Canada Gazette, Part I, Volume 159, Number 26: Regulations Amending the Precursor Control Regulations (Increased Regulatory Oversight)

June 28, 2025

Statutory authority
Controlled Drugs and Substances Act

Sponsoring department
Department of Health

REGULATORY IMPACT ANALYSIS STATEMENT

(This statement is not part of the Regulations or the orders.)

Executive summary

Issues

A dangerous and unpredictable illegal drug supply made up of powerful synthetic opioids like fentanyl and other emerging synthetic drugs is driving overdose deaths and harms, and having devastating impacts on people, families, and communities. Between January 2016 and September 2024, there have been almost 51 000 opioid-related deaths, 46 835 opioid-related hospitalizations, and 193 823 opioid-related emergency department visits. The toxicity and unpredictability of the illegal drug supply continues to be a major driver of the overdose crisis with over 75% of opioid-related deaths involving fentanyl.

Canada has a robust legal framework to mitigate the public health and public safety risks posed by controlled substances. Controlled substances are drugs, such as fentanyl and other synthetic opioids, that the federal government has categorized as having a higher-than-average potential for misuse and diversion, ranging from illegal street drugs to certain prescription medications. The framework not only includes controls on controlled substances themselves, but also on certain chemical building blocks essential to the production of controlled substances (precursors), and on some of the equipment used in their production (designated devices).

Since 2019, Canadian law enforcement agencies have observed a move away from trafficking fentanyl made elsewhere to producing it domestically in clandestine laboratories along with fentanyl analogues (i.e. alterations of drugs that have a different but similar chemical structure that imitates the same pharmacological effects: for example, carfentanil is an analogue of fentanyl). With this shift, there is an increased risk of smuggling precursors into Canada or illegally obtaining them from legitimate domestic sources (diversion).

In response, Canadian law and border enforcement agencies have adapted their efforts to target precursors and designated devices entering Canada, as well as to make it more difficult to divert precursors from legitimate domestic sources. However, there is a need for additional tools to support law and border enforcement agencies, as well as Health Canada, in their collective efforts to address the illegal importation of precursors and designated devices and the illegal importation, production and trafficking of fentanyl. Timely action is required by the Government of Canada to respond to the threat to public health and public safety, in which the illegal drug supply is constantly evolving and in which organized crime groups attempt to evade Canada’s strict controls under the CDSA and its regulations.

Background

Overview of Canada’s legal framework for controlled substances

The CDSA is one of the legislative frameworks through which the Government of Canada fulfills its international obligations under the

• United Nations Convention Against Illicit Traffic in Narcotic Drugs and Psychotropic Substances, 1988;
• Single Convention on Narcotic Drugs, 1961; and
• Convention on Psychotropic Substances, 1971.

These conventions form the basis for the current international drug control system, and require signatories to, among other things, establish national controls on legitimate activities conducted by authorized persons (including organizations) with substances listed in the schedules to the conventions.

The CDSA and its regulations provide a legal framework for the control of drugs that can alter mental processes and pose risks to public health and public safety when misused or diverted to illicit markets.

In general, the CDSA prohibits persons from conducting various activities with substances listed in the schedules to the CDSA, such as production, sale/provision, importation and exportation, unless authorized by regulation or by an exemption issued by the Minister for a medical or scientific purpose, or for a purpose that is otherwise in the public interest. The CDSA specifies a range of offences and penalties for unauthorized activities with controlled substances and precursors. Regulated parties include licensed and registered dealers, pharmacists, health care practitioners and hospitals.

The CDSA and its regulations have the dual purpose of protecting public health and maintaining public safety by balancing the need for access to these substances for legitimate commercial, industrial, medical or scientific purposes and the mitigation of risks of misuse and potential diversion to support the production of illegal drugs by organized crime groups.

Overview of Canada’s regulatory framework for precursors

In Canada, precursors are controlled under Schedule VI to the CDSA and are subject to the PCR. The purpose of the PCR is to ensure that precursors are handled effectively in the course of legitimate commercial, industrial, medical and scientific activities and remain within closed legal distribution channels. It is the regulatory framework through which otherwise prohibited activities with precursors are authorized, for example, through issuance of a licence, registration certificate or import/export permit.

Precursors are essential to the production of a controlled substance. Authorized persons conducting activities with precursors include licensed dealers, pharmacists, health care practitioners and hospital staff. While precursors have legitimate uses, such as in the production of certain goods and products (e.g. pharmaceuticals, fragrances, flavouring agents, petroleum products, fertilizers, paints), they can also be used in the production of illegal drugs, like fentanyl.

There are two classes of precursors under the PCR. Class A precursors are essential ingredients or building blocks used in the production of controlled substances such as fentanyl, methamphetamine, MDMA, cocaine, heroin, LSD and PCP. Class B precursors are common essential reagents such as solvents, acids and bases.

Under the PCR, anyone who wishes to produce, package, provide/sell, export, or possess for those purposes, or import Class A precursors must be licensed with Health Canada. There are also registration requirements for anyone seeking to produce, import or export Class B precursors. There are security, record-keeping and reporting requirements for both Class A and Class B precursors. The PCR also establish a permit scheme for the import, export and transit or transhipment of Class A precursors and a permit scheme for the export of Class B precursors to countries that have requested a pre-export notification of these precursors through the International Narcotics Control Board.

Overview of controls related to ephedrine and pseudoephedrine — two precursors used in the illegal production of methamphetamine

Ephedrine and pseudoephedrine are two precursors that have an established history of misuse and diversion to the illegal production of methamphetamine. While natural health products (NHPs) and non-prescription drugs (NPDs) containing these precursors have been authorized for sale with approved conditions of use as decongestants, there is evidence that some of these health products have been promoted and sold for unintended uses outside the pharmacy setting, often to consumers wishing to enhance athletic performance and increase weight loss and energy.^{footnote 1}

There is also an established history of these products, in particular single ingredient 8 mg ephedrine formulations, being diverted and used to illegally produce methamphetamine in clandestine laboratories by organized crime groups in Canada and internationally. The Royal Canadian Mounted Police (RCMP) and Health Canada’s Drug Analysis Service have recorded instances of clandestine laboratories using ephedrine tablets to synthesize methamphetamine between 2011 and 2020. Evidence demonstrates that pseudoephedrine can also be extracted from a variety of NPDs including cold and flu, allergy and decongestant preparations, and in various forms (tablets, coated tablets, soft gelatin capsules, liquids, etc.).^{footnote 2}

In 2006, in response to evidence from law enforcement demonstrating the diversion of ephedrine and pseudoephedrine to the illegal market, the National Association of Pharmacy Regulatory Authorities (NAPRA) added ephedrine and pseudoephedrine to its National Drug Schedules, which imposed certain condition-of-sale restrictions on NHPs and NPDs containing these substances. Products containing ephedrine or pseudoephedrine as their only medicinal ingredient were listed in Schedule II; this required professional intervention from a pharmacist for their sale (i.e. only available behind the counter). Products containing ephedrine and/or pseudoephedrine, as well as other medicinal ingredients, were listed in Schedule III; they could only be sold in pharmacies but could be available for self-selection (i.e. over the counter). However, in 2024, NAPRA removed ephedrine and pseudoephedrine from its National Drug Schedules as part of an updated policy on NHPs, which outlines that NHPs approved for sale under the Natural Health Products Regulations are not considered products for scheduling within the National Drug Schedules. This policy also impacted some NPDs containing ephedrine and pseudoephedrine, as NAPRA schedules are based on ingredients, not whether the product is an NHP or NPD.

Since many provinces and territories incorporate by reference NAPRA’s National Drug Schedules in their respective laws, the NAPRA scheduling change resulted in the removal of the associated condition-of-sale restrictions in pharmacy settings for all NHPs and many NPDs containing ephedrine and/or pseudoephedrine. This had the potential to increase risks of misuse and diversion of these products.

Overview of the Order Establishing Supplementary Rules Respecting the Sale of Natural Health Products Containing Ephedrine or Pseudoephedrine

In response to NAPRA’s removal of ephedrine and pseudoephedrine from the National Drug Schedules, the Minister made a temporary Interim Order Concerning the Sale of Certain Natural Health Products Containing Ephedrine or Pseudoephedrine (Interim Order), which was replaced by the Order Establishing Supplementary Rules Respecting the Sale of Natural Health Products Containing Ephedrine or Pseudoephedrine (Ministerial Order) under the Food and Drugs Act. The Ministerial Order was published in the Canada Gazette, Part II, on March 26, 2025, and came into force on May 18, 2025.

The Ministerial Order maintains the requirements set out in the Interim Order (which ceased to have effect on May 17, 2025) for NHPs containing ephedrine and/or pseudoephedrine as their only medicinal ingredients. The Ministerial Order also introduced condition-of-sale restrictions for NHPs containing ephedrine and/or pseudoephedrine in combination with other NHPs. These requirements align with how ephedrine and pseudoephedrine were previously scheduled under NAPRA’s National Drug Schedules. The Interim Order and Ministerial Order, however, did not introduce condition-of-sale restrictions for NPDs containing ephedrine and/or pseudoephedrine. Thus, there continues to be a gap concerning the retail sale of certain NPDs containing ephedrine and/or pseudoephedrine, and they continue to be at risk of misuse and diversion.

Overview of Schedule IX to the Controlled Drugs and Substances Act

In 2017, amendments were made to the CDSA to prohibit the unregistered importation of certain equipment (designated devices) that can be used in the illegal production of drugs. The list of designated devices subject to import controls is set out in Schedule IX to the CDSA. Currently, pill presses and capsule filling machines (i.e. encapsulators) are listed in Schedule IX, but not their component parts. These designated devices are also used in pharmaceutical, food and other consumer product industries.

Objective

Organized crime groups are constantly evolving their illegal drug operations to evade the strict controls established under the CDSA and its regulations. In response, the Government of Canada must continually take concrete action to adapt its own strategies and approaches to mitigate risks to public health and public safety. The proposed amendments aim to protect public health and public safety by providing Health Canada and the Canada Border Services Agency (CBSA) with additional tools to support law enforcement in their efforts to detect and disrupt the illegal fentanyl trade and the supply of other illegal synthetic drugs. Targeted amendments to the regulations for precursors and designated devices would reduce risks of their misuse or diversion while supporting their legitimate use for commercial, industrial, medical or scientific purposes. They would address commitments made in Canada’s Border Plan, strengthen border security and help keep individuals, families and communities safe.

