a definitive agreement was announced for Tilray to acquire HEXO Corp.

    Cannabis producers compete on several factors, including price, quality, and other business and product attributes and features. According to data from Health Canada's Canadian Cannabis Survey (2022), respondents who used cannabis in the past 12 months ranked product price (30%), safe supply (23%), and product quality (12%) as the top factors that determine where they purchase cannabis. Product quality was also ranked as the second most important factor by 23% of respondents. Footnote 33

    Improving the productivity of cannabis producers

    Cannabis producers also compete in the illegal market. Illegal market players are not bound by licensing requirements and do not face the same costs and regulatory restrictions as licensed cannabis producers. These factors allow illegal market players to offer consumers a wider range of (unregulated) products, often at lower prices, the agency has heard.

    International spotlight: United States

    As mentioned above, the illegal market is a major competitor to licensed cannabis producers. Although steps have been taken to combat the illegal market, it still plays a large role in Canada's cannabis industry (see Figure 4).

    Explanation of Image 4

    Figure 4: Ratio of cannabis consumers accessing illegal cannabis (the first quarter of 2018, the first quarter of 2019, the fourth quarter of 2020)

    date

    Percentage of cannabis consumers accessed illegal cannabis

    Barrier 3: Prohibitions on cannabis promotion, packaging and labelling

    The first quarter of 2018

    Limitations on cannabis promotion

    51, 0%

    Q1 2019

    Packaging and labelling restrictions

    38, 1%

    How do these prohibitions affect the ability of cannabis producers to compete effectively in the industry?

    Q4 2020

    35, 4%

    Barriers to competition outside the Cannabis Act ’s legal framework

    Note *It is significantly different from the reference category (p)

    Barrier 4: The excise duty framework

    Note Due to the small number of samples, almost all of the estimated values, including the age of 15-17, lacked reliability and could not be disclosed. The exception was the estimated value of friends and family in 2019: 91. 8 % (46. 9 % to 99. 3 %), which was significantly higher than the reference category (p.

    Canadian Statistics Bureau (2021), Table 4: The number and percentage of consumers using cannabis from each source (period to selected population statistics, periods to legalization, quarterly), Canada (state only), 2018 and 2019 According to data from the Canada Canadian Health Survey by the Canadian Ministry of Health in the first quarter of the year and the 4th quarter of 2020, in 2022, 33 % of those who used cannabis in the past 12 months were somehow illegal. Obtained cannabis (5 % always purchased from illegal obtained destinations, 5 % is purchased from almost illegal obtained destinations, 8. Sometimes illegal obtained destinations, 15 % are purchased from almost illegal obtained destinations). For more information, see the Canadian Health (2022) "Canada Cannabis Survey 2022: Summary".

    A 2022 survey by the Waterlue University Faculty of Public Health Sciences conducted a tracking survey of the reasons why cannabis consumers would purchase cannabis from illegal destinations. Many reasons are listed, but the most common reasons were prices, the inconvenience of the legal sources, the quality of the product, and the selection of products. Footnote 34

    • However, the legal cannabis industry in Canada has a certain success in destroying illegal cannabis. According to the Canadian Ministry of Health in 2022, about half (48 %) of cannabis in the past 12 months purchased cannabis only from legal suppliers, 43 % of 2021. It is increasing from. The data of the Canadian Statistics Bureau also suggests that the legal industry steadily exceeds illegal markets (see Figure 5). Footnote 35
    • Most of the officials interviewed by the authorities agree that there was a progress, but some believe that the actual share of illegal markets is higher than estimated. This is due to the difficulty of estimating the scale of an opaque market.
    • Explanation in Fig. 5

    The share of the illegal cannabis market in Ontario (4th quarter of 201 8-4th quarter of 2021)

    Excise duty rates

    date

    Share of illegal cannabis market in Canada

    Figure 6: Average price per gram for dried cannabis (Canadian dollars, March 2019 – March 2023)

    Figure 6: Average price per gram for dried cannabis (Canadian dollars, March 2019 – March 2023)

