While the United States remains locked in an impasse between state and federal law, Canada looks to pass nationwide marijuana legalization this year and begin recreational sales in 2018. How did Canada get to this point? The path to legalization in Canada has been a haphazard one, driven largely by legal decisions. To make the recent Canadian cannabis developments easier to understand, below are eight key court cases and regulations that shaped the current landscape:

1996: Controlled Drugs and Substances Act (“CDSA”)

Provided for limited exemptions for the medical use of cannabis in Section 56, but legal access to dried marijuana for medical purposes was not provided until 1999.

2000: R. v. Parker (Ontario Court of Appeals)

Section 4 of the CDSA was found to be unconstitutional because prohibiting cannabis possession forced people to choose between liberty and health. The medical marijuana exemption in place was found to be unconstitutional because of the Minister of Health’s discretionary power.

2001: Marihuana for Medical Access Regulations (“MMAR”)

R. v. Parker led to the MMAR, which enabled individuals with the practitioner authorization to access dried marijuana for medical purposes by producing their own marijuana plants, designating someone to produce for them, or purchasing Health Canada supply.

April 1, 2014: Marihuana for Medical Purposes Regulations (“MMPR”)

The MMPR replaced the MMAR, which was officially repealed on March 31, 2014. For the first time in Canada, the new system allowed for the production and distribution of cannabis for medical purposes, but still contained restrictions on certain types of marijuana.

June 2015: R. v. Smith (Supreme Court of Canada)

The Court decided the MMPR’s restrictions were unconstitutional and that individuals with a medical need have the right to use and make other cannabis products. To eliminate uncertainty, in July 2015 the Minister of Health issued section 56 class exemptions under the CDSA to allow licensed producers to produce and sell cannabis oil and fresh marijuana buds and leaves in addition to dried marijuana, and to allow authorized users to possess and alter different forms of cannabis.

February 2016: Allard v. Canada

A Canadian federal court found that restricting an individual’s right to home grow and requiring individuals to get their marijuana only from licensed producers violated liberty and security rights protected by section 7 of the Canadian Charter of Rights and Freedoms. The Court found that individuals who require marijuana for medical purposes did not have “reasonable access” under the MMPR’s restrictions. Instead of striking certain portions of the MMPR or reinstating the MMAR, the court called for a new legislative framework for accessing medical marijuana.

August 24, 2016: Access to Cannabis for Medical Purposes Regulations (“ACMPR”)

The ACMPR, similar to the MMPR, provided for commercial production and distribution of quality-controlled fresh or dried marijuana or cannabis oil or starting materials (i.e., marijuana seeds and plants) and allowed for limited production by individuals. The two types of licenses to be aware of are: (1) Dealers License, issued under the Narcotic Control Regulations and permits activities with cannabis, including analytic testing and (2) Licensed Producers who are authorized to produce and sell cannabis under the ACMPR.

April 13, 2017: The Cannabis Act, Bill C-45 (the “Cannabis Act”)

On April 13, 2017, the Cannabis Act was introduced. If passed, it will provide Canadians with legal access to recreational cannabis nationwide. On June 8, 2017, after the second reading of the bill, the Act passed the House at a vote of 200 for and 76 against. The bill has now been referred to the Standing Committee on Health. The bill is widely expected to pass Parliament and take effect in the summer of 2018.

Canada is already a worldwide leader in the growing cannabis industry, with last year’s sales reaching over one billion Canadian dollars. With the passage of the Cannabis Act, annual sales are expected to increase to between five and eight billion in the first-year post-recreational legalization. And the total estimated annual economic impact could be as high as $23 billion. Given the size of the new market, anyone with an interest in cannabis should pay special attention to Canada and the eight key events listed above.

Amber D. Lengacher also contributed to this post.

Charlie Alovisetti

Charles Alovisetti is a senior associate and co-chair of the corporate department at Vicente Sederberg LLC. Prior to joining Vicente Sederberg, Charlie worked as an associate in the New York offices of Latham & Watkins and Goodwin where he focused on representing private equity sponsors and their portfolio companies, as well as public companies, in a range of corporate transactions, including mergers, stock and asset acquisitions and divestitures, growth equity investments, venture capital investments, and debt financings. He is a graduate of McGill University and Columbia Law School. Charlie is admitted to practice in Colorado and New York.

