Proceedings of the Standing Senate Committee on National Finance
Issue 23 - Evidence
OTTAWA, Wednesday, April 23, 1997
The Standing Senate Committee on National Finance met this day at 5:15 p.m. to examine the Main Estimates laid before Parliament for the fiscal year ending March 31, 1998.
Senator David Tkachuk (Chairman) in the Chair.
[English]
The Chairman: I call the meeting to order. This is the third public meeting of the committee. Our witnesses today are Mr. Bruce Rowsell, Director of the Bureau of Drug Surveillance, and Ms Jean Peart, Acting Chief of the Hemp Project.
If you have a presentation to make, please proceed.
Mr. Bruce Rowsell, Director, Bureau of Drug Surveillance, Health Canada: I have a short opening statement.
Honourable senators, I am pleased to report that on this past Monday, April 21, the Controlled Drugs and Substances Act and the regulations were proclaimed. These regulations will come into effect on May 14. They focus on the medical use of controlled drugs, so they will facilitate pharmacists, physicians, licensed dealers, and others, to be able to handle these products under the new act.
Let me try to address the specific concern that you raised with respect to the regulations regarding industrial hemp. First, I would like to say that Health Canada is making every effort to gain approval of these regulations as early as possible, while recognizing that there are other regulatory priorities within the department. Our priorities are established, to the extent possible, on the basis of risks to health of Canadians and their medical needs for certain products.
Second, in accordance with the Treasury Board policies, it is our practice to consult with as many interested parties as we can to gain as much insight as possible into the issues and concerns related to these products. It is important to establish the policy framework before asking our legal advisers to begin to draft regulations. The efforts spent up-front allow us to get it right from the beginning and thus reduce any time required later for revisions.
Let me give you a couple of examples. We held a consultative workshop here in Ottawa on March 17 and 18, and during that session a number of issues came to light. Most of our focus with regard to industrial hemp had been the fibre content and issues around the fibre for textiles, for paper products, other wood substitutes. However, a number of parties came forward and said that the oil from the seeds is also a very valuable product. We had not considered that aspect to any great extent, and there seems to be quite a strong interest in dealing with the seed content. This gives us quite a different issue from the one we had before, just dealing with fibre. There is some interest in using the oils in cosmetics, in other toiletries, in food nutritional substances. We have an exemption in the act for non-viable seeds. However, many people said they think there would probably be better nutritional or other values in these oils if they come from live or viable seeds.
We must be able to distinguish between those seeds, and seeds that will be used for cultivation of marijuana or industrial hemp. Seed content is very difficult to distinguish. That is why we have been working with our colleagues in Agriculture Canada. We hope to use the Seeds Act to link our regulations with them to make sure that we do not overburden this industrial sector, but we also want to make sure that the hemp seeds get through and the marijuana seeds do not.
There were a number of proposals brought forward. There seems to be, within the sector, quite a divergence of approaches. Obviously some would like no regulations while others would like to be over-regulated, almost to the extent of creating a monopoly. We want to see a balance that will let the industry function with whatever minimum controls are necessary.
It is essential that we look at the opposing views, that we gather that information, analyze it and develop a policy framework that will allow this industry to progress, recognizing that there is also a public confidence issue that must be addressed. There are those in society who view industrial hemp as a step towards the greater use of marijuana. We must ensure that Canadians recognize that these regulations are only to facilitate the industrial development of hemp fibre, and that there will be protections against any recreational use of marijuana.
Again, I think it is incumbent upon us to try to avoid future disruption of this industry by concerns that these regulations are aimed at recreational marijuana use as opposed to the industrial benefits of this product.
We have a website on our Health Canada bulletin board, to provide the public and interested parties an opportunity to give us their thoughts on how they think the controls should be implemented. I must say we have had a good response from around the world, which has provided guidance and information for us. There have been many comments, some of them very detailed.
I have available a discussion document from our consultation meeting in March, that was used as background information for our consultation process. It is the type of information that is available on the website.
