Since recreational cannabis was legalized in 2018, the cannabis retail industry in Ontario has boomed. There are numerous laws, regulations, and rules floating around in a variety of resources, which can make understanding and undertaking the process of opening a cannabis retail store a challenge. This blog is intended to eliminate the extra research and bring the information you need together in a simple step-by-step guide, so you can open your cannabis retail store sooner.
Anyone who would like to open a cannabis retail store in Ontario, must complete the following steps:
- Send a notice to the local government, fire authority, and police force or Royal Canadian Mounted Police detachment responsible for providing policing services to the area;
- Obtain a Retail Operator Licence;
- Obtain a Cannabis Retail Store Authorization;
- Obtain a Cannabis Retail Manager Licence;
- Enter into a supply purchase contract with the Ontario Cannabis Retail Store (OCS); and
- Obtain a security clearance and complete the AGCO board-approved training program.
Notice to the local government, fire authority, and police force
Notice of a potential new cannabis retail store must be addressed and delivered to a senior official at the local government, fire authority, and police force and must contain: (i) the applicant’s name; (ii) the date the applicant expects to submit an application for a Retail Operator Licence; (iii) the class of licence sought (i.e. licence for the sale of cannabis); (iv) the activity the applicant expects to conduct under the licence (i.e. opening and operating a retail cannabis store); and (v) the address of the site where the applicant plans to open and operate the store.
Retail Operator Licence
To apply for a Retail Operator Licence, you will need to create an iAGCO account and submit your application through the iAGCO portal. The applicant must:
- be at least 19 years of age (for a corporation, every director, officer, and shareholder must be at least 19);
- not have been charged with an offence under or be/have been carrying on activities not in compliance with the Cannabis Act, Cannabis Control Act, or Cannabis Licence Act;
- not have roles in or connections with any criminal organizations, as defined in s. 467.1(1) of the Criminal Code;
- not make false statements or provide false information on your application;
- not have defaulted in filing Ontario tax returns and must not have amounts owing in tax, penalties, or interest (unless you have made payment arrangements);
- have filed all corporate tax returns if you have a business number with the CRA;
- if applying through a corporation, ensure that no more than 25% of the corporation is owned by licensed cannabis producers or their affiliates;
- be financially responsible in operating your cannabis retail business;
- operate your cannabis retail business in compliance with the law and with integrity, honesty, and in the public interest; and
- not have had a Cannabis Retail Store Authorization revoked in the past.
You must wait two (2) years to apply for a Retail Operator Licence if you (i) applied for a Retail Operator Licence or a renewal of a Retail Operator Licence in the past but were refused, or (ii) you had a Retail Operator Licence that was revoked.
As part of your application, you will need to obtain a Tax Compliance Verification Number from the Ontario government; if the applicant is a corporation, submit your corporation’s articles of incorporation, by-laws, shareholder agreements, and the details of the company’s shareholdings; and upload the applicant’s tax returns, assessments, and financial statements. Shareholders, owners, directors, and officers of the applicant will also be required to file information regarding their backgrounds and integrity.
Cannabis Retail Store Authorization
You will also need to apply for a Cannabis Retail Store Authorization through the iAGCO portal. The applicant must:
- have a Retail Operator Licence, either when you apply for a Store Authorization or when the Cannabis Retail Store Authorization would be issued;
- not have a Retail Operator Licence that has conditions that do not allow you to apply for or receive a Cannabis Retail Store Authorization for that store;
- not have been charged with an offence under or be/have been carrying on activities not in compliance with the Cannabis Act, Cannabis Control Act, or Cannabis Licence Act;
- not have roles in or connections with any criminal organizations, as defined in s. 467.1(1) of the Criminal Code;
- not hire or plan to hire someone who does not have a Cannabis Retail Manager Licence but should because of the work they do;
- ensure the store is in the public interest, based on the needs and wishes of the people who live in the municipality (the registrar will post a notice on the AGCO website, and the municipality and local residents may send in submissions regarding health and safety, protecting youth and preventing illicit activities);
- ensure the store, equipment, and facilities comply with the Cannabis Licence Act and its regulations and the Registrar’s Standards for Cannabis Retail Stores;
- have sufficient control over the store, equipment, and facilities; and
- not have made a false statement or provided false information in your application.
You must wait two (2) years to apply for a Cannabis Retail Store Authorization if you (i) applied for a Cannabis Retail Store Authorization or a renewal of a Cannabis Retail Store Authorization in the past but were refused, or (ii) you had a Cannabis Retail Store Authorization that was revoked.
After you submit your application for a Cannabis Retail Store Authorization, the AGCO will determine a 15-day posting period during which you will be required to post a Public Notice placard, provided by AGCO, on the proposed storefront. During the posting period, residents of the municipality and the municipality itself may file submissions about your proposed cannabis store to the AGCO. At the end of the posting period, the AGCO will consider any submissions and make a final decision to either issue or refuse your Cannabis Retail Store Authorization. If you are refused, you may be able to submit an application for judicial review to the Superior Court of Justice.
Conclusion
Stay tuned for Part 2 of this blog where we will cover the last three steps to opening a cannabis retail store in Ontario: obtaining a Cannabis Retail Manager Licence; obtaining a supply purchase contract with the Ontario Canada Retail Store; and obtaining a security clearance and completing mandatory training. We will also cover the rules and regulations that apply to cannabis retail.
