Law Times

Law Times • January 15, 2018 Page 9 www.lawtimesnews.com Pot ad rules to be stricter than alcohol marketing BY SHANNON KARI For Law Times T he means of purchas- ing cannabis legally will soon be no different for people 19 years and old- er in Ontario than that of beer, wine or spirits. The rules around marketing this product, though, are going to be much more restrictive and potentially more complicated than those surrounding beer, for example. There won't be any television commercials featuring attrac- tive young people smiling and socializing. The same prohibitions would not allow commercial spots fea- turing friends gathered together in front of a big-screen TV and a bong to cheer on their favourite hockey team. Producers of legal cannabis are instead going to have to rely on different methods of distin- guishing their offerings from that of their competitors, as a re- sult of the many restrictions set out in the federal Cannabis Act. The provisions include prohibi- tions against sponsoring events, using celebrity endorsements, advertising that might impact "young persons" or suggest that the use of cannabis promotes a way of life that includes glamour or vitality. The restrictions may pose a challenge for legal produc- ers, but they are not as strict as those in place for tobacco, says Alison Hayman, partner at Cas- sels Brock & Blackwell LLP in Toronto. "It is in between alcohol and tobacco. You cannot have packaging or promotion that is associated with a way of life. But the federal government is not requiring plain packag- ing," explains Hayman, who is in the firm's intellectual prop- erty group and advises on brand strategies for the cannabis in- dustry. That view is shared by Alice Tseng, partner at Blake Cassels & Graydon LLP in Toronto. "It cannot be appealing to young persons," says Tseng, which is what the federal gov- ernment has explicitly stated as the main policy reason behind the marketing restrictions. Even though people under the age of 19 in Ontario will not be permitted to purchase can- nabis, rules related to packaging are not necessarily aimed at the legal customers, she explains. "The reason for a special section on packaging is that it should not be appealing, even once it is in the house," where children might see it, says Tseng, who specializes in marketing and regulatory issues in the pharmaceutical and cannabis industries. Along with restricting youth access to cannabis, inform- ing the public about the health risks of the product and trying to reduce organized crime in- volvement in the distribution of marijuana are the goals of the measures in the Cannabis Act, the federal government stated in a background paper issued last spring. Legal producers of cannabis have already been active in set- ting out their own pledges when it comes to advertising their product. An industry organization representing 17 of the largest licensed producers issued its own marketing guidelines last November, which promises that advertising will not be aimed at young people and will contain "responsible use" statements. As well, the companies pledged to comply with the rules set out by Ad Standards, the national regu- latory body for advertising in the private sector. Despite the statutory restric- tions and broader concerns about the marketing of canna- bis, there are still ways in which producers will be able to distin- guish their product to consum- ers, says Hayman. Inside the government retail stores in Ontario, "they can com- municate information about the nature of the product," she states. "They can do advertising that is informational promotion as long as it targets people over 18," she adds. Breweries, for example, cur- rently have promotional materi- als on a company's website, but they require an online user to click on a link that attests that the person is of legal drinking age. Whether that will be suffi- cient for cannabis producers on its websites is not yet clear, says Hayman. "The challenge is restricting to 18-plus," she says. As well, restrictions against celebrity endorsements of a cannabis producer might not contravene the rules if the indi- vidual is only an investor in the company, which is not uncom- mon in the wine industry, she points out. The Cannabis Act permits promotions by produc- ers to entities that are authorized to sell to consumers, which in Ontario would be the province. There are other ways to re- lease information about your product that would not contra- vene the statute, says Tseng. "A lot of this goes back to how the pharmaceutical industry is regulated. Certain press re- leases are not advertising if it is considered informational," she explains. Online advertising or e-mail updates about a product might be permitted as long as suffi- cient measures have been taken to ensure that anyone signing up to receive the information is of legal age, says Tseng. As well, advertisements on late-night programming or pay- per-view outlets, where there is a reasonable assumption that the audience is over 18, could also comply with the provisions, Tseng notes. The regulations to accom- pany the legislation have still not been finalized and Hayman says that will provide more clarity for the industry. "This is still evolving. It would be ideal to have the regu- lations by July," she says. LT FOCUS Alice Tseng says recreational marijuana products will not be able to advertise in a way that is appealing to young people. Calgary | Montréal | Ottawa | Toronto | Vancouver Lawyers | Patent & Trademark Agents | Borden Ladner Gervais LLP (BLG) is an Ontario Limited Liability Partnership. Borden Ladner Gervais LLP is committed to playing an active role in helping clients effectively and responsibly navigate the rapidly evolving landscape of the Canadian cannabis industry. BLG is at the forefront of Canadian law firms acting as counsel on corporate transactions and providing regulatory advice across all areas of the cannabis industry. We provide first-in-class corporate, securities, regulatory, tax, intellectual property, commercial real estate, employment and litigation counsel. Find out how our Cannabis Industry Focus Group can assist you: Andrew Powers | 416.367.6135 | apowers@blg.com David Wood PhD | 403.232.9742 | dwood@blg.com blg.com/cannabis From seed to sale, BLG HAS YOU COVERED Untitled-1 1 2018-01-04 11:24 AM

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