Through Agriculture Canada there is legislation regarding the propagation of seeds, the import and export of seeds, the control of seeds. We want to make sure we have the proper linkage with those so that farmers are not having to go through two regulatory processes in order to grow these products and so the varieties of hemp seeds are maintained.
At our consultation meeting, a number of people indicated that the industry is not ready for full production yet. I know the farming industry is anxious to get going. I think they are prepared. However, there is a concern that the infrastructure is not in place yet to be able to purchase that crop and then further process it.
The situation in Germany is similar, although not exactly the same. Farmers are subsidized for growing hemp, and what is happening is that they grow hemp to get the subsidy and then they burn the crop because there is no-one to buy it and to use the fibre. When we had our consultation process we tried to make sure that various industries, such as the paper and textile industries, would be available to process the hemp. I know that Industry Canada and Agriculture Canada are working with these industries as well to try and make sure there is a full infrastructure for the hemp industry.
I would like to conclude by giving you some insight into our proposed timetable, recognizing that we are bound by Treasury Board policies. Right now our workload is extremely heavy, dealing with the research licences for the companies that are applying to grow hemp for this season. Within the next week, those licences should be completed. We are still receiving inquiries from people who would like to have a research project for this coming season, and we are trying to accommodate as many of those as possible.
We hope to have a policy framework in place by July, 1997. Then, depending on the availability of our legal advisers, the drafting of the regulations themselves will probably take two to three months. This will probably bring us to August or September. They will then be published in the Canada Gazette, Part I, and then there is a comment period of 75 days, which will probably bring us to about the middle of November. The analysis of those comments and any revision of the regulations, if necessary, would probably take another 30 days or so, and then we would publish them in the Canada Gazette, Part II. If everything goes well, we would be looking at early 1998 for publication.
I can tell you I do not want to go through another series of research licences. The approval process is cumbersome. It is essential that we get these regulations in place for next year's growing season. If we can adhere to the timetable I just outlined and get the cooperation of everyone within the process, we should be able to meet the deadline of early 1998, which would give the people a chance to get started for next year's growing season.
The Chairman: Ms Peart, did you have anything to add?
Ms Jean Peart, Acting Chief, Hemp Project, Health Canada: No, but I will be open for questions.
Senator Milne: I wanted to start by giving everybody a sample of a non-viable Cannabis seed. Unfortunately we were unable to get any. They are quite popular. There is a store here in Ottawa that sells them mixed with salt as a snack, like trail mix.
For the record, I would like to read a letter I received from the minister today.
Dear Senator Milne:
Thank you for your letters of March 20 and April 10, 1997 regarding regulations for cultivation of industrial hemp.
I was keeping him in touch with what was going on in this committee.
I understand my officials will be appearing before the Standing Senate Committee on National Finance on Wednesday, April 23, 1997. This will no doubt provide an opportunity for you to raise your concerns directly. In addition, I have asked my legislative assistant, Athana Mentzelopoulos, to continue to work closely with departmental officials to ensure this matter is dealt with expeditiously.
I wish to emphasize particularly the last three words: "dealt with expeditiously."
I like what I have heard this evening. I am pleased that the process seems to have been speeded up considerably.
Since we have brought you here under the guise of talking about the Estimates, we will start with them. Can you show me, since we are talking about the fact that this is actually will now go ahead, whereabouts in the Estimates I will find the expenditures for this?
Mr. Rowsell: No, I cannot.
Senator Milne: Is this a nasty question?
Senator Lavoie-Roux: Senator Milne, will you excuse me?
Senator Milne: Yes.
Senator Lavoie-Roux: I have probably what will sound like a stupid question, but before you go on I am interested in what you are asking. What use do you make of hemp? Why will we cultivate it? What is the use of hemp?
Mr. Rowsell: It is a crop that has a very long fibre in the stock. It grows similar to corn, so the stock has a long, strong fibre.
Senator Lavoie-Roux: Is it like flax?
