Missed out on opening a legal cannabis retail dispensary in Ontario the first time around?

Today, July 3, 2019, the provincial government officially announced their plans to license an additional 50 cannabis retail stores in Ontario, including eight on First Nations reserves.

The province hopes these new stores will be open by October 1 2019, which once again means that stores will be under a time crunch to get built and launch once licensed.

There will be 7 stores in the East, 6 stores in the GTA, 13 in Toronto, 11 in West Region, and 5 in the North.  

Prospective store owners will need things from their bank: (i) a commitment to provide a $50,000 standby letter of credit and (ii) a letter of confirmation that you have the financial capacity to obtain $200,000 in cash or cash equivalents and that you  are in good standing.

In addition, applicants will need to confirm that they have secured a location and the type of arrangement (lease, rent, or purchase) will serve as the legal basis of occupation in October 2019.

Licensed producers and their affiliates will not be allowed to apply. While that rule was in place for the first lottery, producers and related companies found their way into the mix by licensing their brand names out to stores in ways that were compliant with the AGCO. No word yet on whether this type of arrangement would be allowed for the second lottery, but there does not appear to be explicit rules prohibiting it.

An interesting rule to the lottery that wasn’t found in the rules to the first lottery is that applicants must adhere to provincial disabilities accessibilities legislation, likely put in the rules after some locations in the first lottery were not wheelchair accessible.

Lottery applications will be accepted starting 12:01AM August 7 and ending 8pm on August 9. The lucky lottery winners will be selected on August 20. Like the first lottery, the fee to enter is only $75.

First Nations communities will also get the chance to have legal cannabis stores on reserves but won’t be subject to the rules. Eight of the 50 licenses set aside will be for applicants located, and they won’t be subject to lottery requirements – they will be awarded on a first-come first-served basis and the respective Band Council must ultimately approve the location.

I would be happy to assist you with your AGCO lottery application, and other related matters such as incorporation, trademark registration, and Standard Operating Procedures. In addition, I offer clients a free map-based tool that allows prospective applicants to conduct an initial cursory check to see if a location is close to a school, and thus ineligible for a location.

I’m a Toronto-based lawyer assisting small businesses with their cannabis retail application. Call me at 1-855-542-0529 or email me.

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Harrison Jordan, Lawyer at Substance Law
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