Compliance and enforcement policy for the Cannabis Act

Table of contents

• Disclaimer
• 1.0 Introduction and purpose
• 2.0 Scope
• 3.0 Guiding principles
  • 3.1 Accountability
  • 3.2 Fairness, consistency and impartiality
  • 3.3 Transparency
  • 3.4 Targeted and outcomes focused
  • 3.5 Evidence based
• 4.0 Roles and responsibilities
  • 4.1 Regulated parties
  • 4.2 Health care practitioners
  • 4.3 Consumers
  • 4.4 Provincial and territorial governments
  • 4.5 Law enforcement
• 5.0 Compliance and enforcement activities
  • 5.1 Promoting compliance
  • 5.2 Monitoring compliance
  • 5.3 Enforcement
• 6.0 Appeals
• 7.0 Openness and transparency
• 8.0 Contact us

Disclaimer

This document does not constitute part of the Cannabis Act (Act) or its associated Regulations. In the event of any inconsistency or conflict between that Act or Regulations and this document, the Act or the Regulations take precedence. This document is an administrative document that is intended to facilitate compliance with the Act, the Regulations and the applicable administrative policies by regulated parties. This document is not intended to provide legal advice regarding the interpretation or application of the Act or Regulations. If a regulated party has questions about legal obligations or responsibilities under the Act or Regulations, they should seek their own legal advice.

1.0 Introduction and purpose

Health Canada is one of the federal organizations responsible for compliance and enforcement activities for cannabis. The purpose of this policy is to describe Health Canada’s compliance and enforcement approach under the Cannabis Act (referred to herein as “the Act”) and its Regulations. It is intended to promote a consistent and transparent approach to compliance and enforcement.

The Act establishes a framework for legal access to cannabis and a framework to control and regulate its production, distribution and sale. The purpose of the Act is to protect public health and public safety, including reducing the risk of cannabis being diverted to an illegal market. To achieve its objectives, the Act, in conjunction with its Regulations:

• Sets the general control framework for cannabis, including establishing a series of criminal prohibitions
• Provides authorizations to permit persons to engage in certain activities related to cannabis
• Sets the parameters for the operation of a legal cannabis industry through the granting of licences, permits or authorizations
• Sets clear authorities intended to protect against the public health and public safety risks associated with cannabis
• Seeks to restrict youth access to cannabis and deter criminal activity by imposing serious penalties for those who break the law

2.0 Scope

A number of organizations are responsible for administering and enforcing different parts of the Act and its Regulations. This policy applies to the compliance and enforcement approach undertaken by Health Canada and not to other responsible authorities under the Act. The section on roles and responsibilities provides more information on the role of Health Canada and of other organizations.

To support the objectives of the Act, Health Canada collaborates with other federal partners, including the Canada Border Services Agency, the Canada Revenue Agency, and law enforcement, and works closely with partners across the federal Health Portfolio, including the Public Health Agency of Canada, the Canada Food Inspection Agency and the Pest Management Regulatory Agency. Health Canada also works closely with provincial and territorial governments.

In addition to the requirements of the Act and its Regulations, other legislation may apply to some products, including but not limited to drugs that contain cannabis or cannabis accessories. It is the responsibility of the regulated parties to be aware of all applicable requirements.

The Act regulates a number of activities that may not necessarily require an authorization from Health Canada. These activities include, but are not limited to activities related to promotions and advertising including broadcasting and publishing, packaging and labelling of cannabis accessories, and activities related to cannabis accessories and services. It is the responsibility of regulated parties to ensure they comply with all applicable requirements of the Act or its Regulations.

3.0 Guiding principles

Health Canada’s Compliance and Enforcement Policy Framework identifies the following principles that guide the department’s compliance and enforcement activities. The following guiding principles are described in the framework and apply to all activities undertaken under this policy.

3.1 Accountability

Health Canada is accountable to Parliament and to Canadians to help ensure that the compliance and enforcement actions and decisions are consistent with:

• its mandate, values, policies and legal and operational frameworks
• the public interest
• applicable international requirements

3.2 Fairness, consistency and impartiality

Health Canada's acts and regulations are applied in a fair, consistent and impartial manner. Qualified and authorized personnel carry out its compliance and enforcement activities in ways that are reasonable, professional, unbiased and unprejudiced.

Health Canada staff will act with the highest levels of integrity, as set out in the Values and Ethics Code for the Public Sector.