Mr. Rowsell: It is somewhat like flax, yes. The reports are that it is extremely good for the production of fine papers. There are several textile products in the city today made from hemp, even clothing. The textile industry is doing a fair amount of research and is developing textiles that are very good replicas of a linen. It is a high-quality fibre. It is being used for pressed wood and fibreboard. In British Columbia and in other provinces it is seen as a renewable resource.
It is an annual crop, and probably equivalent to a 20-year-old tree. Instead of waiting 20 years to cut down trees, they can use hemp as a replacement. They certainly see this as an alternative in some areas to tobacco crops. The soil conditions required for hemp are similar to those needed for tobacco.
As I mentioned, the oils in it may be used for many purposes, as a nutritional food source and for cosmetics and other toiletries. There are many different opportunities. I have read some articles that say there are 5,000 uses for it. I think that is extreme, but there certainly are good opportunities in the textile, wood-product and paper-product industries.
Senator Milne: If I can take over from where you left off, hemp is a viable alternative for tobacco. It produces about four times as much fibre for paper per acre as an acre of spruce trees does, and it can be used for more products. You cannot make clothing out of spruce trees too easily.
It is a very good crop and it is a cash-at-the-farm-gate crop for farmers. It is good alternative crop for our tobacco farmers in Southern Ontario. After all, we are looking for ways to ease them out of tobacco. It is good for the lands out west because it is very frost-hardy, and it is hardy north of Edmonton. It is good for New Brunswick. It is good for heavy clay soils.
Senator Forest: What is the connection between hemp and marijuana? They are completely different plants.
Mr. Rowsell: They are both from the plant Cannabis Sativa. They are simply different varieties of that plant. They both come from the same family. The marijuana plant is grown as a low bush because they want the leaves, where the THC levels are high. For hemp, they grow it tall. It will probably grow up to four or five metres high. You plant it close together like corn, and you do not want the leaves.
Senator Forest: I did not realize it was the same family.
What do you mean by a viable and non-viable seed?
Mr. Rowsell: To make a non-viable seed, you heat treat it to destroy the growing capacity of the seed.
Senator Taylor: My understanding is the female plant that produces a seed is much higher and the male plant is bushier. Are the seeds like chickens, de-sexed before you plant them, in order to get the male plant versus the female plant?
Mr. Rowsell: They will use the female when they want to grow it for seed and the male when they want it for the fibre.
Senator Taylor: That is done a lot too, is it not?
Mr. Rowsell: Yes. One of the difficulties is that most of the seed now is controlled by France. If our Canadian industry is to develop, we must have an infrastructure amongst the seed growers in order to propagate the seed for our Canadians purposes.
Senator Taylor: My understanding is that the female plant they grow for seeds looks very similar to marijuana.
Mr. Rowsell: That is correct.
Senator Taylor: This gives you a bit of an inspection problem as to whether you have a female hemp plant being grown for seed or a marijuana plant. I also understand the female hemp plant's THC level is a lot higher than the male's.
Mr. Rowsell: That is correct. We would licence seed growers, and we are considering a central database. A police force could go into that database and see that Smith Nurseries has a licence for the propagation of the hemp seeds. If they see a field with the low bush, they can be confident that those are for hemp purposes, not for the marijuana purposes. We are trying to make this easier for all parties, the police and the growers. The growers do not wish to have someone coming in and impeding their production, so we must try to have an open system that will allow everyone to operate.
Senator Taylor: I understand the female plant can be smoked, the male cannot.
Mr. Rowsell: If I can come back to Senator Milne's question, the answer is found on page 19, in the table, figure 10, where the middle item is, "Control of Dangerous Drugs". The resources in that grouping are committed to this project -- not all of them, but at the moment we have Ms Peart and another person working with her.
Senator Milne: We have two people?
Mr. Rowsell: We have two people.
Senator Milne: That is all?
Mr. Rowsell: That is all.
Senator Milne: You are telling me that you will have these complicated regulations, and all the interplay required between law enforcement agencies and Agriculture Canada, in place by spring of next year?
