Mr. Chairman and committee members, thank you for having me here today.
I'm going to approach the panel topic of workplace safety from a different perspective, from the employee perspective, and specifically from the perspective of a specific group of employees, those being the thousands of workers across the country who currently work within the illicit cannabis industry.
It is estimated that over 13,000 individuals in British Columbia alone participate and work in the illicit cannabis industry. This represents an estimated wage amount of over $600 million. These are obviously estimates only. We don't have reliable statistics, but I think it's safe to say that across the country we're talking about tens of thousands of workers involved in cultivation, processing, or sales of illicit cannabis. The safety of these workers is threatened in a number of ways. In the retail sector, dispensary workers face a threat to their personal safety through the risk of robbery. Dispensaries are a ripe target for thieves due to cash on hand and due to the fact that thieves know that there's a good chance the robbery won't even get reported to the police. There may be environmental risks associated with working in an unregulated grow op or lab, and of course, the personal liberty of these workers is threatened by the risk of criminal prosecution.
I'm here to suggest to you today that the risks to these workers can be mitigated while simultaneously the objectives of legalization are advanced as these workers are provided a meaningful opportunity to participate within the legal market. This can be done by codifying within the bill and the regulations to the bill a tolerance for applicants with certain prior illicit market participation.
Subclause 62(7) of Bill C-45 provides that the minister may refuse to issue a production licence if the applicant has contravened the Controlled Drugs and Substances Act, the CDSA, in the past 10 years. That, in and of itself, excludes anyone who has been convicted of producing, trafficking, or even possessing cannabis in the last decade. The bill also provides that additional grounds for refusal may be prescribed by regulation.
We don't yet know what those regulations will look like, but we can look to the current access to cannabis for medical purposes regulations, the ACMPR, for a sense of this. In section 36 of the ACMPR, not only is the minister required to refuse to issue a production licence where the CDSA has been contravened in the past 10 years, but the minister is also required to refuse to issue a licence where law enforcement has provided information that raises reasonable grounds to believe that the applicant has been involved in the diversion of a controlled substance to an illicit market. The use of the words “reasonable grounds” here is important because it means that a conviction is not required. Charges are not even required. A mere reasonable suspicion is sufficient to result in the refusal of your application.
In addition, the ACMPR provides that all directors and officers of a licensed producer as well as certain key employees must be security cleared. Clause 67 of Bill C-45 also refers to security clearances, so it appears that this concept is being brought forward into the cannabis act, and again, under section 112 of the ACMPR, mere reasonable grounds to suspect that the applicant has been involved in the diversion of a controlled substance to the illicit market is a factor to be taken into account by the minister in deciding whether to grant a security clearance.
Under the ACMPR clearly we have a framework that essentially denies prior illicit cannabis market participants from obtaining a licence to produce medical cannabis, and also precludes them from holding many key positions with a licensed producer. This also creates a chilling effect on licensed producers with regard to hiring those with prior cannabis convictions, and it appears that we are heading in the same direction with Bill C-45.
This can be contrasted with the approach that's being taken in the United States. Of the eight states in the U.S. that licensed the production of recreational cannabis, seven have legislation that contains what I would refer to as amnesty provisions regarding prior cannabis convictions. Massachusetts, Nevada, and Colorado deny licences to those with a prior felony conviction, but they expressly exclude certain marijuana offences from that rule. Oregon, Maine, and Washington exclude certain marijuana convictions completely from the consideration of whether a licence should be granted. The draft regulations in California are the most inclusive. They provide that a prior conviction for the possession, sale, manufacture, or cultivation of a controlled substance, not involving minors, shall not form the sole ground for denial of a licence application. At least 11 states that have legalized medical cannabis also have some form of amnesty provisions in their legislation.
What I submit to you is that this is the direction we need to take in Canada as well. We need to consider and debate the parameters of acceptable prior illicit market participation. Many of these individuals would embrace the opportunity to operate legally. They would comply with regulations. Granted, some would choose to continue to operate outside of the law, so as not to be burdened by government regulation, and so be it. They would be dealt with on the offence and enforcement side of the equation, but there should be an opportunity to comply and participate.
At the very least, mere possession offences should not inhibit legal market participation, but what I'm suggesting is that we should go further than that because the cannabis entrepreneurs that I'm referring to are producing and selling cannabis products, so they would still be excluded. We need a more nuanced approach to the issue of licensing and who should be prohibited from obtaining a licence. For example, we can exclude those convicted of offences that involve young persons. We can exclude those with established connections to organized crime. We can exclude those convicted of offences that involved guns, violence, or controlled substances other than cannabis. We can build reasonable parameters that exclude those who are likely to be a threat to public health and safety, while also providing an opportunity for those who would not be.
I am a business lawyer. I have advised the medical cannabis industry since it was privatized three and a half years ago with the MMPR. I have seen the shortcomings of this system, but I've also seen the potential of this industry. Current licence producers are not averse to an inclusive industry. What they want is for everybody to be on a level playing field and to be subject to the same set of rules. I'm certainly not suggesting this from the perspective of being a cannabis activist and I'm not suggesting that illicit market participants have somehow earned the right to participate as a reward for their civil disobedience. I'm suggesting it because I believe it's the only way legalization is really going to work. The stated objectives of the bill include the reduction of the illicit market and it attempts to do so by imposing criminal sanctions on those operating outside of the legal framework, but this, in and of itself, will not work. We know this because it hasn't worked. Those who are excluded will continue to operate outside of the law. A better approach would be to design a framework for legalization which permits the inclusion of prior illicit market participants. This will enhance the public health and safety objective by subjecting those individuals to government oversight and regulation. It will increase tax revenues, as these individuals report and pay tax on their income. It will allow the legal industry to benefit from the breadth of knowledge that is possessed by these individuals and it will protect these individuals, by allowing them to work in a safe, regulated environment, free from the risk of criminal sanctions. If we fail to create an inclusive cannabis industry, the black market will thrive, and if it thrives, cannabis will continue to be easily accessible to minors, the public health and safety objective of restricting access to unregulated cannabis products will be compromised, and we will continue to place an unnecessary burden on the criminal justice system.
I would also add that a meaningful opportunity to transition into the legal market involves having regulations which are not so onerous that they effectively exclude small operators. The task force on cannabis legalization and regulation, in fact, recommended that the government encourage market diversity by creating a space for smaller producers. Under the ACMPR, what I am seeing is that the cost of compliance, in particular relating to security requirements, is a real barrier to small-scale production, and a meaningful opportunity to transition also requires expanding the scope of cannabis products to include edibles and other derivative products. This is what the market wants and demands and it will be required in order to transition the existing producers of these derivative products into the legal market.