3.3 Transparency

Health Canada strives to make its compliance and enforcement actions and decision-making process clear and understandable to everyone. The department provides access to relevant, useful and timely information about compliance and enforcement while respecting privacy rights. One of the ways this is done is by publishing data through regulatory transparency and openness initiatives.

3.4 Targeted and outcomes focused

Health Canada's compliance and enforcement actions are targeted to have the most positive impact on health and safety outcomes based on the effective use of resources. The most appropriate actions and tools are used, based on the impact of non-compliance for each situation.

3.5 Evidence based

Health Canada's compliance and enforcement actions and decisions are based on the best available evidence, information and science.

Evidence is assessed objectively and is based on Health Canada's Decision Making Framework for Identifying, Assessing and Managing Health Risks and other departmental risk frameworks.

4.0 Roles and responsibilities

Many parties have a role in advancing the objectives of the Act. One of those objectives is the protection of public health and public safety.

4.1 Regulated Parties

Regulated parties are expected to:

• understand the law and their obligations with respect to all regulated activities, including those that do not require a licence or authorization
• ensure their products, activities and processes comply with applicable laws
• treat Health Canada staff in a courteous and respectful manner
• understand the role of an inspector
• comply with provisions of the Act and its Regulations that govern interactions with Health Canada, such as requirements to comply with orders and prohibitions on obstructing an inspector or providing false or misleading statements
• be aware of the ethical obligations that govern the actions of Health Canada inspectors as set out in the Values and Ethics Code for the Public Sector

4.2 Health care practitioners

In the case of cannabis for medical purposes, health care practitioners must continue to meet the professional standards and obligations of their respective provincial or territorial licensing authorities.

To help protect the health and safety of Canadians, health care practitioners are encouraged to report any adverse reactions (side effects) related to the use of cannabis products to the licensed producer, and may also report these directly to Health Canada.

4.3 Consumers

Consumers are responsible for their health and the health of others in their care. Consumers are also responsible for the safe use and control of cannabis in their possession.

Consumers are encouraged to report any issues with respect to the quality or health and safety of cannabis products directly to the licensed producer.  Consumers are also encouraged to inform Health Canada about health- and safety-related concerns that they may have with cannabis products. This will help inform Health Canada’s compliance and enforcement activities. A Cannabis Reporting Form is available on the Health Canada website for this purpose.

In addition, consumers are encouraged to report any adverse reactions (side effects) related to the use of cannabis products to the licensed producer, and may also report these directly to Health Canada.

4.4 Provincial and territorial governments

Provincial and territorial governments share responsibility with the federal government for the oversight and licensing of the cannabis supply chain. The federal Minister of Health is responsible for licensing various aspects of the cannabis supply chain (e.g., cultivation, processing, sale for medical purposes, analytical testing, research and cannabis drug licences).

Provinces and territories have the authority to authorize the distribution and sale of cannabis in their respective jurisdiction. This provincial or territorial legislation must impose on sellers of cannabis certain conditions outlined in the Act: only cannabis produced under the Cannabis Act may be sold; cannabis may not be sold to young persons; appropriate records must be kept; and adequate measures must be taken to reduce the risk of diversion.

Provinces and territories as well as local governments may also tailor certain rules in their jurisdictions, such as setting a higher minimum age or restrictions on personal cultivation of cannabis, and may have compliance and enforcement policies that apply to the activities they regulate. Where necessary, Health Canada works with provincial and territorial authorities to support the public health and public safety objectives of the Act.

4.5 Law enforcement

Law enforcement plays a critical role in directly supporting the purposes of the Act and in working with departments and agencies, where appropriate. Law enforcement has the authority to take action against illegal cannabis activity and against those who operate outside of the legal framework.

Health Canada works closely with law enforcement to promote, among other things, the integrity of the licensing system including appropriate personnel security screening and compliance with the provisions of the Act and its Regulations, and may refer suspected illegal activity to law enforcement for further action.

Information sharing

Where the disclosure is necessary to protect public health or public safety, Health Canada may disclose relevant information collected under authorities in the Act and its Regulations, during compliance and enforcement activities, to other parties such as provincial or territorial governments or law enforcement.

5.0 Compliance and enforcement activities

Health Canada manages risks posed to public health and public safety in connection with cannabis through a variety of compliance and enforcement activities, including:

• Compliance promotion
• Compliance monitoring
• Enforcement actions

Other legislation and regulations may also apply to cannabis-related products. It is the responsibility of the regulated party to be aware of all applicable requirements.