Description

The proposed amendments to the PCR and to Schedule IX to the CDSA target the following five priority areas: mandatory reporting of suspicious transactions; reasonable steps taken by licensed and registered dealers to prevent the potential diversion of precursors; condition-of-sale restrictions for NHPs and NPDs containing ephedrine and/or pseudoephedrine; increased regulatory flexibility for Health Canada; and expansion of import registration requirements for designated devices to include the importation of component parts. These amendments would be made by the Governor in Council. The Repeal Order, made by the Minister, would help ensure there is no duplication of the regulatory requirements related to retail sale for NHPs containing ephedrine and pseudoephedrine and that there is clarity for regulated parties.

Mandatory reporting of suspicious transactions to Health Canada

To help ensure that precursors remain in legal distribution channels and are used for legitimate purposes, the proposed amendments to the PCR would require licensed and registered dealers conducting activities with precursors to provide a written report to Health Canada within 72 hours of becoming aware of a transaction occurring where they have reasonable grounds to suspect it may be related to the diversion of a precursor to an illicit market or use. Currently, licensed and registered dealers are required to make a record of every suspicious transaction and retain it for at least two years; reporting to Health Canada is voluntary.

The proposed mandatory report would include a detailed description of the reasons for the dealer’s suspicions and would be retained for two years after it was made. This retention requirement would also apply to dealers who are no longer licensed or registered. Dealers would not be permitted to disclose that they have made a report or disclose details in the report with the intent to prejudice a criminal investigation, whether or not a criminal investigation has begun.

Mandatory reporting would enable prompt action by Health Canada to verify and triage information on suspicious transactions. In appropriate cases, Health Canada would proactively disclose this information to law enforcement agencies. Mandatory reporting also provides a proactive mechanism for collecting information instead of relying on inspections and encourages early detection of criminal activity trends. It is anticipated that mandatory reporting would reduce the risk of legitimate businesses being targeted by organized crime groups and protect licensed and registered dealers who may feel at risk when reporting suspicious transactions voluntarily.

To encourage reporting, protective measures would be provided for licensed and registered dealers. They would be protected against civil proceedings if the suspicious transactions report was made in good faith. In addition, there would be a partial protection against self-incrimination for them, and their agents or mandataries, when reporting suspicious transactions. Similar protection against self-incrimination would be provided for licensed and registered dealers, and their agents or mandataries, when reporting loss or theft.

Reasonable steps taken by licensed and registered dealers to prevent the potential diversion of precursors

Under the PCR, senior personnel responsible for dealing with precursors are required to provide a criminal record check to Health Canada, or consent to one being carried out for them, when applying for or renewing a licence or registration. Depending on whether the dealer deals in Class A or Class B precursors, this applies to the senior person in charge of a licence (SPIC), the responsible person in charge of a licence (RPIC) and the alternate RPIC.

Concerns have been raised that organized crime groups might look to infiltrate licensed and registered dealers. To address this concern, the proposed amendments to the PCR would require licensed and registered dealers to take reasonable steps and require criminal record checks for certain employees to ensure that all of their employees do not contribute to the risk of a precursor being diverted to an illicit market or use. The reasonable steps would involve taking into consideration whether an employee with access to precursors in the course of their duties has been convicted as an adult within the previous 10 years of a designated drug offence or a designated criminal offence (e.g. production of substances in the schedules to the CDSA), or an equivalent offence outside of Canada. Licensed and registered dealers would have flexibility to determine how best to achieve compliance with this new personnel security requirement and tailor measures to their operations.

Any documents or records related to implementing reasonable steps would need to be retained for two years after the information was recorded. This requirement would also apply to dealers who are no longer licensed or registered.

Condition-of-sale restrictions for natural health products and non-prescription drugs containing ephedrine and/or pseudoephedrine

To address the risk of misuse and diversion of ephedrine and pseudoephedrine, the proposed amendments to the PCR would replicate the requirements set out in the Ministerial Order for NHPs, while introducing condition-of-sale restrictions for NPDs containing these ingredients. Since ephedrine and pseudoephedrine are listed as Class A precursors and the PCR is the regulatory framework by which Health Canada controls precursors, Health Canada recognizes the PCR would be a more appropriate place for these condition-of-sale restrictions to reside than the Ministerial Order. These restrictions would align with the previous restrictions under NAPRA’s National Drug Schedules. The aim would be to ensure these products remain strictly regulated, while also ensuring individuals can continue to have access to these products for the treatment of approved indications (e.g. nasal congestion).

While the PCR allow for the sale or provision (or possession for the purpose of sale or provision) of a Class A precursor on a retail basis under certain conditions by persons other than licensed dealers and other regulated parties, under the proposed amendment this exception would no longer apply to NHPs and NPDs containing ephedrine and/or pseudoephedrine. Furthermore, the proposed amendment would prohibit licensed dealers from selling or providing these products to anyone other than other licensed dealers, pharmacists, health care practitioners and hospitals. This would effectively allow for continued intra-industry sale of these products (e.g. between manufacturers and distributors), but limit their ability to be provided or sold to an end user (e.g. the consumer) by anyone other than pharmacists, health care practitioners and hospitals.

Clinical trials involving these products and the distribution of product samples by a practitioner or pharmacist would remain unaffected.

Conditions of sale at the retail level

For pharmacists selling these products only on a retail basis, the following condition-of-sale restrictions would apply:

• The proposed amendment would permit a pharmacist to sell NHPs containing ephedrine and/or pseudoephedrine as their only medicinal ingredients (referred to as non-combination products) in a pharmacy setting, but these products could not be accessible to the public (e.g. would need to be sold behind the counter in a pharmacy).
• For NHPs and NPDs that contain ephedrine and/or pseudoephedrine in combination with other NHPs or drugs (referred to as combination products), a pharmacist (or a person working in a retail location serviced by a pharmacist) would be permitted to sell them in an area accessible to the public for self-selection (e.g. sold over the counter in a pharmacy). However, a pharmacist would need to be available at the request of a purchaser or consumer to discuss the products prior to purchase.

The proposed amendment would allow pharmacists to further restrict the retail sale of combination products to comply with additional restrictions that may be imposed by provincial or territorial regulations or should they choose to do so for other reasons. For example, where there is evidence or a particular concern about misuse or diversion, a pharmacist could sell these products in an area not accessible to the public (e.g. sold behind the counter in a pharmacy).

The proposed amendments are technologically neutral in that the sale prohibitions and exceptions apply to both physical and online retail settings. For example, combination products could be sold by an online pharmacy retailer; however, a pharmacist would need to be available (e.g. by telephone, video, text or other means of communication) at the request of the purchaser or consumer to discuss the products prior to purchase.

The proposed amendments would not include any new restrictions on the sale of veterinary drugs or veterinary health products containing ephedrine and/or pseudoephedrine or natural health products or drugs containing the plant ephedra (as long as the health product does not also contain isolated and extracted ephedrine or pseudoephedrine in addition to the ephedra), which is typically used in traditional Chinese medicines. While there are a limited number of approved pharmaceutical drugs containing ephedrine that are administered via injection and do not require a prescription, these drugs would be out of the scope of these amendments due to their lower risk of diversion and misuse. Should Health Canada or law enforcement detect instances of diversion or misuse of any of these other products, additional condition-of-sale restrictions may be considered by Health Canada in the future.

Increased regulatory flexibility so that Health Canada can respond to public health or public safety risks in a more agile and timely manner

The following proposed amendments to the PCR would provide the Minister with increased flexibility to respond to new and emerging public health or public safety risks related to precursors in a timely manner. In addition, they would increase efficiency by enabling the Minister to target specific activities instead of fully suspending a dealer’s licence or registration, thereby reducing potential operational impacts to businesses.

Licence and registration conditions

The proposed amendments would introduce new regulatory tools and flexibility for the Minister. Namely, they would allow the Minister to add, modify or delete conditions to a licence (for Class A precursors) or registration (for Class B precursors) at any time the Minister has reasonable grounds to believe that the conditions are necessary to ensure that international obligations are respected or to ensure compliance with the CDSA or PCR, including by preventing a precursor from being diverted to an illicit market or use.

For example, the Minister could add conditions to a licence in response to an issue of non-compliance identified during an inspection. Currently, the Minister is limited to adding, modifying or removing conditions to a licence or registration at the time of issuance or renewal (or in the case of a licence for Class A precursors, when an amendment is initiated by the licensed dealer).

To ensure transparency and fairness, a licensed or registered dealer would be provided prior written notice that sets out the Minister’s reasons and dealers would have an opportunity to comment on the changes before conditions are added or modified.

The proposed amendments would provide an exception in urgent circumstances, where the Minister may add a condition or modify one without prior notice if there are reasonable grounds to believe that it is necessary to do so to protect public health or public safety or reasonable grounds to suspect that it is necessary to prevent a precursor from being diverted to an illicit market or use. In such situations, impacted parties would have an opportunity to be heard after the decision has taken effect, and the notice would specify any corrective measures that are to be carried out.

In the context of deleting a condition on a licence or registration, the change would take effect as soon as the Minister provides the dealer with a written notice to that effect.

Partial suspensions

Consistent with federal regulations such as the Cannabis Regulations and the proposed Controlled Substances Regulations, the proposed amendments would authorize the Minister to partially suspend a licence or registration with respect to any authorized activity relating to any precursor, without prior notice, if the Minister has reasonable grounds to believe that such suspension is necessary to protect public health, safety or security or has reasonable grounds to suspect that continuing the activities presents a risk of a precursor being diverted to an illicit market or use. Currently, the Minister’s authority under the PCR is limited to fully suspending a licence or registration.

In such cases, the suspension would take effect as soon as the Minister provides the dealer with a notice in writing. While the decision would take effect when the notice is provided, the notice would specify the reasons for the suspension, corrective measures that must be carried out (if applicable) and provide dealers with an opportunity to be heard. Reinstatement would occur if the reasons for the suspension no longer exist or the dealer demonstrates that the suspension is unfounded.

