Those looking to conduct finished product packaging of dried flower or manufacture and package cannabis-based products (e.g. edibles, extracts, topicals) are required to hold a Processing license. Currently under the Cannabis Regulations, there are two variations of the Processing licence; Standard Processing and Micro-Processing.
Variations of the Processing License
The Micro-Processing Licence is generally reserved for smaller manufacturers, as it only permits up to 600 kg of dried flower (or the equivalent) to be handled each year. This option is ideal for businesses that do not intend on expanding their market reach in the near future. Keep in mind, micro-processors who also have a micro-cultivation licence are permitted to process more than the 600 kg cap, given that they are processing the cannabis cultivated from their own site.
The Standard Processing licence functions much like the Micro-Processing Licence, but there is no limit on the amount of cannabis product your business can handle each year. You can manufacture, sell, and distribute an unlimited amount of cannabis with this licence. Both Standard and Micro Processing licences allow for the sale and distribution of cannabis products to other licence holders or to provincial and territorial retailers.
Prerequisites for Licenses
Regardless of which licence you choose, Standard or Micro-Processing, a prerequisite to being licensed is that a production-ready facility must be built prior to submitting a licence application to Health Canada. This requirement was announced in May 2019 and replaced the former two-step review process, which included an extensive assessment of a paper application with feedback from Health Canada, followed by submission of a site evidence package for review. The site evidence package used to be one of the final steps in proving a facility was operationally ready – but now, it is one of the first.
Deciding Between Standard Processing and Micro-Processing
When deciding between Standard Processing and Micro-Processing, it’s also important to consider the future of your cannabis business. If you know there is potential for growth and expansion, it may be wise to secure a Standard Processing Licence and proceed with operations in a phased approach, rather than pursuing a Micro-Processing licence and then having to upgrade later to a Standard Processing licence. Expanding in a phased manner could definitely save some time and effort in the future, because the amendment that will need to be submitted to Health Canada will be a simpler application than changing licence subclasses.