If a private vendor wants to sell cannabis in six months time, they will have to work through red tape and follow strict government regulations.
When cannabis is legalized this week, the only vendors that will be selling the product for the first six months will be government approved liquor stores in Yellowknife, Fort Smith, Hay River, Fort Simpson and Norman Wells and the GNWT online cannabis store. After those first six months, private vendors will be allowed to enter the market if they are approved by the minister responsible for the NWT liquor and cannabis commission.
That approval will depend on if a vendor is able to pass a criminal record check, a financial check, a security check and if the government decides that there is a market for that private vendor.
“So this will start with an expression of interest, so the way that will take place is that if you're in a community or you're an individual that wants to become a vendor ... We will take that and then do some community engagement to see if there is some support for a cannabis store,” said David Stewart, deputy minister of finance, at a public briefing this week. “We will also look at the demand that's out there and see if it's reasonable to establish a store in that location.”
If a private vendor's application is approved they will then have to purchase their supply from the liquor and cannabis commission and must sell it at the government set retail price. If the application is denied there will be no appeal process.
While the department cited a need for higher restrictions to combat against the illegal sale of cannabis, regular members worried that current regulations allowed for the government to overrule the processes of a free market.
“When I look at these regulations I see a very onerous process with a lot of ministerial discretion and not a lot of room for entrepreneurs to get out there and compete in a market place,” said Kam Lake MLA Kieron Testart. “I see a very powerful liquor commission that has already designated stores that we’ve been presented to, that have a leg up on any other retailer that wants to operate in those stores or in any other community that doesn’t have a store.”
In responding to Testart’s concerns, the government stated these regulations are in place to ensure that private stores have done their homework and noted the regulations exist for any vendors wanting to sell liquor.
“I think what this process is saying is that we want to do work with those potential applicants,” said Stewart. “To see that in fact when the minister is being provided a recommendation around that additional vendor that it is somebody that has done their homework and understands the business that they’re getting into.”
Stewart also noted that in the early stages of legalization there will be no set timeline on how quickly a private vendor’s application will be approved or denied.