    • Ε4 2018
    87, 2%

    Measures to promote competition will allow cannabis producers to compete more effectively, including illegal markets. As a result, business innovation has been promoted, consumers can get a wider range of qualit y-controlled safe cannabis products, and ultimately lead consumers to legal industries.	86, 2%
    Ε2 2019	79, 6%
    Ε3 2019	70, 8%
    Q4 2019	66, 2%
    Ε1 2020	61, 4%
    Ε2 2020	56, 7%
    Ε3 2020	49, 0%
    Ε4 2020	45, 4%
    Ε1 2021	44, 5%
    Ε2 2021	41, 2%
    Ε3 2021	37, 6%
    Ε4 2021	36, 1%
    Ε1 2022	35, 7%
    Ε2 2022	32, 7%
    Ε3 2022	30, 9%
    Ε4 2022	30, 3%
    Competition is the driving force of the Canadian economy. Competition enhances Canada and benefits Canadian companies and consumers. Competition enhances business efficiency and innovation, promoting companies to provide new and innovative products and services to the market. As a result, consumers provide competitive prices and product options. Footnote 36	Competition is important in the cannabis industry for many reasons. That is, consumers can obtain various products, get enough information, and get the necessary information to determine the purchase. Competition also helps to destroy illegal market activities and strengthen the strength of the legal industry. Without the established illegal market and the ability to compete with powerful and effectively, companies that work in the Canadian emerging legal industry will not be successful or succeeded.
    The determinant of the cannabis industry is responsible for a very important job to protect the health and safety of Canadian people. Several regulation safe guard supports this goal. However, as the cannabis industry continues to develop, healthy competition can strengthen these public policy goals. Even if it is a good faith regulation, it may be sel f-destructed if consumers are pushed from a legal sources of a proven track record to an illegal source of illegal supply that may not be safe.	By actively considering the impact of policy on competition, and making changes that enable competition if possible, the decisio n-made users are still powerful and in the future. You can promote the vibrant cannabis industry.
    In this review, the competition has identified five barriers that affect the Canadian cannabis industry. The bureau recognizes that many cannabis producers are currently developing business in the industry, but these five barriers have made it more difficult to enter the industry, and cannabis producers have innovated. It grows business and directly hinders the truly effective competitive ability.	Barriers 1 through 3 are within the legal framework of the Cannabis Act and are therefore within the scope of Health Canada’s legislative review. Barriers 4 and 5, while not within the scope of the legislative review, impact cannabis producers’ ability to compete effectively. These barriers also highlight the complexity of regulating the legal cannabis industry and the need for government collaboration to promote its competitiveness and long-term sustainability.
    While this is not an exhaustive list of barriers to competition, the five barriers described below were cited frequently by stakeholders interviewed by the Bureau and are widely documented in the literature.	Stakeholders informed the Bureau that licensing requirements and regulatory compliance costs37 can make it difficult and hinder cannabis producers from setting up and competing effectively. They are particularly burdensome for small and medium-sized enterprises, which may lack the financial resources or expertise to meet many of the regulatory requirements. We have also heard that such factors discourage illegal market participants from entering the legal industry.
    Require cannabis producers to have completed their establishment before receiving a license. The Department has heard that operators are required to invest millions of dollars before they can be licensed in the cannabis industry. Before cannabis producers can obtain a license, they must have a fully constructed site. Footnote 38 In some cases, they will modernize their existing facilities and invest in the infrastructure needed to comply with regulations (physical security measures such as optical recording devices), while in other cases they will build facilities from scratch. The Department recognizes that there are currently many cannabis producers in the industry, but has heard that these high start-up costs make it more difficult for some operators to enter the industry or obtain housing. Barriers 1 through 3 are within the legal framework of the Cannabis Act and are therefore within the scope of Health Canada's legislative review. Barriers 4 and 5 are not within the scope of the legislative review, but they impact cannabis producers' ability to compete effectively. These barriers also highlight the complexity of regulating the legal cannabis industry and the need for government cooperation to promote its competitiveness and long-term sustainability. While this is not an exhaustive list of barriers to competition, the five barriers described below were frequently cited by stakeholders interviewed by the Department and are widely documented in the literature.	Stakeholders reported to the Department that licensing requirements and regulatory compliance costs37 could make it difficult and impede cannabis producers from setting up and competing effectively. They are particularly burdensome for small businesses, which may lack the financial resources or expertise to meet many of the regulatory requirements. We also heard that these factors discourage illegal market participants from entering the legal industry.
    Require that cannabis producers complete their establishment before being licensed. The Department has heard that operators will need to invest millions of dollars before being licensed in the cannabis industry. Require that cannabis producers have a fully constructed site before they can obtain a license. Footnotes 38 In some cases, they will modernize existing facilities and invest in the infrastructure needed to comply with regulations (such as physical security measures like optical recording devices), while in other cases they will build facilities from scratch. The Bureau recognizes that there are currently many cannabis producers in the industry, but has heard that high start-up costs make it more difficult for some operators to enter or obtain housing in the industry. Barriers 1 through 3 are within the legal framework of the Cannabis Act and are therefore within the scope of Health Canada’s legislative review. Barriers 4 and 5, while not within the scope of the legislative review, impact cannabis producers’ ability to compete effectively. These barriers also highlight the complexity of regulating the legal cannabis industry and the need for government collaboration to promote its competitiveness and long-term sustainability.	While not an exhaustive list of barriers to competition, the five barriers described below were frequently cited by stakeholders interviewed by the Bureau and are widely documented in the literature.
    Stakeholders reported to the Bureau that licensing requirements and regulatory compliance costs 37 can make it difficult and hinder cannabis producers from establishing or competing effectively. They are particularly burdensome for small and medium-sized enterprises, which may lack the financial resources or expertise to meet many of the regulatory requirements. We have also heard that these factors discourage illegal market participants from entering the legal industry.	Require cannabis producers to complete their setup before receiving a license. The Department has heard that operators must invest millions of dollars before being licensed in the cannabis industry. Require cannabis producers to have a fully constructed site before obtaining a license. Footnote 38 In some cases, they will modernize existing facilities and invest in the infrastructure necessary to comply with regulations (physical security measures such as optical recording devices), while in other cases they will build facilities from scratch. The Department recognizes that there are currently many cannabis producers in the industry, but has heard that these high start-up costs are making it more difficult for some operators to enter the industry or obtain housing.
    In order to raise funds to build facilities, companies need to secure capital through investors and banks. This is difficult for small and mediu m-sized enterprises without licenses and business brand images. Some officials have reported that it is difficult to get a loan from a bank, and it is extremely difficult for companies to procure capital. In the current collective lawsuit, a Canadian bank refuses to open a bank account for legal cannabis business, or refuses access to mortgages and 40 loan slots. He said he went.	Lon g-cost security procedures and requirements. To get a license from the Canadian Ministry of Health, cannabis producers need to obtain security clearance of major personnel. Note 41) While this security clearance has an effective and important purpose, it costs additional costs (Note 42), and in some cases it can take several months to one year to complete. Footnote 43
    As mentioned earlier, cannabis producers must also comply with various physical security measures to secure cannabis premises, and the initial costs are high. Footnote 44	The Canadian Revenue Agency (CRA) is a minimum of $ 5, 000 for all cannabis cultivators and up to $ 5 million for cannabis processors, in addition to the security requirements of the Health Canada (Health Canada). We are demanding a deposit). Note 45
    The expensive application and the acquisition and maintenance of the annual regulation of cannabis licenses are expensive for cannabis cultivators only for application fees and annual regulatory fees (see Table 1). Note 46) The bureau has heard that these commissions are intended for cost recovery, but they are too expensive and may hinder the entry of the industry and increase industry withdrawal. In addition, many microcanna bis producers may not want to expand their business, but producers who want to expand their business may be less likely to require standardized licenses.	Navigate, a legal framework, heard that some cannabis producers are struggling with the legal rules for license. Some officials have told the secretariat that this process has been improved, but other stakeholders have stated that it is almost unclear how to prepare successful applications, and the process is a management burden. Ta.