Mr. Rowsell: Ms Peart has coordinated an interdepartmental committee, so we have representation from the Solicitor General, from Agriculture, from Industry, Environment Canada, and from Health Canada, who are working as a team to pull this together. They are helping us both in the processing of research licences as well as in the development and the consultation process. I must say we are getting good cooperation from the other departments.
Senator Milne: That is wonderful to hear but does that mean that in effect you really do have more than two people working on this?
Mr. Rowsell: There are two people in my bureau committed to it, and then other departments are contributing as well, yes.
Senator Lavoie-Roux: It will be ready a year from now?
Mr. Rowsell: I hope it will be sooner than that.
Senator Milne: Once the regulations are in place, then the farmers still must go through all the steps required to be licensed to grow it, and that cannot be done overnight.
Mr. Rowsell: One of the things that we are considering is whether we need to license farmers.
Senator Milne: Good.
Mr. Rowsell: If there is to be a problem, it will be with the seed. If we are able to put in controls over propagation, importing, and distribution of the seed, then we may not need to have every farmer licensed. My view is that we do not, but there may be compelling arguments that would make me change my opinion.
Senator Milne: You are talking about having a database to which the police will have access to find out who can grow it and who cannot.
Mr. Rowsell: One possibility is that a licensed dealer under the regulations would be required to keep records of their customers, how much they sold, and when. If that goes into a database, the police could see that ABC Nursery sold to Farmer John who is located at such and such a place. There must be some checks and balances. It would have to be determined if that person is truly a farmer, and so on. We think that we can build those things into the program in a reasonable manner without going through a lengthy and detailed licensing process.
Senator Milne: Right now you are sending the RCMP out to investigate the farm and the farmer. They put barbed wire around the five-acre plot. Five acres is hardly big enough to turn a harvesting machine around in.
Mr. Rowsell: Yes. This is a new venture and there are many inquisitive people, so the farmers themselves want to protect their investment.
Senator Milne: The original response your department sent to the committee predicted that the regulations might not be finalized before August 1998. I realize we have lost this growing season, and I am very pleased to hear that we will not lose next year's growing season as well, but I would like an absolutely solid, unbreakable confirmation from you on this, signed in blood on the dotted line.
Mr. Rowsell: I would like to be in a position to do that but unfortunately I do not think I can honestly say that it will be done. As I mentioned to you, the timetables are tight but we will do everything we can to meet those deadlines. If something else arises, there may be a problem.
Senator Milne: Your department came through very quickly with regulations on the tobacco bill, so I am hopeful that with the work you have already done, it will be possible. Perhaps, Ms Peart, you could tell us precisely where you are in the proceedings. Your committee is meeting with different groups. Have you done anything in preparation for the licensing?
Ms Peart: As Mr. Rowsell has pointed out, we have been having consultations. I met with officials in Great Britain and in Germany to discuss the processes they were using, to see whether or not those would be appropriate for us. One usually discovers that what works in one country does not necessarily work in another. As was pointed out, subsidies are a major factor in Europe. For example, in Britain the subsidy is 240 pounds per acre.
We have gone through the consultations, the committee has examined those issues, we have had the workshop, and we are evaluating the results of the workshop. In addition to that, we are examining what impact other regulations, for example, in the Department of Agriculture, will have on the issue. You will see in that document we have made great reference to the Seeds Act. After we are finished with the research licences, the next step is to determine how we can utilize the legislation that is already available to us and what changes will be required. Some changes will be required relating to the Seeds Act.
Mr. Rowsell: In the U.K. they have set up what amounts to a monopoly to control the distribution of the seed throughout the country. We have reservations about whether that is the way to proceed here. In Germany, they have a registration system for farmers, so only registered farmers can participate, but at the same time they require that an inspector go and see the site before they can proceed. We do not have the resources to send inspectors across Canada; the distances are too great. We are trying to find ways that will suit our Canadian situation and not impose these heavy restrictions.