Transit and transhipment permits

Currently, there are no authorities for the Minister to add conditions to transit and transhipment permits at the time of issuance. The proposed amendments would enable the Minister to add conditions to these permits; however, the Minister would not be authorized to add, modify or delete conditions after the permit is issued nor to partially suspend this type of permit once a permit has been issued.

Expansion of import registration requirements for designated devices to include the importation of component parts

Law and border enforcement agencies have raised concerns that organized crime groups are breaking down designated devices into component parts prior to importation to evade existing import registration requirements under the CDSA.

The proposed Order Amending Schedule IX to the Controlled Drugs and Substances Act would

• Clarify that designated devices must be registered with the Minister prior to importation regardless of whether this equipment is imported as a whole or in parts (i.e. unassembled or fully or partially assembled or disassembled); and
• Add component parts (i.e. punches, moulds and dies) suitable for use in a pill press or encapsulator to prohibit their importation unless the importation is registered.

When importing a designated device, importers would not be required to register both the device and the component parts (punches, moulds and dies) that already form part of that device. They would only be required to register scheduled component parts if they are being imported as separate parts from the device (e.g. as replacement parts for an already existing device or if importing multiple different punches, moulds or dies along with a designated device).

Prior to importation, importers would be required to provide the information set out in the CDSA to the Minister. This would enable the Minister to register the importation and provide proof of the registration to the person importing the scheduled items. The importer would be further required to provide proof of the import registration to the customs office at the time of importation.

The Minister would be authorized to disclose this information to the CBSA for the purpose of verifying compliance and also to a Canadian police force who requests the information in the course of an investigation under the CDSA.

The Minister would have the option to refuse to register or to cancel the import registration of these scheduled component parts if the Minister believes on reasonable grounds that false or misleading information was provided, or it is necessary to do so to protect public health or public safety.

Order Repealing the Order Establishing Supplementary Rules Respecting the Sale of Natural Health Products Containing Ephedrine or Pseudoephedrine

For clarity and to avoid confusion for regulated parties, as well as to avoid the application of similar requirements under two different frameworks for controlling ephedrine and pseudoephedrine, the Ministerial Order would be repealed via the proposed Repeal Order when the PCR amendments come into force.

Unlike the other regulatory instruments covered by this Regulatory Impact Analysis Statement, which are made under the authority of the Governor in Council, the proposed Repeal Order would be made under the authority of the Minister. Given that the proposed amendments to the PCR and the proposed Repeal Order are linked, presenting both instruments in this Regulatory Impact Analysis Statement offers a more transparent and coherent picture.

Regulatory development

Consultation

On February 1, 2025, Health Canada published a notice of intent in the Canada Gazette, Part I, and launched a public consultation on the proposed amendments to the PCR and to the Schedule IX to the CDSA that would increase oversight of precursors, strengthen Canada’s regulatory framework and increase Health Canada’s regulatory flexibility and agility. The consultation was open for public comment for 30 days and closed on March 3, 2025.

Health Canada received 23 responses to the notice of intent, largely from industry or industry associations that use precursors such as manufacturers, distributors, importers and exporters in the pharmaceutical, chemical and fragrance industries. Other responses were from law enforcement and the general public. The proposal was generally well received. Most respondents were supportive of Health Canada’s efforts to curb illegal activities related to the importation, production, diversion and trafficking of precursors and designated devices.

Key highlights of the consultation feedback received are summarized thematically below.

Mandatory reporting of suspicious transactions to Health Canada

The proposal to change from voluntary reporting of suspicious transactions to mandatory reporting was positively received and supported by all stakeholders with the exception of one.

Many indicated a need for a precise definition of a suspicious transaction, more information on the reporting mechanism and details on potential implications for failing to report suspicious transactions accurately. There were also some questions on enforcement, such as whether Health Canada or law enforcement agencies would be leading investigations and how compliance would be enforced. Some respondents suggested considering incentives for those who report suspicious transactions and protections for whistle-blowers.

Health Canada would address many of the suggestions in updated guidance. To support compliance with reporting, the proposed amendments include protective measures for licensed and registered dealers.

Reasonable steps by licensed and registered dealers to prevent the potential diversion of precursors

As part of taking reasonable steps to prevent diversion, Health Canada consulted on an initial proposal to require licensed and registered dealers to conduct criminal record and background checks on prescribed additional personnel dealing with precursors. There was support for this proposal; however, respondents identified a need for more details on who, within an organization, would be included under this expanded requirement. They also expressed concern about the costs of additional criminal record checks and how this might implicate personnel who are located abroad. Respondents also suggested a phased implementation approach to allow businesses time to transition their operations.

In response to this feedback and further analysis, Health Canada has adjusted its approach to reduce regulatory burden and cost, and to increase flexibility for licensed and registered dealers, by proposing they take reasonable steps to ensure their employees do not contribute to the risk of diversion. Measures could include conducting employment background checks or verifying previous convictions as part of their hiring practices. Through guidance, it would be recommended that licensed and registered dealers have a process in place and keep records to explain the reasonable steps that were taken. This approach aligns more closely with the approach taken in the United States.

Condition-of-sale restrictions for natural health products and non-prescription drugs containing ephedrine and/or pseudoephedrine

In general, respondents expressed support for the condition-of-sale restrictions for health products containing ephedrine and pseudoephedrine.

However, many requested greater detail on the scope and intent of the proposed changes. The potential negative impacts that certain restrictions could have on pharmacies were of particular concern. For example, respondents requested more clarity on how these changes would impact individual pharmacy operations and the potential for increased burden on pharmacies in rural and remote communities.

Taking this feedback into consideration, as well as further analysis, Health Canada is not planning to establish certain condition-of-sale restrictions, such as setting limits on the amount of these health products that could be sold to an individual by pharmacies.

In addition to the notice of intent, provincial and territorial health officials, pharmacy regulatory authorities (including NAPRA) and industry stakeholders (including product licence holders and distributors) were consulted in October 2024 on the impact of the Interim Order and Health Canada’s plans for a ministerial order, including broadening the scope of oversight to include combination NHPs (i.e. NHPs containing ephedrine and/or pseudoephedrine in combination with other NHPs). As part of these consultations, some industry stakeholders sought clarification as to whether NPDs containing pseudoephedrine would be prohibited from sale to non-pharmacy retailers. At that time, Health Canada confirmed that NPDs containing ephedrine and/or pseudoephedrine were not under the scope of the Ministerial Order.

Increased regulatory flexibility to allow Health Canada to respond to public health or public safety risks in a more agile and timely manner

Respondents were generally supportive of the proposal to allow the Minister to add, modify or delete conditions of a licence or registration at any time and to enable the partial suspension of activities authorized in a licence or registration.

Some had concerns about the lack of detail on the expanded authorities, including how the proposed amendments would be different from existing federal powers to revoke or suspend licences. In addition, there were concerns around the potential lack of transparency in the exercise of this new authority. To address concerns about transparency and procedural fairness, the proposed amendments would require the Minister to provide written notice of changes being made to a licence or registration.

Health Canada would continue to take a risk-based approach to its compliance and enforcement actions and would choose the most appropriate tool to monitor compliance and mitigate risks to public health or public safety as circumstances warrant.

Expansion of import registration requirements for designated devices to include the importation of component parts

Industry expressed concerns about expanding the import registration requirements for designated devices to include component parts.

In particular, they indicated that there could be delays to business operations, including product manufacturing, if the new import registration requirements impeded the ability to quickly obtain replacement parts, which could in turn lead to drug shortages. It was suggested that Health Canada consider an exemption for those businesses with valid licences under other frameworks (e.g. a drug establishment licence under the Food and Drugs Regulations). One respondent suggested limiting this regulatory amendment to proprietary parts versus generic ones as the latter are used widely across various industries.

Based on consultation feedback, Health Canada is proposing to limit component parts to punches, moulds and dies suitable for use in pill presses and encapsulators. Other jurisdictions (e.g. Alberta and British Columbia) have also sought to regulate these parts because they are considered integral parts to drug manufacturing equipment.

Order Repealing the Order Establishing Supplementary Rules Respecting the Sale of Natural Health Products Containing Ephedrine or Pseudoephedrine

Health Canada did not consult on its intent to repeal the Ministerial Order (via the Repeal Order) in the notice of intent. However, this regulatory action is not expected to impact regulated parties because all condition-of-sale restrictions in the Ministerial Order pertaining to non-combination and combination NHPs would be carried over in the proposed amendments to the PCR.

Support from law enforcement partners

Law enforcement partners were supportive of the proposed amendments because they address operational concerns and prior recommendations made to Health Canada. Key partners include Public Safety Canada, the CBSA, the RCMP and local police forces.

Modern treaty obligations and Indigenous engagement and consultation

An assessment of modern treaty implications has been conducted and concluded that the proposed amendments do not trigger a duty to consult with Indigenous peoples. The proposed amendments would advance public health and public safety objectives, particularly those related to curbing illegal activities related to fentanyl and illegal synthetic drug production and the potential diversion of precursors. Since the proposed amendments do not specifically target Indigenous peoples, they are not expected to impact the rights of Indigenous peoples recognized and affirmed under section 35 of the Constitution Act, 1982, and the assessment did not identify any implications for modern treaties and self-government agreements.

There were no responses received from Indigenous peoples from the notice of intent.

Instrument choice

The threat that the illegal fentanyl trade and other illegal synthetic drugs pose to public health and public safety, and the means by which organized crime groups seek to evade current controls, indicate that guidance, directives or other non-regulatory approaches would not be efficient or effective in curbing illegal activities with precursors and designated devices. Regulatory amendments, on the other hand, would allow the Government of Canada to respond proportionally to the degree and type of risk and would provide law and border enforcement agencies, as well as Health Canada, with additional tools to target the diversion of precursors and designated devices that support the illegal domestic production of fentanyl and other synthetic drugs by organized crime groups.

