Canada’s marijuana packaging rules blasted as ‘unscientific,’ ‘fearmongering’

A sample of Canada's proposed recreational cannabis packaging.

A day after Canada released detailed packaging requirements for recreational cannabis, executives and analysts warned that the rules are so restrictive that the government is risking a “policy fail.”

The new regulations, in many ways, are more restrictive than the packaging rules for tobacco, a disappointment for marijuana companies that had been lobbying for rules that would allow for clear branding of their products.

Industry observers are concerned the policy will make it harder for companies to carve out meaningful market share from the black market after recreational marijuana is legalized later this summer.

“The central objective of legalization is to replace the vast and sophisticated black market with a regulated and safer one,” Aurora Chief Corporate Officer Cam Battley told BNN.

“By restricting our branding and treating us more like tobacco than beer and liquor, that will hold us back from being able to establish the brand.

“We’ve got to take a more rational approach to this and be more scientific.”

The government proposes all recreational cannabis be sold in packaging that:

  • Has no graphics.
  • Displays one of 14 health warnings.
  • Contains a background with a single, uniform color.
  • Restricts fonts to a small size and uniform color.
  • Restricts brand logos to a small size.
  • Restricts brand name text to a small size and uniform color.

Justin Cooper, co-founder and CEO of Green Planet Wholesale, said the packaging requirements are inconsistent with the government’s public policy goal of overtaking the black market.

“A stop sign with THC on it? Get serious. It’s fearmongering,” he said. “It’s going to be federally legal.

“Have you ever bought a bottle of booze with a stop sign on it?”

The rules also call for only one “brand element” on the package, also restricted in size, in addition to the brand name.

Ian Dawkins, principal consultant of British Columbia-based Althing Consulting, said the rules “will disproportionately hurt the legitimate players who have invested in their brands.”

The regulations, separate from the marijuana legalization bill currently before the Senate, will be enacted after the Cannabis Act wins final approval.

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3 comments on “Canada’s marijuana packaging rules blasted as ‘unscientific,’ ‘fearmongering’
  1. Clayton McCann on

    So… MJ LP spokespersons (AKA “Lobbyists”) don’t like the packaging? And they want to push back back against what they describe as onerous over-regulation? Huh. Where have I heard this before?

    Oh, yeah! It was Big Booze, Big Tobacco, and Big Pharma. Pushing Ottawa around, to the detriment of consumer health, and diversion to adolescent users. Great track record, Big Weed! You’ve made us proud yet again*.

    I wonder what these “analysts” will have to say about CDN MJ legalization being pushed back to 2019 (October election, anyone???).
    ____________________________________________________________________________________________________

    *See overvaluation crisis in CDN MJ LP sector: LPs are trying to apply already-vague accounting rules to a new industry. Companies have to put a value on their marijuana plants for accounting purposes, even though pricing and future demand are not yet known. As a result, financial statements rely heavily on managers’ estimates, and are wildly inconsistent.

    “If investors are using the numbers at all, there’s a serious chance they’re being misled, or they’re misinterpreting the numbers themselves,” [interview subject Mark Rosen, of Accountability Research Corp.] says. The issue is compounded by the fact that valuations are soaring, and companies are trading based on future projections that may never materialize. “It’s just adding to all of the speculation around marijuana, and feeding the frenzy.”

    So, you can see the problem might not simply be a disagreement about how to value a MJ LP, but might very well be an intended misrepresentation of actual value. If I tell you I have a MJ plant that will furnish me with 32 salable ounces (a generous plant!) you might very well say, “Oh? What’s that worth?” The problem becomes critical when my answer directly affects my bottom line. The truth is, I shouldn’t be permitted to answer at all. We can easily evaluate using current market data: if a gram is worth about $7 (likely less) and there are 28.35 grams per ounce, we’re looking at about $6,350 (less costs to produce & process). From there, we merely look at square footage of holdings, determine the percentage dedicated to production, estimate plants per sq.ft, harvest turnover, costs of doing business, payroll, etc. and we may very well determine what an LP is “worth” in an “industry that technically doesn’t exist yet.”

    Anyway, there’s other factors to consider, of course, but there’s no way in hell Aurora or Canopy are worth anywhere near $10bn, or even $1bn, and it is highly irresponsible, or grossly misinformed, to either encourage or permit investors to assume that they are.

    Reply
  2. Clayton McCann on

    Further, you spoke of “industry observers.” I’m an industry observer, and what I see is alarming: the entry of Big Pharma has begun (e.g. Novartis, dba: Sandoz, in bed with Privateer); Big Tobacco is moving in (Alliance One International Inc., announced its subsidiary Canadian Cultivated Products acquired a 75 per cent equity position in Charlottetown-based Canada’s Island Garden; Jan. 2018); Big Booze already in on the ground floor (Constellation Brands–e.g. “Corona products” buying in late last year).

    Could this have been averted? Yes. Did Trudeau, Morneau, Blair, Goodale, McLellan et al. have the opportunity to prevent such a whirlwind of greed? Yep. Did they bother to do ANYTHING to protect CDN consumers? Nope, unless you count TALKING about protecting CDN consumers, while their peers invested heavily in CDN MJ LP sectors.

    There’s that sense of pride I was talking about (see post above), when a bunch of plutocrats violate their oath of public office and betray CDNs. And they said the black market was going to die?

    Reply
  3. pebbles trippet on

    Keep everything flat, colorless, compressed, barely able to breathe, tiny print, health warnings, THC stop signs. The stop sign is beyond the pale, pure prejudice, designed to disadvantage the industry. It shows their state of mind. This is not about a fair distribution of the fruits of the cannabis plant but about government squeezing, blocking and taking from the trailblazers and innovators who kept the plant alive during prohibition, opening the paths to corporate take overs where the “real money” is at.

    Reply

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