Senator Milne: That is welcome news. Have you studied the situation in Ireland at all? They never stopped growing hemp in southern Ireland.
Ms Peart: No, we have not. There are some other countries we must look at too. It is interesting that while the countries in the European Union agree on a particular level of THC, Switzerland, for example, does not. It has its own requirements. The situation in Australia is slightly different. They are still in the process of research licences. In the U.S. only one person has ever received a research licence. We must still do more research about the situations in other countries, just to be sure that whatever model we develop will be the best.
The Chairman: When did you start, Ms Peart?
Ms Peart: I got involved in October of last year.
The Chairman: Did you have anybody else, Mr. Rowsell, working on this previously?
Mr. Rowsell: Yes, Dr. Hossie and Ms Francine Magnan were working in this area before Ms Peart joined them. I recognize that the resources are not great, but a lot of Ms Peart's time is spent providing advice to people who are interested in this subject. We receive many requests for information, and responding to them takes time away from developing policy and regulations.
The Chairman: It is a question of resources. You have two functions. You have the job of actually getting those regulations into place, and then also answering the questions of would-be growers and users?
Mr. Rowsell: Exactly.
The Chairman: Have you asked the government for more money? It appears this will take three years, about half the time of the Second World War. We should be able to license hemp more quickly than that.
Mr. Rowsell: We should. The problem is not just one of the resources within my department. Senator Milne referred to the regulations for tobacco control. We also have regulations on blood products, on prohibited substances, and on other medical applications, such as tissues and organs. Ms Peart, myself and other people within my bureau are not the only ones involved in this process of bringing the regulations forward. It involves the entire infrastructure within the department. I am led to believe that the department is committed to working with us to help us ensure that we meet these deadlines.
Senator Lavoie-Roux: You mentioned the fact that in the United Kingdom there are subsidies for people to grow hemp. Do you think we will need to provide subsidies to the people who want to get into this business? If your answer is yes, would you tell me if there are other crops that receive subsidies in Canada?
Ms Peart: The question on subsidies would need to be addressed to the Department of Agriculture and Agri-Food. In Germany, where they give subsidies for growing hemp -- similar to the subsidy for flax -- they have found, as Mr. Rowsell said, that much of the hemp grown had no end use. They have now decided that the only way to get that infrastructure in place is to start diverting the subsidy to processors and away from farmers. The point is that subsidies do not necessarily work for this particular situation.
Senator Lavoie-Roux: Are subsidies given for other crops? I would hesitate to start subsidizing in another field. If the government is tempted to go in that direction, they should be very careful about it.
Since this is not clearly an agricultural issue, have you had any consultation with the provinces on the regulations? I do not mean necessarily to get their consent but they might see things differently and it might avoid difficulties later on.
Mr. Rowsell: Yes, the provincial governments have been part of the process, particularly departments representing the agricultural and industrial sectors. This particular piece of legislation is under the federal mandate. We are trying to facilitate the opportunities for this industry. It will then be up to individual provincial programs to take it up as they see fit, but they have been part of the consultation process, yes.
Senator Taylor: I am very interested in hemp farming. As a matter of fact, my farm is only about 20 miles away from some experimental plots. That is how I know so much about the subject.
I want to congratulate Senator Milne because it was she who started rattling the tree early. If you can, I hope you will publicize the deadlines that you gave to us so that they will be well known and we will be able to follow the progress.
Is there anything in the Controlled Drugs and Substances Act that can hold up the hemp regulations, such as an interface with a regulation regarding any other drug, or can you operate on hemp by itself?
Mr. Rowsell: We can operate on hemp by itself, yes. There are two parts under the Controlled Drug and Substances Act that were not brought into force with the regulations that came forward on April 21, and they deal with precursor chemicals and benzodiazepines. Precursor chemicals are the substances used by the motorcycle gangs to manufacture amphetamine-type stimulants and other illicit drugs.
Senator Taylor: I am familiar with that but I am not familiar with the other.