Regulatory analysis

Benefits and costs

Analytical approach

To estimate impacts of the proposed amendments to the PCR and Schedule IX to the CDSA, a cost-benefit analysis (CBA) was undertaken that identified and, to the extent possible, quantified and monetized the incremental costs and benefits on impacted stakeholders. These incremental costs and benefits were derived by comparing a baseline scenario to a regulatory scenario that reflects key aspects of the proposed regulatory amendments. To quantify impacts, Health Canada used internal administrative data as well as information collected from stakeholders through a questionnaire. Where quantification was not possible, the incremental impacts were evaluated in qualitative terms.

Since condition-of-sale restrictions for NHPs containing ephedrine and/or pseudoephedrine already exist in the Ministerial Order, these restrictions are not within the scope of this CBA. Incorporating the restrictions that are in the Ministerial Order into the PCR would constitute a transfer of requirements from one regulatory instrument to another, with no incremental impacts on any stakeholder. The impacts identified and assessed for the Ministerial Order exist in the baseline scenario and would remain in the regulatory scenario. Thus, the benefits and costs outlined are with respect to combination NPDs only (i.e. NPDs that contain ephedrine and/or pseudoephedrine along with additional drugs).

All benefits and costs are estimated over 10 periods of 12 months and expressed in constant 2024 Canadian dollars. The present values (PV) of these estimates are discounted to period one using a 7% discount rate.

Regulations Amending the Precursor Control Regulations (Increased Regulatory Oversight)

Costs

Costs to licensed and registered dealers

One-time costs to licensed and registered dealers to familiarize themselves with the amendments

All licensed and registered dealers would need to review the amendments to familiarize themselves with the requirements to ensure compliance. Health Canada assumes that each of the 429 licensed and registered dealers would have four employees (i.e. one managerial and three staff) reviewing the proposed amendments, and that each employee would spend approximately 30 minutes reviewing the proposed amendments.^{footnote 3} Using hourly wages of $75.60 (managerial)^{footnote 4} and $41.52 (staff),^{footnote 5} the total cost to all licensed and registered dealers to familiarize themselves with the proposed amendments is estimated to be about $40,127 in PV over 10 periods of 12 months, or $5,713 in annualized value.

Cost of mandatory reporting of suspicious transactions to Health Canada

Currently under the PCR, licensed and registered dealers must make a record relating to suspicious transactions; however, they do not have to report these suspicious transactions to Health Canada. Nevertheless, some dealers have been reporting transactions they deemed suspicious to Health Canada on a voluntary basis. Over the past three years, Health Canada received a cumulative total of about 580 suspicious transactions reports involving precursors.

With the proposed mandatory reporting requirement, licensed and registered dealers who have not been voluntarily reporting suspicious transactions to Health Canada would now have to do so and would face the associated incremental administrative burden. It is estimated that about 120 suspicious transactions reports that would not have been submitted to Health Canada under the baseline scenario would now be submitted every year going forward. It is assumed that a dealer would spend approximately 30 minutes to prepare and submit a suspicious transactions report and, if necessary, respond to Health Canada’s subsequent inquiry. This assumption is based on internal assessment of the information requirements on the form as well as estimates provided by industry from previous feedback on similar forms. Using an hourly wage rate of $41.52 (staff), the total costs to licensed and registered dealers are estimated to be $17,057 in PV over 10 periods of 12 months or $2,429 in annualized value.

Cost associated with reasonable steps

Currently most dealers proactively take various steps to minimize the risk that their employees might contribute to the diversion of precursors. These steps often include conducting criminal record checks for some employees (particularly for senior person in charge and responsible person in charge), or verifying prior convictions.

The proposed amendments to the PCR would require licensed and registered dealers to take reasonable steps to ensure that employees do not contribute to the risk of precursors being diverted to an illicit market. While the proposed amendments do not prescribe any specific measures, licensed and registered dealers are able to determine their own approaches depending on the circumstances of their operations.

Given that many regulated parties already use various methods to mitigate this risk, and considering that industry typically opt for cost-effective compliance approaches, we expect that most will continue with their existing practices. However, companies who have not yet fully met this requirement voluntarily would therefore need to implement additional measures. Although Health Canada has not outlined specific measures, potential steps that could be taken include developing a standard operating procedure for hiring employees with access to precursors, conducting employment or identify verification, or performing an online search for information about the applicant (government website, social media, etc.).

There are 355 companies who have 429 licensed or registered sites. It is assumed that 10% of these companies would spend approximately 3 360 hours (96 hours per company) per year to screen employees. Using an hourly wage rate of $58.56,^{footnote 6} the total costs to these companies are estimated to be $1.38 million in PV over 10 periods of 12 months or $196,765 in annualized value.

Costs of imposing condition-of-sale restrictions for combination NPDs

Currently, according to the Drug Product Database, there are approximately 90 combination NPDs listed as marketed. Technically, under the baseline scenario, these products can be sold by any retailers, including pharmacies or gas stations. However, given that they were previously under NAPRA’s National Drug Schedules and some products still include other ingredients that remain subject to NAPRA’s National Drug Schedules, to the best of Health Canada’s knowledge, these combination NPDs are not currently sold or expected to be sold or provided by anyone other than pharmacists, health care practitioners, and hospitals.

Under the proposed amendments, licensed dealers would be prohibited from selling or providing these NPDs to anyone other than licensed dealers, pharmacists, health care practitioners, and hospitals. It should be noted that in the absence of the sale restrictions, it is possible that some licensed dealers may in the future want to start selling combination NPDs to businesses other than pharmacies. The proposed amendments may therefore limit this opportunity thus impacting industry in the form of limited access to the market resulting in profit losses. However, given the uncertainty about future sales to businesses other than pharmacies, and due to a lack of data, it is not possible to quantify this impact. Nonetheless, Health Canada acknowledges that these proposed amendments could lead to an economic impact for some businesses.

Record keeping costs

Currently, former registered dealers are not required to retain loss and theft records and other documents once their registration expires or is revoked. However, with the proposed amendments, former registered dealers would be required to retain loss and theft records and other documents after their registration is no longer active.

In addition, all 429 licensed and registered dealers would be required to retain reports submitted to Health Canada regarding suspicious transactions, and any documents related to reasonable steps in ensuring their employees do not pose a diversion risk. All of these documents must be kept for two years. It is assumed that all dealers have migrated to keeping records electronically. It is also assumed that each year, there would be 2 former registered dealers, each retaining 250 documents, while each of the 429 existing dealers would retain 200 documents to meet this requirement. Assuming that the costs of storing a digital document are approximately 2.16 cents per 100 documents,^{footnote 7} the total cost of retaining these required documents is estimated to be $131 in PV over 10 periods of 12 months or $19 in annualized value.

Costs to government

Health Canada would incur costs associated with processing suspicious transactions reports. Additionally, Health Canada would incur costs to conduct compliance promotion and enforcement activities to support the implementation of the proposed regulatory amendments. These activities would include developing and publishing web-based promotional materials to raise awareness about changes to the PCR, revising guidance, relevant forms as well as internal standard operating procedures, responding to stakeholder inquiries and conducting inspections to promote and verify compliance. These costs are expected to be $295,178 in PV over 10 periods of 12 months or $42,027 in annualized value.

Benefits

Requiring licensed and registered dealers to report suspicious transactions to Health Canada, including high-volume transactions or unusual payment methods, would strengthen existing controls and oversight for precursors under the PCR. This would help reduce risks of diversion of these precursors to illicit markets and prevent their use in the illicit production of fentanyl and other synthetic drugs, as well as disrupt related actions in support of these illicit activities. Mandatory reporting of suspicious transactions would align the PCR with the regulatory scheme for controlled substances and with similar requirements with respect to precursors in the United States.

The proposed amendments would require licensed and registered dealers to take reasonable steps to ensure employees do not contribute to the risk of precursors being diverted to an illicit market or use. Measures could include conducting employment background checks or verifying convictions as part of their hiring practices. This requirement would help prevent the potential for legitimate businesses from being inadvertently involved in illegal activities.

The proposed amendments would also prohibit licensed dealers from selling and providing combination NPDs to anyone other than licensed dealers, pharmacists, health care practitioners, and hospitals. This targeted amendment would ensure the protection of public health and public safety while maintaining continued access for legitimate purposes. These benefits are considered minimal given that most, if not all, of the impacted combination NPDs are already being sold or provided primarily by pharmacists, health care practitioners and hospitals.

Enabling the Minister to add, modify or delete conditions to a licence or registration at any time, or to partially suspend certain activities authorized on a licence or registration, would allow Health Canada to address areas of non-compliance by regulated parties or take quick actions against potential risks to public health or public safety, including the risk of misuse and diversion of precursors to illicit markets.

Order Amending Schedule IX to the Controlled Drugs and Substances Act

Costs

Registration costs to importers of component parts for designated devices

Under the baseline scenario, any person can import component parts (i.e. punches, moulds and dies) that are intended to be used in designated devices, without having to register these parts with Health Canada. Under the regulatory scenario, any person importing these component parts^{footnote 8} must register them with Health Canada prior to their importation.

Registering the targeted component parts would result in costs to affected importers. These costs are associated with time spent preparing and submitting a registration form to Health Canada prior to the component part arriving at the border. Since the registration form is similar to the one used for registering designated devices, which takes approximately 45 minutes to complete, it is assumed that affected importers would require the same amount of time per registration form. Additionally, it is estimated that about 1 200 component parts would be imported annually. Assuming an average hourly wage of $41.52, the total cost to importers associated with the import registration application is estimated to be $249,086 in PV over 10 periods of 12 months or about $35,464 in annualized value.

Costs to government

Health Canada would bear costs associated with processing import registration requests for component parts. Additionally, Health Canada would bear costs to conduct compliance promotion and enforcement activities to support the implementation of the proposed amendments. These activities would include developing and publishing web-based promotional materials to raise awareness about changes to Schedule IX to the CDSA, revising guidance, developing the registration form, responding to stakeholder inquiries and conducting inspections to promote and verify compliance. These costs are expected to be $53,917 in PV in total over 10 periods of 12 months or $7,677 in annualized value.

Benefits

Amending Schedule IX to the CDSA to include individual component parts (punches, moulds and dies) suitable for use in a pill press or encapsulator would support law and border enforcement’s efforts to address the illegal importation of these parts in Canada and would further prevent the use of designated devices in the illicit production of fentanyl and other synthetic drugs.