5.1 Compliance promotion

Health Canada believes that compliance promotion is an effective tool in facilitating compliance with the Act and its Regulations.

Health Canada promotes compliance through educational activities and information sharing on legislative and regulatory matters. This includes policies and guidance documents intended to help regulated parties better understand the requirements and their responsibilities.

Health Canada also provides information to consumers to enable them to make appropriate, safe and healthy choices. Consumers should stay informed about the health risks of cannabis and understand their obligations, including personal possession limits.

5.2 Compliance monitoring

Health Canada monitors the activities of regulated parties to verify they are complying with the Act and its Regulations and to prevent non-compliance. Compliance monitoring includes gathering and analyzing information, carrying out compliance verification activities and collaborating with other regulatory agencies as appropriate.

As part of monitoring and verifying compliance, Health Canada has the authority to conduct inspections. Inspections may involve actions such as:

• Visually examining a facility, inventories, equipment, packaging, labelling and websites
• Collecting and reviewing documents and records
• Taking samples for laboratory analysis

Health Canada uses information from internal and external sources to identify possible risks to public health and public safety. When Health Canada identifies a product or activity that may not be compliant with the Act or its Regulations, it applies the guiding principles in this policy, including using a targeted, outcomes-focused and evidence-based approach to assess whether there is non-compliance. External sources may include consumers, a company within a supply chain, and federal, provincial, territorial and international partners.

5.3 Enforcement

When non-compliance is identified, there are a number of options to support achieving compliance.

5.3.1 Voluntary compliance measures initiated by the regulated party

It is always the regulated party’s responsibility to take appropriate and timely action to meet all requirements of the legislation and regulations. In cases of non-compliance, the regulated party may voluntarily undertake one or more interventions based on the level of risk. These could include consent to forfeiture, product detention, product disposal, product stop-sale and product recall.

Voluntary actions by a regulated party may not preclude Health Canada from initiating other measures if they are appropriate in the circumstances.

5.3.2 Measures initiated by Health Canada

When a regulated party is unable or unwilling to take action, Health Canada may take enforcement action to address non-compliance or mitigate risks to public health or public safety. Health Canada's actions are targeted to have the most positive impact on health and safety outcomes based on the effective use of resources. Health Canada uses the most appropriate actions and tools based on the impact of the non-compliance for each situation.

Health Canada may take a number of enforcement actions to address non-compliance or to address an issue of public health, depending on the circumstances. These include:

• Issuing warning letters to non-compliant regulated parties
• Issuing public advisories or other forms of risk communication
• Seizure and detention
• Refusing, suspending or revoking an authorization, including a licence or permit
• Issuing administrative monetary penalties up to $1 million
• Issuing a ministerial order to recall products from the market, conduct tests or studies, produce information or documents, or take other measures

Decision factors

Health Canada considers many factors to inform its compliance monitoring and enforcement activities, and to determine the most appropriate level of intervention, including:

• Public health and public safety risk
  • The real or potential risk to public health or public safety
  • The risk of diversion of a product to an illicit market
• Behaviour of the regulated party
  • Whether the regulated party acted with indifference, recklessness or premeditation
  • The degree of co-operation and responsiveness offered by the regulated party once non-compliance is identified
• Compliance history
  • Previous compliance issues
  • Actions taken by the regulated party to comply with the law
• Other factors
  • The likelihood that the same problem will recur
  • The expected impact and success of compliance and enforcement actions
  • The need to maintain public confidence in the integrity of the regulatory regime

6.0 Appeals

Under the Act, regulated parties have the right to request a review of decisions relating to certain compliance and enforcement measures undertaken by Health Canada, including administrative monetary penalties and ministerial orders. There are also opportunities to be heard on licensing decisions, including licence amendment, suspension and revocation.

These review processes involve individual(s) other than the decision maker that imposed the compliance and enforcement measure. They will also occur in a manner that prioritizes on-going compliance and enforcement actions and does not compromise Health Canada’s efforts to address risks to public health and public safety.

7.0 Openness and transparency

Health Canada proactively releases data and information in accordance with the open government plan. This includes making information about compliance and enforcement activities, such as issuing administrative monetary penalties and ministerial orders, available to the public via its website.

8.0 Contact us

For more information about this policy, email cannabis@canada.ca
Effective Date: October 17, 2018