It's no surprise that Ontario's cannabis market has been a bright spot where private recreational stores are thriving. In fact, reports show the province saw a significant boost in cannabis sales from the physical store rollout in April. Initially capped at 25, Ontario's government last week announced its plans to accept the second allocation of cannabis retail store authorizations this fall – 50 to be exact – by amending the Ontario Regulation 468/18.So what does the amendment mean? The new regulation overrides the first lottery process initialized by the AGCO in January 2019 to not only lift store allocation limits but also implement pre-qualification controls for interested lottery participants. Also, those on the waitlist from the previous lottery process are eligible to apply.
How to Apply for a Cannabis Retail License in the AGCO Lottery
Now that the AGCO is open for business, it's time to get to work. If you are interested in opening a cannabis dispensary in Ontario, keep reading for a quick overview of what you should know about the upcoming AGCO lottery.
How many operator licenses and store authorizations will be awarded?
In the next licensing round, 50 operator licenses and store authorizations will be awarded across Ontario, divided across 5 regions and First Nation land. 42 will be allocated to the following areas: (7) East, (6) GTA, (13) Toronto, (11) West with the North Region having (5) specific cities to allocate to. The remaining eight (8) store locations are to be allocated on First Nation land.
What pre-qualification criteria do lottery applicants need to meet?
If you've decided that you have a future in Ontario's burgeoning cannabis retail market, first you'll have to participate in the AGCO's lottery process to win a license. The following are must-haves to pre-qualify.
- Confirmation from a bank or credit union that the applicant has the financial capacity to obtain $250,000 in Cash or Cash Equivalents (e.g. bonds, other short-term investments)
- Confirmation from a bank or credit union that the applicant can obtain a Standby Letter of Credit for $50,000 within five business days of being notified of their selection by the Registrar
- Confirmation that the applicant has secured a suitable retail space, including its address, which will be available to them for operating a cannabis retail store no later than October 2019
What is the AGCO's timeline for the second allocation of cannabis retail store authorizations?
These are exciting times in Ontario. With all that you need to remember it's imperative that you keep you up with the process and important deadlines. The AGCO shared the following critical dates for lottery applicants to remember.
- To participate in the lottery, applicants must submit an expression of interest between August 7, 2019, at 12:01 a.m. and August 9 at 8:00 p.m.
- The draw will take place on August 20, 2019, and the AGCO intends to publish the results of the lottery, including the selected store locations, on its website within 24 hours of the lottery draw
Separate from the lottery process, on July 31, 2019, at 9:00 a.m., the AGCO will begin accepting applications from any applicant who has received Band Council approval to operate a store on its First Nations reserve. Eight such store authorizations will be available on a first-come, first-served basis.
When will the second wave of cannabis retail stores open in the province?
Once you've received a license, you'll have to move fast. According to the AGCO timeline, it is anticipated that stores will begin to open in October 2019, as they become ready. If selected, you'll need to find a cannabis retail POS partner you can rely on, and Cova has a proven track record. In fact, Cova helped 22 Ontario cannabis retailers launch their store in time, avoiding hefty fines.
As a result of our significant market share, Cova has gained recognition as the standard for cannabis retail. That said, we are well established to partner with the growing success of the next generation of cannabis retailers. Request a demo today!