Canada Gazette, Part I, Volume 152, Number 25: Regulations Amending the Narcotic Control Regulations (Licences and Permits)

June 23, 2018

Statutory authority
Controlled Drugs and Substances Act

Sponsoring department
Department of Health

REGULATORY IMPACT ANALYSIS STATEMENT

(This statement is not part of the regulations.)

Issues

The legislative and regulatory framework in Canada for controlled substances has evolved over decades to address emerging issues and meet international commitments under the United Nations drug control conventions. As a result, some of the regulations under the Controlled Drugs and Substances Act (CDSA) are relatively recent while others are far older. The Narcotic Control Regulations (NCR), for example, first came into force in 1961 under the Narcotic Control Act (the legislation that preceded the CDSA), while the Benzodiazepines and Other Targeted Substances Regulations (BOTSR) only came into force in 2000.

This evolution has resulted in a set of regulations that, while containing broadly similar provisions, also feature several issues, gaps and inconsistencies regarding the issuance of licences and permits under the NCR and the BOTSR, as well as the Food and Drug Regulations, Part G (FDR-G), and the Food and Drug Regulations, Part J (FDR-J). The key issues, gaps and inconsistencies in terms of the licence and permit scheme set out in these regulations include

• inconsistencies between the regulations with regard to the maximum validity periods for licences (up to three years under the NCR, the FDR-G and the FDR-J, but only one year under the BOTSR), leading to more frequent licence renewals than necessary, and thus undue administrative burden for licensed dealers;
• relatively short and inconsistent maximum validity periods for import and export permits, frequently resulting in the expiry of permits and thus the need for licensed dealers to apply for new permits to allow import and export shipments;
• the lack of requirements under these regulations compelling licensed dealers to record suspicious transactions involving controlled substances;
• the lack of clarity with respect to requirements for reporting on loss and theft of controlled substances;
• the unduly restrictive nature of acceptable academic credentials under the regulations for qualified persons in charge (QPIC) or alternate qualified persons in charge (A/QPIC) designated by licensed dealers; and
• the lack of authority for the Minister of Health to add or modify conditions on a dealer's licence at a time other than issuance, amendment or renewal in order to address newly identified public health and safety risks involving certain controlled substances or licensed dealers.

In addition, inconsistencies in the overall structure of these regulations result in a lack of clarity and potential confusion, leading to administration and compliance problems. For example, while there are provisions requiring permits for import and export of controlled substances in the NCR, the FDR-G and the FDR-J, there are no provisions in these regulations outlining the permit application and issuance process similar to those in the BOTSR. Instead, the permit application and issuance process for the NCR, the FDR-G and the FDR-J has been established by Health Canada via policy.

Notwithstanding amendments made over the years to the above-noted regulations, particularly since the enactment of the CDSA, these and other issues, gaps and inconsistencies have remained unaddressed. As a result, challenges have arisen with respect to the administration of these regulations and in compliance by licensed dealers, including undue administrative burden and unnecessary confusion or misunderstanding of certain provisions of the regulations.

Background

The CDSA is the federal statute that provides a legislative framework for the control of substances that can alter mental processes and that may cause harm to the health of an individual or to society when diverted or misused. Among other things, the CDSA enables the Governor in Council to make regulations with respect to authorizing legitimate activities with the substances controlled under the CDSA, particularly (although not exclusively) through the issuance of licences and permits.

The CDSA is the means by which Canada fulfills its obligations under the United Nations Single Convention on Narcotic Drugs, 1961 (1961 Convention), the Convention on Psychotropic Substances, 1971 (1971 Convention), and the United Nations Convention Against Illicit Traffic in Narcotic Drugs and Psychotropic Substances, 1988 (1988 Convention). These conventions form the basis for the current global drug control system and require the signatories to, among other things, place controls on legitimate activities with controlled substances conducted by authorized persons or businesses.

The CDSA prohibits any person from conducting activities such as the production, sale and provision, importation and exportation of controlled substances unless authorized by regulation or specifically exempted by the Minister of Health. The CDSA also specifies the range of penalties associated with the conduct of illegal activities with controlled substances.

When the CDSA was enacted in 1996, it set out a new legislative framework for controlled substances by repealing the Narcotic Control Act and Part III and Part IV of the Food and Drugs Act. Since then, changes have been made to various provisions of the CDSA and to some of its regulations in order to address emerging issues and to allow Canada to meet its international obligations under the United Nations drug control conventions.

The following regulations under the CDSA contain provisions for the issuance, by the Minister of Health, of licences and permits authorizing certain activities with controlled substances,^{footnote 1} including their production, import and export:

• Narcotic Control Regulations (NCR): Made originally pursuant to the Narcotic Control Act, the NCR set out the circumstances and requirements under which producers, distributors, importers, exporters, pharmacists, practitioners and hospitals may conduct regulated activities including the possession, sale, distribution, importation, exportation, and production of narcotics (e.g. cocaine, opium, codeine, morphine). The NCR enable Canada to fulfill its obligations under the 1961 Convention.
• Benzodiazepines and Other Targeted Substances Regulations (BOTSR): Implementing the provisions of the 1971 Convention, the BOTSR set out the circumstances and requirements under which producers, distributors, importers, exporters, pharmacists, practitioners and hospitals may conduct regulated activities including the possession, sale, distribution, importation, exportation, and production of benzodiazepines and other "targeted substances" requiring a similar level of regulatory control. The BOTSR allow Canada to fulfill its obligations under the 1971 Convention.
• Food and Drug Regulations, Part G (FDR-G): Moved from under the Food and Drugs Act (FDA) and placed under the CDSA upon its enactment in 1996, the FDR-G governs the activities of producers, distributors, importers, exporters, pharmacists, practitioners, and hospitals including the possession, sale, distribution, importation, exportation, and production of substances listed in the schedule to the FDR-G, referred to as "controlled drugs" — such as stimulants, sedatives, and anabolic steroids. Through the FDR-G, Canada is able to fulfill its obligations under the 1971 Convention.
• Food and Drug Regulations, Part J (FDR-J): Also moved from under the FDA and placed under the CDSA upon its enactment in 1996, the FDR-J regulates the use of the controlled substances referred to in its schedule as "restricted drugs," most of which have no recognized medical use. These include such substances as LSD and mescaline. Under these Regulations, restricted drugs can only be used for clinical and laboratory research purposes. The FDR-J allows Canada to fulfill its obligations under the 1971 Convention.

Objectives

The objectives of this regulatory proposal are

• To modernize and improve the administration of, and compliance with, the NCR, the BOTSR, the FDR-G and the FDR-J by removing certain requirements that impose undue administrative burden, and by including consistent authorities and requirements across these regulations; and
• To further enhance the clarity and readability of these regulations by modernizing and harmonizing the regulatory provisions in relation to licences and permits, with the application of the up-to-date legislative drafting convention.

Description

The majority of the proposed amendments relate to provisions regarding the issuance of licences and permits. In particular, these amendments

• streamline processes for the issuance, amendment, renewal, suspension and revocation of a licence or permit by aligning these processes among the affected regulations;
• enhance and clarify requirements for licensed dealers with respect to record keeping, reporting and security; and
• strengthen the power of the Minister of Health to address urgent public health and safety issues caused by the risk of diversion or misuse of controlled substances.

Licences and permits

Overall, the current provisions with respect to licences and permits in the NCR, the BOTSR, the FDR-G and the FDR-J would be replaced with modernized and harmonized provisions, drafted in accordance with the current legal drafting convention. More specifically, the licence and permit part would have a completely different structure in comparison with the current regulations and would include added headings for every level of the regulations. This approach would clearly identify the process involved in the application for, and the issuance of, licences and permits as well as requirements for licensed dealers.

The following headings would be included:

• Authorized Activities
• Licences
• Import Permits
• Export Permits
• Sale and Provision
• Packaging and Transportation
• Thefts, Losses and Suspicious Transactions
• Destruction
• Documents

Each of these headings would include subheadings addressing particular aspects. The heading for licences, for example, would include the following subheadings:

• Preliminary Requirements
• Application, Issuance, Validity and Refusal
• Renewal
• Amendment
• Changes Requiring Prior Approval
• Changes Requiring Notice
• Changes to Terms and Conditions
• Suspension and Revocation

While the above-noted modifications would make requirements and conditions pertaining to the issuance of licences and permits easier to understand, this regulatory proposal would also make the following substantive changes to the licence and permit scheme in these regulations.

Issuance of licences and permits

• The lack of a complete permit scheme in the NCR, the FDR-G and the FDR-J, including information required in a permit application as well as the content of a permit, would be addressed by placing comprehensive provisions for permits, modelled on current provisions in the BOTSR with modifications, in those regulations;
• The designation and eligibility criteria such as residency and the absence of criminal offences would be applied to all responsible personnel at a licensed dealership, including the senior person in charge (SPIC) [referred to as the individual in charge of the premises in the current regulations], QPIC and A/QPIC in the NCR, the BOTSR, the FDR-G and the FDR-J;
• The range of educational qualifications for QPICs and A/QPICs in the NCR, the BOTSR, the FDR-G and the FDR-J would be broadened to include additional fields and occupations such as pharmacy technician and supply chain management, and even work-related experience and training for certain licensed dealers, in order to take into account operational realities of affected industries and enable licensed dealers to designate persons from a wider spectrum of backgrounds to carry out regulated activities at a licensed site; and
• In order to reduce undue administrative burden
  • The maximum licence validity period in the BOTSR (currently up to one year) would be harmonized with that of the other regulations (to a maximum of three years);
  • The maximum validity period for permits in all of the regulations would be aligned with that in the current provisions for export permits in the BOTSR so that import and export permits issued under the NCR, the BOTSR, the FDR-G and the FDR-J would be valid up to 180 days;
  • Licensed dealers that manufacture or assemble products or compounds containing controlled substances would no longer be required to seek a licence amendment for changes regarding specific products/compounds manufactured or assembled (e.g. brand name, package size, strength per unit). Instead, the NCR, the BOTSR, the FDR-G and the FDR-J would simply require that the Minister of Health be notified of such changes; and
  • A distinction would be made between changes to regulated activities requiring prior approval by the Minister of Health (e.g. changes to security measures or QPICs and A/QPICs) and changes for which the Minister of Health only needs to be notified (e.g. changes to the products or compounds and the cessation of activities) in the NCR, the BOTSR, the FDR-G and the FDR-J.

Requirements for licensed dealers

The proposed amendments introduce the following new substantive requirements for licensed dealers:

• New provisions in the NCR, the BOTSR, the FDR-G and the FDR-J requiring a licensed dealer to record suspicious transactions in the course of conducting regulated activities and provide such information to the Minister of Health;
• New provisions in the NCR, the BOTSR, the FDR-G and the FDR-J (mirroring the current provisions in the BOTSR with modifications) setting out the process and requirements regarding the destruction of controlled substances by licensed dealers, either on the licensed sites or elsewhere;
• Expanded provisions in the NCR, the BOTSR, the FDR-G and the FDR-J in relation to thefts and losses, which outline specifications of the type of loss (explainable and unexplainable), the reporting timeline and to whom a licensed dealer must report a loss or theft; and
• A new provision in the NCR, the BOTSR, the FDR-G and the FDR-J requiring a licensed dealer to notify the Minister of Health of certain information and within a certain time period in the case of the cessation of operations.

The proposed regulatory amendments also add a provision in the NCR, the BOTSR, the FDR-G and the FDR-J regarding partial protection from self-incrimination for a licensed dealer who reports an incident of loss or theft to law enforcement that leads to a criminal investigation.

Addressing public health and safety issues

Given the risk to public health and safety caused by the diversion and misuse of controlled substances, the proposed regulations would authorize the Minister to add, modify or remove any terms or conditions in a licence at a time other than licence issuance, amendment or renewal.

Consequential and other amendments

The proposed regulations also amend numerous definitions and provisions in other parts of these regulations either as consequential amendments or as a result of applying the current legislative drafting convention for greater clarity and readability. The proposed regulations would also repeal provisions relevant to inspectors, as the CDSA was amended in 2017 to include more detailed provisions regarding inspections.

"One-for-One" Rule

The "One-for-One" Rule would apply and this proposal would be an "OUT" for the purpose of controlling administrative burden, as the proposed regulatory modifications would result in an overall reduction in administrative burden on affected industry stakeholders. The reduction in administrative burden cost would be banked and the administrative credits used to offset administrative burden costs imposed by other regulations implemented under the health portfolio.

Once the proposed amendments are implemented, a number of activities that are resulting in administrative burden on industry stakeholders would either no longer be required or would be reduced, resulting in an overall reduction in administrative burden and related costs. The changes in administrative burden are discussed in detail in the "Benefits and costs" section; essentially, impacted business licensed dealers would see benefits over the 10-year period of analysis for the following reasons:

• They would now be required to provide a notification to the Minister regarding changes to the manufacture or assembly of products or compounds containing controlled substances, instead of submitting an application for licence amendment. As a result, a total of 155 hours in related administrative burden would be saved over 10 years.
• They would no longer be required to submit an application to amend the list of "individuals authorized to place an order." As a consequence, a total of 490 hours in related administrative burden would be saved over 10 years.
• In many cases, the importing or exporting business licensed dealers would no longer have to re-apply for a permit in order to complete the same import or export transaction associated with controlled substances, as the length of the validity of the permit would be increased to 180 days. Thus, a total of 7 720 hours in related administrative burden would be saved over 10 years.
• Most licensed dealers would now submit an application for licence renewal once every three years instead of every year, saving a total of 14 900 hours in related administrative burden over 10 years.

It is assumed that completing the activities mentioned above usually involves someone with a technical or scientific background, such as a QPIC or an A/QPIC, and someone at management level, such as a SPIC. The time spent or avoided in relation to these activities is valued using average wage rates of $28.76 and $53.45 per hour (adjusted for overhead and in 2012 dollars) for QPIC and SPIC respectively.

As per the requirements of the Red Tape Reduction Act and the Red Tape Reduction Regulations, the reduction in administrative burden costs for all affected industry stakeholders is estimated over a 10-year period (2019–2028) and discounted to 2012 using a 7% real discount rate. The annualized net cost savings to licensed dealers are estimated to be $53,140 or $225 per licensed dealer.

Small business lens

The small business lens does not apply to this regulatory proposal, as the proposal would decrease costs to all businesses, including small businesses.

Consultation

A notice to interested parties was published in the Canada Gazette, Part I, on May 23, 2015, outlining the proposed key changes to the NCR, the BOTSR, the FDR-G and the FDR-J described above. Feedback from stakeholders in response to this notice was very positive. Concerns were raised by key stakeholders during a subsequent targeted meeting regarding a newly proposed record-keeping and reporting requirement, but the requirement has not been included in this regulatory proposal.

It should be noted that while the notice also signalled Health Canada's intent to make certain amendments to the Precursor Control Regulations (PCR), the Department subsequently decided that the PCR will be the subject of a stand-alone regulatory review in the future. Therefore, the present regulatory initiative targets the NCR, the BOTSR, the FDR-G and the FDR-J only.