Order Repealing the Order Establishing Supplementary Rules Respecting the Sale of Natural Health Products Containing Ephedrine or Pseudoephedrine

The Repeal Order would not result in any change in impacts because the requirements in the Ministerial Order would be incorporated in the PCR.

Cost-benefit statement

• Number of years: 10 periods of 12 months (2025–2026 to 2034–2035)
• Price year: 2024
• Present value base year: 2025
• Discount rate: 7%

Table 1.1: Monetized costs — Regulations Amending the Precursor Control Regulations (Increased Regulatory Oversight)

Impacted stakeholders	Description of cost	Base year	2nd year	Final year	Total (undiscounted)	Total (PV)	Annualized value
Licensed and registered dealers	Familiarization with the regulatory proposal	$42,936	$0	$0	$42,936	$40,127	$5,713
	Reporting suspicious transactions	$1,884	$2,512	$2,512	$24,493	$17,057	$2,429
	Taking reasonable steps	$196,765	$196,765	$196,765	$1,967,648	$1,381,993	$196,765
	Record keeping	$19	$19	$19	$186	$131	$19
	Total costs to industry	$241,603	$199,295	$199,295	$2,035,262	$1,439,308	$204,925
Government	Implementation compliance and enforcement	$109,868	$51,359	$18,328	$373,768	$295,178	$42,027
	Total costs to government	$109,868	$51,359	$18,328	$373,768	$295,178	$42,027
All stakeholders	Total costs	$351,471	$250,655	$217,623	$2,409,030	$1,734,486	$246,952

Table 1.2: Monetized costs — Order Amending Schedule IX to the Controlled Drugs and Substances Act

Impacted stakeholders	Description of costs	Base year	2nd year	Final year	Total (undiscounted)	Total (PV)	Annualized value
Importers of component parts	Preparing and submitting registration forms for component parts	$27,513	$36,685	$36,685	$357,675	$249,086	$35,464
Government	Processing registration forms for component parts	$7,677	$7,677	$7,677	$76,766	$53,917	$7,677
All stakeholders	Total costs	$35,190	$44,361	$44,361	$434,441	$303,003	$43,141

Table 1.3: Aggregate monetized costs

Impacted stakeholders	Base year	2nd year	Final year	Total (undiscounted)	Total (PV)	Annualized value
Industry	$269,116	$235,980	$235,980	$2,392,937	$1,688,394	$240,389
Government	$117,545	$59,036	$26,004	$450,534	$349,096	$49,703
TOTAL	$386,661	$295,016	$261,984	$2,843,471	$2,037,490	$290,093

Qualitative impacts

Positive impacts

Regulations Amending the Precursor Control Regulations (Increased Regulatory Oversight)

• Requiring licensed and registered dealers to report suspicious transactions would result in reduced risks of diversion of precursors to illicit markets and uses.
• Requiring licensed and registered dealers to take reasonable steps to ensure that employees do not contribute to a diversion risk would prevent the potential for legitimate businesses from being inadvertently involved in supplying products used for illicit activities and help deter organized crime groups from accessing legitimate channels to divert precursors to the illicit market.
• Imposing condition-of-sale restrictions on combination NPDs would contribute to maintaining the protection of public health and public safety.
• Allowing the Minister to add, modify or delete conditions on licences or registrations, to partially suspend activities on a licence or registration, or to impose conditions on transit and transhipment permits would enable the Minister to act quickly against potential risks to public health or public safety.

Order Amending Schedule IX to the Controlled Drugs and Substances Act

Requiring registration of component parts (i.e. punches, moulds and dies) could help deter production of fentanyl and other synthetic drugs and would allow Health Canada to better identify importation that is intended for use in illicit production of drugs.

Order Repealing the Order Establishing Supplementary Rules Respecting the Sale of Natural Health Products Containing Ephedrine or Pseudoephedrine

The Repeal Order would not result in any change in impacts because the requirements in the Ministerial Order would be incorporated into the PCR.

Small business lens

Analysis under the small business lens concluded that the proposed amendments to the PCR and to Schedule IX to the CDSA would impact small businesses. Most impacted businesses are small, accounting for 90% of all businesses. The costs to impacted small businesses would be related to the compliance and administrative burden described in the CBA section.

Regulations Amending the Precursor Control Regulations (Increased Regulatory Oversight)

There would be an administrative burden associated with familiarizing with the regulatory amendments, submitting reports on suspicious transactions to Health Canada and retaining records for two years. In addition, there would be a compliance burden associated with taking reasonable steps to ensure employees do not contribute to the risk of a precursor being diverted to an illicit market.

Order Amending Schedule IX to the Controlled Drugs and Substances Act

There would be administrative burden associated with registering the importation of component parts for designated devices with Health Canada.

Order Repealing the Order Establishing Supplementary Rules Respecting the Sale of Natural Health Products Containing Ephedrine or Pseudoephedrine

The Repeal Order would not result in any change in impacts to affected parties, including small business, as the requirements in the Ministerial Order would be incorporated into the PCR and would remain in effect.

In total, costs to small businesses to undertake the above-mentioned activities are expected to be $1.50 million in PV over 10 periods of 12 months or $213,783 in annualized value. Cost per small business is estimated at $3,890 in PV over 10 periods of 12 months or $554 in annualized value.

Impacts to small businesses would be low and are not expected to be disproportionate compared to other businesses. Further, as the proposed amendments to the PCR and Schedule IX to the CDSA are instrumental for achieving the stated objectives and effectively administering and enforcing the regulations, providing flexibility to small businesses in meeting those requirements is not feasible.

Small business lens summary

• Number of small businesses impacted: 386
• Number of years: 10 periods of 12 months (2025–2026 to 2034–2035)
• Price year: 2024
• Present value base year: 2025
• Discount rate: 7%

Table 2.1: Costs — Regulations Amending the Precursor Control Regulations (Increased Regulatory Oversight)

Administrative or compliance	Description of cost	Present value	Annualized value
Administrative	Familiarization with the regulations	$10,834	$1,543
	Reporting suspicious transactions	$8,528	$1,214
	Record keeping	$118	$17
	Total administrative costs	$19,480	$2,774
Compliance	Familiarization with the regulations	$25,280	$3,599
	Taking reasonable steps	$1,243,794	$177,088
	Total compliance costs	$1,269,074	$180,688
Total	Total costs	$1,288,554	$183,461

Table 2.2: Costs — Order Amending Schedule IX to the Controlled Drugs and Substances Act  

Administrative or compliance	Description of cost	Present value	Annualized value
Administrative	Preparing and submitting import registrations for component parts	$212,968	$30,322
Total	Total costs	$212,968	$30,322

Table 3: Net impacts

Amount	Present value	Annualized value
Costs to impacted small businesses	$1,501,523	$213,783
Costs per impacted small business	$3,890	$554

One-for-one rule

For the purpose of the one-for-one rule, the administrative costs are estimated over 10 periods of 12 months and expressed in constant 2012 Canadian dollars and discounted to year 2012 using a 7% discount rate.

Regulations Amending the Precursor Control Regulations (Increased Regulatory Oversight)

The one-for-one rule applies since there would be an increase in administrative burden on business, and the proposed amendments are considered burden IN under the rule. 

As described in the CBA section, licensed and registered dealers would face administrative burden associated with time spent familiarizing themselves with the proposed amendments and reporting and keeping records of suspicious transactions.

Using an hourly wage of $37.85 for monetizing time spent familiarizing with the proposed requirements imposing administrative burden and $31.41 for monetizing time spent submitting suspicious transactions reports, the total incremental administrative costs to all affected businesses are estimated to be $9,451 in PV over 10 periods of 12 months or $1,346 in annualized value.

Order Amending Schedule IX to the Controlled Drugs and Substances Act

The one-for-one rule applies since there would be an increase in administrative burden on business, and the proposed amendments are considered burden IN under the rule.

As described in the CBA section, affected businesses would face administrative burden associated with registering the importation of component parts for designated devices with Health Canada.

Using an hourly wage of $31.41 for submitting the import registration form for component parts, the total incremental administrative costs to all affected businesses are estimated to be $74,271 in PV over 10 periods of 12 months or $10,574 in annualized value.

Order Repealing the Order Establishing Supplementary Rules Respecting the Sale of Natural Health Products Containing Ephedrine or Pseudoephedrine

The one-for-one rule applies since a regulatory title would be repealed, and the Repeal Order would be considered a title OUT.

Regulatory cooperation and alignment

The proposed amendments respond to operational concerns raised by Canadian law and border enforcement agencies. The changes would strengthen Canada’s existing regulatory framework for precursors and designated devices that can be used to illegally produce fentanyl, fentanyl analogues and other synthetic drugs and align with approaches taken in the United States and other jurisdictions. Additionally, the condition-of-sale restrictions for NHPs and NPDs containing ephedrine and/or pseudoephedrine would align with the previous restrictions under NAPRA’s National Drug Schedules, which all provinces and territories either incorporated by reference or mirrored in their own legislation. Health Canada would continue to consider opportunities to align with requirements under other frameworks, as appropriate.

International obligations

Canada and other parties to the United Nations drug control conventions are concerned about synthetic drug-related harms to individuals and society, including the illegal importation, production, diversion and trafficking of synthetic drugs and their precursors. These proposed changes would not affect Canada’s compliance with international drug control conventions. They would be in line with Canada’s commitment to strengthen the coordinated global response to the international public health and public safety challenges posed by synthetic drugs, as outlined in the Ministerial Declaration on Accelerating and Strengthening the Global Response to Synthetic Drugs.

As a member of the World Trade Organization (WTO), Canada has an obligation under the WTO Agreement on Technical Barriers to Trade to ensure that any new regulations do not create unnecessary obstacles to trade. A notice and link to the proposed amendments published in the Canada Gazette, Part I will be provided to members, including the nature of the problem that Canada is aiming to address. Members will be provided with an opportunity to provide their comments in writing and to discuss these comments upon request.

Effects on the environment

In accordance with the Cabinet Directive on Strategic Environmental and Economic Assessment, a preliminary scan concluded that a strategic environmental and economic assessment is not required. There are no anticipated effects on the environment, positive or negative, as a result of the proposed amendments.

