Vancouver Enacts Bylaws To Regulate Medical Marijuana-Related Retail Businesses

Medical marijuana is becoming big business. Recently, it was announced that two titans in the medical growing sphere have agreed to merge in a $58-million deal expected to close in August. The headlines in Vancouver relate to the recent boom in medical marijuana-related storefront "dispensaries." Over the last two years, the number of these retail businesses in the City has grown by 100 percent each year. As of April 2015, the City reported that there were over 80 such businesses operating in Vancouver without a business licence.

On June 24, 2015, Vancouver became the first city in Canada to regulate this emerging business sector. The bylaw amendments were made pursuant to the City's business regulation and licensing powers (Vancouver Charter, s. 272) and regulate business licences, not directly the sale of marijuana. The full text of the amendments is available here.

What follows is a summary of the key features of the new regulatory and licencing regime in Vancouver.

Two New Types of Business Licences: Compassion Club and Retail Dealer

As of August 24, 2015, those operating a medical marijuana-related retail business must have a licence from the City. There are two new classes of business licences available: Compassion Club and Retail Dealer - Medical Marijuana-related.

A Compassion Club is a retail business that advocates for the use of medical marijuana while providing non-marijuana health services at least 60% of the time. Compassion Clubs must also be duly registered non-profit societies, serve only their members, and hold membership in the Canadian Association of Medical Cannabis Dispensaries. The annual business licence fee for this category is $1000. No person can hold more than one licence as a Compassion Club.

The retail dealer licence applies to businesses that advocate for the use of medical marijuana and do not carry on any other business on the premises. Holders of this licence cannot incorporate, but may be non-profit societies. A person can hold up to five licences of this category; however, the licence fee is $30,000 annually, the City's highest licence fee.

Ban on Selling Edibles and Provisions Protecting Minors

Neither business licence category permits the sale of edible products, with the exception of tinctures, capsules and edible oils. This exception responds to the Supreme Court of Canada's decision in R v. Smith, 2015 SCC 34 which found that the federal ban on possession of non-dried forms of medical marijuana was...