Q1 Can an Applicant apply for both the First Nations Allocation and the Allocation Lottery?

A1. The Allocation Lottery Rules do not prohibit a person, or an affiliate of that person, who has submitted an Expression of Interest Application from also submitting a Retail Store Authorization Intent to Apply - First Nations Reserve application.

A person who has been selected by the AGCO to apply for a cannabis retail store to be located on a First Nations reserve may not submit an Expression of Interest Application to the Lottery. (See Rule 4c for details)

However, it is important to note that Regulation 468/18 provides that a person, including an affiliate of that person, may only hold one Retail Store Authorization (which would include authorization for a store on a First Nations Reserve).

 

Q2. If an Applicant is submitting as a corporation, limited partnership, partnership or trust, and its organization is new (i.e. not yet formed or holding any assets), can the Letters of Confirmation from a bank be in the name of a principal of the Applicant organization?

A2. No, letters of confirmation issued in the name of a principal of the Applicant would not be acceptable. The Allocation Lottery Rules (Rule 8.c.ii and 8.c.iii) state that Letters of Confirmation must confirm that the applicant is in good standing and has the financial capacity necessary to obtain $250,000 in Cash or Cash Equivalents.

 

Q3.  Do I need to include the Retail Store Name (Premises Name) in my Expression of Interest Application?

A3. No. In the iAGCO online portal, the “Premises Name” is a mandatory field in the Expression of Interest Application form. However, Applicants are permitted to enter “N/A” in this field if they do not have a retail store name at the time of their application to the Lottery.

 

Q4. What will happen if multiple Applicants in the Lottery identify the same retail space in their Expression of Interest Application? What would happen if, by chance, more than one of these Applicants were selected in the Lottery?

A4: The Allocation Lottery has no rule that prohibits the same address from being listed in multiple Expression of Interest Applications. However, Rule 2(c) requires that a selected Applicant must operate their store at the address provided on their Expression of Interest Application.   

Rule 14 requires that each selected Applicant has five business days to submit a formally executed legal instrument that demonstrates the Applicant’s right to possession of the retail space identified in the Application.  A selected Applicant that cannot demonstrate this right of possession will be disqualified, unless, within the five business day period, they can:

  • fulfill the obligation to demonstrate the right of possession to a different retail space other than the one identified in the Application and
  • have secured the Registrar’s agreement to a different address because of extenuating circumstances.  

The decision of the Registrar as to whether extenuating circumstances exist in order to allow for such a change of address will be made on a case-by-case basis.  The Registrar will take into consideration all factors declared by the selected Applicant and make the assessment in a fair and reasonable manner.

 

Q5. Regarding the pre-qualification requirement relating to submission of Letters of Confirmation, can banks use their own letterhead as long as the required information outlined in the AGCO confirmation letter template is captured?

A5. Yes. The Allocation Lottery Rules provide that an Applicant may submit the following substantively in the form set out by the AGCO:

  1. Letter of Confirmation – Cash or Cash Equivalents Capacity
  2. Letter of Confirmation – Commitment to Provide Letter of Credit
  3. Confirmation of Retail Space
  4. Standby Letter of Credit (if on the Selected List)

If the form set out by the AGCO is not used, the documentation MUST:

  1. Meet the requirements set out in the Allocation Lottery Rules
  2. Contain the same content as in the corresponding AGCO form

Please refer to the Rules and the forms set out by the AGCO for more information.

 

Q6. The Rules indicate that persons who have been selected for a cannabis retail store to be located on a First Nations reserve may not submit an Expression of Interest Application. If a First Nations owns a minority equity interest in a person submitting an Expression of Interest Application, are they still eligible for a cannabis retail store located on a First Nations reserve?  If so, is there a limitation to what that minority equity interest could be?

