Can Municipalities Do Anything About The Number Of Cannabis Shops Popping Up Everywhere?

• Published date: 01 April 2022
• Subject Matter: Cannabis & Hemp
• Law Firm: McCague Borlack LLP
• Author: Mr Eric Turkienicz and Paul Jacoby

Nowadays, you can't walk very far down the streets of downtown Toronto, and likely other major cities, without seeing a cannabis store. A product that was illegal a short time ago is now widely available to the public. Before January 22, 2019, municipalities could opt out of cannabis retail stores within their municipal boundaries.¹ Some of those that haven't are left wondering what their options are.

Can municipalities do anything about the volume and density of cannabis shops showing up everywhere? In short, while they can have their concerns heard, their right to be heard doesn't mean they have a right to be obeyed.

To become a licensed cannabis store, one must send an application to the Registrar.² Before approving a license, the Registrar must provide notice to the municipality which may make written submissions against granting the license.³ These submissions need to discuss whether issuing the license is in the public interest, based on the needs and wishes of residents.

Nothing in the Act, however, compels the Registrar to take action as a result of the municipality's submissions. The only other avenue for a municipality to prevent or restrict the establishment of cannabis stores, through the establishment of by-laws, is prohibited if they have already opted in.⁴

The Registrar makes the final decision about licensing approval, based on enumerated factors in the Act, including the broad language of "any other circumstance that may be prescribed."⁵ This could also be used by municipalities to make an argument against granting a license. Ultimately, the licensing decision will come down to a municipality persuading the Registrar that the cannabis store in question is against the public interest. The Registrar's decisions can be subject to further review if one side or the other is dissatisfied with the result.⁶

Despite the municipalities having little control over the Registrar's decision, there are still some restrictions on issuing a license. For example, storefronts cannot be located within 150 metres of schools (as defined in the Education Act).⁷

In British Colombia, a recent case held that a strata, which is an entity similar to a condominium corporation in Ontario, can pass by-laws to prevent a potential licensee from undertaking cannabis-related activities.⁸ Though this case has not been applied in Ontario, it suggests that a condominium corporation may be able to pass by-laws to restrict cannabis stores from opening on their property, for...