    Source:

    Although it is out of the Legal Review of the Ministry of Health, the report also mentions the other two barriers to competition. These two problems were widely raised by industry officials, and after all, it hinders the ability of cannabis producers to compete effectively in the industry:

    Note: These numbers do not take any additional regulatory compliance costs:

    Terms of payment and unpaid excise duties

    Physical construction requirements

    Figure 7 : Total unpaid cannabis excise duties (Canadian dollars, 2019 – 2023)

    Figure 7 : Total unpaid cannabis excise duties (Canadian dollars, 2019 – 2023)

    • Physical security cost
    CRA regulatory cost (security deposit, goods tax, stamp tax requirements).

    Note	The sample of annual income is intended only for example. These are arbitrary income used to emphasize the minimum entry and entry of cannabis producers and beyond entry and entry of cannabis producers with a lower threshold of $ 1 million.
    2019	For more information about the annual regulation fee, see the section 6. 0 of the Canadian Ministry of Health, the Cannabis Fee Direction Guide 6. 0. It should be noted that the time and application of the annual regulatory fee to the Canadian Ministry of Health may vary depending on whether the Licensee is in three periods (entry, first year, next year).
    2020	The minimum site usage fee of the Ministry of Health (HCN) is $ 2, 500 for microscaster licensei and $ 23, 000 for standar d-dricencies. For more information, please refer to Section 6. 1. 1 of the Canadian Ministry of Health's "Order Guide".
    2021	In the case of a small licensee, this fee is 1 % if the cannabis income is $ 1 million or more, and a 2, 3 % for $ 1 million. In the case of standard licensing, this fee is a few % of cannabis income. For more information, refer to Section 6. 1. 3 of the Cannabis Fee Ordering Guide of the Health Canada.
    2022	The Ministry of Health of Health, the Cannabis Tax Order Guide 6.
    2023	The illegal cannabis producers do not face these costs to comply with regulations, and other specific costs (for example, physical building requirements, physical security costs, CRA regulation costs). In addition, officials pointed out that the wholesale price (applicable) would be basically set by state or regional wholesalers, albeit with several exceptions. In an illegal market, cannabis producers can decide the price on their own. Legal cannabis producers need to operate more efficiently, taking into account regulation and other additional costs.