Rationale

The evolution of the regulatory framework for controlled substances in Canada over the last few decades has resulted in a set of regulations that, while containing broadly similar parts and provisions, also feature a series of issues, gaps and inconsistencies related to provisions governing the issuance of licences and permits.

This has resulted in undue administrative burden and challenges to the implementation of these regulations. This regulatory proposal would rectify these issues, gaps and inconsistencies, and, in so doing, modernize the NCR, the BOTSR, the FDR-G and the FDR-J and improve the administration of, and compliance with, these regulations.

Benefits and costs

A cost-benefit analysis was conducted to estimate the impacts of the proposed amendments on the NCR, the BOTSR, the FDR-G and the FDR-J on potentially affected stakeholders (i.e. businesses, universities and research institutions, and the Government of Canada). All identified costs and benefits were assessed in incremental terms by considering changes that would only occur as a result of the proposed regulatory modifications.

It should be noted that some of the proposed requirements (e.g. submitting an annual report, reporting suspicious transactions, destroying remaining controlled substances, submitting a declaration after the completion of an importation/exportation or providing notification for the cessation of activities) would not result in any material incremental impacts on targeted stakeholders, since it is currently the practice for licensed dealers to undertake these activities.

The Government of Canada collects fees to process licence applications and renewals on a full cost-recovery basis. With the proposed extension of the licence validity period, the majority of the licences would not have to be renewed every year. For those licences that would not be renewed, the service that would have been associated with processing those applications would no longer be provided and the associated fees would not be collected. The reduction in fees collected would be offset by a reduction in processing costs and would therefore not constitute an incremental impact on the Government of Canada.

All impacts are quantified and monetized to the extent possible. Where this is not possible due to data limitations or lack of sufficient information, the impacts are described qualitatively. Together, the quantified and non-quantified impacts provide a more accurate picture of the costs and benefits to stakeholders and allow for an adequate assessment of the net impact of the proposed amendments.

All costs and benefits were estimated over a period of 10 years, from 2019 to 2028. This time period is considered long enough for all the costs and benefits to manifest themselves sufficiently.

All cost and benefit estimates are expressed in 2012 Canadian dollars (real monetary values).

A 7% real discount rate is used to estimate the present value (PV) of the incremental costs and incremental benefits and all values are discounted to 2018.

There were about 275 sites licensed to conduct activities with controlled substances (human or veterinary) in 2017. These sites are operated by businesses, research institutions, universities or government agencies. Among these sites, 236 are operated by businesses, 19 of which belong to small businesses. There is not enough historical data to observe the variations in the number of site licences over time; however, the number of licences in 2018 is similar to that of 2017. For this cost-benefit analysis, the number of licences is assumed to be constant over the analytical period.

Benefits

Benefits to businesses

Once the proposed amendments are made, business licensed dealers would see a number of benefits associated with a reduction in both compliance and administrative burden. The present value of the total benefit to businesses over the 10-year analytical period is estimated to be $6.70 million (or $954,250 annually).

Increasing the maximum licence validity period

Extending the maximum licence validity period from one year to three years in the BOTSR would harmonize this provision in all four regulations and would provide significant benefit to licensed dealers, as the frequency of renewing a licence could be reduced from once every year to once every three years. Due to the proposed amendments, Health Canada would make policy and operational adjustments when determining the validity period of a licence based on certain factors such as the compliance history of a licensed dealer. Health Canada estimates that 95% of licences (i.e. 224 licences) would receive a three-year validity period. These licensed dealers would enjoy both administrative burden cost savings as well as financial savings in the form of avoided payment of fees for two of the three years for which the licences are valid. Given the estimated time that will not be spent preparing a licence renewal application (1.5 hours, i.e. 1 hour for a QPIC and 0.5 hour for a SPIC) combined with the associated criminal record checks and the licensing fees that would not be paid, licensed dealers would save $5.18 million (PV) in costs (or $737,880 annually).

Removing the requirements on individuals authorized to place an order

The proposed amendments would remove the requirement that a business provide, in its licence application, the name of the individuals authorized to place an order as well as the requirement that businesses submit an application to amend the list of "individuals authorized to place an order." Licensed dealers would benefit from these regulatory changes as they would no longer need to spend time filling in and submitting the "Application for changes affecting personnel in charge" form (20 minutes, i.e. 15 minutes for a QPIC or an A/QPIC and 5 minutes for a SPIC) to have the list of individuals authorized to place an order updated whenever there is a change in personnel. In 2017, 226 submissions from businesses with respect to changes in personnel were received by Health Canada. Among them, 66% (149 amendment submissions) contained changes regarding individuals authorized to place an order. Assuming the number of such requests remains unchanged over time, it is estimated that the proposed amendments would save the industry $11,500 (PV) or $1,640 annually.

Expansion of educational and professional criteria for QPIC or A/QPIC

Licensed dealers would benefit from broadening the scope of acceptable educational and professional qualifications for a QPIC or A/QPIC. It is assumed that licensed dealers whose routine business consists of non-science-based activities such as wholesale or distribution do not necessarily require a QPIC or A/QPIC to hold a scientific or similar degree and would benefit most from the proposed amendments. These licensed dealers would be able to designate an employee with other types of educational backgrounds (e.g. training as pharmacy technician, qualification in supply chain management) earning lower wages to be a QPIC or A/QPIC. In 2017, there were approximately 60 licensed dealers engaged only in wholesale or distribution of controlled substances. It is assumed that once the proposed amendments come into force, these companies would assign the QPIC or A/QPIC function to an employee earning a lower wage. As a result of the change in personnel, these businesses would save about $1.32 million in PV (or approximately $187,810 annually).

Removing the annex to the licences

Currently, licensed dealers that make or assemble products or compounds containing controlled substances have to apply for a licence amendment to reflect in the annex to the licence any changes to requisite information (e.g. brand name, strength per unit) regarding these products and compounds. In 2017, 38% of licence amendment applications (62 applications) were submitted to make changes to the licences' annexes. Given the absence of historical data on trends, this number is assumed to remain constant over time. Removing the annex to the licence and requiring instead a notification to the Minister in relation to these types of changes would eliminate the need for licence amendments. This change would provide benefits to affected licensed dealers as it would reduce the administrative burden they face, and at the same time eliminate the potential delay licensed dealers may face in conducting their activities while waiting for the licence amendment to be processed. When accounting for the time it would normally take to submit a notification to the Minister, around 15 minutes (10 minutes for a QPIC or A/QPIC and 5 minutes for a SPIC) would be saved by licensed dealers by not having to apply for a licence amendment. The associated administrative burden cost savings to licensed dealers is estimated to be approximately $3,850 in PV (or $550 annually).

Extending permit validity period

The proposed amendments would extend the validity period of import and export permits to up to 180 days. Some licensed dealers have indicated that insufficient permit validity length has prevented them from completing their import or export transactions. This has resulted in these licensed dealers not being able to use the permits, and in most of these cases, having to reapply for a permit.

On average, 23% of permits granted in 2016 and 2017 were not used. Licensed dealers had reapplied for 63% of the unused permits at a later date within the same year in order to complete the same transaction. It is not possible to determine with a large degree of certainty the number of permits that were not used and had to be reapplied for solely because of the length of the permit validity period. However, it is reasonable to assume that in 90% of the cases, the permits were not used because the validity period had expired. These regulatory amendments would benefit licensed dealers as they would reduce the risk of delay in completing their import or export transaction and would eliminate the additional administrative burden associated with reapplying for a permit (45 minutes to prepare the application: 30 minutes for a QPIC or A/QPIC and 15 minutes for a SPIC). The resulting administrative burden cost savings to impacted licensed dealers is estimated to be approximately $185,265 in PV (or $26,380 annually).

Benefits to private laboratories, researchers and research institutions

Universities and other research institutions that hold a dealer's licence would also benefit from the proposed amendments to provisions regarding the licence validity period and the individuals authorized to place an order. Currently, there are 25 laboratories and research institutions, including 19 universities, holding dealers' licences. As per the risk-based approach, it is expected that 95% of them (about 24) would see a reduction in administrative burden as they would no longer have to renew their licences every year or amend their list of individuals authorized to place an order. These licensed dealers would save a total of 1 285 hours over 10 years. These reductions in time spent and the avoided fees would translate into savings of $45,850 in PV over 10 years (or $6,530 annually).

Benefits to the Government

There are 14 government institutions (departments, agencies and laboratories) conducting activities with controlled substances. These activities include supplying controlled substances to third parties or conducting forensic laboratory work. These government licensed dealers would benefit from the proposed expansion of a licence validity period in the form of time saved as they would only need to renew a licence once every three years. Considering the time it normally takes to fill in a licence application, the proposed amendments would save them 145 hours over 10 years.

Health Canada would also benefit from the proposed amendments. The expected reduction in the number of submissions received by Health Canada in relation to permit reapplications would result in time savings. This time savings would total 4 840 hours over 10 years.

The total time saved by the Government would translate into savings of $130,030 in PV over 10 years (or $18,510 annually).

The reduced burden on government resources would also provide benefits in that the available resources would be used to ensure and likely further improve services provided by the Department under the controlled substances licensing and permitting regime, for example, by meeting the service standards for licence and permit issuance with a higher percentile.

Allowing the Minister to impose conditions on a licence at a time other than at issuance, renewal or amendments would enable her to take timely actions to address areas of risk where controlled substances could be diverted to illicit markets and uses. Formalizing the reporting of suspicious transactions, and requiring the reporting of losses and thefts on a particular timeline would enhance the capacity of the Minister to identify any trend or instance of diversion attempts and take necessary enforcement actions, thereby increasing the overall effectiveness of the controlled substances regime.

Health and safety benefits

There would be additional non-quantifiable benefits to Canadians as the Minister would be able to add, modify or remove terms and conditions on a licence (at a time other than at issuance, amendment or renewal) in order to protect public health and safety if activities are suspected to be taking place contrary to the regulations or are suspected to negatively impact the health and safety of Canadians.

Costs

Cost to businesses, researchers and research institutions

Regulated parties (businesses, researchers and research institutions) would need to thoroughly review the updated provisions to understand the changes in order to ensure compliance with the regulations. Researchers and research institutions would spend 90 hours and industry stakeholders would spend 825 hours to review and understand the proposed regulatory modifications. As a result, the affected stakeholders would bear a cost of $26,035 in PV over 10 years (or $3,705 annually).

Cost to the Government

The Government is not expected to incur any material incremental cost as a result of the proposed amendments.

Limited compliance promotion activities would be undertaken to raise awareness about the modernized regulatory language and the formalized requirements related to reporting. However, given that the licensed dealers are already reporting losses and thefts, suspicious transactions and cessation of activities, these compliance promotion activities would be very limited and conducted as part of normal activities under the controlled substances program.

Finally, there would be no change in the manner in which the regulatory requirements are enforced. As a result, no new funding would be required.

Net impacts

Overall, all of the affected licensed dealers are expected to see a reduction in administrative and/or compliance burden due to these proposed amendments. While the proposed amendments would create some costs, the net impact is expected to be positive. The total net benefit of the proposed amendments over the 10-year period would amount to $6.85 million (or $975,590 annually). The Department would also see its services improved (for example by meeting its service standards in areas where they are currently not adequately met), resulting in reduced costs to businesses as they would be able to conduct their activities in a more timely fashion.

Cost-benefit statement

A. Quantified impacts (rounded to 000's, in 2012$)	2019	2021	2023	2028	Total (2019–2028)	Total (2019–2028) (PV)	Annualized Average
	Undiscounted					Discounted to 2018
A1. Industry Benefits (cost savings)
Increased length of licences' validity period	1,040.08	0.00	1,114.17	1,215.44	7,850.05	5,182.56	737.88
Removal of licences' annexes	0.59	0.59	0.59	0.59	5.87	3.85	0.55
Removal of the requirements regarding individuals authorized to place an order	1.75	1.75	1.75	1.75	17.51	11.50	1.64
Extension of permit validity period	20.07	23.46	27.51	41.55	295.22	185.26	26.38
Expansion of educational and professional criteria for QPIC and A/QPIC	200.96	200.96	200.96	200.96	2,009.59	1,319.11	187.81
Total benefits	1,263.44	226.76	1,344.98	1,460.28	10,178.24	6,702.28	954.25
Costs
Reviewing the regulatory modifications	−26.95	0.00	0.00	0.00	−26.95	−23.54	−3.35
Net benefits	1,236.49	226.76	1,344.98	−1,460.28	10,151.29	6,678.74	950.90
A2. Research institutions Benefits (cost savings)
Increased length of licences' validity period	9.69	0.00	9.69	9.69	67.81	45.24	6.44
Removal of the requirements regarding individuals authorized to place an order	0.09	0.09	0.09	0.09	0.92	0.61	0.09
Total benefits	9.78	0.09	9.78	9.78	68.73	45.85	6.53
Costs
Reviewing the regulatory modifications	−2.85	0.00	0.00	0.00	−2.85	−2.49	−0.36
Net benefits	6.92	0.09	9.78	9.78	65.88	43.35	6.17
A3. Federal government Benefits (cost savings)
Reduction in volume of applications and other activities	14.49	15.99	19.55	29.13	206.84	130.03	18.51
Overall net benefit	1,257.91	242.84	1,374.32	1,499.19	10,424.01	6,852.12	975.59
B. Non-quantified impacts
B1. Benefits to Government	The Department would be able to improve the services it provides, for example by meeting the service standards for licence and permit issuance with a higher percentile.
B2. Benefits to public health and safety	Formalizing certain activities, in addition to being able to impose conditions on a licence, would allow the Minister to take appropriate actions to prevent diversion of controlled substances to illicit markets and uses, thereby protecting public health and safety.

Implementation, enforcement and service standards

There are no additional service standards other than those that already exist for issuing licences and permits. Since the proposed amendments aim to further improve the administration of and the compliance with these regulations, it would be expected that the service standards for licence issuance, amendment, renewal and permit issuance would be improved as a result of the proposed amendments.

Contact

Markes Cormier
Healthy Environments and Consumer Safety Branch
Health Canada
Main Stats Building
150 Tunney's Pasture Driveway
Ottawa, Ontario
K1A 0K9
Email: OCS_regulatorypolicy-BSC_politiquereglementaire@hc-sc.gc.ca

PROPOSED REGULATORY TEXT

Notice is given that the Governor in Council, pursuant to subsection 55(1)^{footnote a} of the Controlled Drugs and Substances Act^{footnote b}, proposes to make the annexed Regulations Amending the Narcotic Control Regulations (Licences and Permits).

Interested persons may make representations concerning the proposed Regulations within 75 days after the date of publication of this notice. All such representations must cite the Canada Gazette, Part I, and the date of publication of this notice, and be addressed to the Office of Legislative and Regulatory Affairs, Controlled Substances Directorate, Healthy Environments and Consumer Safety Branch, Department of Health, Address Locator 0302A, 150 Tunney's Pasture Driveway, Ottawa, Ontario, K1A 0K9 (email: ocs_regulatorypolicy-bsc_politiquereglementaire@hc-sc.gc.ca).

