Ontario Cannabis Retail Corporation Act, 2017, S.O. 2017, c. 26, Sched. 2

Ontario Cannabis Retail Corporation Act, 2017

S.o. 2017, chapter 26
Schedule 2

Historical version for the period December 12, 2017 to October 16, 2018.

Last amendment: 2017, c. 26, Sched. 2, s. 30.

Legislative History: 2017, c. 26, Sched. 2, s. 30.

CONTENTS

 

General

Interpretation

1 In this Act,

“cannabis” has the same meaning as in the Cannabis Act, 2017; (“cannabis”)

“Corporation” means the Ontario Cannabis Retail Corporation established under section 3; (“Société”)

“LCBO” means the Liquor Control Board of Ontario continued under section 2 of the Liquor Control Act; (“Régie des alcools”)

“Minister” means the Minister of Finance or such other member of the Executive Council as may be assigned the administration of this Act under the Executive Council Act; (“ministre”)

“prescribed” means prescribed by the regulations; (“prescrit”)

“regulations” means the regulations under this Act; (“règlements”)

“sell” includes offer for sale, expose for sale and have in possession for sale. (“vente”)

Note: Section 2 comes into force on October 17, 2018, the day subsection 6 (1) of Schedule 1 (Cannabis Act, 2017) to the Cannabis, Smoke-Free Ontario and Road Safety Statute Law Amendment Act, 2017 comes into force.

Exclusive right to sell cannabis

2 (1) The Corporation has the exclusive right to sell cannabis in Ontario.

Exceptions

(2) Subsection (1) does not apply with respect to sales of cannabis,

(a) for medical purposes in accordance with applicable federal law;

(b) to the Corporation in accordance with applicable federal law; or

(c) by such persons or in such circumstances as may be prescribed.

Establishment, Objects, Powers, etc.

Corporation established

3 (1) A corporation without share capital is established under the name Ontario Cannabis Retail Corporation in English and Société ontarienne de vente du cannabis in French.

Name of Corporation

(2) The name of the Corporation may be changed by regulation.

Composition

(3) The Corporation is composed of the members of its board of directors.

Same

(4) A person ceases to be a member of the Corporation when he or she ceases to be a director.

Objects

4 The Corporation’s objects are,

(a) to buy, possess and sell cannabis and related products;

(b) subject to the regulations, to determine the varieties, forms or types of cannabis and related products it sells and at what prices;

(c) to promote social responsibility in connection with cannabis; and

(d) to engage in such other activities as may be prescribed by regulation or assigned to the Corporation under this or any other Act.

Powers

5 (1) Except as limited by this Act and the regulations, the Corporation has the capacity, rights, powers and privileges of a natural person for carrying out its objects.

Subsidiaries

(2) The Corporation shall not create or acquire a subsidiary.

Limitation, acquisition of real property

(3) The Corporation shall not purchase real property that meets the prescribed criteria without the written approval of the Minister and, if the Minister is not the Minister of Finance, the Minister of Finance.

Terms

(4) An approval under subsection (3) may be subject to such terms as are considered advisable by the Minister and, if the Minister is not the Minister of Finance, the Minister of Finance.

Crown agent

6 The Corporation is an agent of the Crown in right of Ontario for all purposes.

French Language Services Act

7 The Corporation is deemed to be a government agency for the purposes of the French Language Services Act.

Board of directors

8 (1) The board of directors shall manage or supervise the management of the Corporation’s affairs.

Delegation

(2) The board of directors may delegate to a committee of the board or to an officer or employee of the Corporation any of the board’s powers other than the power to,

(a) approve the Corporation’s budget, including the budget for capital expenditures and staffing;

(b) approve the Corporation’s business plan, annual report and financial statements;

(c) appoint, remove and set the remuneration of the president and chief operating officer;

(d) establish committees of the board of directors and fill vacancies on those committees;

(e) make, amend or repeal by-laws; or

(f) do any other thing that may be prescribed.

Further delegation

(3) The board of directors may authorize that powers delegated to an officer or employee of the Corporation may be further delegated to an employee of the Corporation on such terms as the board of directors may specify.

Composition, etc.

9 (1) The board of directors shall consist of at least three and not more than seven members appointed by the LCBO, subject to the approval of the Minister.

Terms of office

(2) The members of the board of directors shall be appointed for a term not exceeding five years and may be reappointed for further terms not exceeding five years each.

Eligibility of LCBO member

(3) An individual who is a member of the LCBO,

(a) is eligible to be appointed as a member of the Corporation’s board of directors; and

(b) if so appointed, does not have a conflict of interest by virtue only of the fact that he or she is also a member of the LCBO.

