Ontario government to open up cannabis retail system The Government of Ontario will announce an open licencing system for cannabis retail stores shortly, according to sources familiar with the situation.
Aspiring cannabis retailers will be allowed to apply for licences on a first-come, first-served basis similar to what is available in Alberta. It’s unclear at this point whether there will be a cap on the total number of licences that will be issued, the sources said, who are not authorized to speak publicly on the matter.
This is a move away from the lottery-system that Ontario used to award the first 75 cannabis licences. Ontario had intended to introduce an open-licence private retail model after the Progressive Conservatives were elected in the summer of 2018. Last December, however, the Provincial Government abruptly announced that it was capping the number of licences it would issue and use a lottery system, due to a shortage of legal cannabis.
The lack of stores in Ontario has been a major complaint for licences cannabis producers, which have reported poor sales in recent months. Only 24 stores are open in the province.
“Ontario represents 40 per cent of the country’s population, yet has one retail cannabis store per 600,000 people. When one year into the market, the addressable market is nearly half of what is expected, there’s going to be meaningful short-term problems," said Canopy Growth Corp.'s former CEO Mark Zekulin on the company’s most recent earnings call.