    Source:

    As described in the commitment document for the Legal Study of the Canadian Health Health, "The license system is designed to enable a diverse and competitive legal industry consisting of large and small businesses. The system states that the purpose is to enable various activities, reduce the risk of organized crime into legal industries, and promote the transition to illegal producers to the legal industries. " 。 Footnote 47

    As mentioned earlier, the license plays a necessary and important role in cannabis production regulations and directors in Canada. However, the aspect of the licensed process may not be able to compete well in the industry, combined with the cost of complying with regulations. The operating cost is too high to sustain, and businesses may completely withdraw from the industry. Footnote 48

    At present, the industry is characterized by relatively many cannabis producers, but the number of competitors alone cannot accurately measure the competitiveness of the industry. By minimizing the burden on the licensed process and reducing compliance costs as much as possible, the decision-determined decides reduces the barrier of entry and expansion, further effective in competition-within the legal cannabis industry and legal cannabis producer. It is possible to stimulate competition with illegal colleagues in the market. This will enable business operators to operate more productive and efficiently, increasing the possibility of success in the industry.

    Reducing the barriers of regulations will also stimulate innovation and increase consumer diversity and options. Reducing the burden of regulations can help the decisive determination to achieve other important public policy goals, such as driving illegal markets and protecting the diversity and vitality of the legal cannabis industry in Canada.

    Through interviews with the stakeholders, the authorities may be disproportionate to groups with low social status, such as women and communities with racism, especially in the barriers of regulations, especially in terms of licensing and funding. I heard that there is.

    Barrier 5: Lack of industry standardization

    For example, aspects with the process of obtaining cannabic license, such as detailed identity surveys, prevent people related to organizational crime from entering the legal industries, and the license acquisition people are unacceptable to public health and safety. Introduced to prevent it from being brought. However, these requirements have directly influenced the ability to acquire a license and compete in the legal industry, combined with the issues facing some groups in access to capital.

    The Ministry of Health has already implemented many measures to enhance diversity and comprehensive*in the legal cannabis industry. Authorities have the impact of the Ministry of Health of Canada to groups with low social status, and how they can correct policies to promote more competitive legal industries. Encourage to continue considering. < SPAN> License plays a necessary and important role in cannabis production regulations and directors in Canada, as described above. However, the aspect of the licensed process may not be able to compete well in the industry, combined with the cost of complying with regulations. The operating cost is too high to sustain, and businesses may completely withdraw from the industry. Footnote 48

    Getting products to market

    At present, the industry is characterized by relatively many cannabis producers, but the number of competitors alone cannot accurately measure the competitiveness of the industry. By minimizing the burden on the licensed process and reducing compliance costs as much as possible, the decision-determined decides reduces the barrier of entry and expansion, further effective in competition-within the legal cannabis industry and legal cannabis producer. It is possible to stimulate competition with illegal colleagues in the market. This will enable business operators to operate more productive and efficiently, increasing the possibility of success in the industry.

    Reducing the barriers of regulations will also stimulate innovation and increase consumer diversity and options. Reducing the burden of regulations can help the decisive determination to achieve other important public policy goals, such as driving illegal markets and protecting the diversity and vitality of the legal cannabis industry in Canada.

    Through interviews with the stakeholders, the authorities may be disproportionate to groups with low social status, such as women and communities with racism, especially in the barriers of regulations, especially in terms of licensing and funding. I heard that there is.

    For example, aspects with the process of obtaining cannabic license, such as detailed identity surveys, prevent people related to organizational crime from entering the legal industries, and the license acquisition people are unacceptable to public health and safety. Introduced to prevent it from being brought. However, these requirements have directly influenced the ability to acquire a license and compete in the legal industry, combined with the issues facing some groups in access to capital.