Ottawa, June 7, 2018

Jurica Čapkun
Assistant Clerk of the Privy Council

Regulations Amending the Narcotic Control Regulations (Licences and Permits)

Amendments

1 The long title of the Narcotic Control Regulations ^{footnote 2} is replaced by the following:

Narcotic Control Regulations

2 Section 1 of the Regulations and the heading before it are repealed.

3 The heading before section 2 and sections 2 to 29 of the Regulations are replaced by the following:

Definitions

Definitions

2 (1) The following definitions apply in these Regulations.

Act means the Controlled Drugs and Substances Act. (Loi)

advertisement includes any representation by any means for the purpose of promoting, directly or indirectly, the sale or other disposal of a narcotic. (publicité.)

cannabis means the substance set out in item 17 of the schedule. (chanvre indien)

cannabis medical document has the meaning assigned by the definition medical document in subsection 1(1) of the Access to Cannabis for Medical Purposes Regulations. (document médical concernant le chanvre indien)

cannabis oil has the same meaning as in subsection 1(1) of the Access to Cannabis for Medical Purposes Regulations. (huile de chanvre indien)

common-law partner, in relation to an individual, means a person who is cohabiting with the individual in a conjugal relationship, having so cohabited for a period of at least one year. (conjoint de fait)

competent authority means a public authority of a foreign country that is authorized under the laws of the country to approve the importation or exportation of narcotics into or from the country. (autorité compétente)

compound includes a preparation. (composé)

designated criminal offence means

• (a) an offence involving the financing of terrorism against any of sections 83.02 to 83.04 of the Criminal Code;
• (b) an offence involving fraud against any of sections 380 to 382 of the Criminal Code;
• (c) the offence of laundering proceeds of crime against section 462.31 of the Criminal Code;
• (d) an offence involving a criminal organization against any of sections 467.11 to 467.13 of the Criminal Code; or
• (e) a conspiracy or an attempt to commit, being an accessory after the fact in relation to, or any counselling in relation to, an offence referred to in any of paragraphs (a) to (d). (infraction désignée en matière criminelle)

destroy, in respect of a narcotic, means to alter or denature it to such an extent that its consumption is rendered impossible or improbable. (destruction)

diacetylmorphine (heroin) includes the salts of diacetylmorphine. (diacétylmorphine (héroïne))

dried marihuana has the same meaning as in subsection 1(1) of the Access to Cannabis for Medical Purposes Regulations. (marihuana séchée)

former Marihuana for Medical Purposes Regulations means the regulations made by Order in Council P.C. 2013-645 of June 6, 2013 and registered as SOR/2013-119. (ancien Règlement sur la marihuana à des fins médicales)

former Marihuana Medical Access Regulations means the regulations made by Order in Council P.C. 2001-1146 of June 14, 2001 and registered as SOR/2001-227. (ancien Règlement sur l'accès à la marihuana à des fins médicales).

fresh marihuana has the same meaning as in subsection 1(1) of the Access to Cannabis for Medical Purposes Regulations. (marihuana fraîche)

health care practitioner has, except in section 59, the same meaning as in subsection 1(1) of the Access to Cannabis for Medical Purposes Regulations. (praticien de la santé)

hospital means a facility

• (a) that is licensed, approved or designated by a province in accordance with the laws of the province to provide care or treatment to persons or animals suffering from any form of disease or illness; or
• (b) that is owned or operated by the Government of Canada or the government of a province and that provides health services. (hôpital)

immediate container means the container that is in direct contact with the narcotic. (contenant immédiat)

international obligation means an obligation in respect of a narcotic set out in a convention, treaty or other multilateral or bilateral instrument that Canada has ratified or to which Canada adheres. (obligation internationale)

licensed dealer means the holder of a licence issued under section 10.1. (distributeur autorisé)

licensed producer has the same meaning as in subsection 1(1) of the Access to Cannabis for Medical Purposes Regulations. (producteur autorisé)

marihuana means the substance referred to as "Cannabis (marihuana)" in subitem 17(2) of the schedule. (marihuana)

methadone includes the salts of methadon. (méthadone)

midwife has the same meaning as in section 1 of the New Classes of Practitioners Regulations. (sage-femme)

narcotic means, subject to subsection (2), a controlled substance set out in the schedule. (stupéfiant)

nurse practitioner has the same meaning as in section 1 of the New Classes of Practitioners Regulations. (infirmier praticien)

pharmacist means a person who is registered and entitled under the laws of a province to practise pharmacy and who is practising pharmacy in that province. (pharmacien)

podiatrist has the same meaning as in section 1 of the New Classes of Practitioners Regulations. (podiatre)

prescription means an authorization given by a practitioner that a stated amount of a narcotic be dispensed for the person or animal named in the authorization. (ordonnance)

qualified person in charge means the individual designated under subsection 9.2(1). (responsable qualifié)

Security Directive means the Directive on Physical Security Requirements for Controlled Substances (Security Requirements for Licensed Dealers for the Storage of Controlled Substances) published by the Department of Health, as amended from time to time. (Directive en matière de sécurité)

senior person in charge means the individual designated under section 9.1. (responsable principal)

test kit means a kit

• (a) that contains a narcotic and a reagent system or buffering agent;
• (b) that is used during the course of a chemical or analytical procedure to test for the presence or quantity of a narcotic for a medical, laboratory, industrial, educational, law administration or enforcement, or research purpose; and
• (c) the contents of which are not intended or likely to be consumed by, or administered to, a person or an animal. (nécessaire d'essai)

transfer means, except in subsection 45(3), to transfer, whether directly or indirectly, without consideration. (transférer)

verbal prescription narcotic means a narcotic that is contained in medication that may be prescribed verbally and that has the following characteristics:

• (a) it contains two or more medicinal ingredients that are not narcotics, in a recognized therapeutic dose;
• (b) it is not intended for parenteral administration; and
• (c) it does not contain diacetylmorphine (heroin), hydrocodone, methadone, oxycodone or pentazocine. (stupéfiant d'ordonnance verbale)

Exception

(2) Despite subitem 2(2) of the schedule, the following are not narcotics for the purposes of these Regulations:

• (a) a drug in dosage form, as defined in subsection C.01.005(3) of the Food and Drug Regulations, that contains cocaine (benzoylmethylecgonine) or any of its salts unless the drug
  • (i) has a drug identification number assigned to it under Division 1 of Part C of those Regulations,
  • (ii) is authorized for sale under Division 5 of Part C of those Regulations, or
  • (iii) is compounded by a pharmacist in accordance with or in anticipation of an authorization from a practitioner that a stated amount of the drug be dispensed for a person who is or will be named in the authorization; or
• (b) cocaine (benzoylmethylecgonine) or any of its salts, or any drug that is not in dosage form that contains such a substance, unless the cocaine, salt or drug is to be compounded by a pharmacist in accordance with or in anticipation of an authorization from a practitioner that a stated amount of the drug be dispensed for a person who is or will be named in the authorization.
  

Possession

Authorized persons

3 (1) A person is authorized to possess a narcotic if the person has obtained the narcotic in accordance with these Regulations, in the course of activities conducted in connection with the administration or enforcement of an Act or regulation, or from a person who is exempt under section 56 of the Act from the application of subsection 5(1) of the Act with respect to that narcotic, and the person

• (a) requires the narcotic for their business or profession and is
  • (i) a licensed dealer,
  • (ii) a pharmacist, or
  • (iii) a practitioner who is registered and entitled to practise in the province in which they possess the narcotic;
• (b) is a practitioner who is registered and entitled to practise in a province other than the province in which they possess the narcotic and their possession is for emergency medical purposes only;
• (c) is a hospital employee or a practitioner in a hospital;
• (d) has obtained the narcotic for their own use
  • (i) from a practitioner,
  • (ii) in accordance with a prescription that was not issued or obtained in contravention of these Regulations,
  • (iii) from a pharmacist under section 36, or
  • (iv) in accordance with a cannabis medical document that was not provided or obtained in contravention of the Access to Cannabis for Medical Purposes Regulations;
• (e) is a practitioner of medicine who received the narcotic under subsection 68(1) or (2) and their possession is for the purpose of providing or delivering it to a person referred to in subsection 68(3);
• (f) is an agent or mandatary of a practitioner of medicine who received the narcotic under subsection 68(1) and their possession is for the purpose of providing or delivering it to a person referred to in subsection 68(2);
• (g) is employed as an inspector, a member of the Royal Canadian Mounted Police, a police constable, a peace officer or a member of the technical or scientific staff of the Government of Canada, the government of a province or a university in Canada and their possession is in connection with that employment;
• (h) is not a practitioner of medicine referred to in paragraph (e) or an agent or mandatary referred to in paragraph (f), is exempted under section 56 of the Act with respect to the possession of that narcotic and their possession is for a purpose set out in the exemption; or
• (i) is the Minister.
  

Agent or mandatary

(2) A person is authorized to possess a narcotic if the person is acting as the agent or mandatary of any person who is authorized to possess it in accordance with any of paragraphs (1)(a) to (e), (h) and (i).

Agent or mandatary — person referred to in paragraph (1)(g)

(3) A person is authorized to possess a narcotic if

• (a) the person is acting as the agent or mandatary of a person that they have reasonable grounds to believe is a person referred to in paragraph (1)(g); and
• (b) their possession of the narcotic is for the purpose of assisting that person in the administration or enforcement of an Act or regulation.
  

Test Kits

Authorized activities

4 A person may sell, possess or otherwise deal in a test kit if

• (a) a registration number has been issued for the test kit under section 6 and has not been cancelled under section 7;
• (b) the test kit bears, on its external surface,
  • (i) the manufacturer's name,
  • (ii) the trade name or trademark, and
  • (iii) the registration number; and
• (c) the test kit is sold, possessed or otherwise dealt in for a medical, laboratory, industrial, educational, law administration or enforcement, or research purpose.
  

Application for registration number

5 (1) The manufacturer of a test kit may obtain a registration number for it by submitting to the Minister an application containing

• (a) a detailed description of the design and construction of the test kit;
• (b) a detailed description of the narcotic and other substances, if any, contained in the test kit, including the qualitative and quantitative composition of each component; and
• (c) a description of the proposed use of the test kit.
  

Signature and attestation

(2) The application must

• (a) be signed and dated by the person authorized by the applicant for that purpose; and
• (b) include an attestation by that person that all of the information submitted in support of the application is correct and complete to the best of their knowledge.

Additional information or document

(3) The applicant shall provide the Minister with any information or document that the Minister determines is necessary to complete the Minister's review of the application, not later than the date specified in the Minister's written request to that effect.

Issuance of registration number

6 On completion of the review of the application for a registration number, the Minister shall issue a registration number for the test kit, preceded by the letters "TK", if the Minister is satisfied that the test kit will only be used for a medical, laboratory, industrial, educational, law administration or enforcement, or research purpose and that it contains

• (a) a narcotic and an adulterating or denaturing agent in such a manner, combination, quantity, proportion or concentration that the preparation or mixture has no significant drug abuse potential; or
• (b) such small quantities or concentrations of a narcotic as to have no significant drug abuse potential.
  

Cancellation of registration number

7 The Minister shall cancel the registration number for a test kit if

• (a) the test kit is removed from the market by the manufacturer;
• (b) the Minister has reasonable grounds to believe that the test kit is used or is likely to be used for any purpose other than a medical, laboratory, industrial, educational, law administration or enforcement, or research purpose; or
• (c) the Minister has reasonable grounds to believe that the cancellation is necessary to protect public health or safety, including preventing a narcotic from being diverted to an illicit market or use.
  

Licensed Dealers

Authorized Activities

General

8 (1) A licensed dealer may produce, assemble, sell, provide, transport, send, deliver, import or export a narcotic if they comply with

• (a) the terms and conditions of their dealer's licence and any permit issued under these Regulations; and
• (b) these Regulations and the Access to Cannabis for Medical Purposes Regulations.
  

Qualified person in charge present

(2) A licensed dealer may conduct an activity in relation to a narcotic at their site only if the qualified person in charge or an alternate qualified person in charge is present at the site.

Permit — import and export

(3) A licensed dealer shall obtain a permit in order to import or export a narcotic.

Possession for export

(4) A licensed dealer may possess a narcotic for the purpose of exporting it if they have obtained it in accordance with these Regulations or the Access to Cannabis for Medical Purposes Regulations.

Marihuana — production

(5) A licensed dealer may cultivate, propagate or harvest marihuana only for scientific purposes.

Opium poppy — production

(6) A licensed dealer may cultivate, propagate or harvest opium poppy only for scientific purposes.

Licences

Preliminary Requirements

Eligible persons

9 The following persons may apply for a dealer's licence:

• (a) an individual who ordinarily resides in Canada;
• (b) a corporation that has its head office in Canada or operates a branch office in Canada; or
• (c) the holder of a position that includes responsibility for narcotics on behalf of the Government of Canada or of a government of a province, a police force, a hospital or a university in Canada.
  

Senior person in charge

9.1 An applicant for a dealer's licence shall designate only one individual as the senior person in charge, who has overall responsibility for management of the activities with respect to narcotics that are specified in the licence application. The applicant may designate themself if the applicant is an individual.

Qualified person in charge

9.2 (1) An applicant for a dealer's licence shall designate only one individual as the qualified person in charge, who is responsible for supervising the activities with respect to narcotics that are specified in the licence application and for ensuring that those activities comply with these Regulations and the Access to Cannabis for Medical Purposes Regulations. The applicant may designate themself if the applicant is an individual.

Alternate qualified person in charge

(2) An applicant for a dealer's licence may designate an individual as an alternate qualified person in charge, who is authorized to replace the qualified person in charge when that person is absent. The applicant may designate themself if the applicant is an individual.

Qualifications

(3) Only an individual who meets the following requirements may be designated as a qualified person in charge or an alternate qualified person in charge:

• (a) they work at the site specified in the dealer's licence;
• (b) they are
  • (i) a person registered by a provincial professional licensing authority or a professional association in Canada and entitled to practise a profession that is relevant to their duties, such as pharmacist, practitioner, pharmacy technician or laboratory technician,
  • (ii) the holder of a diploma, certificate or credential awarded by a post-secondary educational institution in Canada in a field or occupation that is relevant to their duties, such as pharmacy, medicine, dentistry, veterinary medicine, pharmacology, chemistry, biology, pharmacy technician, laboratory technician, pharmaceutical regulatory affairs or supply chain management or security, or
  • (iii) the holder of a diploma, certificate or credential that is awarded by a foreign educational institution in a field or occupation referred to in subparagraph (ii) and hold
    • (A) an equivalency assessment as defined in subsection 73(1) of the Immigration and Refugee Protection Regulations, or
    • (B) an equivalency assessment issued by an organization or institution that is responsible for issuing equivalency assessments and is recognized by a province;
• (c) they have sufficient knowledge of and experience with the use and handling of the narcotics specified in the licence to properly carry out their duties; and
• (d) they have sufficient knowledge of the provisions of the Act and these Regulations that are applicable to the activities specified in the licence to properly carry out their duties.
  