Mr. Rowsell: Benzodiazepines are the tranquillizers. These are substances that have been placed under international control by the United Nations.
Senator Taylor: The problem is mixing them with alcohol and so on?
Mr. Rowsell: Yes, and there is also concern over their over-consumption and diversion. Often they are used with other drugs to increase the effect so they are diverted to the black market. The United Nations has asked us to put increased controls on those. There is another group, separate from our group, which is developing regulations for them.
Senator Taylor: As far as you can see, that will not have any impact on the process for hemp regulations?
Mr. Rowsell: No.
Senator Taylor: I notice you mentioned you are very busy giving out research licences, and it sounded as though it was mainly companies that were requesting research licences, and not farmers themselves.
Ms Peart: The reason we mentioned companies is that some of the farmers are incorporated so their licence would be under the company name even though they are principally farmers. You asked earlier about provincial agriculture departments. Some applications are coming in under the names of researchers from agriculture departments but the hemp is to be cultivated on farms. Even when a company is putting in the application, there are farmers involved in the operation.
Senator Taylor: I was trying to find out how hemp would be marketed. Will it be like sugar beets, where the processor at a sugar refinery goes out and makes a contract with the farmer? In other words, will the hemp processor go out and make a contract with the farmer or will the farmer grow the hemp like oats or barley and then look around for a market?
Ms Peart: In England, the processor contracts farmers to grow the hemp for them. Here some people think that might be the way to go about it, whereby processors will contract farmers to grow hemp, but there are other people who think they can farm it and find their own markets. I think there has been too little thought given to the fact that hemp is a very large plant and if the processing facilities are not in the vicinity of the farms, there could be a problem.
One of the things that I find very interesting is that the desire for the products of the hemp plants, whether it is oil or fibre, has become regional. In Ontario, fibre is the main interest; in the prairies, it is the oil.
The Chairman: Is your department involved at all in the marketing or distribution aspects?
Ms Peart: No.
The Chairman: The only regulations you would make would be regarding health?
Mr. Rowsell: Yes.
The Chairman: I do not understand that.
Senator Taylor: Neither do I. I want to go back to the answer that you gave where you said that most of the research licences applications are from farmers who are also companies. Why are we worrying about farmers growing hemp if we know that within a year we will have regulations for growing it. In other words, what is wrong with giving farmers a research licence to grow a crop this year? Perhaps they can. Am I missing something?
Mr. Rowsell: There is a regulation under the Narcotic Control Act which says that the minister may, upon application, issue a licence to any person who in the opinion of the minister is qualified to cultivate, gather or produce opium poppy or marijuana for scientific purposes, on such terms and conditions as the minister deems necessary.
Senator Taylor: Why does the minister not give everyone who wants to grow it a licence?
Mr. Rowsell: As long as there is a research element to the cultivation, we can.
Senator Taylor: Surely in a free-market system, if you grow hemp and then go looking for a market, that could fulfil the research requirement, or are you insisting that the guy has two PhDs from Switzerland before he is allowed to grow marijuana?
Mr. Rowsell: We have not been quite so demanding, but the regulations says the research should not be just marketing research, it should be scientific research. When Senator Milne proposed her amendment to the Controlled Drugs and Substances Act, she suggested that once it is cultivated and harvested, there be no further controls on it, so any of those marketing things would occur outside any regulatory regime. Our only function is to make sure that what will be grown will be certain varieties for hemp purposes.
Senator Taylor: I think we are going in a circle here. We are telling people, "If you apply, you can get a research permit to grow hemp this year, but if you wait a year we will give you a permit to grow the hemp without the research permit." It is legal to grow it now but we just do not have the regulations yet. Why do you not just issue a permit and say, "You are researcher this year and a farmer next year"?
Mr. Rowsell: That is what we have been doing for those that have applied.
Senator Taylor: Are you turning down any farmer who wants to grow industrial hemp, on the grounds that he or she is not a researcher?