    Recommendations

    The Ministry of Health has already implemented many measures to enhance diversity and comprehensive*in the legal cannabis industry. Authorities have the impact of the Ministry of Health of Canada to groups with low social status, and how they can correct policies to promote more competitive legal industries. Encourage to continue considering. As mentioned earlier, the license plays a necessary and important role in cannabis production regulations and directors in Canada. However, the aspect of the licensed process may not be able to compete well in the industry, combined with the cost of complying with regulations. The operating cost is too high to sustain, and businesses may completely withdraw from the industry. Footnote 48

    At present, the industry is characterized by relatively many cannabis producers, but the number of competitors alone cannot accurately measure the competitiveness of the industry. By minimizing the burden on the licensed process and reducing compliance costs as much as possible, the decision-determined decides reduces the barrier of entry and expansion, further effective in competition-within the legal cannabis industry and legal cannabis producer. It is possible to stimulate competition with illegal colleagues in the market. This will enable business operators to operate more productive and efficiently, increasing the possibility of success in the industry.

    Recommendation 1: Health Canada should review the cannabis licensing process and related regulatory compliance costs to ensure policies are minimally intrusive to competition, where possible.

    Reducing the barriers of regulations will also stimulate innovation and increase consumer diversity and options. Reducing the burden of regulations can help the decisive determination to achieve other important public policy goals, such as driving illegal markets and protecting the diversity and vitality of the legal cannabis industry in Canada.

    Through interviews with the stakeholders, the authorities may be disproportionate to groups with low social status, such as women and communities with racism, especially in the barriers of regulations, especially in terms of licensing and funding. I heard that there is.

    For example, aspects with the process of obtaining cannabic license, such as detailed identity surveys, prevent people related to organizational crime from entering the legal industries, and the license acquisition people are unacceptable to public health and safety. Introduced to prevent it from being brought. However, these requirements have directly influenced the ability to acquire a license and compete in the legal industry, combined with the issues facing some groups in access to capital.

    Recommendation 2: Health Canada should review and consider adjusting THC limits on edible cannabis products, as appropriate, to allow legal cannabis producers to meet consumer demand and better compete with the illicit market.

    The Ministry of Health has already implemented many measures to enhance diversity and comprehensive*in the legal cannabis industry. Authorities have the impact of the Ministry of Health of the Canadian to a group with a low social status, and how to correct the policy to promote more competitive legal industries. Encourage to continue considering.

    *For example, Health Canada offers some services specifically for Aboriginal and First Nations applicants, which include a two-stage review process.

    Delta-9-tetrahydrocannabinol (THC) is the primary psychoactive compound found in cannabis. Footnote 49 THC is involved in how the brain and body respond to cannabis, including intoxication. THC potency varies depending on the cannabis product in question, but is usually expressed as a percentage of THC by weight or volume. Footnote 50

    Recommendation 3: Health Canada should review and consider easing restrictions on cannabis promotion, packaging and labelling, as appropriate, to empower consumers to make informed purchasing decisions and to provide cannabis producers with more flexibility to compete and innovate.

    In Canada, the amount of THC that may be present in cannabis products is regulated to reduce the risks associated with overdose (including accidental ingestion). Footnote 51 While these public health and safety objectives are important, policies vary by product category and may have the unintended effect of giving the illicit market a competitive advantage, particularly in the vaping sector.

    Health Canada, in its engagement documents, notes that there are no limits on the THC content of dried cannabis products to facilitate the ability of the legal industry to compete and shift illicit markets. 52) However, this is inconsistent with the approach to other categories of cannabis products, including edibles (see Table 2).

    Table 2: THC Limits per Unit and Container/Package by Product Category

    Product Category

    Conclusion

    Limit per Unit

    Limit per Container/Package

    Raw or Dried Cannabis

    How to contact the Competition Bureau

    None

    Website

    Address

    None

    Telephone

    Hemp Extracts and Topicals

    Facsimile

    Footnotes

    10 mg

    1, 000 mg

    Cannabis Edibles (e. g. gummies, chocolates, baked goods, beverages)

    10 mg

    10 mg

    Source

    

    Elim Poon - Journalist, Creative Writer

    Last modified: 27.08.2024

    Most of these ex- perimentally based studies of plant competition have examined the effect on yield (plant biomass, number of fruits, or number of seeds) per. Plant your sunflower seeds and compete to grow the tallest sunflower! Agree a date to plant your seeds in early summer and a date to measure your sunflowers. Calling all artists ages Use your creativity to help sustain our world! Create a piece of art that illustrates the theme: Plant the Seed.