Exception

(4) An applicant for a dealer's licence may designate an individual who does not meet any of the requirements of paragraph (3)(b) as a qualified person in charge or an alternate qualified person in charge if

• (a) no other individual working at the site meets those requirements;
• (b) those requirements are not necessary for the activities specified in the licence; and
• (c) the individual has sufficient knowledge — acquired from a combination of education, training or work experience — to properly carry out their duties.
  

Ineligibility

9.3 A person is not eligible to be a senior person in charge, a qualified person in charge or an alternate qualified person in charge if, during the 10 years before the day on which the dealer's licence application is submitted,

• (a) in respect of a designated substance offence or a designated criminal offence, the person
  • (i) was convicted as an adult, or
  • (ii) was a young person who received an adult sentence, as those terms are defined in subsection 2(1) of the Youth Criminal Justice Act; or
• (b) in respect of an offence committed outside Canada that, if committed in Canada, would have constituted a designated substance offence or a designated criminal offence,
  • (i) the person was convicted as an adult, or
  • (ii) if they committed the offence when they were at least 14 years old but less than 18 years old, the person received a sentence that was longer than the maximum youth sentence, as that term is defined in subsection 2(1) of the Youth Criminal Justice Act, that could have been imposed under that Act for such an offence.
    

Application, Issuance, Validity and Refusal

Application

10 (1) A person who intends to conduct an activity referred to in section 8 shall obtain a dealer's licence for each site at which they plan to conduct activities by submitting an application to the Minister that contains the following information:

• (a) if the licence is requested by
  • (i) an individual, the individual's name,
  • (ii) a corporation, its corporate name and any other name registered with a province under which it intends to conduct the activities specified in its dealer's licence or by which it intends to identify itself, and
  • (iii) the holder of a position described in paragraph 9(c), the applicant's name and the title of the position;
• (b) the municipal address, telephone number and, if applicable, the facsimile number and email address of the proposed site and, if different from the municipal address, its mailing address;
• (c) the name and date of birth of the senior person in charge;
• (d) with respect to the proposed qualified person in charge and the proposed alternate qualified person in charge,
  • (i) their name and date of birth,
  • (ii) the title of their position at the site,
  • (iii) the name and title of the position of their immediate supervisor at the site,
  • (iv) if applicable, the name of their profession that is relevant to their duties, the name of the province that authorizes them to practise it and their authorization number,
  • (v) their education, training and work experience relevant to their duties, and
  • (vi) their hours of work at the site;
• (e) the activities that are to be conducted and the narcotics in respect of which each of the activities is to be conducted;
• (f) if the licence is requested to manufacture or assemble a product or compound that contains a narcotic, other than a test kit, a list that includes, for each product or compound,
  • (i) the brand name of the product or the name of the compound,
  • (ii) the drug identification number that is assigned to the product under section C.01.014.2 of the Food and Drug Regulations, if any,
  • (iii) the name and the strength per unit of the narcotic in it,
  • (iv) its quantity or package sizes,
  • (v) if it is to be manufactured or assembled by or for another licensed dealer under a custom order, the name, municipal address and licence number of the other licensed dealer, and
  • (vi) if the applicant's name appears on the label of the product or compound, a copy of the inner label, as defined in section A.01.010 of the Food and Drug Regulations;
• (g) if the licence is requested to produce a narcotic other than a product or compound that contains a narcotic,
  • (i) its name,
  • (ii) the quantity that the applicant expects to produce under their licence and the period during which that quantity would be produced, and
  • (iii) if it is to be produced for another licensed dealer under a custom order, the name, municipal address and licence number of the other licensed dealer;
• (h) if the licence is requested for any activity that is not described in paragraphs (f) and (g), the name of the narcotic for which the activity is to be conducted and the purpose of the activity;
• (i) a detailed description of the security measures in place at the site, determined in accordance with the Security Directive; and
• (j) a detailed description of the method for recording information that the applicant proposes to use for the purpose of section 28.

Documents

(2) An application for a dealer's licence must be accompanied by the following documents:

• (a) if the applicant is a corporation, a copy of
  • (i) the certificate of incorporation or other constituting instrument, and
  • (ii) any document filed with the province in which its site is located that states its corporate name and any other name registered with the province under which the applicant intends to conduct the activities specified in its dealer's licence or by which it intends to identify itself;
• (b) individual declarations signed and dated by each of the senior person in charge, the proposed qualified person in charge and the proposed alternate qualified person in charge, attesting that the person is not ineligible for a reason specified in section 9.3;
• (c) a document issued by a Canadian police force in relation to each person referred to in paragraph (b), indicating whether, during 10 years before the day on which the application is submitted, the person was convicted as specified in subparagraph 9.3(a)(i) or received a sentence as specified in subparagraph 9.3(a)(ii);
• (d) if any of the persons referred to in paragraph (b) has ordinarily resided in a country other than Canada during the 10 years before the day on which the application is submitted, a document issued by a police force of that country indicating whether in that period that person was convicted as specified in subparagraph 9.3(b)(i) or received a sentence as specified in subparagraph 9.3(b)(ii);
• (e) a declaration, signed and dated by the senior person in charge, attesting that the proposed qualified person in charge and the proposed alternate qualified person in charge have the knowledge and experience required under paragraphs 9.2(3)(c) and (d); and
• (f) if the proposed qualified person in charge or the proposed alternate qualified person in charge does not meet the requirement of subparagraph 9.2(3)(b)(i), either
  • (i) a copy of the person's diploma, certificate or credential referred to in subparagraph 9.2(3)(b)(ii) or (iii) and a copy of the course transcript for it, or
  • (ii) a detailed description of the education, training or work experience that is required under paragraph 9.2(4)(c), together with supporting evidence, such as a copy of a course transcript or an attestation by the person who provided the training.

Signature and attestation

(3) An application for a dealer's licence must

• (a) be signed and dated by the senior person in charge; and
• (b) include an attestation by the senior person in charge that
  • (i) all of the information and documents submitted in support of the application are correct and complete to the best of their knowledge, and
  • (ii) they have the authority to bind the applicant.

Additional information and documents

(4) The applicant shall provide the Minister with any information or document that the Minister determines is necessary to complete the Minister's review of the application, not later than the date specified in the Minister's written request to that effect.

Issuance

10.1 Subject to section 10.4, on completion of the review of the licence application, the Minister shall issue a dealer's licence, with or without terms and conditions, that contains

• (a) the licence number;
• (b) the name of the licensed dealer, their corporate name or the title of the position they hold;
• (c) the activities that are authorized and the names of the narcotics in respect of which each activity may be conducted;
• (d) the municipal address of the site at which the licensed dealer may conduct the authorized activities;
• (e) the security level at the site, determined in accordance with the Security Directive;
• (f) the effective date of the licence;
• (g) the expiry date of the licence, which must be not later than the third anniversary of its effective date;
• (h) any terms and conditions that the Minister has reasonable grounds to believe are necessary to
  • (i) ensure that an international obligation is respected,
  • (ii) ensure conformity with the requirements associated with the security level that is referred to in paragraph (e), or
  • (iii) reduce a potential risk to public health or safety, including the risk of a narcotic being diverted to an illicit market or use; and
• (i) if the licensed dealer produces a narcotic, the quantity that they may produce and the authorized production period.
  

Validity

10.2 A dealer's licence is valid until the expiry date set out in the licence or, if it is earlier, the date of the suspension or revocation of the licence under section 16 or 17.

Return of licence

10.3 A licensed dealer whose licence is not renewed shall return the original of the licence to the Minister as soon as feasible after its expiry.

Refusal

10.4 (1) The Minister shall refuse to issue a dealer's licence if

• (a) the applicant is not eligible under section 9;
• (b) during the 10 years before the day on which the licence application is submitted, the applicant has contravened
  • (i) a provision of the Act or its regulations, or
  • (ii) a term or condition of a licence or permit issued to the applicant under any regulations made under the Act;
• (c) during the 10 years before the day on which the licence application is submitted, the senior person in charge, the proposed qualified person in charge or the proposed alternate qualified person in charge was convicted as specified in subparagraph 9.3(a)(i) or (b)(i) or received a sentence as specified in subparagraph 9.3(a)(ii) or (b)(ii);
• (d) an activity for which the licence is requested would contravene an international obligation;
• (e) an activity for which the licence is requested is the cultivation, propagation or harvesting of marihuana other than for scientific purposes;
• (f) the applicant does not have in place at the site the security measures set out in the Security Directive in respect of an activity for which the licence is requested;
• (g) the method referred to in paragraph 10(1)(j) does not permit the recording of information as required by section 28;
• (h) the applicant has not complied with the requirements of subsection 10(4) or the information or documents that they have provided are not sufficient to complete the review of the application;
• (i) the Minister has reasonable grounds to believe that the applicant has submitted false or misleading information or false or falsified documents in or with the application;
• (j) information received from a competent authority or the United Nations gives the Minister reasonable grounds to believe that the applicant has been involved in the diversion of a narcotic to an illicit market or use or has been involved in an activity that contravened an international obligation; or
• (k) the Minister has reasonable grounds to believe that the issuance of the licence would likely create a risk to public health or safety, including the risk of a narcotic being diverted to an illicit market or use.
  

Exceptions

(2) The Minister shall not refuse to issue a licence under paragraph (1)(b) or (i) if the applicant meets the following conditions, unless the Minister has reasonable grounds to believe that it is necessary to do so to protect public health or safety, including preventing a narcotic from being diverted to an illicit market or use:

• (a) the applicant does not have a history of non-compliance with the Act or its regulations; and
• (b) the applicant has carried out, or signed an undertaking to carry out, the necessary corrective measures to ensure compliance with the Act, these Regulations and the Access to Cannabis for Medical Purposes Regulations.

Notice

(3) Before refusing to issue a licence, the Minister shall send the applicant a notice that sets out the Minister's reasons and gives the applicant an opportunity to be heard.

Renewal

Application

11 (1) To apply to renew a dealer's licence, a licensed dealer shall submit to the Minister an application that contains the information and documents referred to in subsections 10(1) and (2)..

Signature and attestation

(2) An application must

• (a) be signed and dated by the senior person in charge of the site to which the renewed licence would apply; and
• (b) include an attestation by the senior person in charge that
  • (i) all of the information and documents submitted in support of the application are correct and complete to the best of their knowledge, and
  • (ii) they have the authority to bind the licensed dealer.

Additional information and documents

(3) The licensed dealer shall provide the Minister with any information or document that the Minister determines is necessary to complete the Minister's review of the application, not later than the date specified in the Minister's written request to that effect.

Renewal

11.1 (1) Subject to section 11.4, on completion of the review of the renewal application, the Minister shall issue a renewed dealer's licence that contains the information specified in section 10.

Terms and conditions

(2) When renewing a dealer's licence, the Minister may, if he or she has reasonable grounds to believe that it is necessary to do so, add a term or condition to it or modify or delete one in order to

• (a) ensure that an international obligation is respected;
• (b) ensure conformity with the requirements associated with the security level specified in the licence or the new level required as a result of the licence renewal; or
• (c) reduce a potential risk to public health or safety, including the risk of a narcotic being diverted to an illicit market or use.
  

Validity

11.2 A renewed dealer's licence is valid until the expiry date set out in the licence or, if it is earlier, the date of the suspension or revocation of the licence under section 16 or 17.

Return of previous licence

11.3 The licensed dealer shall, as soon as feasible after the effective date of the renewal, return the original of the previous licence to the Minister.

Refusal

11.4 (1) The Minister shall refuse to renew a dealer's licence if

• (a) the licensed dealer is no longer eligible under section 9;
• (b) during the 10 years before the day on which the renewal application is submitted, the licensed dealer has contravened
  • (i) a provision of the Act or these Regulations, or
  • (ii) a term or condition of a licence or permit issued to the dealer under these Regulations;
• (c) during the 10 years before the day on which the renewal application is submitted, the senior person in charge, the proposed qualified person in charge or the proposed alternate qualified person in charge was convicted as specified in subparagraph 9.3(a)(i) or (b)(i) or received a sentence as specified in subparagraph 9.3(a)(ii) or (b)(ii);
• (d) an activity for which the renewal is requested would contravene an international obligation;
• (e) an activity for which the renewal is requested is the cultivation, propagation or harvesting of marihuana other than for scientific purposes;
• (f) the licensed dealer does not have in place at the site the security measures set out in the Security Directive in respect of an activity for which the renewal is requested;
• (g) the method referred to in paragraph 10(1)(j) does not permit the recording of information as required by section 28;
• (h) the licensed dealer has not complied with the requirements of subsection 11(3) or the information or documents that they have provided are not sufficient to complete the review of the application;
• (i) the Minister has reasonable grounds to believe that the licensed dealer has submitted false or misleading information or false or falsified documents in or with the application;
• (j) information received from a competent authority or the United Nations gives the Minister reasonable grounds to believe that the licensed dealer has been involved in the diversion of a narcotic to an illicit market or use or has been involved in an activity that contravened an international obligation; or
• (k) the Minister has reasonable grounds to believe that the renewal of the licence would likely create a risk to public health or safety, including the risk of a narcotic being diverted to an illicit market or use.
  

Exceptions

(2) The Minister shall not refuse to renew a licence under paragraph (1)(b) or (i) if the licensed dealer meets the following conditions, unless the Minister has reasonable grounds to believe that it is necessary to do so to protect public health or safety, including preventing a narcotic from being diverted to an illicit market or use:

• (a) the licensed dealer does not have a history of non-compliance with the Act or these Regulations; and
• (b) the licensed dealer has carried out, or signed an undertaking to carry out, the necessary corrective measures to ensure compliance with the Act, these Regulations and the Access to Cannabis for Medical Purposes Regulations.

Notice

(3) Before refusing to renew a licence, the Minister shall send the licensed dealer a notice that sets out the Minister's reasons and gives the dealer an opportunity to be heard.

Amendment

Application

12 (1) Before making a change affecting any information referred to in section 10.1 that is contained in their dealer's licence, a licensed dealer shall submit to the Minister an application to amend the licence that contains a description of the proposed amendment, as well as the information and documents referred to in section 10 that are relevant to the proposed amendment.

Signature and attestation

(2) The application must

• (a) be signed and dated by the senior person in charge of the site to which the amended dealer's licence would apply; and
• (b) include an attestation by the senior person in charge that
  • (i) all of the information and documents submitted in support of the application are correct and complete to the best of their knowledge, and
  • (ii) they have the authority to bind the licensed dealer.

Additional information and documents

(3) The licensed dealer shall provide the Minister with any information or document that the Minister determines is necessary to complete the Minister's review of the application, not later than the date specified in the Minister's written request to that effect.

Amendment

12.1 (1) Subject to section 12.4, on completion of the review of the application, the Minister shall amend the dealer's licence.

Terms and conditions

(2) When amending a dealer's licence, the Minister may, if he or she has reasonable grounds to believe that it is necessary to do so, add a term or condition to it or modify or delete one in order to

• (a) ensure that an international obligation is respected;
• (b) ensure conformity with the requirements associated with the security level specified in the licence or the new level required as a result of the licence amendment; or
• (c) reduce a potential risk to public health or safety, including the risk of a narcotic being diverted to an illicit market or use.
  