Mr. Rowsell: We are helping them design research projects so they qualify under this regulation. We are working for them. A large part of Ms Peart's work is helping people obtain a licence.
Senator Taylor: My impression -- and I am going from what farmers in my own area tell me -- is that they cannot qualify for research so they cannot grow hemp. However, if they wait a year, they will be able to grow it. It seems to me we have a simple solution to this system, and it is to say all farmers are researchers. You could then take three years to put the regulations together, if you need that amount of time.
Mr. Rowsell: We would have the same demands by those who want to grow marijuana for other purposes.
Senator Taylor: We have a law now that says they will not need to call themselves researchers a year from now. You said yourself that by 1998 everyone who applies will be able to grow hemp. You will even try to stay out of the marketing end. So why not just allow anyone who wants to grow hemp now call themselves researchers and let them go ahead?
Mr. Rowsell: Because we do not have the regulatory framework to do that, sir, and we will not until the new regulations are in place. The act prohibits; the regulations provide exemptions to allow. The act is prohibitory in nature so nobody can have Cannabis sativa. The regulations provide exemptions which allow people to do certain things. Let me give you an example. Codeine is prohibited but we have a regulation that says a licensed dealer may manufacture tablets for pain-relief purposes, a physician can prescribe those and a pharmacist can dispense them, so patients can benefit by having codeine as a pain killer. The principle is the same for hemp.
Senator Taylor: If you knew there was a regulation coming by the end of 1998 saying that codeine did not need that exemption any longer, why would you be going around trying to arrest anyone using codeine now? I am having a difficult time following your logic. A researcher can plant hemp and sell it, but a farmer cannot farm hemp; however, a year from now, those researcher become farmers and can then grow hemp as a farmer. If that is not a bureaucracy sort of swallowing itself, I do not know what is.
Mr. Rowsell: As I have tried to say, sir, there is no regulation in place today that would allow us to do that.
Senator Taylor: Yes, except you have one; you can call everyone who wants to grow hemp a researcher.
Mr. Rowsell: And anybody who wanted to grow opium and anyone who wanted to grow marijuana.
Senator Taylor: No, just hemp.
Mr. Rowsell: You cannot distinguish that.
Senator Taylor: Hemp will be legal.
Senator Lavoie-Roux: Only when the regulations are in place.
Senator Taylor: It will be; we know it.
Ms Peart: One of the problems here is that we expect to define in the regulations the maximum level of THC allowable in hemp for industrial uses. As it is now, if we said that farmers of Cannabis were researchers, it would mean the farmers of what we call marijuana would be considered researchers. Since we have no regulations to limit the amount of THC, all those people who want to grow marijuana would be seeking legal redress if we refused them the research title.
The Chairman: We do not yet know the levels that we want; is that the problem?
Ms Peart: The international community generally uses 0.3 per cent THC. One would assume that that would be the level we would use. That is the level we are now using for research licences. However, when we had our workshop, some of the Canadian farmers expressed concern about what would happen if they had a hail storm that was responsible for bumping up the THC level to what would be considered illegal here and in the European Union. One of the advantages of the research projects is that some of these things will become clearer. We want to do it right the first time with the regulations rather than finding ourselves locked in with circumstances that might not be adequate for Canada.
Mr. Rowsell: As part of the research projects, farmers are testing their crops on a regular basis to determine the THC levels, and the results will then help us to set the standard for Canada.
Senator Taylor: How many people who have applied for a research licence have been turned down?
Ms Peart: I cannot answer that for the past. The trouble is that people would write in and just say they wanted to grow hemp and if their applications were refused, they would say that they had been turned down. Some wrote in knowing that the licences were for research and said they wanted to grow hemp because they wanted to make some money. If their applications were refused, they would say that they had been turned down. This year we have a form with well-established criteria as to what should be included in the application, and so far we have received only 12 applications that comply with the form.
Senator Taylor: Could you circulate that form here, please?
Ms Peart: Yes. You will notice that the information in the package talks about the website. The form is on the Internet. People can down-load it and print it out.
