Pot-store-friendly city council paved way for landmark store: Company

London politicians’ overwhelming support for cannabis retailers helped influence the world’s largest marijuana company to strike a partnership to open a store in the city, a company official says.

Canopy Growth, a Smith Falls-based marijuana producer, is teaming up with Quebec’s Couche-Tard, the operator of 15,000 variety stores worldwide under the Circle K and other banners, to enter a licence agreement with an Ontario pot lottery winner planning to open an outlet near White Oaks Mall.

“The council there voted overwhelmingly in favour of retail cannabis locations,” Shega Youngson, Canopy’s community engagement manager, said of council’s 13-1 vote Dec. 18 to allow brick-and-mortar stores.

“It’s exciting to be starting our retail footprint in a community that has been open and welcoming to our new industry.”

Seventy-seven of Ontario’s 444 municipalities opted out of allowing marijuana retailers in their communities ahead of a Jan. 22 deadline imposed by the province.  But London politicians argued that doing so would cost the city provincial funding – $1 million over the next two years – and snuff out an industry that will create jobs and fill vacant retail space.

An Ontario numbered company submitted an application last week to the Alcohol and Gaming Commission of Ontario, the province’s pot regulator, to open a retailer called Tweed in a commercial plaza at 1025 Wellington Rd.

The licensing agreement will allow the store operator, who will have full ownership and control over the business, to bring a premium experience to customers in London, Youngson said, noting Tweed is a recognized and trusted brand in Canada’s cannabis industry.

“Tweed is really synonymous about empowering consumers to be as knowledgeable as possible about cannabis so they can make the right decisions for themselves,” she said.

Canopy already operates stores in Manitoba, Saskatchewan and Newfoundland under its Tweed and Tokyo Smoke banners.

Licensed producers weren’t allowed to enter Ontario’s lottery for a shot at opening one of the first 25 storefront retailers in April. The province’s rules also limit commercial growers to a 9.9 per cent ownership stake in any retail operation.

A leading cannabis lawyer says there’s no explicit prohibition on using a cannabis producer’s brand on a retail store as long the ownership restriction is followed.

“But there is also a provision . . . that say licensees may not accept or request material inducements from licensed producers,” said Trina Fraser, an Ottawa-based lawyer who advises the marijuana industry.

“You can’t, for example, feature a certain licensed producer’s products in your retail store in exchange for any type of material inducement,” she said, adding the AGCO will likely be keeping a watchful eye to ensure compliance.

The Tweed store backed by two deep-pocketed companies will continue London’s tradition as a test market centre. Some of the new products and concepts tested in the Forest City include automated bank machines and McDonald’s. The fast-food chain opened its first store in eastern Canada in London

The numbered company proposing to open the south-end cannabis retailer was created Jan. 7, the same day the AGCO began accepting expressions of interest for the lottery that drew more than 17,000 submissions, according to corporate records.

Xiangquing Li is listed as the company’s president, while Andrew Collingwood is vice-president, the records show.

The store is proposed for a commercial plaza, north of Bradley Avenue, that houses David’s Bridal, Mary Maxim, Orange Theory Fitness, Pita Pit and Zoup.

London is on track to get at least two of the seven cannabis retailers allocated to the west region, an area stretching from Windsor to Waterloo to Niagara.

Earlier this month, Christopher Comrie applied to the AGCO to open a cannabis store in the former Oarhouse restaurant at 666 Wonderland Rd. N.

Only one other application has been filed, to open a store in St. Catharines, for the region.

Objections to the proposed locations can be made to the commission during a 15-day period, but only on grounds related to public health and safety, restricting access to minors or preventing illegal activity.

Coun. Steve Lehman, whose Ward 8 encompasses the proposed Wonderland Road retailer, says only a few constituents have contacted him to raise concerns about increased traffic at the already-busy plaza.

Lottery winners who don’t open their stores by April 1 will be fined $12,500, while those still not up and running by the end of that month will be fined $50,000.

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Canopy Growth

• Producer of medical and recreational marijuana
• Founded by Bruce Linton and Chuck Rifici in 2013
• First publicly traded cannabis company in North America

Couche-Tard

• Operator of 15,000 stores across the world
• Has stores under Mac’s, Circle K, Daisy Mart and other banners
• Founded by Alain Bouchard in 1985