Validity

12.2 An amended dealer's licence is valid until the expiry date set out in the licence or, if it is earlier, the date of the suspension or revocation of the licence under section 16 or 17.

Return of previous licence

12.3 The licensed dealer shall, as soon as feasible after the effective date of the amendment, return the original of the previous licence to the Minister.

Refusal

12.4 (1) The Minister shall refuse to amend a dealer's licence if

• (a) an activity for which the amendment is requested would contravene an international obligation;
• (b) an activity for which the amendment is requested is the cultivation, propagation or harvesting of marihuana other than for scientific purposes;
• (c) the licensed dealer does not have in place at the site the security measures set out in the Security Directive in respect of an activity for which the amendment is requested;
• (d) the method referred to in paragraph 10(1)(j) does not permit the recording of information as required by section 28;
• (e) the licensed dealer has not complied with the requirements of subsection 12(3) or the information or documents that they have provided are not sufficient to complete the review of the application;
• (f) the Minister has reasonable grounds to believe that the licensed dealer has submitted false or misleading information or false or falsified documents in or with the application; or
• (g) the Minister has reasonable grounds to believe that the amendment of the licence would likely create a risk to public health or safety, including the risk of a narcotic being diverted to an illicit market or use.
  

Exceptions

(2) The Minister shall not refuse to amend a licence under paragraph (1)(f) if the licensed dealer meets the following conditions, unless the Minister has reasonable grounds to believe that it is necessary to do so to protect public health or safety, including preventing a narcotic from being diverted to an illicit market or use:

• (a) the licensed dealer does not have a history of non-compliance with the Act or these Regulations; and
• (b) the licensed dealer has carried out, or signed an undertaking to carry out, the necessary corrective measures to ensure compliance with the Act, these Regulations and the Access to Cannabis for Medical Purposes Regulations.

Notice

(3) Before refusing to amend a licence, the Minister shall send the licensed dealer a notice that sets out the Minister's reasons and gives the dealer an opportunity to be heard.

Changes Requiring Prior Approval

Application

13 (1) A licensed dealer shall obtain the Minister's approval before making any of the following changes by submitting a written application to the Minister:

• (a) a change affecting the security measures in place at the site specified in the dealer's licence;
• (b) the replacement of the senior person in charge;
• (c) the replacement of the qualified person in charge; or
• (d) the replacement or addition of an alternate qualified person in charge.

Information and documents

(2) The licensed dealer shall provide the Minister with the following with respect to any change referred to in subsection (1):

• (a) details regarding the change affecting the security measures in place at the site specified in the dealer's licence;
• (b) in the case of the senior person in charge,
  • (i) the information specified in paragraph 10(1)(c), and
  • (ii) the declaration specified in paragraph 10(2)(b) and the documents specified in paragraphs 10(2)(c) and (d); and
• (c) in the case of the qualified person in charge or an alternate qualified person in charge,
  • (i) the information specified in paragraph 10(1)(d), and
  • (ii) the declarations specified in paragraphs 10(2)(b) and (e) and the documents specified in paragraphs 10(2)(c), (d) and (f).

Additional information and documents

(3) The licensed dealer shall provide the Minister with any information or document that the Minister determines is necessary to complete the Minister's review of the application, not later than the date specified in the Minister's written request to that effect.

Approval

13.1 (1) Subject to section 13.2, on completion of the review of the application, the Minister shall approve the change.

Terms and conditions

(2) When approving a change, the Minister may, if he or she has reasonable grounds to believe that it is necessary to do so, add a term or condition to the licence or modify or delete one in order to

• (a) ensure that an international obligation is respected;
• (b) ensure conformity with the requirements associated with the security level specified in the licence; or
• (c) reduce a potential risk to public health or safety, including the risk of a narcotic being diverted to an illicit market or use.
  

Refusal

13.2 (1) The Minister shall refuse to approve the change if

• (a) during the 10 years before the day on which the application is submitted, the proposed senior person in charge, qualified person in charge or alternate qualified person in charge was convicted as specified in subparagraph 9.3(a)(i) or (b)(i) or received a sentence as specified in subparagraph 9.3(a)(ii) or (b)(ii);
• (b) the licensed dealer has not complied with the requirements of subsection 13(3) or the information or documents that they have provided are not sufficient to complete the review of the application;
• (c) the Minister has reasonable grounds to believe that the licensed dealer has submitted false or misleading information or false or falsified documents in or with the application; or
• (d) the Minister has reasonable grounds to believe that the change would likely create a risk to public health or safety, including the risk of a narcotic being diverted to an illicit market or use.
  

Exceptions

(2) The Minister shall not refuse to approve a change under paragraph (1)(c) if the licensed dealer has carried out, or signed an undertaking to carry out, the necessary corrective measures to ensure compliance with the Act, these Regulations and the Access to Cannabis for Medical Purposes Regulations, unless the Minister has reasonable grounds to believe that it is necessary to do so to protect public health or safety, including preventing a narcotic from being diverted to an illicit market or use.

Notice

(3) Before refusing to approve a change, the Minister shall send the licensed dealer a notice that sets out the Minister's reasons and gives the dealer an opportunity to be heard in respect of them.

Changes Requiring Notice

Prior notice

14 (1) A licensed dealer shall notify the Minister in writing before

• (a) manufacturing or assembling a product or compound that is not set out in the most recent version of the list referred to in paragraph 10(1)(f) that the licensed dealer has submitted to the Minister; or
• (b) making a change to a product or compound that is set out in the list, if the change affects any of the information set out in the list.

Information and list

(2) The notice shall contain the information referred to in paragraph 10(1)(f) that is necessary to update the list and shall be accompanied by the revised version of the list.

Notice as soon as feasible

14.1 A licensed dealer shall notify the Minister in writing as soon as feasible of

• (a) a change at the site at which a narcotic is produced, assembled or stored; and
• (b) a change to the processes used to conduct those activities and the conditions under which they are conducted.

Notice — next business day

14.2 A licensed dealer shall notify the Minister in writing, not later than the next business day after the change, that a person is no longer acting as the qualified person in charge or an alternate qualified person in charge.

Notice — 10 days

14.3 (1) A licensed dealer shall notify the Minister in writing not later than 10 days after one of the following changes occurs:

• (a) a person is no longer acting as the senior person in charge; or
• (b) the licensed dealer ceases to manufacture or assemble a product or compound that is set out in the most recent version of the list referred to in paragraph 10(1)(f) that the licensed dealer has submitted to the Minister.

Information and list

(2) A notice submitted under paragraph (1)(b) shall specify which information referred to in paragraph 10(1)(f) is being changed and shall be accompanied by the revised version of the list.

Notice of cessation of activities

14.4 (1) A licensed dealer who intends to cease conducting activities at their site — whether before or on the expiry of their licence — shall notify the Minister in writing to that effect at least 30 days before ceasing those activities.

Content of notice

(2) The notice shall be signed and dated by the senior person in charge and contain the following information:

• (a) the expected date of the cessation of activities at the site;
• (b) a description of the manner in which any remaining narcotics on the site as of that date will be dealt with by the licensed dealer, including
  • (i) if some or all of them will be sold or provided to another licensed dealer who will be conducting activities at the same site, the name of that dealer,
  • (ii) if some or all of them will be sold or provided to another licensed dealer who will not be conducting activities at the same site, the name of that dealer and the municipal address of their site, and
  • (iii) if some or all of them will be destroyed, the date on which and the municipal address of the location at which the destruction is to take place;
• (c) the municipal address of the location at which the licensed dealer's documents will be kept after activities have ceased; and
• (d) the name, municipal address, telephone number and, if applicable, the facsimile number and email address of a person whom the Minister may contact for further information after activities have ceased.
  

Update

(3) After having ceased to conduct the activities, the licensed dealer shall submit to the Minister a detailed update of the information referred to in subsection (2) if it differs from what was set out in the notice. The update shall be signed and dated by the senior person in charge.

Changes to Terms and Conditions

Adding or modifying term or condition

15 (1) The Minister may, at any time other than at the issuance, renewal or amendment of a dealer's licence, add a term or condition to it or modify one if the Minister has reasonable grounds to believe that it is necessary to do so to

• (a) ensure that an international obligation is respected;
• (b) ensure conformity with the requirements associated with the security level specified in the licence; or
• (c) reduce a potential risk to public health or safety, including the risk of a narcotic being diverted to an illicit market or use.
  

Notice

(2) Before adding a term or condition to a licence or modifying one, the Minister shall send the licensed dealer a notice that sets out the Minister's reasons and gives the dealer an opportunity to be heard.

Urgent circumstances

(3) Despite subsection (2), the Minister may add a term or condition to a licence or modify one without prior notice if the Minister has reasonable grounds to believe that it is necessary to do so to protect public health or safety, including preventing a narcotic from being diverted to an illicit market or use.

Urgent circumstances — notice

(4) The addition or modification of a term or condition of a licence that is made under subsection (3) takes effect as soon as the Minister sends the licensed dealer a notice that

• (a) sets out the reasons for the addition or modification;
• (b) gives the dealer an opportunity to be heard; and
• (c) if applicable, specifies the corrective measures that must be carried out by the dealer and the date by which the dealer must do so.

Deletion of term or condition

15.1 (1) The Minister may delete a term or condition of a licence of a licensed dealer if the Minister determines that it is no longer necessary.

Notice

(2) The deletion takes effect as soon as the Minister sends the licensed dealer a notice to that effect.

Return of previous licence

15.2 The licensed dealer shall, as soon as feasible after the effective date of the addition, modification or deletion of a term or condition, return the original of the previous licence to the Minister.

Suspension and Revocation

Suspension

16 (1) The Minister shall suspend a dealer's licence without prior notice if the Minister has reasonable grounds to believe that it is necessary to do so to protect public health or safety, including preventing a narcotic from being diverted to an illicit market or use.

Notice

(2) The suspension takes effect as soon as the Minister sends the licensed dealer a notice that

• (a) sets out the reasons for the suspension;
• (b) gives the dealer an opportunity to be heard; and
• (c) if applicable, specifies the corrective measures that must be carried out by the dealer and the date by which the dealer must do so.
  

Reinstatement of licence

(3) The Minister shall reinstate the licence if the Minister has reasonable grounds to believe that the suspension is no longer necessary.

Revocation

17 (1) Subject to subsection (2), the Minister shall revoke a dealer's licence if

• (a) the licensed dealer is no longer eligible under section 9;
• (b) the licensed dealer requests the Minister to do so or informs the Minister of the loss or theft of the licence or the actual or potential unauthorized use of the licence;
• (c) the licensed dealer ceases to conduct activities at their site before the expiry of their licence;
• (d) the licensed dealer does not take the corrective measures specified in an undertaking or notice;
• (e) the licensed dealer has contravened
  • (i) a provision of the Act or these Regulation, or
  • (ii) a term or condition of a licence or permit issued to the dealer under these Regulations;
• (f) during the 10 years before the day on which the licence is revoked, the senior person in charge, the qualified person in charge or the alternate qualified person in charge was convicted as specified in subparagraph 9.3(a)(i) or (b)(i) or received a sentence as specified in subparagraph 9.3(a)(ii) or (b)(ii);
• (g) the Minister has reasonable grounds to believe that the licensed dealer submitted false or misleading information or false or falsified documents in or with the application; or
• (h) information received from a competent authority or the United Nations gives the Minister reasonable grounds to believe that the licensed dealer has been involved in the diversion of a narcotic to an illicit market or use.
  

Exceptions

(2) The Minister shall not revoke a dealer's licence for a ground set out in paragraph (1)(e) or (g) if the licensed dealer meets the following conditions, unless the Minister has reasonable grounds to believe that it is necessary to do so to protect public health or safety, including preventing a narcotic from being diverted to an illicit market or use:

• (a) the licensed dealer does not have a history of non-compliance with the Act or these Regulations; and
• (b) the licensed dealer has carried out, or signed an undertaking to carry out, the necessary corrective measures to ensure compliance with the Act, these Regulations and the Access to Cannabis for Medical Purposes Regulations.

Notice

(3) Before revoking a licence, the Minister shall send the licensed dealer a notice that sets out the Minister's reasons and gives the dealer an opportunity to be heard.

Return of licence

17.1 The licensed dealer shall, as soon as feasible after the effective date of the revocation, return the original of the licence to the Minister.

Import Permits

Application

18 (1) A licensed dealer shall submit to the Minister, before each importation of a narcotic, an application for an import permit that contains the following information:

• (a) their name, municipal address and dealer's licence number;
• (b) with respect to the narcotic to be imported,
  • (i) its name, as specified in the dealer's licence,
  • (ii) if it is a salt, the name of the salt,
  • (iii) its quantity, and
  • (iv) in the case of a raw material, its purity and its anhydrous content;
• (c) in the case of the importation of a product that contains the narcotic,
  • (i) the brand name of the product,
  • (ii) the drug identification number that has been assigned to the product under section C.01.014.2 of the Food and Drug Regulations, if any, and
  • (iii) the strength per unit of the narcotic in the product;
• (d) the name and municipal address of the exporter in the country of export from whom the narcotic is being obtained;
• (e) the name of the customs office where the importation is anticipated; and
• (f) each proposed mode of transportation to be used, and any proposed country of transit or transhipment.
  

Signature and attestation

(2) The application must

• (a) be signed and dated by the qualified person in charge or the alternate qualified person in charge; and
• (b) include an attestation by that person that all of the information submitted in support of the application is correct and complete to the best of their knowledge.

Additional information and documents

(3) The licensed dealer shall provide the Minister with any information or document that the Minister determines is necessary to complete the Minister's review of the application, not later than the date specified in the Minister's written request to that effect.

Issuance

18.1 Subject to section 18.4, on completion of the review of the import permit application, the Minister shall issue to the licensed dealer an import permit that contains:

• (a) the permit number;
• (b) the information set out in subsection 18(1);
• (c) the effective date of the permit;
• (d) the expiry date of the permit, which must be the 180th day after its effective date or, if it is earlier, the expiry date of the dealer's licence; and
• (e) any terms and conditions that the Minister has reasonable grounds to believe are necessary to
  • (i) ensure that an international obligation is respected, or
  • (ii) reduce a potential risk to public health or safety, including the risk of a narcotic being diverted to an illicit market or use.
    

Validity

18.2 An import permit is valid until the earliest of

• (a) the expiry date set out in the permit,
• (b) the date of the suspension or revocation of the permit under section 19 or 20,
• (c) the date of the suspension or revocation of the dealer's licence under section 16 or 17, and
• (d) the date of the expiry, suspension or revocation of the export permit that applies to the narcotic to be imported and that is issued by the competent authority in the country of export.
  

Return of permit

18.3 If an import permit expires, the licensed dealer shall, as soon as feasible after its expiry, return the original of the permit to the Minister.