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When people ask me what I do for a living, I usually give the simple response: “I’m a lawyer.” Which usually ends the conversation. But sometimes people will ask, “what kind of law?” My response: “marijuana.” This is when people suddenly perk up, “so what do you actually do?” No, it doesn’t mean that I smoke a joint while drafting documents. And while that sounds like fun, THC and asset purchase agreements don’t play well together.

The answer varies for each marijuana lawyer as there are several different types. But all marijuana lawyers share one thing in common–we represent marijuana businesses for a living. And that means their problems become our problems. From banking, to dealing with 280E (which is the section of the federal tax code that prevents marijuana businesses from deducting certain expenses from their income–resulting in far higher tax bills than non-marijuana businesses), to residency requirements for ownership, to the inability to access federal bankruptcy courts, there are major difficulties that marijuana businesses face. And while the underlying legal work that a marijuana lawyer does might be very similar to that done by a non-marijuana lawyer, these unique challenges often define our jobs.

Marijuana lawyers these days tend to come in two varieties: old school types who often have strong criminal law or activist backgrounds and newer arrivals who frequently come from more corporate backgrounds. I’m very much of the latter variety, having spent the six years prior to joining the marijuana industry working at large firms in New York, but I work for a law firm founded and run by lawyers with impeccable activist credentials (if you have ever benefitted from legalized marijuana you owe them a debt of gratitude–they helped write and pass Amendment 64 in Colorado, which created the first legal and regulated recreational marijuana market in the world).

I specialize in corporate and securities law, which is to say that I help marijuana businesses and investors raise capital, buy and sell assets and businesses, navigate the patchwork of ownership requirements across the US, and generally assist with any business law issue that arises. A lot of what I do is almost identical to the work of a startup lawyer in Silicon Valley–drafting contracts and negotiating deals is very similar across industries. But there are key differences. In my previous life, it was extraordinary rare for a client to lose a bank account, or have trouble opening one, and now this is a daily occurrence. And that’s just one of many unique challenges that marijuana businesses and their lawyers face.

But no matter how transactional your focus, being a marijuana lawyer necessarily implies some level of political engagement. Our clients’ businesses are subject to heavy regulation (in addition to currently being federally illegal) and that means marijuana lawyers must both stay on top of the ever-changing regulations governing our clients and continue being activists for our industry. Following cannabis news is effectively a second job for a dedicated marijuana lawyer and my colleagues and I all have a long list of podcasts, daily and weekly newsletters, and websites that we attempt to follow regularly.

Like any other lawyer focused on an industry, we need also to learn the underlying business. In this way marijuana lawyers are far more like oil and gas lawyers than, say, employee benefits or tax lawyers (examples of legal specialties where lawyers are generally agnostic as to the underlying industry–a stock incentive plan can pretty much be the same for a software, machine tools, or widgets company). Unfortunately, this means more than burning one down after work. It means being able to talk intelligently to a grower, extractor, or dispensary manager about their job and it also means keeping up to date on the latest industry trends and news. Good marijuana lawyers understand not only the laws that impact the industry, but also how marijuana is grown, how it is sold, who buys it, and what keep marijuana business owners up at night.

This is the first of a series of articles I’ll be writing for Cannabis in America alongside my colleague Kelly Rosenberg. Together we will explore the frontlines of marijuana law and policy, business, and the day to day challenges and rewards of representing cannabis businesses.

Charlie Alovisetti

Charles Alovisetti is a senior associate and co-chair of the corporate department at Vicente Sederberg LLC. Prior to joining Vicente Sederberg, Charlie worked as an associate in the New York offices of Latham & Watkins and Goodwin where he focused on representing private equity sponsors and their portfolio companies, as well as public companies, in a range of corporate transactions, including mergers, stock and asset acquisitions and divestitures, growth equity investments, venture capital investments, and debt financings. He is a graduate of McGill University and Columbia Law School. Charlie is admitted to practice in Colorado and New York.

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