The Ins and Outs of Canada’s Cannabis Tracking and Licensing System

Canada’s Minister of Health has taken steps to formally establish the new Cannabis Tracking and Licensing System (CTLS), which covers cannabis production, inventories, distribution and sales from reporting parties and supports the federal government’s objective of tracking the movement of cannabis throughout the entire cannabis supply chain.

The CTLS creates reporting requirements for federal licence holders, provincial wholesalers and provincially licensed retailers. The CTLS is an expansion to provincial wholesalers and licensed retailers of a similar monthly reporting regime for licensed producers (LPs) under the Access to Cannabis for Medical Purposes Regulations (ACMPR), which has existed since October 2013.

The CTLS is intended to work with the other regulatory measures designed to track the movement of cannabis. It applies to:

  • Holders of federally issued licences for cultivation, processing and sale for medical purposes, which are required to provide information to the Minister;
  • Provincial and territory (P/T) bodies that are authorized to sell cannabis under P/T legislation, which are required to provide information to the Minister; and
  • Private distributors and retailers, which are required to provide data to the public body authorized to sell cannabis or that authorizes sale under P/T legislation (typically a Crown corporation or a provincial ministry).

These entities will be required to report on cannabis that is, among other things:

  • Produced, obtained, purchased, returned, sent and sold;
  • Destroyed, lost or stolen; and
  • Used at each stage of production (such as when it is transformed from one product class or form, or when it is packaged and labelled for sale).

The CTLS has been designed so that reporting parties can submit information by using fillable fields on a web application or uploading a data file. The ability to upload a data file will allow public P/T bodies or federal licence holders with more than one licensed facility to report data for multiple licensed facilities at once. Further reporting requirements may be added as specific conditions to a licence if deemed necessary by Health Canada.

The CTLS Order requires that holders of licences for cannabis cultivation, processing, and/or sale for medical purposes, as well as public P/T bodies, report prescribed information no later than the 15th day of the month immediately following the reporting period. Private retailers and distributors are required to report (to their applicable P/T body) no later than the 10th day of the month. For audit purposes, relevant records, reports and data will need to be retained for at least two years after they were required to be provided. Because the reporting requirements under the CTLS Order are substantially similar to those under the ACMPR, Health Canada expects that existing federal LPs should not incur significant incremental administrative costs in order to comply with the new regime.

The CTLS Order does not apply to holders of cannabis drug licences, and licences for industrial hemp cultivation, research or analytical testing. Record keeping and reporting requirements for these classes of licences are specified in the Cannabis Regulations. Additionally, no reporting of any personal information about consumers who purchase cannabis at the retail level is required.

For further information, please contact:

Alexis Levine                 416-863-3089
Chris Nyberg                 416-863-4252

or any other member of our Cannabis group.

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