Refusal

18.4 (1) The Minister shall refuse to issue an import permit if

• (a) the licensed dealer is not authorized by their dealer's licence to import the relevant narcotic or their dealer's licence will expire before the date of importation;
• (b) the Minister has reasonable grounds to believe that the importation would contravene an international obligation;
• (c) the licensed dealer does not have in place at the site the security measures set out in the Security Directive in respect of the importation;
• (d) the licensed dealer has not complied with the requirements of subsection 18(3) or the information or documents that they have provided are not sufficient to complete the review of the application;
• (e) the Minister has reasonable grounds to believe that the licensed dealer has submitted false or misleading information or false or falsified documents in or with the application;
• (f) the licensed dealer has been notified that their application to renew or amend their licence is to be refused;
• (g) the Minister has reasonable grounds to believe that the importation would contravene the laws of the country of export or any country of transit or transhipment; or
• (h) the Minister has reasonable grounds to believe that the issuance of the permit would likely create a risk to public health or safety, including the risk of a narcotic being diverted to an illicit market or use.
  

Notice

(2) Before refusing to issue the permit, the Minister shall send the licensed dealer a notice that sets out the Minister's reasons and gives the dealer an opportunity to be heard.

Providing copy of permit

18.5 The holder of an import permit shall provide a copy of the permit to the customs office at the time of importation.

Declaration

18.6 The holder of an import permit shall provide the Minister, within 15 days after the day of release of the narcotic specified in the permit in accordance with the Customs Act, with a declaration that contains the following information:

• (a) their name and the numbers of their dealer's licence and the import permit with respect to the narcotic;
• (b) with respect to the narcotic,
  • (i) its name, as specified in the dealer's licence,
  • (ii) if it is a salt, the name of the salt, and
  • (iii) its quantity;
• (c) in the case of the importation of a product that contains the narcotic,
  • (i) the brand name of the product,
  • (ii) the drug identification number that has been assigned to the product under section C.01.014.2 of the Food and Drug Regulations, if any, and
  • (iii) the strength per unit of the narcotic in the product; and
• (d) the name of the customs office from which the narcotic was released and the date of the release.
  

Suspension

19 (1) The Minister shall suspend an import permit without prior notice if

• (a) the dealer's licence is suspended;
• (b) the Minister has reasonable grounds to believe that the suspension is necessary to protect public health or safety, including the risk of a narcotic being diverted to an illicit market or use; or
• (c) the importation would contravene the laws of the country of export or any country of transit or transhipment.

Notice

(2) The suspension takes effect as soon as the Minister sends the licensed dealer a notice that

• (a) sets out the reasons for the suspension;
• (b) gives the dealer an opportunity to be heard; and
• (c) if applicable, specifies the corrective measures that must be carried out by the dealer and the date by which the dealer must do so.
  

Reinstatement of permit

(3) The Minister shall reinstate the import permit if the Minister has reasonable grounds to believe that the suspension is no longer necessary.

Revocation

20 (1) Subject to subsection (2), the Minister shall revoke an import permit if

• (a) the licensed dealer requests the Minister to do so or informs the Minister of the loss or theft of the permit or the actual or potential unauthorized use of the permit;
• (b) the licensed dealer does not carry out the corrective measures specified by the Minister under paragraph 19(2)(c) by the specified date;
• (c) the licensed dealer has contravened a term or condition of the permit;
• (d) the Minister has reasonable grounds to believe that the licensed dealer submitted false or misleading information or false or falsified documents in or with the application;
• (e) information received from a competent authority or the United Nations gives the Minister reasonable grounds to believe that the licensed dealer has been involved in the diversion of a narcotic to an illicit market or use; or
• (f) the dealer's licence has been revoked.

Exceptions

(2) The Minister shall not revoke an import permit for a ground set out in paragraph (1)(d) or 17(1)(e) or (g) if the licensed dealer meets the following conditions, unless the Minister has reasonable grounds to believe that it is necessary to do so to protect public health or safety, including preventing a narcotic from being diverted to an illicit market or use:

• (a) the licensed dealer does not have a history of non-compliance with the Act or these Regulations; and
• (b) the licensed dealer has carried out, or signed an undertaking to carry out, the necessary corrective measures to ensure compliance with the Act, these Regulations and the Access to Cannabis for Medical Purposes Regulations.

Notice

(3) Before revoking an import permit, the Minister shall send the licensed dealer a notice that sets out the Minister's reasons and gives the dealer an opportunity to be heard.

Return of permit

20.1 If an import permit is revoked, the licensed dealer shall, as soon as feasible after its revocation, return the original of the permit to the Minister.

Export Permits

Application

21 (1) A licensed dealer shall submit to the Minister, before each exportation of a narcotic, an application for an export permit that contains the following information and document:

• (a) their name, municipal address and dealer's licence number;
• (b) with respect to the narcotic to be exported,
  • (i) its name, as specified in the dealer's licence,
  • (ii) if it is a salt, the name of the salt,
  • (iii) its quantity, and
  • (iv) in the case of a raw material, its purity and its anhydrous content;
• (c) in the case of the exportation of a product that contains the narcotic,
  • (i) the brand name of the product,
  • (ii) the drug identification number that has been assigned to the product under section C.01.014.2 of the Food and Drug Regulations, if any, and
  • (iii) the strength per unit of the narcotic in the product;
• (d) the name and municipal address of the importer in the country of final destination;
• (e) the name of the customs office where the exportation is anticipated;
• (f) each proposed mode of transportation to be used and any proposed country of transit or transhipment; and
• (g) a copy of the import permit issued by the competent authority in the country of final destination that sets out the name of the importer and the municipal address of their site in that country.
  

Signature and attestation

(2) The application must

• (a) be signed and dated by the qualified person in charge or the alternate qualified person in charge; and
• (b) include an attestation by that person that, to the best of their knowledge,
  • (i) the exportation does not contravene any requirement of the laws of the country of final destination or any country of transit or transhipment, and
  • (ii) all of the information and documents submitted in support of the application are correct and complete.
    

Additional information and documents

(3) The licensed dealer shall provide the Minister with any information or document that the Minister determines is necessary to complete the Minister's review of the application, not later than the date specified in the Minister's written request to that effect.

Issuance

21.1 Subject to section 21.4, on completion of the review of the export permit application, the Minister shall issue to the licensed dealer an export permit that contains

• (a) the permit number;
• (b) the information set out in paragraphs 21(1)(a) to (f);
• (c) the effective date of the permit;
• (d) the expiry date of the permit, which must be the earliest of
  • (i) the 180th day after its effective date,
  • (ii) the expiry date of the dealer's licence, and
  • (iii) the expiry date of the import permit issued by the competent authority in the country of final destination; and
• (e) any terms and conditions that the Minister has reasonable grounds to believe are necessary to
  • (i) ensure that an international obligation is respected, or
  • (ii) reduce a potential risk to public health or safety, including the risk of a narcotic being diverted to an illicit market or use.
    

Validity

21.2 An export permit is valid until the earliest of

• (a) the expiry date set out in the permit,
• (b) the date of the suspension or revocation of the permit under section 22 or 23,
• (c) the date of the suspension or revocation of the dealer's licence under section 16 or 17, and
• (d) the date of the expiry, suspension or revocation of the import permit that applies to the narcotic to be exported and that is issued by the competent authority in the country of final destination.
  

Return of permit

21.3 If an export permit expires, the licensed dealer shall, as soon as feasible after its expiry, return the original of the permit to the Minister.

Refusal

21.4 (1) The Minister shall refuse to issue an export permit if

• (a) the licensed dealer is not authorized by their dealer's licence to export the relevant narcotic or their dealer's licence will expire before the date of export;
• (b) the Minister has reasonable grounds to believe that the exportation would contravene an international obligation;
• (c) the licensed dealer has not complied with the requirements of subsection 21(3) or the information or documents that they have provided are not sufficient to complete the review of the application;
• (d) the Minister has reasonable grounds to believe that the licensed dealer has submitted false or misleading information or false or falsified documents in or with the application;
• (e) the licensed dealer has been notified that their application to renew or amend their licence is to be refused;
• (f) the Minister has reasonable grounds to believe that the exportation would not be in conformity with the import permit issued by the competent authority of the country of final destination;
• (g) the Minister has reasonable grounds to believe that the exportation would contravene the laws of the country of final destination or any country of transit or transhipment; or
• (h) the Minister has reasonable grounds to believe that the issuance of the permit would likely create a risk to public health or safety, including the risk of a narcotic being diverted to an illicit market or use.
  

Notice

(2) Before refusing to issue the permit, the Minister shall send the licensed dealer a notice that sets out the Minister's reasons and gives the dealer an opportunity to be heard.

Providing copy of permit

21.5 The holder of an export permit shall provide a copy of the permit to the customs office at the time of exportation.

Declaration

21.6 The holder of an export permit shall provide the Minister, within 15 days after the day of export of the narcotic specified in the permit, with a declaration that contains the following information:

• (a) their name and the numbers of their dealer's licence and the export permit with respect to the narcotic;
• (b) with respect to the narcotic,
  • (i) its name, as specified in the dealer's licence,
  • (ii) if it is a salt, the name of the salt, and
  • (iii) its quantity;
• (c) in the case of the exportation of a product that contains the narcotic,
  • (i) the brand name of the product,
  • (ii) the drug identification number that has been assigned to the product under section C.01.014.2 of the Food and Drug Regulations, if any, and
  • (iii) the strength per unit of the narcotic in the product; and
• (d) the name of the customs office from which the narcotic was exported and the date of export.
  

Suspension

22 (1) The Minister shall suspend an export permit without prior notice if

• (a) the dealer's licence is suspended;
• (b) the Minister has reasonable grounds to believe that the suspension is necessary to protect public health or safety, including the risk of a narcotic being diverted to an illicit market or use; or
• (c) the exportation would contravene the laws of the country of final destination, or any country of transit or transhipment.

Notice

(2) The suspension takes effect as soon as the Minister sends the licensed dealer a notice that

• (a) sets out the reasons for the suspension;
• (b) gives the dealer an opportunity to be heard; and
• (c) if applicable, specifies the corrective measures that must be carried out by the dealer and the date by which the dealer must do so.
  

Reinstatement of permit

(3) The Minister shall reinstate the export permit if the Minister has reasonable grounds to believe that the suspension is no longer necessary.

Revocation

23 (1) Subject to subsection (2), the Minister shall revoke an export permit if

• (a) the licensed dealer requests the Minister to do so or informs the Minister of the loss or theft of the permit or the actual or potential unauthorized use of the permit;
• (b) the licensed dealer does not carry out the corrective measures specified by the Minister under paragraph 22(2)(c) by the specified date;
• (c) the licensed dealer has contravened a term or condition of the permit;
• (d) the Minister has reasonable grounds to believe that the licensed dealer submitted false or misleading information or false or falsified documents in or with the application;
• (e) information received from a competent authority or the United Nations gives the Minister reasonable grounds to believe that the licensed dealer has been involved in the diversion of a narcotic to an illicit market or use; or
• (f) the dealer's licence has been revoked.

Exceptions

(2) The Minister shall not revoke an export permit for a ground set out in paragraph (1)(d) or 17(1)(e) or (g) if the licensed dealer meets the following conditions, unless the Minister has reasonable grounds to believe that it is necessary to do so to protect public health or safety, including preventing a narcotic from being diverted to an illicit market or use:

• (a) the licensed dealer does not have a history of non-compliance with the Act or these Regulations; and
• (b) the licensed dealer has carried out, or signed an undertaking to carry out, the necessary corrective measures to ensure compliance with the Act, these Regulations and the Access to Cannabis for Medical Purposes Regulations.

Notice

(3) Before revoking an export permit, the Minister shall send the licensed dealer a notice that sets out the Minister's reasons and gives the dealer an opportunity to be heard.

Return of permit

23.1 If an export permit is revoked, the licensed dealer shall, as soon as feasible after its revocation, return the original of the permit to the Minister.

Identification

Name

24 A licensed dealer must include its name, as set out in its dealer's licence, on all the means by which it identifies itself in relation to narcotics, including product labels, orders, shipping documents, invoices and advertising.

Sale and Provision of Narcotics

Sale to licensed dealer

25 A licensed dealer may sell or provide a narcotic to another licensed dealer.

Sale to pharmacist

25.1 (1) Subject to subsection (2), a licensed dealer may sell or provide to a pharmacist any narcotic other than dried marihuana.

Exception — pharmacist named in notice

(2) A licensed dealer shall not sell or provide to a pharmacist who is named in a notice issued under subsection 48(1) the narcotics referred to in the notice.

Retraction

(3) Subsection (2) does not apply to a licensed dealer who has received a notice of retraction issued under section 49 in respect of a pharmacist named in a notice issued under subsection 48(1).

Sale to practitioner

25.2 (1) Subject to subsections (2) to (4), a licensed dealer may sell or provide to a practitioner any narcotic other than diacetylmorphine (heroin) or dried marihuana.

Exception — heroin

(2) A licensed dealer may sell or provide diacetylmorphine (heroin) to the following practitioners:

• (a) a practitioner of medicine;
• (b) a practitioner of dentistry, if practising in a hospital that provides care or treatment to persons; or
• (c) a nurse practitioner.

Midwife, nurse practitioner or podiatrist

(3) For the purpose of subsections (1) and (2) a licensed dealer may sell or provide a narcotic to a midwife, nurse practitioner or podiatrist only if that practitioner is permitted to prescribe or possess the narcotic, or to conduct an activity with it, in accordance with sections 3 and 4 of the New Classes of Practitioners Regulations.

Exception — practitioner named in notice

(4) A licensed dealer shall not sell or provide to a practitioner who is named in a notice issued under subsection 59(1) the narcotics referred to in the noticeunless the licensed dealer has received a notice of retraction issued under section 60.

Provision to hospital employee

25.3 (1) Subject to subsection (2), a licensed dealer may provide to a hospital employee any narcotic other than dried marihuana.

Exception — heroin

(2) A licensed dealer may provide diacetylmorphine (heroin) to a hospital employee only if that hospital provides care or treatment to persons.

Sale to exempted person

25.4 (1) Subject to subsection (2), a licensed dealer may sell or provide a narcotic to a person who is exempted under section 56 of the Act with respect to the possession of that narcotic.

Exception — heroin

(2) A licensed dealer may sell or provide diacetylmorphine (heroin) only to a person who is exempted under section 56 of the Act with respect to the possession of that narcotic for a scientific purpose.

Sale to licensed producer

25.5 A licensed dealer may sell or provide cannabis to a licensed producer.

Written order

25.6 A licensed dealer may sell or provide a narcotic under sections 25 to 25.5 if

• (a) the licensed dealer has received a written order that specifies the name and quantity of the narcotic to be supplied and is signed and dated
  • (i) in the case of a narcotic to be provided to a hospital employee or a practitioner in a hospital, by the pharmacist in charge of the hospital's pharmacy or by a practitioner authorized by the person in charge of the hospital to sign the order, and
  • (ii) in any other case, by the person to whom the narcotic is to be sold or provided; and
• (b) the licensed dealer has verified the signature, if it is unknown to them.
  

