Cannabis sales in Canada could launch by late summer or fall

Canada will be the first G7 nation to legalize marijuana nationwide

Recreational cannabis advocates cheered Thursday night as the Canadian Senate voted to pass Bill C-45 — the landmark legislation to legalize recreational marijuana — by a vote of 56 to 30, with one abstention.

It was high time, according to cannabis advocates. Canada is the second country in the world, behind Uruguay, to legalize recreational marijuana. Cannabis is partially or fully decriminalized in some countries, such as Switzerland and Spain, but Canada will be the first G7 nation to give commercial sale the go-ahead.

“It’s a historic night for Canada in terms of progressive health policy and social policy,” said the bill's sponsor, Independent Senator Tony Dean.

Canada's Attorney General and Justice Minister, Jody Wilson-Raybould, echoed Sen. Dean's comments.

"C-45 will create a strictly-regulated cannabis market, which will help keep it out of the hands of kids and take profits away from criminals," she Tweeted last night. "This is a milestone for progressive public policy."

Details still to hash out

There was fractious debate and a near-fatal vote along the pathway as bill C-45 moved through Parliament. And there are still a number of hurdles to pass through.

The bill will now go on to the House of Commons for further review of the numerous 45 amendments (far more than most pieces of government legislation).

The government must now decide which amendments to keep, modify and toss before sending the bill back to the Senate, where it will be voted on again.

Roll out could be delayed

Canada's Health Minister Ginette Petitpas Taylor said that once the bill is passed, provinces and territories will need two to three months to prepare — before cannabis is actually available in a retail setting. That is likely a best-case scenario.

From a company perspective, many companies have welcomed the delay in the process, as it allows them a bit more time to get ready, particularly on the supply side, with many producers facing the challenge of having enough product to meet supply demands.

According to industry analysts, Canada’s cannabis industry could surpass C$22 billion in size over the coming years.

US could further tap into the market

The change also has the potential to bring entrants to the market, as Canada's neighbours to the south look north, with an aim to tap into the industry.

"I’m going to wear my American hat here. I think we’re going to see a huge influx of American companies that have already been working with Canadian companies on many of their products, move more into the market," said Meris Kott, CEO of Redfund Capital Corporation, a cannabis merchant bank that provides an alternative source of capital through a debt facility to bridge financing.

Kott has straddled both worlds, after originally getting into the cannabis industry in 2012 in Colorado, after Amendment 64 passed in the state.

"I think the Americans are going to flood our market with new brands, technologies and licensing agreements, as well as other countries who have approved recreational cannabis already. It can only help create a successful global marketplace."

Nine states and Washington, DC, have legalized marijuana for recreational use for adults over the age of 21.

Provinces to decide specifics

Individual provinces and territories in Canada will have significant power when it comes the specifics of recreational cannabis in Canada. The nationwide maximum for personal possession is set at 30 grams.

However, other specifics, such as implementation (government-operated or private industry), the eligible age of purchase (likely 18 or 19) and home cultivation rules were all be decided on by each specific province and territory.