Canada aims for marijuana legalization in 2017

[April 21, 2016]   By Ethan Lou

TORONTO (Reuters) - Canada's Liberal government will introduce a law in spring 2017 to legalize recreational marijuana, it said on Wednesday, fulfilling an election pledge and following several U.S. states in permitting easy access to the drug.

Canadian Prime Minister Justin Trudeau promised during last year's election campaign that his Liberals would legalize recreational marijuana, but the time frame has been unclear. Trudeau has previously admitted to smoking marijuana a few times in his life but said he never enjoyed it much.

Health Minister Jane Philpott, speaking at a special session of the United Nations General Assembly in New York, said the Canadian law will ensure marijuana is kept away from children and keep criminals from profiting from its sale.

"We will work with law enforcement partners to encourage appropriate and proportionate criminal justice measures," she said. "We know it is impossible to arrest our way out of this problem."

The announcement came on April 20, a day celebrated by some cannabis advocates as "weed day." Hundreds gathered outside Canada's Parliament on Wednesday to smoke marijuana.

Former Toronto police chief Bill Blair, the government's point man on legalization, has emphasized current laws banning marijuana remain in effect, but illegal dispensaries have multiplied after the Liberals came to power.

Voters in four U.S. states plus the District of Columbia have already legalized the recreational use of the drug in ballot initiatives. Advocates have pushed for similar referendums this year in a half-dozen other states, including Massachusetts and California.

Gerard Deltell, a legislator from Canada's opposition Conservatives, said the country's proposed legislation would harm people's health and lead to life-long problems among users.

"That's one of the worst things you can do to Canadian youth - to open the door to marijuana ... it's wrong, all wrong," he told reporters in Ottawa.

Medical marijuana is a separate issue from recreational marijuana in Canada and already is legal. Canada's medical marijuana growers say the rise in illegal marijuana dispensaries is costing them customers.

Even so, shares of medical marijuana producers rose after the announcement. Canopy Growth Co closed up 9 percent at C$2.79. OrganiGram Holdings rose nearly 16 percent to C$1.25 and Aphria Inc rose 8 percent to C$1.67.

The Canadian government has not provided details on production and distribution plans. But Aaron Salz, an analyst at Dundee Capital Markets, said many investors expect the federal government to dictate the supply chain, while provincial governments oversee the distribution model.

This type of regime could benefit existing medical marijuana producers, he said.

“If you're a licensed producer now with a facility and you've been operating for a few years in a medicinal environment, you have an enormous leg up on your peers.”

(Additional reporting by David Ljunggren and Leah Schnurr in Ottawa; Editing by Bill Trott and Matthew Lewis)

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