Verbal order

25.7 (1) A licensed dealer may sell or provide a verbal prescription narcotic under sections 25 to 25.5 if

• (a) the licensed dealer has received a verbal order that specifies the name and quantity of the narcotic to be supplied; and
• (b) in the case of the provision of the narcotic to a hospital employee or a practitioner in a hospital, the order has been placed by the pharmacist in charge of the hospital's pharmacy or by a practitioner authorized by the person in charge of the hospital to place the order.
  

Receipt

(2) A licensed dealer who receives a verbal order from a pharmacist or practitioner shall, within five working days after filling the order, obtain and keep a receipt that includes

• (a) the signature of the pharmacist or practitioner who received the narcotic;
• (b) the date the pharmacist or practitioner received the narcotic; and
• (c) the name and the quantity of the narcotic.

No further sale without receipt

(3) If the licensed dealer has not obtained the receipt within five working days, the licensed dealer shall not sell or provide a narcotic to the pharmacist or practitioner in accordance with a further verbal order received from them until after obtaining the receipt.

Packaging and Transportation

Packaging — sale and provision

26 (1) A licensed dealer who sells or provides a narcotic, other than a preparation described in section 36, shall securely package it in its immediate container, which shall be sealed in such a manner that the container cannot be opened without breaking the seal.

Packaging — transport and export

(2) A licensed dealer who transports or exports a narcotic shall ensure that its package is sealed in such a manner that the package cannot be opened without breaking the seal.

Exception

(3) Subsection (1) does not apply to a test kit that contains a narcotic and that has a registration number.

Transport

26.1 (1) A licensed dealer shall, in taking delivery of a narcotic that they have imported or in making delivery of a narcotic,

• (a) take any measures that are necessary to ensure the security of the narcotic while it is being transported;
• (b) subject to subsection (2), use a method of transportation that permits an accurate record to be kept of all handling of the narcotic as well as of the signatures of any persons handling the narcotic until it is delivered to the consignee;
• (c) in the case of an imported narcotic, ensure that it is transported directly to the site specified in their licence after it is released under the Customs Act; and
• (d) in the case of a narcotic that is to be exported, transport it directly from the site specified in their licence to the customs office where it is to be exported.

Exception

(2) A licensed dealer may have a verbal prescription narcotic transported by a common carrier.

Thefts, Losses and Suspicious Transactions

Protective measures

27 A licensed dealer shall take any measures that are necessary to ensure the security of any narcotic in their possession and any licence or permit in their possession.

Theft or loss — licences and permits

27.1 A licensed dealer who becomes aware of a theft or loss of their licence or permit shall provide a written report to the Minister not later than 72 hours after becoming aware of the occurrence.

Theft or unexplainable loss — narcotics

27.2 A licensed dealer who becomes aware of a theft of a narcotic or of a loss of a narcotic that cannot be explained on the basis of normally accepted business activities shall

• (a) provide a written report to a member of a police force not later than 24 hours after becoming aware of the occurrence; and
• (b) provide a written report to the Minister not later than 72 hours after becoming aware of the occurrence and confirm that the report required under paragraph (a) has been provided.

Explainable loss — narcotics

27.3 A licensed dealer who becomes aware of a loss of a narcotic that can be explained on the basis of normally accepted business activities shall provide a written report to the Minister not later than 10 days after becoming aware of the occurrence.

Suspicious transaction

27.4 (1) A licensed dealer shall provide a written report containing the following information to the Minister not later than 72 hours after becoming aware of a transaction occurring in the course of their activities that they have reasonable grounds to suspect may be related to the diversion of a narcotic to an illicit market or use:

• (a) the name, municipal address, telephone number and, if the licensed dealer is a corporation, the position held by the individual making the report;
• (b) the name and municipal address of the other party to the transaction;
• (c) details of the transaction involved, including its date and time, its type, the name and quantity of the narcotic and, in the case of a product or compound, the quantity of every narcotic that it contains;
• (d) in the case of a product that contains the narcotic, other than a test kit, the drug identification number that is assigned to the product under section C.01.014.2 of the Food and Drug Regulations, if any; and
• (e) a detailed description of the reasons for those suspicions.

Good faith

(2) No civil proceedings lie against a licensed dealer for having provided the report in good faith.

Non-disclosure

(3) A licensed dealer shall not disclose that they have provided the report or disclose details of it, with the intent to prejudice a criminal investigation, whether or not a criminal investigation has begun.

Partial protection against self-incrimination

27.5 A report made under any of sections 27.1 to 27.4, or any evidence derived from it, is not to be used or received to incriminate the licensed dealer in any criminal proceeding against them other than a prosecution under section 132, 136 or 137 of the Criminal Code.

Destruction

Destruction at site

27.6 (1) A licensed dealer who destroys a narcotic at the site specified in their licence shall ensure that the following conditions are met:

• (a) the licensed dealer obtains the prior approval of the Minister to carry out the destruction;
• (b) the destruction is carried out in the presence of two of the following persons, at least one of whom shall be a person referred to in subparagraph (i):
  • (i) the senior person in charge, the qualified person in charge or the alternate qualified person in charge, and
  • (ii) a person who works for or provides services to the licensed dealer and holds a senior position;
• (c) the destruction is carried out in accordance with a method that complies with all federal, provincial and municipal environmental protection legislation applicable to the place of destruction; and
• (d) once the destruction is completed, the person who carried out the destruction and each of the two persons referred to in paragraph (b) who were present at the destruction sign and date a joint declaration attesting that the narcotic was completely destroyed, to which each signatory shall add their name in printed letters.

Destruction elsewhere than at site

(2) A licensed dealer who destroys a narcotic elsewhere than at the site specified in their licence shall ensure that the following conditions are met:

• (a) the licensed dealer obtains the prior approval of the Minister to carry out the destruction;
• (b) the licensed dealer takes appropriate measures to ensure the security of the narcotic while it is being transported in order to prevent its diversion to an illicit market or use;
• (c) the destruction is carried out by a person working for a business that specializes in the destruction of dangerous goods and in the presence of another person working for that business;
• (d) the destruction is carried out in accordance with a method that complies with all federal, provincial and municipal environmental protection legislation applicable to the place of destruction; and
• (e) once the destruction is completed, the person who carried out the destruction provides the licensed dealer with a dated declaration attesting that the narcotic was completely destroyed and containing
  • (i) the municipal address of the place of destruction,
  • (ii) the name and quantity of the narcotic and, if applicable, the brand name and quantity of the product containing it or the name and quantity of the compound containing it,
  • (iii) the method of destruction,
  • (iv) the date of destruction, and
  • (v) the names in printed letters and signatures of that person and the other person who was present at the destruction.

Application for approval

27.7 (1) A licensed dealer shall submit to the Minister an application that contains the following information in order to obtain the Minister's prior approval to destroy a narcotic:

• (a) their name, municipal address and dealer's licence number;
• (b) the proposed date of destruction;
• (c) the municipal address of the place of destruction;
• (d) a brief description of the method of destruction;
• (e) if the destruction is to be carried out at the site specified in the dealer's licence, the names of the persons proposed for the purpose of parargraph 27.6(1)(b) and information establishing that they meet the conditions of that paragraph;
• (f) the name of the narcotic to be destroyed and, if applicable, the brand name of the product containing it or the name of the compound containing it; and
• (g) the form and quantity of the narcotic to be destroyed or the product or compound containing it and, if applicable, its strength per unit, the number of units per package and the number of packages.

Signature and attestation

(2) The application shall

• (a) be signed and dated by the qualified person in charge or the alternate qualified person in charge; and
• (b) include an attestation by that person that
  • (i) the proposed method of destruction complies with all applicable federal, provincial and municipal environmental protection legislation applicable to the place of destruction, and
  • (ii) all of the information submitted in support of the application is correct and complete to the best of the signatory's knowledge.

Additional information and documents

(3) The licensed dealer shall provide the Minister with any information or document that the Minister determines is necessary to complete the Minister's review of the application, not later than the date specified in the Minister's written request to that effect.

Approval

27.8 On completion of the review of the application, the Minister shall approve the destruction of the narcotic unless

• (a) in the case of a destruction that is to be carried out at the site specified in the dealer's licence, the persons proposed for the purpose of paragraph 27.6(1)(b) do not meet the conditions of that paragraph;
• (b) the Minister has reasonable grounds to believe that the narcotic would not be destroyed;
• (c) the Minister has reasonable grounds to believe that the licensed dealer has submitted false or misleading information or false or falsified documents in or with the application;
• (d) the narcotic or a portion of it is required for the purposes of a criminal or administrative investigation or any preliminary inquiry, trial or other proceeding under any Act or its regulations; or
• (e) the Minister has reasonable grounds to believe that the approval of the destruction would likely create a risk to public health or safety, including the risk of the narcotic being diverted to an illicit market or use.

Documents

Method of recording information

28 A licensed dealer shall record any information that they are required to record under these Regulations using a method that permits an audit of it to be made at any time.

Information — general

28.1 A licensed dealer shall record the following information:

• (a) the name and quantity of any narcotic that the dealer orders, the name of the person who placed the order on the dealer's behalf and the date of the order;
• (b) the name and quantity of any narcotic that the dealer receives, the name and municipal address of the person who sold or provided it and the date on which it was received;
• (c) tin the case of a narcotic that the dealer sells or provides,
  • (i) the brand name of the product or the name of the compound containing the narcotic and the name of the narcotic,
  • (ii) the quantity and, if applicable, the strength per unit of the narcotic,
  • (iii) the name and municipal address of the person to whom it was sold or provided, and
  • (iv) the date on which it was sold or provided;
• (d) the name and quantity of any narcotic that the dealer manufactures or assembles and the date on which it was placed in stock and, if applicable, the strength per unit of the narcotic, the number of units per package and the number of packages;
• (e) the name and quantity of any narcotic used in the manufacturing or assembling of a product or compound, as well as the brand name and quantity of the product or the name and quantity of the compound, and the date on which the product or compound was placed in stock;
• (f) the name and quantity of any narcotic in stock at the end of each month;
• (g) the name and the quantity of any narcotic that the dealer delivers, transports or sends a narcotic, the name and municipal address of the consignee and the date on which it was delivered, transported or sent;
• (h) in the case of an importation, the name and quantity of any narcotic imported, the date on which it was imported, the name and municipal address of the exporter, the country of exportation and any country of transit or transhipment; and
• (i) in the case of an exportation, the name and quantity of any narcotic exported, the date on which it was exported, the name and municipal address of the importer, the country of final destination and any country of transit or transhipment.

Verbal prescription narcotic

28.2 A licensed dealer who receives a verbal order for a verbal prescription narcotic and sells or provides it to a pharmacist, a practitioner or a hospital employee shall immediately record

• (a) the name of the person who placed the order;
• (b) the date the order was received; and
• (c) the name of the person recording the order.

Destruction

28.3 A licensed dealer shall record the following information concerning any narcotic that they destroy at the site specified in their licence:

• (a) the municipal address of the place of destruction;
• (b) the name and quantity of the narcotic and, if applicable, the brand name and quantity of the product containing the narcotic or the name and quantity of the compound containing the narcotic;
• (c) the method of destruction; and
• (d) the date of destruction.

Annual report

28.4 (1) Subject to subsections (2) and (3), a licensed dealer shall provide to the Minister, within three months after the end of each calendar year, an annual report that contains

• (a) the name and total quantity of each narcotic that they receive, produce, use to manufacture or assemble a product or compound, sell, provide, import, export or destroy during the calendar year;
• (b) the quantity of each narcotic in physical inventory taken at the site specified in their licence at the end of the calendar year; and
• (c) the name and quantity of any narcotic that has been lost in the course of conducting activities during the calendar year.

Non-renewal or revocation within first three months

(2) A licensed dealer whose licence expires without being renewed or is revoked within the first three months of a calendar year shall provide to the Minister

• (a) within three months after the end of the preceding calendar year, the annual report in respect of that year; and
• (b) within three months after the expiry or revocation, a report in respect of the months of the current calendar year during which the licence was valid that contains the information referred to in subsection (1), in which the quantity in physical inventory is to be calculated as of the date of expiry or revocation.

Non-renewal or revocation after third month

(3) A licensed dealer whose licence expires without being renewed or is revoked after the first three months of a calendar year shall provide to the Minister, within three months after the expiry or revocation, a report in respect of the portion of the calendar year during which the licence was valid that contains the information referred to in subsection (1) for that period, including the quantity in physical inventory on the date of expiry or revocation.

Retention of documents

29 (1) A licensed dealer or former licensed dealer shall keep any document containing the information that they are required to record under these Regulations, including every declaration and a copy of every report, for a two-year period beginning on the day on which the last record is recorded in the document and in a manner that permits an audit of the document to be made at any time.

Location

(2) The documents must be kept

• (a) in the case of a licensed dealer, at the site specified in their licence; and
• (b) in the case of a former licensed dealer, at a location in Canada.

Quality of documents

(3) The documents must be complete and readily retrievable and the information in them must be legible and indelible.

4 Paragraphs 31(2)(b) and (c) are replaced by the following:

• (b) except in the case of diacetylmorphine (heroin), if the pharmacist has received a written order or prescription for the narcotic that is signed and dated by a practitioner and has verified the signature of the practitioner, if it is not known to them; or
• (c) in the case of diacetylmorphine (heroin), if the pharmacist has received a written order or prescription for the narcotic that is signed and dated by a practitioner of medicine or a nurse practitioner and has verified the signature of the practitioner, if it is not known to them.

5 Paragraphs 32(d) and (e) of the Regulations are replaced by the following:

• (d) dispense, sell or provide a narcotic, other than a verbal prescription narcotic, to a practitioner named in a notice issued by the Minister under subsection 59(1) or fill a prescription or order for a narcotic, other than a verbal prescription narcotic, from a practitioner named in such a notice; or
• (e) dispense, sell or provide a verbal prescription narcotic to a practitioner named in a notice issued by the Minister under subsection 59(1) or fill a prescription or order for a verbal prescription narcotic from a practitioner named in such a notice.

6 Section 34 of the Regulations is replaced by the following:

34 Subject to section 39, a pharmacist may dispense a verbal prescription narcotic on receipt of a verbal prescription or order given by a person whom the pharmacist has taken reasonable precautions to determine is a practitioner.

7 (1) Paragraph 35(1)(a) of the Regulations is replaced by the following:

• (a) the pharmacist in charge of the hospital's pharmacy;

(2) Paragraphs 35(1)(b) and (c) of the French version of the Regulations are replaced by the following:

• b) sauf s'il s'agit de diacétylmorphine (héroïne), un praticien qui est autorisé à signer la commande par la personne à qui est confiée la charge de l'hôpital
• c) s'agissant de diacétylmorphine (héroïne), un médecin, un infirmier praticien ou un dentiste qui est autorisé à signer la commande par la personne à qui est confiée la charge de l'hôpital. à signer la commande.

8 Sections 37 to 39 of the Regulations are replaced by the following:

37 A pharmacist shall not use an order or prescription, to dispense a narcotic after the quantity of the narcotic specified in the order or prescription has been dispensed.

