Understanding the Inspection Processes

As part of running a Health Canada, provincial, and municipally licensed cannabis retail store (CRS), inspections are completed pre-license, and at various points throughout the process of opening and running a legal CRS.
Owners and managers should be prepared for inspections at any point, as Health Canada, and its provincial representatives can turn up unannounced to ensure compliance in every aspect of running a legal CRS.
TechPOS has dug into what Cannabis Retail Store owners and managers need to know about inspections, and the processes that surround them, in order to ensure that retail stores not only meet, but exceed the regulations set forth by The Cannabis Act, and their provincial and local jurisdictions.

Understanding Regulations for Cannabis Retail Stores
The Cannabis Act generally gave responsibility to the provinces and individual municipalities to implement Cannabis Retail Stores within their jurisdiction, although all CRS’ have obligations to fulfill to the federal government and Health Canada.
Some parts of the operations of CRS will be federally regulated, with various Standard Operating Procedures (SOPs), reporting requirements, and facility requirements being blanket requirements for Canadian CRS’ per The Cannabis Act.
Other parts are provincially regulated, which means that each province has its rules, regulations, and requirements for how a cannabis retail store should be run, maintained, and accountable to the province.
Of course, each municipality also has its own requirements in terms of zoning, facility requirements (i.e. methods to control smell), and ways they engage with the local community.
It’s extremely important that owners and managers keep the three levels of government in mind at all times when carrying out their operations and be knowledgeable about the types of inspections, and by who, they should expect as retailers.

The Role of Inspectors
Inspectors are designated by the country and the province to carry out the duties of inspection under The Cannabis Act. For these roles, Health Canada has been involved in hiring a number of Regional Regulatory Compliance and Enforcement officers across Canada.
The enforcement officers that Health Canada hires will be involved in a wide range of activities, including providing scientific, regulatory and technical guidance to stakeholders, and will also focus on policing promotional activities.

Types of Inspections
The types of inspections and the frequency to which they occur depends on both the province and the municipality that the CRS is operating in, but across Canada, the following inspections should be prepared for:
Pre-License Inspection
When the Cannabis Retail Store has completed some initial crucial steps in building its infrastructure, including ensuring the security system is built and most operations are up and running, a Pre-License Inspection will occur that will examine the following things. Note, this is not an exhaustive list:

• The exterior of the Cannabis Retail store, including the security system;
• The interior of the store, including all in-store security measures;
• The cannabis storage room;
• Your Standard Operating Procedures (SOPs) for security, examining anything from how you call up your cameras, to how your store undergoes a complete lock-down;
• Quality Assurance protocols;
• Staff Training protocols and training programs;
• The way you intend to display products so that they are not visible from the outside of the store;
• Description of Store Management across CRS locations

Once your store has demonstrated readiness for your Pre-License Inspection, Health Canada can show up any time, unannounced, and will expect that you are running within your early conceptualized SOPs as you work towards the opening.
Owners and managers are not to interfere with the work of inspectors and must be able to produce records that officers may take away from the store that the store can have back. Owners and managers must allow the compliance officer to take photographs of your store and they also cannot refuse to answer questions or provide false or misleading information.
During this time, owners and managers can take the opportunity to ask any questions of the compliance officer about operations and the legal sale of cannabis to ensure complete understanding and readiness for their next inspection.
Following the inspection, the CRS has the opportunity to fill any gaps that were identified in the Pre-License Inspection in order to improve and adequately prepare for the opening.

Pre-Store Opening Inspection
Once the CRS is nearing opening, a Pre-Store Opening inspection will also occur to ensure that the store meets all the regulatory requirements for sales of cannabis under The Cannabis Act.
During the Pre-Store Opening Inspection, the compliance officer will inspect the following aspects of the Cannabis Retail Store, including, but not limited to:

• • Exterior store signage: Ensuring that it meets the requirements and restrictions of The Cannabis Act and provincial requirements. Store signage and any advertisements must not:
    • Appeal to or target persons under 19 years of age;
    • Promote cannabis or cannabis accessories in a way that is false, misleading or deceptive;
    • Suggest or imply, directly, indirectly, or by use of endorsements of testimonials, that consumption of cannabis is associated with success, enjoyment of an activity, fulfillment of a goal, or the resolution of a problem;
    • Be associated with medicine, health, or pharmaceuticals;
    • Depict or suggest the illegal sale of cannabis
    • Associate consumption of cannabis with driving a motorized vehicle, or with any activity that requires care and skill or has elements of danger
  • Interior store signage: cannabis and cannabis accessories can be promoted, but must be limited to factual information about cannabis or a cannabis accessory and its characteristics, a service related to cannabis, or the availability and the price of cannabis, cannabis accessories, or a service related to cannabis. The promotion must be focused on brand characteristics or cannabis or cannabis accessories;
  • Storage: Demonstrating and ensuring that all products are stored securely at all times and only be available to staff from the time the product arrives at the store to point of sale, destruction, or return to the provincial retailer or Licensed Producer;
  • Products: Ensuring that you’re prohibiting the sales of illegal cannabis in the CRS, limiting the acquisition of legal product to the authorized provincial retailer or Licensed Producer;
  • Staff: Being able to demonstrate that all staff are over the age of 19 and have acquired the necessary provincial licenses and training to sell cannabis in the province under The Cannabis Act;
  • Unauthorized Access: Demonstrated measures to ensure that patrons who look under the age of 25 are not permitted in the store without ID and that all sales are strictly prohibited to those under the age of 19 (or 18 in Quebec and Alberta);
  • Records Keeping: Those in charge must retain and be able to produce records on the following aspects of the operations:
    • Employee records, including names, addresses, primary job responsibilities, shift schedules, training records, CPIC records check results, and dates of employment;
    • Records for all cannabis in the authorized store, including cannabis purchased directly from the authorized provincial retailer or Licensed Producer, and cannabis transferred from another authorized retail store operated by the Licensed Operator;
    • Records required to enable the licensee to participate in any national cannabis tracking system established under section 81 of The Cannabis Act;
    • Records that may be required to support a cannabis product recall;
    • Records demonstrating that the Licensee is complying with sections 7 and 8 of the Cannabis Control Act, 2017, which prohibit sales to persons under 19 years of age and persons who are or appear to be intoxicated.
    • Monthly Federal Reports and Monthly Sales Reports

