Canada: Ontario Introduces Legislation To Regulate The Sale And Consumption Of Cannabis With Bill 174

Last Updated: November 13 2017
Article by Andrew J. Wilder, Yale Hertzman and Vlad Mihaescu

On November 1, 2017, the Government of Ontario introduced Bill 174, Cannabis, Smoke-Free Ontario and Road Safety Statute Law Amendment Act, 2017 (the "Act"), which seeks to regulate, among other things, the sale and consumption of cannabis in Ontario. Ontario is the first province to release legislation to regulate the recreational cannabis market.

The Act is in its first reading and is not currently law. Once passed, the Act will enact the Cannabis Act, 2017, the Ontario Cannabis Retail Corporation Act, 2017, the Smoke-Free Ontario Act, 2017 and make certain amendments to the Highway Traffic Act.

Establishment of the Ontario Cannabis Retail Corporation

The Act provides for the establishment of the Ontario Cannabis Retail Corporation (the "OCRC") pursuant to the Ontario Cannabis Retail Corporation Act, 2017. The OCRC will be overseen by the Liquor Control Board of Ontario and will have the exclusive right to sell cannabis in the Province of Ontario. There are exceptions that permit a party other than the OCRC to sell medical cannabis in accordance with federal legislation, to sell cannabis to the OCRC and to sell cannabis in accordance with the regulations, which have yet to be prescribed.

The objectives of the OCRC include the purchasing, possession and sale of cannabis and related products, the determination of the varieties, forms, types and prices of cannabis and related products and the promotion of social responsibility in connection with cannabis. While additional details regarding the retail and distribution of cannabis in the Province of Ontario are still to be determined, the Government of Ontario has released the following guidelines:

  • Online distribution will be available province-wide by July, 2018;
  • 40 stand-alone cannabis stores will be open by July, 2018;
  • 80 stand-alone cannabis stores will be open by July 1, 2019;
  • 150 stand-alone cannabis stores will be open by 2020; and
  • Cannabis will not be sold in the same stores where alcohol is sold.

The Ontario Government has announced the first 14 municipalities that will operate stand-alone cannabis retail stores by July 1, 2018. These municipalities are Barrie, Brampton, Hamilton, Kingston, Kitchener, London, Mississauga, Ottawa, Sault Ste. Marie, Sudbury, Thunder Bay, Toronto, Vaughan and Windsor.

Ontario's exclusive model for the sale of recreational cannabis contrasts with Manitoba's hybrid retail and distribution model, which was announced by the Government of Manitoba on November 7, 2017. Under Manitoba's hybrid model, the Liquor and Gaming Authority will have oversight over the purchase, storage, distribution of cannabis and the Manitoba Liquor and Lotteries Corporation ("MBLL") will secure and track the supply of cannabis. The private sector will operate all retail locations. All cannabis sold in such retail stores must be purchased from MBLL and will be sourced from federally licensed producers.

Restrictions on the Use and Distribution of Cannabis

The purpose of the Cannabis Act, 2017 is to protect public health and safety, restrict access to youth, deter illicit activity through enforcement and provide for youth education and prevention programs. The Act prescribes a legal minimum age of 19 for the use, purchase, distribution and cultivation of cannabis. Individuals under the age of 19 caught using or distributing cannabis will be subject to a fine of not more than $200, or alternatively, the individual may be sent to an approved youth education and prevention program. This alternative demonstrates the Ontario Government's preferred approach of diversion and educating youth rather than imposing harsh penalties.

Consumption of cannabis will be restricted such that no person can consume cannabis in a public place, workplace, vehicle or boat, or any other place prescribed by the regulations under the Act, which have yet to be released. In effect, these restrictions will limit the consumption of cannabis to private residences. Exceptions are provided to users of medical cannabis, however even medical cannabis use is subject to restrictions imposed by the Smoke-Free Ontario Act, 2017, which are described below.

Compliance and Enforcement

In contrast to the penalties imposed on youth, the consequences under the Act for individuals and corporations who sell or distribute cannabis illegally can be quite significant. Even on the first conviction, corporations can be fined up to $1,000,000 and individuals can be fined up to $250,000, with potential jail sentences of up to two years. Where premises, such as a storefront, are used for the sale or distribution of cannabis, police will have the authority to close and bar entry from the premises for such period of time as determined by a court to ensure that the premises will no longer be used for the sale or distribution of cannabis. These measures appear to primarily target Ontario cannabis dispensaries which, although currently illegal, will certainly contravene the Act once passed into law, primarily due to the OCRC's exclusive right to sell cannabis in Ontario. It is anticipated that there will be greater police enforcement of Ontario cannabis dispensaries after the Act is passed into law so as to limit the availability of cannabis from illicit sources.

Additional Restrictions Under the Smoke-Free Ontario Act, 2017

The Smoke-Free Ontario Act, 2017 will impose additional restrictions on the sale, supply and promotion of cannabis, as well as tobacco and vapour products. Cannabis cannot be displayed or promoted in any place in which it is sold, nor can it be promoted in any place of entertainment, such as a restaurant, bar, sporting event, or any other place primarily devoted to eating, drinking or any form of amusement where the public is ordinarily permitted. The Act also prohibits the sale of such products in other places, such as pharmacies, hospitals, long-term care homes, post-secondary campuses, and schools.

In addition to regulating the locations where cannabis can be sold or promoted, signs and packaging will be subject to regulations that have not yet been released. Restrictions are also placed on the sale of flavoured tobacco products, vapour products and prescribed products and substances.

Overall, the Act generally conforms to the Ontario Government's previous announcements regarding recreational cannabis. The regulations to the Act, which have yet to be released, will provide further guidance as to how the recreational cannabis market will function in Ontario. It is likely that the Act and its regulations will be passed into law quickly in order for the Ontario Government to meet the July 1, 2018 timeline targeted by the federal government for the permitted use of recreational cannabis across Canada.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Andrew J. Wilder
In association with
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


From time to time Mondaq may send you emails promoting Mondaq services including new services. You may opt out of receiving such emails by clicking below.

*** If you do not wish to receive any future announcements of services offered by Mondaq you may opt out by clicking here .


This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at and we will use commercially reasonable efforts to determine and correct the problem promptly.