Regulator points warning after unregulated hashish merchandise offered at licensed pot outlets

A woman holds a hemp plant used for research in Long Pond, PA on June 25, 2021.Matt Slocum / The Associated Press

A pair of licensed cannabis stores selling unregulated hemp products caused the Ontario cannabis regulator to issue a warning to retailers.

The Ontario Alcohol and Gaming Commission warned pot shops Monday that it has uncovered cases of retailers selling products that violate their licensing terms in a letter received from The Canadian Press.

“AGCO has learned that some cannabis licensees are offering and selling cannabis-based products such as lotions, edibles, topicals, etc. that were not purchased from the Ontario Cannabis Store (OCS),” the regulator wrote in the letter.

The OCS is the provincial pot distributor for Ontario.

“We have also noticed that some retailers offer and sell cannabis-based products in different packaging than the original OCS packaging.”

Ontario’s licensed cannabis stores are only allowed to sell cannabis and hemp products purchased from the OCS and must keep items in their original packaging.

Hemp products contain small amounts or traces of THC, the active ingredient in marijuana.

AGCO spokesman Raymond Kahnert said in an email that the news was triggered by compliance officials who became aware that hemp products are on sale in two cannabis stores in the southwestern province.

AGCO regards hemp-derived items such as lotions and oils as cannabis products that retailers must purchase from the OCS.

The products uncovered by the compliance officers were not bought from the OCS and both dealers immediately stopped selling the items after discussions, said Kahnert.

Jennawae McLean, co-founder of Kingston, Ontario. Cannabis retail chain Calyx + Trichomes said it had to “get its jaw off the ground” when AGCO’s letter was mailed to cannabis store owners.

She has never heard or seen of a licensed cannabis store selling unregulated goods.

“I am completely shocked that anyone would do any of these things so boldly,” she said.

“That’s pretty bold, openly violating laws and regulations, and endangering your existence. It’s completely bananas. ”

Although she is unaware of the circumstances surrounding the unregulated goods, she said the market for the illegal products that AGCO warned about is small and unlikely to make a lot of money for the perpetrators.

Between July and September, the OCS website and licensed pot shops sold approximately $ 2.4 million in topicals and $ 18 million in edibles, a marked difference from $ 206 million in dried flower sales in the same Period.

McLean was also disappointed that licensed stores had offered unregulated and repackaged goods, believing these actions ignored the long and arduous struggle that cannabis advocates were waging to legalize the substance in the first place.

“It is borderline insulting that someone should undermine the regulatory framework we have worked so hard on,” she said.

“But on the other hand, I feel sorry for them because it could be an act of desperation as the shopkeepers fight for competition.”