In Response to the Task Force Report on Cannabis Legalization
This week the Task Force on Cannabis Legalization and Regulation released a report and provided some clarity on the potential Canadian government roll-out plan. As a cannabis lifestyle brand, Tokyo Smoke wanted to discuss what this means for the variety of cannabis consumers and share some of our initial thoughts.
While the findings are suggestions and not mandates, we would imagine the Federal Government would give significant consideration to these proposals when formulating their ultimate legalization strategy.
Overall we are excited and more convinced than ever that cannabis is going to be to Canada what wine is to France. The Task Force outlined the potential for retail storefronts, a recreational mail-order system, edibles, cannabis lounges, and a minimum age for consumption of eighteen. This is a more inclusive roll-out plan than was seen in many of the legal US states and will allow for a vibrant market with both product, consumption and retail choices.
The Task Force reinforced that provinces will have quite a bit of latitude in deciding wholesale and point-of-sale in the recreational market. This is an interesting point as in-province distribution could end up looking quite different across the country. With the additional point that retail outlets shouldn’t mix marijuana and alcohol, many who thought that, by default, the liquor boards would gain control of marijuana distribution/retail may have to re-think how the retail environment will look. It will be interesting to see what other restrictions are put on potential retailers whether it be the required distance from public places (parks, schools, etc.) or the dual entry/ID system as is seen in many legal states in the US..
When it comes to marketing, the comparison to the tobacco industry is a bit of a let-down. While restrictions on advertising do make sense, especially when it comes to keeping the product out of the hands of youth, using the alcohol industry’s regulations as a guide would be preferable. There is still plenty of room for brands to be both creative and engaging while educating consumers about the product.
In terms of production, the report suggests Licensed Producers as the de facto suppliers — companies that will “Regulate the production of cannabis and its derivatives (e.g., edibles, concentrates) at the federal level, drawing on the good production practices of the current cannabis for medical purposes system.” This is no big surprise but valued confirmation. Anne McLellan did talk about “diversity of supply” but said new entrants will still have to conform to strict production & quality standards (i.e. — go through the Health Canada gauntlet like every Licensed Producer and applicant). This will ensure a safe, regulated product for the market. While it may be difficult, initially, to have a system of ‘craft grow’ and ’large-scale grow’, some provinces may try to implement this themselves (namely BC). This will help provide the market with the desired diversity in product choice that we see in other categories ranging from food and beverage to skincare to alcohol.
Overall, this is another big step toward legalization. Canada is on its way to furthering our position as a global leader in the Cannabis space. While we can nitpick about little things here and there in the Task Force report, the fact is, we continue to make positive steps towards an open, legal market. This report is yet another reminder that Canada is taking a thoughtful, progressive approach to legalization and Tokyo Smoke is thrilled to be involved in this journey.