Senator Milne: Ms Peart has already answered one of my remaining questions. I was about to ask you how many licences were being issued this year.
Ms Peart: Sorry, I did not say issued. I was referring to how many applications had been received.
Senator Milne: How many have been issued?
Ms Peart: We are in the process of issuing some but we need additional information on some others. Let us put it this way: We have not rejected anyone yet.
Senator Milne: You have a maximum of 12 this year.
The Chairman: Will you continue to issue licences to grow hemp?
Ms Peart: That is the only means of growing it this year, so yes.
The Chairman: Will you be licensing farmers next year?
Senator Milne: Hopefully next year the regulations will be in place.
Mr. Rowsell: The intention is to put the licensing controls on the import, propagation, and distribution of seed, and then farmers will have some mechanism of identifying themselves, either by their purchase or by a registration system. That has not been determined yet. My preference would be not to have them licensed.
The Chairman: That would be good.
Senator Milne: Since money is always tight and since Ms Peart has just one other person helping her, and since this is a crop that extends into Agriculture Canada's sphere of influence, have you thought of approaching the Department of Agriculture to see if they could share the cost or share personnel with you to help speed this process?
Ms Peart: The departmental committee we spoke about has two members from that department. During our review of the research licences, we had them help us with those areas that are agricultural and about which we are not particularly knowledgeable. We are consulting with them. As I said, we are hoping to do some more direct consultation on the Seeds Act, to see where it overlaps and what impact it has on us.
Senator Milne: In effect, they already are donating time and personnel?
Mr. Rowsell: One aspect we are discussing with them is identifying and listing the varieties of Cannabis that would be acceptable for industrial hemp under the Seeds Act, and then Agriculture Canada would make the regulatory amendments.
Senator Milne: I thank you for coming and speeding this process up. I look forward to receiving the transcript of everything that has been said here today, and I will keep it on file.
The Chairman: If a farmer grew hemp now it would be illegal, even though the act makes it legal next year?
Mr. Rowsell: Unless he has a research licence, it would be illegal, yes.
Senator Lavoie-Roux: Who knows about this?
Mr. Rowsell: You would be surprised. There are quite a few groups around the country who are familiar with it. As I mentioned, it is on our website. We invited the Canadian Federation of Agriculture, which represents farmers across the country, to participate in the consultation process, so they know the documents are available.
Ms Peart: In addition, I went to a symposium in Vancouver that was attended by over 300 people who were interested in industrial hemp, and I made it very clear in my presentation that it was illegal to grow it without a research permit.
The Chairman: Thank you for appearing.
Honourable senators, before we adjourn, I should like to put something on the record. Bill C-93, which deals with certain provisions of the budget tabled in Parliament on February 18, was recently introduced in the Senate. My understanding is the Department of Finance took it upon themselves to send briefing documents to the Standing Senate Committee on Banking, Trade and Commerce rather than to our committee. They will need the unanimous consent of the Senate tomorrow to allow it to proceed. Senator Graham was concerned because I was quite angry. I told him this is the second time they have done this to us. The same thing happened with the blended sales tax bill. They argued it was a tax item, and I argued -- and I still think I am right -- it was an expenditure item because they are paying the maritimes to put on a sales tax. It should have been reviewed here in the finance committee. I know that the Department of Finance does not necessarily love the chairman, but nonetheless they must work with us.
Since I am a nice guy, I told Senator Graham that we will let this pass only because of his personal charm, and that he should tell the Department of Finance, on our behalf -- and I hope you all agree -- that we do not take this lightly. They should have consulted with Senator Graham before they made the decision as to where the bill was sent. That is a decision for the Senate and the leadership in the Senate.
Senator Lavoie-Roux: They should be notified that the next time it will not go through.
The Chairman: I have warned them before about this problem but they do not listen. This time I am making my warning formal and on the record. We will send it to the deputy minister to let him know how we feel.
The committee is adjourned.