Gender-based analysis plus

No gender-based analysis plus impacts have been identified as the primary stakeholders affected by this regulatory proposal would be licensed and registered dealers conducting authorized activities with precursors and designated devices. The proposed amendments would apply equally to different population subgroups; there are no disproportionate impacts based on identity factors such as gender, sex, age, language and geography. No adverse outcomes to Canadians are anticipated from these changes.

Implementation, compliance and enforcement, and service standards

Implementation

Coming into force

The proposed amendments to the PCR and to Schedule IX to the CDSA would be approved by the Governor in Council and come into force upon publication in the Canada Gazette, Part II.

The Minister is responsible for approving the Repeal Order. The intent is for the Repeal Order to come into force when the PCR amendments come into force. However, if the Repeal Order is approved and registered after the PCR amendments come into force, the Repeal Order would come into force on the date it is registered.

Communications and guidance

Health Canada will notify stakeholders immediately of the proposed amendments via email and through the Consultation and Stakeholder Information Management System.

Health Canada is committed to continuing to provide industry, provinces and territories, and other stakeholders with relevant and timely information. Guidance documents and the import registration form would be updated to increase awareness of the proposed regulatory changes and to assist regulated parties in achieving compliance, and will be consulted upon during the Canada Gazette, Part I, comment period for the proposed amendments. Questions about how precursors and designated devices are controlled should be directed to precursors-precurseurs@hc-sc.gc.ca.

Compliance and enforcement

Compliance and enforcement measures under the CDSA and the PCR would continue to be available to Health Canada. These measures support the legitimate use of precursors and designated devices and reduce risks of misuse and diversion. They range from activities intended to educate and to prevent non-compliance through compliance promotion, to measures intended to bring a regulated party back into compliance or address a risk to public health or public safety.

In alignment with the Health Canada compliance and enforcement policy framework and the Compliance and Enforcement Policy for Controlled Substances and Precursors, and informed by the circumstances of each case, Health Canada would continue to take a risk-based approach to its compliance and enforcement actions and would choose the most appropriate tool to achieve compliance, including adding conditions to a licence or suspending certain activities on a licence, and mitigate risks as circumstances warrant.

In the conduct of compliance and enforcement activities, the level of risk to public health, public safety and security would be taken into consideration, as well as the risks presented by potential diversion to illegal markets, and the likelihood thereof when addressing identified risks. In certain circumstances, Health Canada could disclose relevant information obtained under the CDSA or PCR, for example when it considers that the disclosure is necessary to protect public health or public safety.

To support its compliance objectives, Health Canada would continue to collaborate with partners, including law and border enforcement agencies and the provinces and territories. Federal, provincial and local law enforcement agencies are responsible for taking enforcement action in response to contraventions of the CDSA and its regulations. Provincial and territorial governments regulate the practice of medicine, and their legislated bodies regulate health professionals.

Service standards

No changes in service standards are anticipated. The current service standards that already exist for issuing licences, registrations and permits would remain in place, and no additional service standards would be required.

Contact

Jennifer Pelley
Director
Office of Legislative and Regulatory Affairs
Controlled Substances and Overdose Response Directorate
Controlled Substances and Cannabis Branch
Health Canada
Email: csd.regulatory.policy-politique.reglementaire.dsc@hc-sc.gc.ca

PROPOSED REGULATORY TEXT

Notice is given that the Governor in Council proposes to make the annexed Regulations Amending the Precursor Control Regulations (Increased Regulatory Oversight) under subsection 55(1)^{footnote a} of the Controlled Drugs and Substances Act ^{footnote b}.

Interested persons may make representations concerning the proposed Regulations within 45 days after the date of publication of this notice. They are strongly encouraged to use the online commenting feature that is available on the Canada Gazette website but if they use email, mail or any other means, the representations should cite the Canada Gazette, Part I, and the date of publication of this notice, and be sent to the Office of Legislative and Regulatory Affairs, Controlled Substances Directorate, Controlled Substances and Cannabis Branch, Department of Health, Address Locator: 0302A, 150 Tunney’s Pasture Driveway, Ottawa, Ontario K1A 0K9 (email: csd.regulatory.policy-politique.reglementaire.dsc@hc-sc.gc.ca).

Ottawa, June 13, 2025

Janna Rinaldi
Acting Assistant Clerk of the Privy Council

Regulations Amending the Precursor Control Regulations (Increased Regulatory Oversight)

Amendments

1 (1) The portion of the definition pharmacien in section 1 of the French version of the Precursor Control Regulations ^{footnote 9} before paragraph (a) is replaced by the following:

pharmacien

Personne physique qui :

(2) Section 1 of the Regulations is amended by adding the following in alphabetical order:

combination product

means

• (a) a natural health product that contains ephedrine or any of its salts or pseudoephedrine or any of its salts, or any combination of those ingredients, in combination with one or more other substances set out in Schedule 1 to the Natural Health Products Regulations; or
• (b) a drug that is for human use and
  • (i) contains ephedrine or any of its salts or pseudoephedrine or any of its salts, or any combination of those ingredients, in combination with one or more other drugs,
  • (ii) is not required under the Food and Drugs Act or the Act to be sold under a prescription,
  • (iii) is not a natural health product,
  • (iv) does not contain a drug that is listed in Schedule C or D to the Food and Drugs Act,
  • (v) does not contain a controlled substance, and
  • (vi) is not intended to be administered by injection. (produit combiné)

non-combination product

means a natural health product that contains — as its only medicinal ingredients — ephedrine or any of its salts or pseudoephedrine or any of its salts, or any combination of those ingredients. (produit non combiné)

natural health product

means a natural health product within the meaning of the Natural Health Products Regulations. (produit de santé naturel)

2 The portion of section 5 of the Regulations before paragraph (a) is replaced by the following:

5 A person who only sells or provides, or possesses for the purpose of sale or provision, a Class A precursor — other than a combination product or non-combination product — is exempt from the requirements of these Regulations in respect of the activity if the person

3 Section 7 of the Regulations is amended by striking out “and” at the end of paragraph (c), by adding “and” at the end of paragraph (d) and by adding the following after paragraph (d):

• (e) in the case of the sale or provision of a combination product or non-combination product, the sale or provision is only to another licensed dealer or to a pharmacist, practitioner or hospital.

4 Paragraph 15.1(d) of the Regulations is replaced by the following:

• (d) examine, as part of the inspection, the books, registers, electronic data and other records kept in accordance with section 85.

5 The portion of subsection 17(1) of the Regulations before paragraph (a) is replaced by the following:

17 (1) Subject to subsection (2), the Minister shall refuse to issue, renew or amend a licence if

6 (1) Paragraph 18(a) of the English version of the Regulations is replaced by the following:

• (a) the expiry date set out in the licence; and

(2) Paragraph 18(b) of the Regulations is replaced by the following:

• (b) the day on which the licence is revoked or suspended under section 22 or 23 or subsection 24(1).

7 The Regulations are amended by adding the following after section 21:

Changes to Conditions of Licence

21.1 (1) The Minister may, at any time other than at the issuance, renewal or amendment of a licence, add a condition to, or modify a condition of, the licence if the Minister gives prior written notice to the holder and has reasonable grounds to believe that the addition or modification is necessary to

• (a) ensure that the international obligations of Canada are respected; or
• (b) ensure compliance with the Act and these Regulations, including by reducing the risk of a Class A precursor being diverted to an illicit market or use.

(2) However, the Minister may add a condition to, or modify a condition of, a licence without prior notice if the Minister has reasonable grounds

• (a) to believe that it is necessary to do so to protect public health, safety or security; or
• (b) to suspect that it is necessary to do so to prevent a Class A precursor from being diverted to an illicit market or use.

21.2 The Minister may delete from a licence a condition that the Minister determines is no longer necessary. Any such deletion takes effect as soon as the Minister notifies the licensed dealer in writing of the deletion.

8 (1) The portion of subsection 23(1) of the Regulations before paragraph (a) is replaced by the following:

23 (1) Subject to subsection (2), the Minister shall revoke a licence if

(2) Subsection 23(3) of the Regulations is replaced by the following:

(3) The Minister may revoke a licence if the licensed dealer fails to comply with a decision of the Minister to suspend the licence under subsection 24(1) or if the situation giving rise to the suspension is not rectified.

9 (1) The portion of section 24 of the Regulations before paragraph (a) is replaced by the following:

24 (1) The Minister shall, without prior notice, suspend a licence in respect of any authorized activities in relation to any Class A precursor if the Minister has reasonable grounds

(2) Paragraph 24(1)(b) of the Regulations is replaced by the following:

• (b) to suspect that the continuation of the activities presents a risk of a Class A precursor being diverted to an illicit market or use.

(3) Section 24 of the Regulations is amended by adding the following after subsection (1):

(2) The Minister shall reinstate the licence in respect of any activities affected by the suspension if the reasons for the suspension no longer exist or the holder demonstrates that the suspension is unfounded.

10 Paragraphs 26(2)(b) and (c) of the Regulations are replaced by the following:

• (b) the day on which the licence pertaining to the permit is revoked or suspended under section 22 or 23 or subsection 24(1); and
• (c) the day on which the permit is revoked or suspended under section 29 or 30 or subsection 31(1).

11 (1) The portion of subsection 30(1) of the Regulations before paragraph (a) is replaced by the following:

30 (1) Subject to subsection (2), the Minister shall revoke a Class A import permit if

(2) Subsection 30(3) of the Regulations is replaced by the following:

(3) The Minister may revoke a Class A import permit if the holder fails to comply with a decision of the Minister to suspend the permit under subsection 31(1) or if the situation giving rise to the suspension is not rectified.

12 Section 31 of the Regulations is renumbered as subsection 31(1) and is amended by adding the following:

(2) The Minister shall reinstate the Class A import permit if the reasons for the suspension no longer exist or the holder demonstrates that the suspension is unfounded.

13 Paragraphs 33(2)(b) and (c) of the Regulations are replaced by the following:

• (b) the day on which the licence pertaining to the permit is revoked or suspended under section 22 or 23 or subsection 24(1), and
• (c) the day on which the permit is revoked or suspended under section 36 or 37 or subsection 38(1).