38 If, in accordance with a written order or prescription, a pharmacist dispenses a narcotic, other than dextropropoxyphene, the pharmacist shall immediately enter in a book, register or other record maintained for such purposes

• (a) their name or initials;
• (b) the name, initials and municipal address of the practitioner who issued the order or prescription;
• (c) the name and municipal address of the person named in the order or prescription;
• (d) the name, quantity and form of the narcotic;
• (e) the date on which the narcotic was dispensed; and
• (f) the number assigned to the order or prescription.

39 A pharmacist shall, before dispensing a verbal prescription narcotic in accordance with a verbal order or prescription, make a written record of it that sets out

• (a) their name or initials;
• (b) the name, initials and municipal address of the practitioner who issued the order or prescription;
• (c) the name and municipal address of the person named in the order or prescription;
• (d) in accordance with the manner in which it is specified in the order or prescription, the name and quantity of the verbal prescription narcotic or the narcotic and the other medicinal ingredients contained in it;
• (e) the directions for use given with the order or prescription;
• (f) the date on which the verbal prescription narcotic was dispensed; and
• (g) the number assigned to the order or prescription.

9 Subsection 40(1) of the Regulations is replaced by the following:

40 (1) A pharmacist shall maintain a special narcotic prescription file in which shall be filed in sequence as to date and number all written orders or prescriptions for narcotics dispensed and the written record of all verbal prescription narcotics dispensed in accordance with a verbal order or prescription.

10 Section 46 of the Regulations is replaced by the following:

46 The Minister shall provide in writing any factual information about a pharmacist that has been obtained under the Act, these Regulations or the Access to Cannabis for Medical Purposes Regulations to the provincial professional licensing authority that is responsible for the registration and authorization of the person to practise their profession

• (a) in the province in which the pharmacist is or was registered and entitled to practise if
  • (i) the authority submits to the Minister a written request that sets out the pharmacist's name and address, a description of the information being requested and a statement that the information is required for the purpose of assisting a lawful investigation by the authority, or
  • (ii) the Minister has reasonable grounds to believe that the pharmacist has
    • (A) contravened a rule of conduct established by the authority,
    • (B) been convicted of a designated substance offence, or
    • (C) contravened these Regulations or the Access to Cannabis for Medical Purposes Regulations; or
• (b) in a province in which the pharmacist is not registered and entitled to practise, if the authority submits to the Minister
  • (i) a written request that sets out the pharmacist's name and address and a description of the information being requested, and
  • (ii) a document that shows that
    • (A) the pharmacist has applied to that authority to practise in that province, or
    • (B) the authority has reasonable grounds to believe that the pharmacist is practising in that province without being authorized to do so.

11 (1) Paragraph 48(2)(c) of the Regulations is replaced by the following:

• (c) been convicted of a designated substance offence or of an offence under these Regulations or the Access to Cannabis for Medical Purposes Regulations.

(2) Paragraphs 48(3)(b) and (c) of the Regulations are replaced by the following:

• (b) all pharmacies within the province in which the pharmacist is registered and practising;
• (c) the provincial professional licensing authority of the province in which the pharmacist is registered and entitled to practise; and

(3) Paragraph 48(5)(a) of the Regulations is replaced by the following:

• (a) consulted with the provincial professional licensing authority of the province in which the pharmacist to whom the notice relates is registered and entitled to practise;

(4) Subparagraph 48(5)(c)(ii) of the Regulations is replaced by the following:

• (ii) whether the actions of the pharmacist pose a significant risk to public health or safety, including the risk of the narcotic being diverted to an illicit market or use.

12 Subparagraph 49(b)(ii) of the Regulations is replaced by the following:

• (ii) provided a letter from the provincial professional licensing authority of the province in which the pharmacist is registered and entitled to practise that states that the authority consents to the retraction of the notice.

13 Paragraphs 54(1)(a) and (b) of the Regulations are replaced by the following:

• (a) three times the maximum daily dosage recommended by the manufacturer or assembler of the narcotic for that narcotic; or
• (b) three times the generally recognized maximum daily therapeutic dosage for the narcotic if the manufacturer or assembler has not recommended a maximum daily dosage.

14 Section 57 of the Regulations is replaced by the following:

57 (1) The Minister shall provide in writing any factual information about a practitioner that has been obtained under the Act, these Regulations, the Access to Cannabis for Medical Purposes Regulations, the former Marihuana for Medical Purposes Regulations or the former Marihuana Medical Access Regulations to the provincial professional licensing authority that is responsible for the registration and authorization of the person to practise their profession

• (a) in a province in which the practitioner is or was registered and entitled to practise if
  • (i) the authority submits to the Minister a written request that sets out the practitioner's name and address, a description of the information being requested and a statement that the information is required for the purpose of assisting a lawful investigation by the authority, or
  • (ii) the Minister has reasonable grounds to believe that the practitioner has
    • (A) contravened a rule of conduct established by the authority,
    • (B) been convicted of a designated substance offence, or
    • (C) contravened these Regulations, the Access to Cannabis for Medical Purposes Regulations or the former Marihuana for Medical Purposes Regulations; or
• (b) in a province in which the practitioner is not registered and entitled to practise, if the authority submits to the Minister
  • (i) a written request that sets out the practitioner's name and address and a description of the information being requested, and
  • (ii) a document that shows that
    • (A) the practitioner has applied to that authority to practise in that province, or
    • (B) the authority has reasonable grounds to believe that the practitioner is practising in that province without being authorized to do so.

(2) The Minister is authorized to provide, in respect of a practitioner of medicine who made a medical declaration that formed the basis for the issuance of an authorization to possess under the former Marihuana Medical Access Regulations, the following information to the provincial professional licensing authority that is responsible for the registration and authorization of persons to practise medicine in the province identified in the declaration as the province in which the practitioner is authorized to practise:

• (a) the practitioner's name and address; and
• (b) the number assigned to their authorization to practise medicine.

15 (1) Paragraph 59(2)(c) of the Regulations is replaced by the following:

• (c) been convicted of a designated substance offence or of an offence under these Regulations or the Access to Cannabis for Medical Purposes Regulations.

(2) Paragraph 59(3)(c) of the Regulations is replaced by the following:

• (c) the provincial professional licensing authority of the province in which the practitioner named in the notice is registered and entitled to practise;

(3) Paragraphs 59(4)(b) to (e) of the Regulations are replaced by the following:

• (b) has, on more than one occasion, self-administered a narcotic, other than a verbal prescription narcotic, under a self-directed written prescription or order or, in the absence of a prescription or order, contrary to accepted professional practice;
• (c) has, on more than one occasion, self-administered a verbal prescription narcotic under a self-directed prescription or order or, in the absence of a prescription or order, contrary to accepted professional practice;
• (d) has, on more than one occasion, prescribed, provided or administered a narcotic, other than a verbal prescription narcotic, to a person who is a spouse, common-law partner, parent or child of the practitioner, including a child adopted in fact, contrary to accepted professional practice;
• (e) has, on more than one occasion, prescribed, provided or administered a verbal prescription narcotic to a person who is a spouse, common-law partner, parent or child of the practitioner, including a child adopted in fact, contrary to accepted professional practice; or

(4) Paragraph 59(5)(a) of the Regulations is replaced by the following:

• (a) consulted with the provincial professional licensing authority of the province in which the practitioner to whom the notice relates is registered and entitled to practise;

(5) Subparagraph 59(5)(c)(ii) of the Regulations is replaced by the following:

• (ii) whether the actions of the practitioner pose a significant risk to public health or safety, including the risk of the narcotic being diverted to an illicit market or use.

(6) Paragraph 59(6)(a) of the French version of the Regulations is replaced by the following:

• a) soit de la personne qui, en vertu des lois d'une province, est inscrite et autorisée à y exercer la médecine;

16 Subparagraph 60(b)(ii) of the Regulations is replaced by the following:

• (ii) provided a letter from the provincial professional licensing authority of the province, in which the practitioner is registered and entitled to practise that states that the authority consents to the retraction of the notice.

17 Subparagraph 63(a)(v) of the French version of the Regulations is replaced by the following:

• (v) du nom du malade pour lequel a été dispensé un stupéfiant autre qu'un stupéfiant d'ordonnance verbale ou que du dextropropoxyphène,

18 Subsection 65(6) of the French version of the Regulations is replaced by the following:

(6) La personne à qui est confiée la charge d'un hôpital peut permettre qu'un stupéfiant soit fourni à des fins de recherche à la personne qui est employée dans un laboratoire de recherche de cet hôpital et qui bénéficie d'une exemption relative à la méthadone et accordée en vertu de l'article 56 de la Loi.

19 Sections 68 to 70 of the Regulations are replaced by the following:

68 (1) Despite anything in these Regulations, a person may, for the purpose of identification or analysis of a narcotic, provide or deliver it to

• (a) a practitioner of medicine; or
• (b) an agent or mandatary of that practitioner, if the agent or mandatary is exempted under section 56 of the Act with respect to the possession of that narcotic for that purpose.

(2) An agent or mandatary of a practitioner of medicine who receives the narcotic shall immediately provide or deliver it to

• (a) the practitioner whom they represent; or
• (b) the Minister.

(3) A practitioner of medicine who receives the narcotic shall immediately provide or deliver it

• (a) for the purpose of its identification or analysis, to a person who is exempted under section 56 of the Act with respect to the possession of that narcotic for that purpose; or
• (b) to the Minister.

69 Every person who is exempted under section 56 of the Act with respect to the possession of a narcotic — other than a person to whom a narcotic has been administered, sold, delivered or provided by a practitioner of medicine who is exempted under section 56 of the Act from the application of any subsection of section 53 with respect to that narcotic —, every practitioner of medicine who has received a narcotic under subsection 68(1) or (2) and every agent or mandatary of a practitioner of medicine who has received a narcotic under subsection 68(1) shall

• (a) keep a record of the following information for a two-year period beginning on the day on which the record is made
  • (i) the name and quantity of any narcotic purchased or received by them and the date on which it was purchased or received,
  • (ii) the name and address of the person from whom the narcotic was purchased or received, and
  • (iii) particulars of the use to which the narcotic was put;
• (b) provide any information respecting the narcotic that the Minister may require; and
• (c) permit access to the records that are required to be kept by these Regulations.

70 No person shall

• (a) advertise a narcotic to the general public;
• (b) advertise in a pharmacy a preparation referred to in section 36; or
• (c) publish any written advertisement respecting a narcotic unless that advertisement displays the symbol "N" in a clear and conspicuous colour and size in the upper left quarter of its first page.

20 Section 71 of the Regulations is repealed.

21 Section 72 of the Regulations is replaced by the following:

72 (1) For the purpose of subsection 24(1) of the Act, notification of an application for an order of restoration shall be given in writing to the Attorney General by registered mail and shall be mailed at least 15 days before the date on which the application is to be made to a justice.

(2) The notification shall specify

• (a) the name of the justice to whom the application is to be made;
• (b) the time and place at which the application is to be heard;
• (c) details concerning the narcotic or other thing in respect of which the application is to be made; and
• (d) the evidence on which the applicant intends to rely to establish that they are entitled to possession of the narcotic or other thing referred to in paragraph (c).

22 Sections 73 and 74 of the Regulations are replaced by the following:

73 (1) The following definitions apply in this section.

member means any person who is authorized by a nursing statutory body to practice nursing. (membre)

nursing statutory body means any provincial professional licensing authority that, in accordance with the laws of that province, authorizes a person to practise nursing. (organisme régissant la profession d'infirmier)

(2) The Minister may provide to a nursing statutory body any information concerning any member of that body obtained under these Regulations, the Act or the Access to Cannabis for Medical Purposes Regulations.

(3) Subsection (2) does not apply to a nurse practitioner.

74 A member of a police force or a person acting under their direction and control who, in respect of the conduct of the member or person, is exempt from the application of subsection 4(2) or section 5, 6 or 7 of the Act by virtue of the Controlled Drugs and Substances Act (Police Enforcement) Regulations is, in respect of that conduct, exempt from the application of these Regulations.

23 The French version of the Regulations is amended by replacing "praticien de la médecine" with "médecin" in the following provisions:

• (a) paragraph 31(3)(c.1);
• (b) subsection 53(4); and
• (c) subsection 65(7).

Consequential Amendments

Licensed Dealers for Controlled Drugs and Narcotics (Veterinary Use) Fees Regulations

24 Paragraph (b) of the definition dealer's licence in section 1 of the Licensed Dealers for Controlled Drugs and Narcotics (Veterinary Use) Fees Regulations^footnote3 is replaced by the following:

• (b) a licence issued under section 10.1 of the Narcotic Control Regulations. (licence de distributeur autorisé)

Industrial Hemp Regulations

25 The definition competent laboratory in section 1 of the Industrial Hemp Regulations^footnote4 is replaced by the following:

competent laboratory means a laboratory that is owned or operated by a person who is a licensed dealer under section 10.1 of the Narcotic Control Regulations, or a laboratory outside Canada that is recognized as a qualified laboratory, for the application of the United Nations' Single Convention on Narcotic Drugs, 1961, as amended from time to time, by the competent authorities of the country in which it is located. (laboratoire compétent)

Precursor Control Regulations

26 Paragraph 6.1(a) of the Precursor Control Regulations^footnote5 is replaced by the following:

• (a) a licence issued under section G.002.007 or J.01.015 of the Food and Drug Regulations, section 17.1 of the Benzodiazepines and Other Targeted Substances Regulations or section 10.1 of the Narcotic Control Regulations that authorizes the production of the substance; or

Fees in Respect of Drugs and Medical Devices Regulations

27 Paragraphs (a) and (b) of the definition dealer's licence in subsection 29(1) of the Fees in Respect of Drugs and Medical Devices Regulations^footnote6 are replaced by the following:

• (a) a licence issued under section G.02.007 of the Food and Drug Regulations; or
• (b) a licence issued under section 10.1 of the Narcotic Control Regulations. (licence de distributeur autorisé)

28 Subsection 31(3) of the Regulations is replaced by the following:

Timing of payment

(3) Subject to subsection (4), the fee is payable at the time of submitting the application for a dealer's licence or for the renewal of a dealer's licence under section 10 or 11 of the Narcotic Control Regulations or section G.02.006 or G.02.011 of the Food and Drug Regulations.

Access to Cannabis for Medical Purposes Regulations

29 (1) Subparagraph 112(a)(i) of the Access to Cannabis for Medical Purposes Regulations^footnote7 is replaced by the following:

• (i) has been convicted, as an adult, of a designated criminal offence as defined in section 2 of the Narcotic Control Regulations or a designated substance offence,

(2) Subparagraph 112(a)(ii) of the French version of the Regulations is replaced by the following:

• (ii) soit il a été condamné, en tant qu'adulte, pour une infraction commise à l'étranger qui, si elle avait été commise au Canada, aurait constitué une infraction visée au sous-alinéa (i),

30 Paragraph 176(2)(a) of the Regulations is replaced by the following:

• (a) have been convicted, as an adult, of a designated substance offence;

Coming into Force

31 These Regulations come into force on the 180th day after the day on which they are published in the Canada Gazette, Part II.