Eligibility of other members

(4) An individual who is not a member of the LCBO is disqualified from being a member of the Corporation’s board of directors if the individual,

(a) is an officer or employee of the Corporation or of the LCBO;

(b) is less than 19 years of age;

(c) has been found under the Substitute Decisions Act, 1992 or under the Mental Health Act to be incapable of managing property or has been found to be incapable by a court in Canada or elsewhere;

(d) has the status of bankrupt; or

(e)   has been convicted of fraud or a similar offence by any court in Canada or elsewhere.

Deemed public servants

(5) If the Corporation is prescribed as a public body under the Public Service of Ontario Act, 2006, each member of the board of directors is deemed to be a public servant for the purposes of sections 5 and 6 and Parts IV, V and VI of that Act.

Chair

(6) The LCBO shall designate a chair from among the members of the board of directors, subject to the approval of the Minister.

Vice-chair

(7) The board of directors shall designate a vice-chair from among its members.

Acting chair

(8) If the chair is absent or unable to act, or if the office of the chair is vacant, the vice-chair shall act as chair.

Same

(9) If the chair and vice-chair are absent, the members present shall appoint an acting chair from among themselves.

Quorum

(10) A majority of the members constitutes a quorum of the board of directors.

Remuneration

(11) The members of the board of directors shall be paid the remuneration fixed by resolution of the LCBO, subject to the approval of the Minister.

Ceasing to hold office

(12) A member of the board of directors ceases to hold office on the earliest of the following dates:

1. The date on which he or she dies.

2. The date on which he or she resigns.

3. The date on which the Minister approves a recommendation from the LCBO that the member be removed.

4. In the case of a member who was a member of the LCBO when he or she was appointed, the date on which he or she ceases to be a member of the LCBO.

5. In the case of a member who was not a member of the LCBO when he or she was appointed, the earlier of,

i. the date on which his or her term of office expires, or

ii. the date on which he or she is disqualified under subsection (4).

Effective date of resignation

(13) The resignation of a member of the board of directors becomes effective at the time the Corporation receives the resignation or at the time specified in the resignation, whichever is later.

Publication — names, remuneration, terms of board members

(14) The Corporation shall publish on its website the name of each member of the board of directors, the member’s rate of remuneration and the start date and term of the board member’s appointment.

Memorandum of understanding

10 (1) The Corporation shall enter into a memorandum of understanding with the LCBO.

Compliance

(2) The Corporation shall comply with the memorandum of understanding, but the failure to do so does not affect the validity of any action taken by the Corporation or give rise in any person to any rights or remedies.

Copy to Minister, availability to public

(3) The Corporation shall provide the memorandum of understanding to the Minister and make it available to the public by posting it on the Corporation’s website and by any other manner as the Corporation considers appropriate.

By-laws

11 (1) The board of directors may by resolution make, amend or repeal any by-law governing its proceedings and generally for the conduct and management of the Corporation’s affairs.

Approval by LCBO

(2) If the memorandum of understanding mentioned in subsection 10 (1) requires that specified by-laws of the Corporation must be approved by the LCBO, the board of directors shall submit the specified by-laws to the LCBO for the LCBO’s consideration.

Financial by-laws

(3) The Corporation shall not make, amend or repeal a by-law relating to borrowing, investing or managing financial risks unless the by-law, amendment or repeal has been approved by resolution of the LCBO, by the Minister and, if the Minister is not the Minister of Finance, by the Minister of Finance.

Effective date of by-laws

(4) A by-law, an amendment to a by-law or the repeal of a by-law is effective from,

(a) in the case of a by-law referred to in subsection (2), the later of the date of the LCBO resolution approving the proposed by-law or the date specified in the by-law itself;

(b) in the case of a by-law referred to in subsection (3), the later of the date the by-law has received the required approval or such date as may be specified in the by-law itself; and

(c) in the case of any other by-law, the date specified in the by-law itself.

President and chief operating officer

12 (1) The Corporation shall appoint an individual who has been approved by the LCBO to serve as the Corporation’s president and chief operating officer.

Initial appointment by LCBO

(2) Despite subsection (1), promptly after the Corporation is established under subsection 3 (1), the LCBO shall appoint the first president and chief operating officer.

Eligibility for reappointment

(3) The individual appointed under subsection (2) is eligible to be reappointed.

Status as officer

(4) The president and chief operating officer is an officer of the Corporation and not a member of its board of directors.

Responsibilities

(5) The president and chief operating officer is responsible for the operation of the Corporation, subject to the supervision and direction of the board of directors, and for such other functions as the board of directors may assign.

Attend meetings

(6) The president and chief operating officer may attend and participate at any meeting of the board of directors but shall not have a vote with respect to any matter to be decided at the meeting.

Exception

(7) Despite subsection (6), the board of directors may exclude the president and chief operating officer from attending any meeting if a matter to be discussed at the meeting involves the position, performance or functions and duties of the president and chief operating officer.