14 (1) The portion of subsection 37(1) of the Regulations before paragraph (a) is replaced by the following:

37 (1) Subject to subsection (2), the Minister shall revoke a Class A export permit if

(2) Subsection 37(3) of the Regulations is replaced by the following:

(3) The Minister may revoke a Class A export permit if the holder fails to comply with a decision of the Minister to suspend the permit under subsection 38(1) or if the situation giving rise to the suspension is not rectified.

15 Section 38 of the Regulations is renumbered as subsection 38(1) and is amended by adding the following:

(2) The Minister shall reinstate the Class A export permit if the reasons for the suspension no longer exist or the holder demonstrates that the suspension is unfounded.

16 Section 40 of the Regulations is amended by striking out “and” at the end of paragraph (c), by adding “and” at the end of paragraph (d) and by adding the following after paragraph (d):

• (e) any conditions that are necessary to
  • (i) ensure that the international obligations of Canada are respected,
  • (ii) ensure compliance with any requirement of the country of final destination or any country of transit or transhipment, or
  • (iii) ensure compliance with the Act and these Regulations, including by reducing the risk of a Class A precursor being diverted to an illicit market or use.

17 (1) The portion of subsection 45(1) of the Regulations before paragraph (a) is replaced by the following:

45 (1) Subject to subsection (2), the Minister shall revoke a permit for transit or transhipment if

(2) Subsection 45(3) of the Regulations is replaced by the following:

(3) The Minister may revoke a permit if the holder fails to comply with a decision of the Minister to suspend the permit under subsection 46(1) or if the situation giving rise to the suspension is not rectified.

18 Section 46 of the Regulations is renumbered as subsection 46(1) and is amended by adding the following:

(2) The Minister shall reinstate the permit for transit or transhipment if the reasons for the suspension no longer exist or the holder demonstrates that the suspension is unfounded.

19 Section 53 of the Regulations is replaced by the following:

53 (1) The Minister shall revoke an authorization certificate if it was issued on the basis of false or misleading information or false or falsified documents.

(2) The Minister may revoke an authorization certificate if the holder fails to comply with a decision of the Minister to suspend the certificate under subsection 54(1) or if the situation giving rise to the suspension is not rectified.

20 Section 54 of the Regulations is renumbered as subsection 54(1) and is amended by adding the following:

(2) The Minister shall reinstate the authorization certificate if the reasons for the suspension no longer exist or the holder demonstrates that the suspension is unfounded.

21 (1) Subsection 65(3) of the French version of the Regulations is replaced by the following:

(3) Si le changement porte sur une mention faite à son certificat d’inscription, le distributeur inscrit joint à l’avis l’original du certificat que lui a délivré le ministre.

(2) Subsection 65(4) of the Regulations is replaced by the following:

(4) Subject to section 67, if the requirements of subsections (1) to (3) are met, the Minister shall amend the registration certificate accordingly and may add any condition necessary to

• (a) ensure that the international obligations of Canada are respected; or
• (b) ensure compliance with the Act and these Regulations, including by reducing the risk of a Class B precursor being diverted to an illicit market or use.

22 The Regulations are amended by adding the following after section 65:

Changes to Conditions of Registration

65.1 (1) The Minister may, at any time other than at registration, renewal of a registration or amendment of a registration certificate, add a condition to, or modify a condition of, the registration certificate if the Minister gives prior written notice to the registered dealer and has reasonable grounds to believe that the addition or modification is necessary to

• (a) ensure that the international obligations of Canada are respected; or
• (b) ensure compliance with the Act and these Regulations, including by reducing the risk of a Class B precursor being diverted to an illicit market or use.

(2) However, the Minister may add a condition to, or modify a condition of, the registration certificate without prior notice if the Minister has reasonable grounds

• (a) to believe that it is necessary to do so to protect public health, safety or security; or
• (b) to suspect that it is necessary to do so to prevent a Class B precursor from being diverted to an illicit market or use.

65.2 The Minister may delete from the registration certificate a condition that the Minister determines is no longer necessary. Any such deletion takes effect as soon as the Minister notifies the registered dealer in writing of the deletion.

23 Section 66 of the Regulations is replaced by the following:

66 The Minister shall revoke a registration if the registered dealer so requests or notifies the Minister that the certificate has been lost or stolen.

24 (1) The portion of subsection 67(1) of the Regulations before paragraph (a) is replaced by the following:

67 (1) Subject to subsection (2), the Minister shall revoke a registration if

(2) Paragraph 67(1)(c) of the Regulations is replaced by the following:

• (c) the registered dealer has failed to comply with a provision of the Act or any regulation made under the Act or with a condition of a registration certificate, licence or import or export permit issued under any regulation made or continued under the Act;

(3) The portion of subsection 67(2) of the Regulations before paragraph (a) is replaced by the following:

(2) The Minister is not required to revoke a registration under paragraph (1)(b) or (c) if the registered dealer

(4) Subsection 67(3) of the Regulations is replaced by the following:

(3) The Minister may revoke a registration if the registered dealer fails to comply with a decision of the Minister to suspend the registration under subsection 68(1) or if the situation giving rise to the suspension is not rectified.

25 (1) The portion of section 68 of the Regulations before paragraph (a) is replaced by the following:

68 (1) The Minister shall, without prior notice, suspend a registration in respect of any authorized activities in relation to any Class B precursor if the Minister has reasonable grounds

(2) Paragraph 68(1)(b) of the Regulations is replaced by the following:

• (b) to suspect that the continuation of the activities presents a risk of a Class B precursor being diverted to an illicit market or use.

(3) Section 68 of the Regulations is amended by adding the following after subsection (1):

(2) The Minister shall reinstate the registration in respect of any activities affected by the suspension if the reasons for the suspension no longer exist or the holder demonstrates that the suspension is unfounded.

26 (1) Subparagraph 70(1)(d)(ii) of the Regulations is replaced by the following:

• (ii) the date of expiry of the registration certificate of the applicant, and

(2) Paragraphs 70(2)(b) and (c) of the Regulations are replaced by the following:

• (b) the day on which the registration is revoked or suspended under section 66 or 67 or subsection 68(1); and
• (c) the day on which the export permit is revoked or suspended under section 73 or 74 or subsection 75(1).

27 Paragraph 71(a) of the English version of the Regulations is replaced by the following:

• (a) the applicant is not a registered dealer or is a registered dealer whose registration certificate will expire prior to the proposed date of export;

28 (1) The portion of subsection 74(1) of the Regulations before paragraph (a) is replaced by the following:

74 (1) Subject to subsection (2), the Minister shall revoke a Class B export permit if

(2) Subsection 74(3) of the Regulations is replaced by the following:

(3) The Minister may revoke a Class B export permit if the holder fails to comply with the decision of the Minister to suspend a permit under subsection 75(1) or if the situation giving rise to the suspension is not rectified.

29 (1) Paragraph 75(a) of the Regulations is replaced by the following:

• (a) the registration certificate of the holder of the permit has expired or their registration has been suspended or revoked;

(2) Section 75 of the Regulations is renumbered as subsection 75(1) and is amended by adding the following:

(2) The Minister shall reinstate the Class B export permit if the reasons for the suspension no longer exist or the holder demonstrates that the suspension is unfounded.

30 Section 81 of the Regulations is replaced by the following:

81 (1) The Minister shall revoke an authorization certificate if it was issued on the basis of false or misleading information or false or falsified documents.

(2) The Minister may revoke an authorization certificate if the holder fails to comply with a decision of the Minister to suspend the certificate under subsection 82(1) or if the situation giving rise to the suspension is not rectified.

31 Section 82 of the Regulations is renumbered as subsection 82(1) and is amended by adding the following:

(2) The Minister shall reinstate the authorization certificate if the reasons for the suspension no longer exist or the holder demonstrates that the suspension is unfounded.

32 Section 84 of the Regulations and the heading before it are replaced by the following:

Notice

84 The following decisions of the Minister do not take effect until the Minister has provided the applicant or holder of an affected licence, certificate or permit with a written notice that sets out the reasons for the decision and the applicant or holder has been given an opportunity to be heard within the period specified in the notice:

• (a) a decision to revoke or to refuse to issue, amend or renew a licence;
• (b) a decision to revoke or to refuse to renew a registration or to refuse to issue or amend a registration certificate;
• (c) a decision to revoke or to refuse to issue, amend or renew an authorization certificate; and
• (d) a decision to revoke or to refuse to issue, amend or renew an import or export permit or a permit for transit or transhipment.

84.1 (1) The following decisions of the Minister take effect as soon as the Minister provides the holder of an affected licence, certificate or permit with a written notice that sets out the reasons for the decision:

• (a) a decision to suspend a licence in respect of any authorized activities in relation to any Class A precursor;
• (b) a decision to suspend a registration in respect of any authorized activities in relation to any Class B precursor;
• (c) a decision to suspend an authorization certificate; and
• (d) a decision to suspend an import or export permit or a permit for transit or transhipment.

(2) The written notice must specify a period within which the holder is given an opportunity to be heard, as well as any corrective measures to be carried out and the date by which they must be carried out.

84.2 A decision of the Minister under subsection 21.1(1) or 65.1(1) to add a condition to, or modify a condition of, a licence or registration certificate does not take effect until the Minister has provided the holder with a written notice that sets out the reasons for the decision and the holder has been given an opportunity to be heard within the period specified in the notice.

84.3 (1) A decision of the Minister under subsection 21.1(2) or 65.1(2) to add a condition to, or modify a condition of, a licence or registration certificate takes effect as soon as the Minister provides the holder with a written notice that sets out the reasons for the decision.

(2) The written notice must specify a period within which the holder is given an opportunity to be heard, as well as any corrective measures to be carried out and the date by which they must be carried out.

33 Subsections 85(5) to (7) of the Regulations are replaced by the following:

(4.1) The licensed dealer and registered dealer shall keep at their respective sites a record showing all steps taken under section 90.1.

(5) The licensed dealer and registered dealer shall

• (a) keep any record referred to in subsections (1) and (3) to (4.1) for at least two years after the day on which information was last recorded in the record;
• (b) keep the report referred to in section 86 for at least two years after the day on which it is made;
• (c) keep an end-use declaration for at least two years after the end of the calendar year for which it was obtained;
• (d) keep the notice referred to in paragraph 90(2)(a) for at least two years after the day on which it is provided to a member of a police force;
• (e) keep the notice referred to in paragraph 90(2)(b) for at least two years after the day on which it is provided to the Minister; and
• (f) keep the notice referred to in subsection 90(3) for at least two years after the day on which it is provided to the Minister.

