(Bloomberg) -- Justin Trudeau set Oct. 17 as the date recreational marijuana will become legal in Canada, the first such move by a Group of Seven nation.
The prime minister, who had previously committed to opening the market by the end of summer, told lawmakers Wednesday the slight delay would give provincial governments more time to prepare for retail sales, which they will administer. The federal government was free to announce the date after the Senate approved Bill C-45 on Tuesday night in Ottawa.
“We are proud to have passed our bill to legalize marijuana and to strictly regulate its access,” Trudeau said in the legislature. “We have been listening to the provinces who are asking for more time to implement it.”
Legalization could create a market worth about C$7 billion ($5.3 billion) and investor anticipation has fueled market valuations of companies such as Canopy Growth Corp. and Aurora Cannabis Inc. to more than C$1 billion. Trudeau’s Liberals pressured the Senate to approve the bill this week before a Parliamentary recess began, saying that after months of debate among appointed members it was time to end a failed system of prohibition.
Canada’s main stock index rose to an all-time high on Wednesday and was up 0.8 percent to 16,442.36 as of 3:28 p.m. Toronto time. Canopy Growth Corp. shares rose as much as 6 percent to a record C$45.10. The BI Canada Cannabis Competitive Peers Index climbed 2.8 percent.
The Senate voted 52 to 29 in favor of a revised bill from the elected House of Commons, and there were two abstentions. The House version accepted some earlier Senate amendments, while rejecting a contentious one calling for further restrictions on people growing plants in their homes.
Senator Andre Pratte said it wasn’t worth creating a political crisis to hold up the legislation over home grown plants. “I don’t think it is of such importance to warrant an extraordinary intervention.”
Conservative senators also raised other concerns, such as slower U.S. border crossings, that kept the bill in the upper house for about seven months. Trudeau countered those concerns with arguments that a regulated market will strip profits from criminal gangs and reduce youth consumption, and it’s rare in Canadian politics for the appointed Senate to outright block laws sent from an elected government.
Justice Minister Jody Wilson-Raybould cautioned that recreational use remains illegal until the law is fully implemented. She also said cabinet ministers have discussed the idea of wiping away criminal records for past minor offenses, adding her focus for now is on completing legalization.
Here are some key points around legalized marijuana:
- Production of cannabis is regulated by the federal government, with provinces and cities given more powers over retail sales in stores that can be either private or government-owned
- There are tough restrictions on packaging and advertising to ensure that smoking doesn’t appeal to youth
- Marijuana use remains illegal for people younger than 18, and no individual can possess more than the equivalent of 30 grams of dried cannabis
- Most importing or exporting of marijuana remains illegal
- Police can still write tickets for some minor infractions, a downgrade from the old system that often meant criminal charges could be filed
- Sales are subject to an excise tax and regular sales taxes, with excise revenue split 75-25 between the provincial and federal governments for the first two years
- A separate law is reworking the powers police have to check for impaired drivers
- Some medical use of marijuana is already legal in Canada
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