Eligibility conditions

To apply for or renew a cannabis licence, you must meet all of the following conditions:

• You are not the subject of a receivership of your debts
• You have not failed to comply with any Act of Parliament (other than the Excise Act, 2001) or of a provincial or territorial legislature that deals with the taxation or control of alcohol, tobacco products, cannabis products, or vaping products or any regulations under it in the past five years
• You have not acted to defraud His Majesty in the past five years
• Each individual involved is at least 18 years of age
• You have a valid business address in Canada
• You provide a list of all premises that will be cultivating, producing and/or packaging cannabis products
• You have sufficient financial resources to conduct your business in a responsible manner
• You hold a valid licence/permit from Health Canada issued under the Cannabis Act
• You provide a business plan (including a business industry overview, operating plan, financial plan or source of funds, and a sales and marketing plan)
• You provide acceptable security to cover one month of cannabis duty liability (minimum of $5,000 and a maximum of $5 million)

Security requirement

The minimum amount of security required for licensees who are only cultivating and/or producing cannabis products would be $5,000. The maximum security amount would be $5 million for cannabis licensees who package cannabis products.

For a new cannabis licence application, security would be calculated as follows:

• plus [(Estimated number of grams of dried cannabis to be sold over the first 12 months x $1 per gram)
• plus(Estimated number of milligrams of total THC to be sold over the first 12 months x $0.01 per milligram)]
• divide12 months
• equalsSecurity amount

For a renewal application, security would be the highest amount of cannabis duties payable for a calendar month in the previous 12 calendar months.

 If you have specific questions on how to calculate the security amount:

• send an email to cannabis@cra-arc.gc.ca
• call 1-866-330-3304.

Learn more: Excise Duty Notice EDN52, Obtaining and Renewing a Cannabis Licence.