TORONTO (Reuters) - Marijuana sales will become legal in Canada beginning October 17, Prime Minister Justin Trudeau said on Wednesday, making it the first major economy to legalize its recreational use.
Stocks of marijuana producers, which have rallied in anticipation of legalization, extended gains on Wednesday after the Senate voted on Tuesday to approve adult use of cannabis.
Officials said the governor general was expected to sign the bill on Thursday, the final step for it to become law.
The start date marks a delay by the government, which had previously said recreational use of marijuana would become legal within eight to 12 weeks of the law being passed.
Canada’s 10 provinces had complained to Ottawa that that schedule was too tight for them to set up distribution and sales networks.
“We’ve listened to the provinces, which have been asking us for more time to implement it,” Trudeau told legislators.
Shares of Canopy Growth Corp WEED.TO, Canada's biggest marijuana producer by market value, closed up 6.7 percent C$45.36 in Toronto.
The Horizons Marijuana Life Sciences ETF HMMJ.TO closed up 3.6 percent at C$19.64.
Statistics Canada estimates that the marijuana market in Canada was worth C$5.7 billion ($4.28 billion) in 2017.
Trudeau’s Liberals had made legalizing recreational use of marijuana part of their successful 2015 election campaign.
Critics accused the government of moving too quickly and said the new distribution and sales network was too limited to curb black market sales.
“I am confident that at the beginning we’re going to take a significant part of the market share right now occupied almost entirely by organized crime,” Trudeau told reporters.
Canada’s regulatory roll out will be closely watched by other countries and by investors, who have already poured billions into Canadian marijuana companies.
Share gains of some of these companies have been muted over the past year on concerns that they had become over-valued, as well as by delays to the legislation that was originally expected to take effect by July, and strict rules around supply and branding.
A report by the Conference Board of Canada released on Tuesday showed that more than half of Canadian employers are concerned about the potential use of marijuana in the workplace.
Additional reporting by Danya Hajjaji and David Ljunggren; editing by Bill Berkrot
Our Standards: The Thomson Reuters Trust Principles.