In 2015, the Liberals were trying to convince Canadians that legalizing cannabis would make our country a leader in the field. Given how strict the rules on edible cannabis products will be, it seems the Liberals are the ones who need convincing
By Sylvain Charlebois
Senior Fellow
Atlantic Institute for Market Studies
Health Canada’s regulatory framework on cannabis edibles will likely receive parliamentary approval and royal assent within weeks.
But the framework is not exactly what most had in mind a few years ago, when everyone thought the federal government was inviting all Canadians to an enormous festival, at an exciting venue playing great music, with lots of dancing and fun.
What we got instead is an invitation to some dingy bingo hall playing lousy music.
That may explain why Canadians are now much less enthusiastic about the whole deal.
But despite the industry wanting more leeway, this outcome was very predictable.
Barely anything has changed from the proposals introduced in December 2018, before the 60-day consulting process. More than 7,000 reports with recommendations were submitted, but Health Canada opted to overlook most.
According to the framework, edibles are a drug, not a food. This is essentially the rationale used to isolate edibles from everything – in manufacturing, retail and throughout the entire supply chain.
Rules are set by Health Canada and will be implemented and supported by the Public Health Agency of Canada.
Despite having more than 3,200 inspectors in the field, it appears the Canadian Food Inspection Agency won’t be actively involved in ensuring industry compliance. Oversight instead falls to the Public Health Agency, which has 70 inspectors nationwide with limited food processing knowledge.
This could create challenges and confusion for regulators and industry.
Also, some of the regulations are unequivocally absurd. Asking companies to process cannabis-infused products in a separate facility, and build it before applying for their licence, is completely unreasonable. This has nothing to do with protecting the public and will be a significant barrier for would-be processing companies. None of this changed from the December draft.
On the positive side, the law will include much-needed guidelines around the safety of children and labelling. For example, potentially hazardous gummy bears won’t be manufactured in Canada.
However, strict rules could mean the black market will explode.
A recent Dalhousie University study suggested that 71 percent of Canadians who support legal cannabis would try an edible product. Deloitte also predicts that the edible market will grow, as it has in many parts of the U.S.
The market for edibles is clearly there and many consumers will be tempted to go online to purchase unregulated edibles from abroad. So you may see gummy bears but they won’t be Canadian-made, or they may be homemade.
In Colorado, where cannabis has been legal for six years, the black market represents about 20 percent. And the Colorado edible market represents well over 40 percent of all cannabis sales and is growing.
Health Canada has predictably and unfortunately shown little interest in listening to industry throughout this process.
We still don’t know much about cannabis and most standards set by Health Canada are based on blurred science. The industry has data that Health Canada could benefit from. By being too overbearing, Health Canada could generate more risks for consumers, not less.
But for Health Canada and the government, on the eve of a federal electoral campaign, it’s all about mitigating perceived risk.
Most Canadians won’t have an issue with this but the work of an overzealous regulator can be costly. It can only delay society’s willingness to shed stigmas about cannabis.
Many consumers will either continue to prepare edibles at home or buy illegally imported products, without oversight. The recent Dalhousie study also suggested that nine percent of all Canadians cook with cannabis at home at least once a month.
Socially normalizing cannabis will help us safely benefit from a natural plant that’s been around for centuries. Cannabinoids, especially CDB, the non-psychoactive agent of the plant, can enhance the quality and the value of many food products. Yet there’s no new mention of CBD in the regulations.
Don’t be surprised to see companies test regulators’ tolerance by not complying with the rules. We’re already seeing it, particularly around the marketing of products and sponsorship of events.
Companies will no doubt partner up, sharing research and development and distribution strategies. The C3 facility in Montreal, the Global Cannabis Innovation Centre, involves McGill University and offers a good example of that.
Canadian industry is also spending a great deal of time abroad to position their products as countries like New Zealand, Mexico and Argentina move toward cannabis legalization.
So while Health Canada wants to keep our fun at bay, the industry is moving ahead.
A few years ago, the Liberals were telling skeptical Canadians that cannabis should be legalized and that would make Canada a leader in the field. But now it’s the Liberal government that appears less convinced.
Dr. Sylvain Charlebois is senior director of the agri-food analytics lab and a professor in food distribution and policy at Dalhousie University, and a senior fellow with the Atlantic Institute for Market Studies.
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