Matt Maurer wrote an article for Cannabis Retailer

Matt Maurer, Co-chair of our Cannabis Law Group and Chair of our Franchise Law Group, wrote an article for the August issue of Cannabis Retailer on regulator disputes. 

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Q: Does the municipal or provincial government have the authority to place a cap on the number of businesses or would that infringe on any laws affecting businesses?

We all know that the Cannabis Act, which legalized adult-use cannabis nationwide, is a piece of legislation enacted by the federal government, however, under the Canadian Constitution the provinces and territories have exclusive jurisdiction over property and civil rights within their borders. “Property and civil rights” essentially includes all commercial transactions that take place within a province or territory. As such, the manner in which cannabis retail is to be conducted within a given province or territory and the rules by which retailers must abide, including any potential cap on the number of stores or businesses, is within the purview of the provincial and territorial governments. Indeed, a number of provinces have set caps on things such as the total number of stores that can be opened within the province or territory and also how many stores can be owned or operated by any given retailer (and their “related” or “affiliated” entities).

The fact that provinces and territories each set their own rules has created vastly different retail regimes across the country. At the municipal level, the rules and regulations are even more diverse. What a municipality can and cannot do is dictated by the province or territory, and the various provinces and territories have taken different approaches. In Ontario, for example, the province has expressly provided that any municipal by-law that has the effect of treating a cannabis store different than another business is essentially void. Ontario has also removed the ability for municipalities to pass business licensing by-laws as they relate to cannabis retail stores. In Alberta on the other hand, not only are municipalities allowed to set certain rules, retailers may not even apply for their provincial sales license until such time as they have first received approval from the local municipality. 

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To read the full article, please visit the Cannabis Retailer website.