A6. A First Nation would be entitled to apply for a Retail Operator Licence and a Retail Store Authorization on reserve land regardless of whether it also has a minority interest in the holder of a Retail Store Authorization. This assumes, however, that the minority interest does not make the First Nation and the holder of the Retail Store Authorization affiliates, as set out in s. 2 of Ontario Regulation 468/18 under the Cannabis Licence Act, 2018.  This regulation provides that a person, including an affiliate of that person, may only hold one Retail Store Authorization (which would include an authorization for a store on a First Nations Reserve).

To help ensure your readiness as a lottery applicant, the government has legislated pre-qualification requirements that require you to demonstrate you have access to enough capital to open a cannabis retail store.

These pre-qualification requirements include proof of financial capacity:

  • Submission of a Letter of Confirmation from a bank confirming you have the financial capacity to obtain $250,000 in Cash or Cash Equivalents (e.g. bonds, other short-term investments). The AGCO will not hold these funds. This Letter of Confirmation will serve as proof that you will have access to funds as you prepare to open and operate your store, if you are selected in the lottery.
  • Submission of a Letter of Confirmation from a bank or credit union confirming you can obtain a Standby Letter of Credit in the amount of $50,000 within five days of being notified of your selection by the Registrar. You will only be required to obtain the Letter of Credit, if you are selected in the lottery. 

If you are having difficulty finding a financial institution to complete a Letter of Confirmation, you are encouraged to obtain your own professional advice.

 

Q7. What are the steps to submitting an Expression of Interest Application for the second store allocation Process?

A7. To participate in the lottery you will have to follow several steps to submit your Expression of Interest Application. (see screenshots of the Expression of Interest Application process)

  1. Expression of Interest Applications will be accepted online from 12:01 AM EDT August 7, 2019 to 8:00 pm EDT August 9, 2019.
  2. You will need to set up an iAGCO account prior to completing your Expression of Interest Application. To avoid a last minute rush, we suggest you create your iAGCO account before August 7. For more information on how to create an account and how to use iAGCO, visit the iAGCO Customer Feedback FAQs web page.
  3. From 12:01 AM EDT August 7, 2019 to 8 pm EDT August 9, 2019, sign into the iAGCO portal. Choose Cannabis Expression of Interest as you type of application -.
  4. Be sure you know which Region, or Regions, you wish to apply for. See Rule 5 of the Allocation Lottery Rules for details. You may submit only one Expression of Interest Application per Region. If you submit more than one per Region, all of your applications will be disqualified from the lottery.  
  5. If you wish to submit an Expression of Interest Application for more than one Region, you must submit a separate Expression of Interest Application for each Region.
    NOTE: For the North Region, you can submit an Expression of Interest Application for only one of the five listed cities within that Region (Kenora, North Bay, Sault Ste. Marie, Thunder Bay, Timmins).
  1. NOTE: You must submit all your Expression of Interest Applications through the same iAGCO account. If you submit Applications from multiple accounts you will be disqualified from the lottery.
  2. Make sure all individuals associated with an Expression of Interest Application, including every director, officer, shareholder, partner and trustee are at least 19 years of age.
  3. Know your Applicant Type (Corporation, Limited Partnership, Partnership, Sole Proprietorship, Trust).
  4. Be prepared to acknowledge and confirm that you have not made a false statement and have not provided false information in your Application. You will be required to answer 7 questions as part of the EOI application process (see Rule 8 c)), including acknowledgement that:
    1. You will excise control over the cannabis retail business
    2. You are legally permitted to operate a business in Ontario
    3. It is possible you may not receive a Retail Operator Licence even if you meet the statutory eligibility criteria
    4. If issued a Retail Operator Licence and Retail Store Authorization, (1) you will abide by all applicable legislation including Cannabis Licence Act 2018, the Cannabis Control Act, 2017, Smoke Free Ontario Act 2017, Accessibility for Ontarians with Disabilities Act 2005 and (2) there is a risk you may not be able to obtain a sufficient quantity of cannabis to operate a cannabis retail business
    5. Ontario and its Agencies have not represented that there will be a sufficient quantity of cannabis for you to operate a cannabis retail business
  5. Make sure the location of your proposed retail store is:
    1. more than 150 metres from a school or private school
    2. in a municipality that permits cannabis retail stores

    (You can use iAGCO to check to make sure your location meets location requirements.)

