May 19, 2020

What effect has the legalisation of recreational cannabis had on the Canadian market?

The Cannabis Act
Ronnie Midlash
2 min
What effect has the legalisation of recreational cannabis had on the Canadian market?

Recreational cannabis was legalised on 17 October, 2018, and in the time since, the country has experienced both increased profits and challenges. On legislation day, the country generated a US$152,408.35 (after tax) of revenue with the influx of customers purchasing from P.E.I. In 2018 alone, the market is expected to generate $1.8bn. Yet the predicted revenue for 2022 has considerably lower growth, with both medical and recreational markets set to break $5.4 bn.

BDS Analytics’ Tom Adams cites that this decrease is due to the regulations of the market, combined with the increase of adult use. The legalisation of marijuana has faced many ethical issues, such as the appropriate consequences of selling to minors, and how those convicted for possession will be reviewed. The government has not yet made a decision as to whether grant amnesty to those who have served their penalty.



Some key concerns included the importance of keeping cannabis “out of the hands of children and youth,” minimising illegal sales and promoting safe use across the country. The Cannabis Act was passed to combat these issues and prevent abuse of the drug. The Act specifies the limitations of the legalisation, with the maximum individual possession of dried cannabis standing at 30 grams.

Cannabis may not be sold to anyone under the age of 18, and the penalties are considerably stricter than that of alcohol, with maximum penalties of 14 years in jail. Any products that may appear enticing or marketed towards those under the age restriction are also prohibited. Self service machines and any promotional advertising within adolescent view has also been restricted. The Act also acknowledges the long term damage illegal possession has done to the livelihood of offenders, and hopes that legalization will help reduce criminal activity.

Although predicted profit margins are not as high as expected from the legalisation of recreational cannabis, it is clear that the Canadian government is proceeding with caution as it sets the precedents for the legal use of the drug internationally, protecting their status as leaders in the Cannabis market.

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