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In BC, if you have a retail cannabis license you must comply with Liquor & Cannabis Regulation Branch terms and conditions and the law, but who’s minding illegal operators? The Community Safety Unit (CSU), part of the BC government Policing and Security Branch, is responsible for investigating the illegal sale and production of cannabis and carrying out compliance and enforcement actions against illegal operators. CSU proactively investigates violations of BC’s Cannabis Control and Licensing Act (CCLA) and may also act on complaints submitted by the public.
CSU activities:
- Conduct inspections
- Obtain warrants
- Summon witnesses
- Conduct hearings
- Seize cannabis
- Issue tickets and fines
- Recommend criminal charges
- Work with enforcement partners to disrupt illegal online vendors
Source: “Community Safety Unit – cannabis enforcement”, Public Safety, Government of BC, September 9, 2024.
Orders Issued by the Community Safety Unit
Concession Orders
Issued when a suspected violator responds to a Notice of Administrative Monetary Penalty by signing a waiver. When a waiver is signed, the violator admits to the contravention and accepts a penalty equal to the retail value of the cannabis sold, possessed for sale, or produced.
Compliance Orders
Issued when a suspected violator does not sign a waiver and an administrative hearing is held. If the hearing finds that the violator is in contravention of the CCLA, a monetary penalty equal to twice the retail value of the cannabis sold, possessed for sale, or produced.
Reconsideration Orders
Issued when a person’s application for reconsideration of a compliance order is accepted. A reconsideration order is then issued either confirming, amending or rescinding the compliance order.
Source: “Community Safety Unit orders issues”, Public Safety, Government of BC, July 30, 2024.
Retail Cannabis Licensees Continue to Compete with Illegal Market
According to a report by Deloitte, unregulated online vendors continue to lure customers away from licensed cannabis stores. The report, “Clearing the smoke, insights into Canada’s illicit cannabis market” (PDF) was the culmination of data analysis comparing the legal recreational cannabis market to the illicit market. The data was culled from 624 legal recreational cannabis stores and 57 illegal online stores between May and June 2023.
The analysis found that:
- Illegal websites sold more unique SKUs and had a higher SKU count than legal retail cannabis licensees.
- The illicit market has larger inventories of flower and extract products and sell volumes above the 30gm limit imposed on legal retailers
- The illicit market has smaller inventories of vapes, pre-rolls, and beverages – likely because they are costly to produce or purchased from suppliers, and have smaller profit margins.
- Illicit market cannabis flower prices are 20% less on average than prices at legal retailers.
- 78% of illegal websites don’t verify age to enter the website
- E-transfer as the primary form of payment
- Nearly all websites ship via Canada Post
- 63% of illicit websites studied sold illicit drugs such as psilocybin mushrooms, LSD and DMT.
Source: “Clearing the smoke, insights into Canada’s illicit cannabis market” (PDF), Deloitte.
Retail Cannabis License Applications and Support from Thrive Advisors
Thrive Liquor & Cannabis Advisors services support legal cannabis retailers in BC. Our services include retail cannabis license applications and renewals, compliance training and audits. Our trusted consultants save you time, reduce frustration – and get it right the first time. Working with Thrive increases your chances of long term success in BC’s competitive recreational cannabis market.
