Cannabis Micro-Cultivation License Requirements

Cannabis Micro-Cultivation License Requirements

In Bill C-45, the Canadian federal government inserted provisions allowing for the establishment of ‘micro-cultivators’. Like microbreweries, small or independently-owned businesses can legally grow marijuana as a “craft” product. 

The idea behind micro-cultivation is to help boost the supply of marijuana in the market, draw on the more innovative capacities of smaller producers, and lower barriers-to-entry to the marijuana market (i.e., lower the incentive to distribute in the black market and encourage competition). 

By applying for a micro-processing license, micro-cultivators can package or process up to 600 kg a year in marijuana goods as well. However, micro-cultivators can only sell their products to businesses licensed (under provincial or territorial laws) to sell marijuana to consumers.

As you can see, while the requirements to get a micro-cultivation license are less onerous than a standard one, it is also more restrictive in a number of areas.

Cannabis Micro-Cultivation License versus Standard Licenses

Cannabis Micro-Cultivation

Plant Surface Area

The plant surface grown by micro-cultivators must not exceed 200m2 (2,152 ft2). This growth restriction includes vertically stacked or arranged surfaces. There are no growth restrictions for standard license holders. However, both can cultivate indoors and/or outdoors.

Licensing Rules

Micro-cultivators are only permitted to have one license per unique address. However, larger facilities spanning multiple address areas could have a license attached to each facility (e.g., production site, warehouse, etc). 

Distribution Rules

Micro-cultivators may only sell their products to the following:

  • Third-party marijuana dispensaries/retailers
  • Provincial distributors (but only for fresh or live plants and seeds)
  • Those licensed to process marijuana goods
  • Medical patients (provided they have a document from a healthcare practitioner)

Licensing Requirements

Yes, a micro-cultivation license is easier to acquire than a standard license, but that doesn’t mean the process is easy or trivial in of itself. Similar to marijuana dispensaries and pre-Bill C-45 medical marijuana producers, Health Canada has stringent rules for micro-cultivators.

In your application to Health Canada, you must provide complete details about your proposed cultivation facility. These details include the floor plan, site location, physical security plan, risk management strategies, corporate structure, and other information.   

The Security Requirements for a Canada Micro-Cultivation License

As with marijuana dispensaries and large marijuana producers, security is a critical component of gaining and maintaining your micro-cultivation license in Canada. 

Compared to standard license holders, micro-cultivation license holders do have fewer security requirements. For example, micro-cultivators aren’t required to have 24/7 visual monitoring and intrusion detection systems. However, there are other physical security requirements:

Site Design & Physical Barriers

Micro-cultivators must provide Health Canada with a site design showing how they will prevent any and all unauthorized access to your production facilities.

To achieve this requirement, you must show plans for a physical barrier covering the perimeter of your facility. Health Canada wants to see how you will implement that barrier. You must also highlight all entry and exit points, including doors, windows, vents, etc.

Like the overall facility, your operations and storage areas must also have physical barriers (with the above-noted information provided to Health Canada). 

Access Controls

You must also restrict access to your storage areas with access control systems.

This means placing secure locks on the doors to the areas where you’re storing marijuana products and, in turn, limiting access to only vetted staff. 

Health Canada requires information on the following: “details on the types, specifications, and locations of access control mechanisms installed and operating clearly marked and labelled with unique identifiers on security floor plans.”

Best Practices For Micro-Cultivators: Visual Monitoring & Intrusion Detection

Micro-Cultivation License in Canada

Although micro-cultivators are not required to have the following security systems in place, they are industry best practices. Ultimately, micro-cultivation is an inherently resource-intensive and time-consuming investment, it deserves the maximum possible protection. 

Thus, we recommend that you install the following optional security systems. 

Visual Monitoring

With a CCTV system, you can monitor every critical area of your facility 24/7. In addition, you can also capture and save recordings, which you can provide to law-enforcement following an incident (and aid with their investigation). 

Intrusion Detection

An intrusion detection system will detect unauthorized entry or access to your facility as well as attempted tampering of your system. You can pair this with an incident response system where as soon as a break-in is detected, you can alert law-enforcement to respond. 

Although these are not currently required by Health Canada, it would be best practice for micro -cultivators to follow the rigid security requirements of standard license holders.

Firstly, while not a multi-million-dollar venture, micro-cultivation is still a massive investment in its own right. The combined cost of leasing facilities and procuring equipment could require an investment of $100,000 to $250,000 (or more). 

Secondly, with time, you will also begin storing a valuable, high-demand product, thus raising the value of what you could lose due to a breach. 

Lastly, given how marijuana legalization is new, the regulatory environment could change and, potentially, stricter security requirements could come into force later. Why not be prepared?

Cannabis Micro-Cultivation Licensing

Logixx brings over 47 years of experience to the table as a proven security systems integrator and consultant. We’ve helped the leading brands in many complex industries, including health and pharmaceuticals, keep their assets — and costly investments — secure from theft. 

Contact us today to see how we can help you meet and exceed Health Canada’s physical security requirements for micro-cultivators.