Application of certain Acts

13 (1) Sections 21 (contract prior to corporate existence) and 132 (conflict of interest), subsections 134 (1) and (3) (standards of care, etc., of directors, etc.), section 136 (indemnification) and any prescribed provisions of the Business Corporations Act apply, with necessary modifications and any prescribed modifications, to the Corporation and its directors and officers.

Same

(2) The Corporations Act and the Corporations Information Act do not apply to the Corporation.

Note: On the day subsection 4 (1) of the Not-for-Profit Corporations Act, 2010 comes into force, subsection 13 (2) of the Act is amended by striking out “The Corporations Act” at the beginning and substituting “The Not-for-Profit Corporations Act, 2010”. (See: 2017, c. 26, Sched. 2, s. 30)

Section Amendments with date in force  (d/m/y)

2017, c. 26, Sched. 2, s. 30 - not in force

Staff

14 (1) The Corporation may appoint such officers and employees and retain such assistance as is considered necessary and may, subject to the approval of the Lieutenant Governor in Council, establish job categories, salary ranges and conditions of employment.

Approval by Minister

(2) Despite subsection (1), job categories, salary ranges and conditions of employment of officers and employees appointed by the Corporation who are not members of a bargaining unit, as defined in the Labour Relations Act, 1995, must be approved by the Minister and not by the Lieutenant Governor in Council.

Agreements with LCBO

15 (1) For greater certainty, the Corporation may enter into written agreements with the LCBO providing that the LCBO, or any of its officers or employees, will provide services, advice, assistance, goods or other property to the Corporation.

Personal information

(2) The Corporation shall take reasonable measures to ensure that any personal information it collects and maintains in connection with its activities is not collected, used or disclosed by the LCBO except for the purpose of providing services under an agreement described in subsection (1) or as otherwise authorized by law.

Same, information technology services

(3) If an agreement described in subsection (1) relates to information technology services or the storing of information collected and maintained by the Corporation, the Corporation shall take reasonable measures to ensure that any of its information that includes personal information is maintained separately from any other information maintained by the LCBO.

Limitation re personal information

(4) The Corporation shall not, under an agreement described in subsection (1), give the LCBO access to personal information it collects and maintains unless such access is reasonably necessary for the LCBO to provide services under the agreement.

Interpretation, “personal information”

(5) In this section,

“personal information” has the same meaning as in the Freedom of Information and Protection of Privacy Act.

Note: Section 16 comes into force on a day to be named by proclamation of the Lieutenant Governor.

Agreements with agents

16 (1) If the Minister authorizes the Corporation in writing to do so, the Corporation may enter into an agreement with a person or entity under which the person or entity may possess and sell cannabis and related products as an agent of the Corporation, subject to such terms as the Corporation may specify in the agreement.

Same

(2) If the Corporation has entered into an agreement described in subsection (1), the agent may possess and sell cannabis and related products on behalf of the Corporation, subject to such limitations, conditions and requirements as may be prescribed.

Immunity of employees and others

17 (1) No cause of action arises against,

(a) a director, officer or employee of the Corporation as a result of any act done in good faith in the performance or intended performance of his or her duties or any alleged neglect or default in the performance in good faith of his or her duties;

(b) the Crown, a minister of the Crown or an employee of the Crown as a result of any act or omission of a person who is not a minister of the Crown or a Crown employee, if the act or omission is related, directly or indirectly, to the Corporation’s affairs or to the administration of this Act; or

(c) the LCBO or a member, officer or employee of the LCBO as a result of any act or omission of a person who is not a member, officer or employee of the LCBO, if the act or omission is related, directly or indirectly, to the Corporation’s affairs or to the administration of this Act.

No proceeding

(2) No proceeding, including but not limited to a proceeding for a remedy in contract, restitution, tort or trust, shall be instituted against,

(a) a director, officer or employee of the Corporation by a person who has suffered any damages, injury or other loss based on or related to any cause of action described in clause (1) (a);

(b) the Crown, a minister of the Crown or an employee of the Crown by a person who has suffered any damages, injury or other loss based on or related to any cause of action described in clause (1) (b); or

(c) the LCBO or a member, officer or employee of the LCBO by a person who has suffered any damages, injury or other loss based on or related to any cause of action described in clause (1) (c).

Liability of Corporation preserved

(3) Subsections (1) and (2) do not relieve the Corporation of any liability to which it would otherwise be subject.

Financial Matters

Revenues not part of Consolidated Revenue Fund

18 (1) Despite Part I of the Financial Administration Act, the revenue and assets of the Corporation do not form part of the Consolidated Revenue Fund.

Same

(2) The revenue of the Corporation shall be applied to carrying out its objects.

Payments into Consolidated Revenue Fund

19 The Corporation’s net profits shall be determined and paid into the Consolidated Revenue Fund at such times and in such manner as the Lieutenant Governor in Council may direct.

