BC to launch direct delivery program on August 15

BC will be launching its direct delivery program that will allow producers to sell directly to retailers on Monday, August 15, 2022.

The BC government has said its program is focused on assisting the participation of Indigenous and small-scale producers in the legal cannabis market.

The program will include three types of direct delivery; Standard Direct Delivery, Production Retail Store (PRS) Direct Delivery, and Section 119 Direct Delivery.

Standard will be the main direct delivery model for BC cultivators producing no more than 3,000 kg of dried, unpackaged cannabis (or fresh equivalent annually). The raw materials for any products produced by a processor for direct delivery must be sourced from federally-licensed BC cultivators.

The processor or cultivator is responsible for delivery to retailers, but they can also use a third-party for transport and shipping. There is no requirement for the processor to be located in B.C. as long as the input material is from a BC cultivator.

B.C. nursery licence holders may also be eligible to participate. There is no production volume cap for nurseries and cultivators who produce only live plants and seeds.

Production Retail Store (PRS) will serve as a special category of direct delivery and is for direct delivery of cannabis products to a PRS as licensed by the Liquor and Cannabis Regulation Branch (LCRB).

According to BC, a “PRS” or “Production Retail Stores” means a provincially licensed or authorized private Cannabis retail stores operating in BC in association with Cannabis production
facilities operated by holders of federal nursery or cultivation licence. In previous messaging, BC has referred to authorizing farmgate sales through a new Production Retail Store (PRS) licence.

UPDATE (July 8): A representative for the LDB confirms that the LCRB is seeking to enable farmgate sales through a new Production Retail Store (PRS) licence, and is says they are still on target to implement this new licence class in the fall.

“Once this licence class has been implemented, the PRS direct delivery category is one of three categories that will be available under the LDB’s direct delivery program. The PRS direct delivery category will be available to processors and cultivators,” noted the representative in an email to StratCann.

Section 119 deliveries are specifically for those operating under a Section 119 agreement between the Province and an Indigenous Nation.

The 3,000 kg cultivation limit will be calculated by producers providing the province access to internal records at the province’s request. Cultivators and processors will be required to keep records of all transactions and be ready to show that all cannabis products sold and delivered under direct delivery originated from the cultivator identified with that specific product at the time of product registration with the LDB. 

Production volume will be based on calendar year for the purpose of establishing eligibility for the Standard Direct Delivery program category.

The BC LDB’s 15% markup will still apply to all sales through the direct delivery program, as well. 

There is no annual production volume cap for the PRS or Section 119 direct delivery program categories.

All participating federal licence holders will need to register with the LDB for the direct delivery program.

BC cannabis retailers who are interested in ordering products through the direct delivery cannabis model can place their orders directly with participating licensed producers. Cannabis products that are offered for sale to retailers must be registered for the direct delivery program by the processor to be eligible for direct delivery.

Producers will be responsible for establishing their ordering processes, quantities, and delivering
these orders.

Once a producer (cultivator and/or processor) and its associated product are registered
for direct delivery and is entered into a supply agreement with the LDB, products may then be registered for direct delivery.

The LDB says they expect it to take about several weeks from the time the supply agreement has
been signed and accurate product registrations are submitted to the LDB to the time they are
approved and activated for direct delivery.

More information can be found here.

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