(6) The licensed dealer and registered dealer shall make the records that they are required to keep under this Part available for examination by the Minister.

(7) The licensed dealer and registered dealer, if requested by the Minister in writing, shall provide to the Minister a copy of any record that they are required to keep under this Part.

34 Section 85.1 of the Regulations is replaced by the following:

85.1 If a licence or registration expires without being renewed or is revoked, the former holder shall

• (a) retain the records that they were required to keep under section 85 for at least two years after the expiry or revocation; and
• (b) at the written request of the Minister, provide the Minister with a copy of any record required to be retained under paragraph (a).

35 Section 86 of the Regulations is replaced by the following:

86 (1) A licensed dealer or registered dealer that becomes aware of a transaction occurring in the course of their activities that they have reasonable grounds to suspect may be related to the diversion of a precursor to an illicit market or use shall, within 72 hours after becoming aware of the transaction, make a written report to the Minister containing the following information:

• (a) with respect to the licensed dealer or registered dealer,
  • (i) in the case of an individual, their name and, if applicable, title, as well as their municipal address and telephone number, or
  • (ii) in the case of a corporation, its name, municipal address and telephone number, as well as the title of the position held by the individual making the report;
• (b) the name and municipal address of the other party to the transaction;
• (c) details of the transaction, including its date and time, and its type;
• (d) the name and quantity of the precursor involved and, in the case of a preparation or mixture, the names and quantities of all precursors set out in Part 1 or 2 of Schedule VI to the Act that it contains; and
• (e) a detailed description of the reasons for the dealer’s suspicions.

(2) A licensed dealer or registered dealer shall not disclose that they have made the report or disclose details of it with the intent to prejudice a criminal investigation, whether or not a criminal investigation has begun.

(3) No civil proceedings lie against a licensed dealer or registered dealer for having made the report in good faith.

(4) The report, or any evidence derived from it, is not to be used or received to incriminate the licensed dealer or registered dealer, or the dealer’s agent or mandatary, in any criminal proceeding against them other than a prosecution under section 132, 136 or 137 of the Criminal Code.

36 The portion of section 87 of the Regulations before paragraph (a) is replaced by the following:

87 A licensed dealer shall make a written report to the Minister, within three months after the end of each calendar year, showing

37 (1) Subsection 89(1) of the French version of the Regulations is replaced by the following:

89 (1) Le titulaire dont la licence ou le certificat d’inscription ou d’autorisation est renouvelé doit, dès que possible après la date de prise d’effet du document de remplacement, remettre au ministre le document remplacé.

(2) Subsection 89(2) of the Regulations is replaced by the following:

(2) If a licence, a registration or authorization certificate, an import or export permit or a permit for transit or transhipment issued under these Regulations, expires without being renewed or is revoked, the former holder shall, within 30 days after the expiry or revocation, return the document to the Minister.

38 (1) Subsections 90(1) and (2) of the Regulations are replaced by the following:

90 (1) The holder of a licence, a registration or authorization certificate or an import or export permit issued under these Regulations shall take reasonable steps to ensure the security of any precursor in their possession, as well as of the licence, certificate or permit.

(1.1) An agent or mandatary of a licensed dealer or registered dealer shall notify the dealer immediately on becoming aware of a theft of a precursor or an unusual waste or disappearance of a precursor that cannot be explained on the basis of normally accepted business practices.

(2) A licensed dealer or registered dealer that becomes aware of a theft, waste or disappearance referred to in subsection (1.1) or that is notified by their agent or mandatary of such a theft, waste or disappearance

• (a) shall provide written notice of the occurrence to a member of a police force within 24 hours after becoming aware or being notified of the occurrence; and
• (b) shall provide written notice of the occurrence to the Minister within 72 hours after becoming aware or being notified of the occurrence and confirm that the notice required under paragraph (a) has been provided.

(2) Section 90 of the Regulations is amended by adding the following after subsection (3):

(4) A notice provided under subsection (2) or (3), or any evidence derived from it, is not to be used or received to incriminate the licensed dealer or registered dealer, or the dealer’s agent or mandatary, in any criminal proceeding against them other than a prosecution under section 132, 136 or 137 of the Criminal Code.

39 The Regulations are amended by adding the following after section 90:

90.1 (1) A licensed dealer or registered dealer must take reasonable steps to ensure that their employees do not contribute to the risk of a precursor being diverted to an illicit market or use.

(2) The reasonable steps must include taking into consideration whether employees who have access to precursors in the course of their duties have, within the previous 10 years, been convicted as an adult of

• (a) a designated drug offence;
• (b) a designated criminal offence; or
• (c) an offence committed outside of Canada that, if committed in Canada, would have constituted an offence referred to in paragraph (a) or (b).

40 (1) Paragraph 91(5)(a) of the English version of the Regulations is replaced by the following:

• (a) information pertaining to an activity authorized by a licence, registration or authorization certificate or permit issued to a person under these Regulations, including the person’s name, the nature of the authorized activity and any applicable conditions; and

(2) Subparagraph 91(5)(b)(i) of the Regulations is replaced by the following:

• (i) information contained in the records mentioned in subsections 85(1) to (4.1),

41 Section 91.1 of the Regulations is replaced by the following:

91.1 (1) The prohibitions set out in paragraph 6(1)(c) and subsection 6(2) on the sale or provision of a Class A precursor and on the possession of a Class A precursor for the purpose of sale or provision do not apply to

• (a) a practitioner or hospital that sells or provides, only on a retail basis, preparations or mixtures containing Class A precursors;
• (b) a pharmacist who sells or provides, only on a retail basis, preparations or mixtures containing Class A precursors, other than combination products or non-combination products;
• (c) a pharmacist who sells or provides, only on a retail basis, non-combination products, if those products are not accessible to the public for self-selection; or
• (d) in the case of combination products that are sold or provided, only on a retail basis,
  • (i) a pharmacist, or any other person working in a retail location serviced by a pharmacist, who sells or provides the products, if those products are accessible to the public for self-selection and a pharmacist is available at the request of a purchaser or consumer to discuss the products prior to purchase, or
  • (ii) a pharmacist who sells or provides the products, if those products are not accessible to the public for self-selection.

(2) The prohibition set out in subsection 9(1) on transporting a Class A precursor and possessing a Class A precursor for the purpose of transport do not apply to a practitioner or hospital referred to in paragraph (1)(a) or a pharmacist referred to in any of paragraphs (1)(b) to (d).

42 Section 91.96 of the Regulations is replaced by the following:

91.96 (1) A pharmacist, practitioner or hospital that sells or provides only on a retail basis, or possesses for the purpose of sale or provision, preparations or mixtures containing Class A precursors shall take reasonable steps to ensure the security of the Class A precursors.

(2) An agent or mandatary of the pharmacist, practitioner or hospital shall notify the pharmacist, practitioner or hospital immediately on becoming aware of

• (a) an unusual waste or disappearance of a Class A precursor that cannot be explained on the basis of normally accepted business practices; or
• (b) a theft of a Class A precursor set out in column 1 of the schedule, if the package that contains the precursor is not intended for retail sale and contains a quantity of the precursor exceeding the maximum quantity specified for the precursor set out in column 2 of the schedule.

(3) If the pharmacist, practitioner or hospital becomes aware — or is notified by their agent or mandatary — of a waste, disappearance or theft, they shall notify the Minister, in writing, within 10 days after the day on which they became aware or were notified.

(4) The notification to the Minister, or any evidence derived from it, is not to be used or received to incriminate the pharmacist, practitioner or hospital, or their agent or mandatary, in any criminal proceeding against them other than a prosecution under section 132, 136 or 137 of the Criminal Code.

(5) The pharmacist, practitioner or hospital shall make available for examination by the Minister any information or record required to be kept under this Part or, if requested by the Minister in writing, shall provide to the Minister a copy of any such information or record.

43 The schedule to the Regulations is amended by replacing the references after the heading “SCHEDULE ” with the following:

(Paragraph 5(b), section 8, subsections 9(1.1) and 91.3(1), section 91.9, subsection 91.92(1), paragraph 91.96(2)(b) and section 92)

44 The English version of the Regulations is amended by replacing “reducing” with “by reducing” in the following provisions:

• (a) subparagraph 16(h)(ii);
• (b) subparagraph 19(3)(b);
• (c) subparagraph 26(1)(e)(ii);
• (d) subparagraph 33(1)(e)(iii);
• (e) subparagraph 49(1)(e)(ii);
• (f) subparagraph 62(f)(ii);
• (g) subparagraph 70(1)(e)(iii); and
• (h) subparagraph 77(1)(e)(ii).

45 The English version of the Regulations is amended by replacing “term or condition” and “terms and conditions” with “condition” and “conditions”, respectively, in the following provisions:

• (a) subparagraph 17(1)(g)(ii);
• (b) paragraph 23(1)(c);
• (c) paragraph 45(1)(b);
• (d) the portion of subsection 57(4) before paragraph (a); and
• (e) subparagraph 63(1)(f)(ii).

46 The French version of the Regulations is amended by replacing “se conformer à la Loi et au présent règlement, notamment pour réduire” with “que soit assurée la conformité à la Loi et au présent règlement, notamment pour que soit réduit” in the following provisions:

• (a) subparagraph 16(h)(ii);
• (b) subparagraph 19(3)(b);
• (c) subparagraph 26(1)(e)(ii);
• (d) subparagraph 33(1)(e)(iii);
• (e) subparagraph 49(1)(e)(ii);
• (f) subparagraph 62(f)(ii);
• (g) subparagraph 70(1)(e)(iii); and
• (h) subparagraph 77(1)(e)(ii).

47 The French version of the Regulations is amended by replacing “se conformer” with “que soit assurée la conformité à” in the following provisions:

• (a) subparagraph 33(1)(e)(ii); and
• (b) subparagraph 70(1)(e)(ii).

Coming into Force

48 These Regulations come into force on the day on which they are published in the Canada Gazette, Part II.

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