The Government of Ontario has announced that it will be accepting another round of cannabis retail store applications. This marks the Government of Ontario’s further efforts to combat the illicit cannabis retail market and protect public health. This next “round” will be limited to 50 stores. Eight of these stores will be allocated to First Nations reserves and the other 42 will be subject to a lottery system like the initial round of applications in January 2019. However, there will be enhanced pre-qualification requirements that will significantly narrow the pool of applicants submitting an Expression of Interest to the lottery.
The next lottery will be held on August 20, 2019, and interested applicants will be subject to new pre-qualification requirements. This will include: having access to a physical retail store, through the confirmation of store ownership, or permission from the landlord. Interested parties will also need to send a letter of confirmation from a bank that the applicant has access to $250,000 cash and letter of confirmation that they will be able to obtain a $50k letter of credit (LOC) if selected. Once selected, the winning applicant will need to submit all the relevant information to the Alcohol Gaming Commission of Ontario (AGCO) within five (5) business days.
These enhanced pre-qualification requirements will likely lead to fewer expressions of interest submitted, thereby increasing the odds of selection for those who have a secure location and access to capital. The eight stores allocated to First Nations will be selected through a separate process on a first come, first serve basis. This process will require the First Nation applicant to first have permission from Band Council, which can be filed along with an “Intent to Apply” form on July 31 at 9:00 am. There will be no working capital or letter of credit requirement for First Nation Applicants.
If you meet the pre-qualification requirements and are interested in submitting an Expression of Interest in the upcoming AGCO lottery on August 20, 2019, please contact a licensing professional at dicentra today!