Unpaid judgments against the Corporation

20 The Minister of Finance shall pay from the Consolidated Revenue Fund the amount of any judgment against the Corporation that remains unpaid after the Corporation has made reasonable efforts, including liquidating its assets, to pay the amount of the judgment.

Major capital expenditures

21 (1) If the Corporation proposes to undertake a major capital expenditure, it shall borrow the necessary funds.

Same

(2) An expenditure is a major capital expenditure for the purposes of this section in either of the following circumstances:

1. It satisfies the criteria prescribed by regulation.

2. If the Minister notifies the Corporation in writing that the expenditure is a major capital expenditure for the purposes of this section.

Loans, etc., to the Corporation

22 (1) The Lieutenant Governor in Council may, by order, authorize the Minister of Finance to purchase securities of, or make loans to, the Corporation in the amounts, at the times and on the terms determined by the Minister, subject to the maximum principal amount specified by the Lieutenant Governor in Council that may be purchased or advanced or that may be outstanding at any time.

Same

(2) The Minister of Finance may pay out of the Consolidated Revenue Fund any amount required for the purposes of subsection (1).

Delegation of Minister’s authority

(3) The Lieutenant Governor in Council may, by order, delegate all or part of the authority of the Minister of Finance under subsection (1) to a public servant who works in the Ministry of Finance, other than in the office of the Minister, or who works in the Ontario Financing Authority.

Fiscal year

23 The Corporation’s fiscal year begins on April 1 in each year and ends on March 31 in the following year.

Audits

24 The accounts and financial transactions of the Corporation shall be audited annually by the Auditor General.

Annual report

25 (1) The Corporation shall prepare an annual report, provide it to the LCBO and the Minister and make it available to the public by posting it on the Corporation’s website and by any other manner as the Corporation considers appropriate.

Content

(2) The Corporation shall include in the annual report,

(a) a report on the Corporation’s affairs;

(b) the Corporation’s audited financial statements; and

(c) such additional content as the LCBO may require.

Other reports

26 The Corporation shall promptly give the LCBO such other reports and information as the LCBO may request.

Miscellaneous

Restrictions on corporate operations, applicable federal law

27 The Corporation,

(a) shall not sell cannabis unless the cannabis has been produced by a person who holds a licence under applicable federal law to produce cannabis for commercial purposes;

(b) shall not sell cannabis to a person under 19 years of age;

(c) shall keep appropriate records, in accordance with the regulations, respecting its activities in relation to cannabis that it possesses;

(d) shall take adequate measures, in accordance with the regulations, to reduce the risk of cannabis it possesses being diverted to an illicit market or activity.

Agreement with council of the band

28 (1) In this section and section 29,

“council of the band” has the same meaning as in subsection 2 (1) of the Indian Act (Canada); (“conseil de la bande”)

“Indian” has the same meaning as in subsection 2 (1) of the Indian Act (Canada); (“Indien”)

“reserve” means a reserve as defined in subsection 2 (1) of the Indian Act (Canada) or an Indian settlement located on Crown land, the Indian inhabitants of which are treated by Indigenous and Northern Affairs Canada in the same manner as Indians residing on a reserve. (“réserve”)

Same

(2) Subject to the approval of the Lieutenant Governor in Council, the Minister and, if the Minister is not the Minister of Finance, the Minister of Finance, may, on behalf of the Crown, enter into arrangements and agreements with a council of the band with respect to cannabis that is sold and delivered to a purchaser on a reserve.

Regulations

29 (1) The Lieutenant Governor in Council may make regulations,

(a) respecting anything that, under this Act, may or must be prescribed, done or provided for by regulation;

(b) governing the sale of cannabis, including the operation of stores;

(c) respecting varieties, forms and types of cannabis and related products that may and may not be sold by the Corporation;

(d) prescribing reserves to which the Corporation may not deliver cannabis or related products;

(e) respecting the Corporation’s determination of prices at which it sells cannabis and related products;

(f) governing packaging to be used for containing cannabis and related products sold by the Corporation;

(g) governing information to be provided or disseminated by the Corporation and the manner of providing or disseminating it;

(h) governing records to be kept by the Corporation;

(i) requiring the Corporation to take measures to reduce the risk that cannabis under its control is not diverted to an illicit market or activity, and prescribing those measures;

(j) governing such transitional matters as the Lieutenant Governor in Council considers necessary or advisable to facilitate the implementation of this Act or to respond to changes in applicable federal law.

Same

(2) A regulation under clause (1) (d) shall contain a description of any request made by a council of the band that a regulation be made under that clause with respect to a reserve.

30 Omitted (provides for amendments to this Act).

31 Omitted (amends, repeals or revokes other legislation).

32 Omitted (provides for coming into force of provisions of this Act).

33 Omitted (enacts short title of this Act).

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