Note that this is not an exhaustive list and you must check with your provincial regulatory body to understand the full requirements of the Pre-Store Opening Inspection. A system like TechPOS can help you streamline all your operations so that you have this information stored in one place, and organized in a way that you can demonstrate full compliance for retail sales under The Cannabis Act.

Ongoing Inspections
Once the Cannabis Retail Store is open and operational, the owners and managers can expect inspections at any time. During any inspection, according to Section 86, Subsection 2 of The Cannabis Act, an inspector has the right to:

• Open and examine any receptacle or package found in the CRS;
• Examine anything found in the CRS that is used or may be capable of being used for the production, preservation, packaging, labeling or storage of cannabis;
• Examine any record, report, electronic data or other document, or any label or promotional material, found in the CRS with respect to cannabis, other than the records of the medical condition of individuals, and make copies of them or take extracts from them;/li>
• Use or cause to be used any computer system at the place to examine any electronic data referred to in the above paragraph;
• Reproduce any document from any electronic data referred to in this subsection, or cause it to be reproduced, in the form of a printout or other output;
• Take the record, report or other document, or the label or promotional material, referred to in this subsection or the printout or other output referred to in the above paragraph for examination or copying;
• Ise or cause to be used any copying equipment at the place to make copies of any document;
• Take photographs and make recordings and sketches;
• Examine any substance found in the CRS and take, for the purpose of analysis, any samples of it;
• Seize and detain in accordance with this Part, cannabis or any other thing found in the CRS that the inspector believes on reasonable grounds is something in relation to which The Cannabis Act was contravened or is something the seizure and detention of which is necessary to prevent non-compliance with the provisions of The Cannabis Act or of the regulations;
• Order the owner or person having possession of cannabis or any other thing to which the provisions of The Cannabis Act or of the regulations apply that is found in that place to move it or, for any time that may be necessary, not to move it or to restrict its movement;
• Order the owner or person having possession of any conveyance that is found in the CRS and that the inspector believes on reasonable grounds contains cannabis to stop the conveyance, to move it or, for any time that may be necessary, not to move it or to restrict its movement;
• Order any person in that place to establish their identity to the inspector’s satisfaction; and
• Order a person that, at that place, conducts an activity to which the provisions of The Cannabis Act or of the regulations apply to stop or start the activity.
• What to Expect and How to Be Prepared
  While Cannabis Retail Stores must abide by the regulations put forth by their province and municipality as well as The Cannabis Act, here is a checklist to ensure you’re ready for your inspections:

• • • • Use a Cannabis POS and Store Management System like TechPOS to help streamline your operations, records, employees, and sales to make compliance automated, easy to use, and easily demonstrable to compliance officers;
      • Fully read, and understand the regulations of The Cannabis Act as it pertains to cannabis in general, and especially the regulations around the sale of legal cannabis;
      • Adequately train and prepare staff on the regulations of The Cannabis Act and what is to be expected during inspections;
      • Prepare and update all records to ensure full compliance with The Cannabis Act and all provincial and municipal regulations;
      • Ensure all products remain labeled, packaged, and secured, and remain out of sight from the outside of the store;
      • Ensure all records contained within your POS system are easily accessible and that all records can be explained or demonstrated to a compliance officer if requested;
      • Test and ensure all security and video surveillance equipment is updated and in full working order;
      • Maintain compliant promotions in accordance with The Cannabis Act in regards to external and internal signage and marketing;
      • Ensure your environment is open and welcoming to compliance officers.

The sale of legal cannabis in Canada is a privilege, with licensing being restricted only to those who meet the provisions of The Cannabis Act.
Whether it’s opening day or scaling for multiple locations, TechPOS (Cannabis POS) software solutions for Cannabis retail is here to streamline your cannabis store operations so that headache of managing your cannabis store is reduced. Our reliable software and digital solutions are built to make complex operations simple, streamline your workflows, and grow your business with our Cannabis POS products.
We are compliant with The Cannabis Act and exist to help store owners and managers ensure all operations are running smoothly, and total compliance can be demonstrated to compliance officers during a Pre-Licensing Inspection, Pre-Store Opening Inspection, or Ongoing Inspections.

Contact us today to discuss how we can help you build an infrastructure that keeps you on top of all the regulatory requirements for selling cannabis under The Cannabis Act.