  1. Make sure you upload the required document types with your Application using the required templates and forms available in the Allocation Lottery Rules on the AGCO website:
  1. letter of confirmation – cash/cash equivalents capacity (see iKnow #145) in the form set out by the AGCO 
  2. letter of confirmation – commitment to provide letter of credit (see iKnow #145) in the form set out by the AGCO
  3. confirmation of retail space (See iKnow #224) in the form set out by the AGCO
  1. Check the box to confirm that you have read, understand and agree to comply with the Lottery Rules and have the authority to bind the Applicant.
  2. Pay the non-refundable $75 Expression of Interest fee.
  3. Submit your Application.
  4. You will receive an online confirmation that your Application has been received. You will receive a confirmation email that includes an Application summary.

Additional Reminders for Submission

  • You will need to provide evidence for each Expression of Interest Application submission that, if you are selected in the lottery, you meet the pre-qualification requirements including:
    • 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 in the amount of $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
  • Failure to provide evidence that you meet the pre-qualification requirements at the time of the Expression of Interest Application will make you ineligible to participate in the lottery.
  • To ensure you meet these requirements, we suggest you download the required letter templates and forms from the Allocation Lottery Rules now and talk to your bank, credit union or caisses populaire about completing them:
  • NOTE: You must include the address of your proposed retail store in your Expressions of Interest Application. You will not be able to submit your Expression of Interest Application without it.
  • Carefully review the Allocation Lottery Rules to ensure you are fully aware of, and ready to meet, the requirements before submitting your Expression of Interest Application.

 

Q8. The Allocation Lottery Rules state that a selected Applicant must submit a “formally executed legal instrument that demonstrates the Applicant has a right to possession of the retail space” within 5 business days of the Registrar notifying the Applicant of their selection.  If I plan to lease the premises, is a binding offer to lease (with the dates, terms, and address of the location) acceptable, or do I have to submit a final lease within these 5 business days?

A8. It is possible that a binding offer to lease could demonstrate that the Applicant has a right to possession of the retail space, as required by the Rules.  However, given that the nature of these instruments can vary greatly, we cannot make a blanket statement that all offers to lease are acceptable. We will only be able to confirm the requirement has been met once the Applicant is selected and the AGCO is able to review the formally executed legal instrument submitted.

 

Q9. If I represent 2 or more potential Applicants, can I submit their Expression of Interest Applications from the same iAGCO account?

A9. If you represent 2 or more potential Applicants, each of whom is submitting an Expression of Interest Application for a different Region, the same iAGCO account may be used. However, you may not use the same iAGCO account to submit an Expression of Interest Application for 2 or more potential applicants if they are submitting an Expression of Interest Application for the same Region.   Rule #6 states that: Prospective Applicants or their representatives must create an iAGCO account, if an account has not yet been created, prior to filling out an Expression of Interest Application. An Applicant must submit all Expression of Interest Applications through the same iAGCO account, and not more than one Expression of Interest Application may be submitted per Region from the same iAGCO account.

 

Q10. The retail location I have identified in my Expression of Interest Application has been rejected by iAGCO and I believe the proposed address meets the school boundary requirements. What should I do?

A10. As part of the application process, the iAGCO online portal conducts an automated check of the address of the proposed Cannabis Retail Store location against the physical location of school properties as provided by the Ministry of Education. The AGCO relies on this automated check to determine whether the proposed retail address submitted by the Applicant meets the school boundary requirements.  If you feel an error has been made, call AGCO Customer Service to check the result as soon as possible at 416-326-8700 or 1-800-522-2876 from 8:30 a.m. to 5:00 p.m. or submit your inquiry electronically via iAGCO Online Services.

 

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