Cannabis key investor reporting form: Cultivation, processing and sale for medical purposes licences

On this page

• How to complete the reporting form
• How to submit your Key investor report

Whether you're an applicant or licence holder, you need to use the Key investor reporting form if your equity securities are not listed on a published market. Refer to the requirements for more information on when you need to submit.

• Submitting as an applicant
• Submitting as a licence holder

Do not delete key investors from your record. If any key investor stops being a key investor during the previous calendar year, you must include this information in your annual reporting.

How to complete the reporting form

These forms are intended for applicants and licence holders who need to report on their key investors. If you don't know if you should report, refer to Who needs to report.

Key investor reporting form

Each licence holder or applicant should complete 1 form per key investor. Information pertaining to that key investor will go in that form.

Your report should contain all information from January 1 through December 31 of the reporting year.

For licence holders submitting an annual report: you do not need to re-submit transactions and benefits that were reported in a previous year. However, you should report any changes to information that you previously reported for the key investor, such as any update as to how they exercise control over your business.

Section A: Applicant or licence holder information

This section should be the same for all your key investors and match the information on your application or licence. Include:

• your application number (APP#) or licence number (LIC #)
• your business name (corporation or individual)
• reporting year (only licence holders)

Section B: Information on key investor

From this point, every Key investor form should be unique to a single key investor. Any dollar values shown on this page are examples only. You should ensure that dollar values in your report reflect your situation.

Part 1: Name and mailing address

• First and last name of individual or full name of the corporation or organization
• Mailing address

Part 2: How the key investor exercises, or is in a position to exercise, control

In your report, include:

• type of transaction
  • such as money, goods, services or other
• how this key investor exercises, or is in a position to exercise, control over your business. The manner in which they exercise control must be linked to their investment. If the key investor exercises control in various ways, please provide details about each manner in which they exercise control.
  • for example:
    • As a result of having provided money for my business, the investor is the COO of my business and has legal authority to contractually bind my business to other entities. The investor exercises control by managing the day-to-day operations of the business.
    • Investor provided land, rent-free, for my cultivation business. This investor is in a position to exercise indirect control by ending the land use agreement at any time, meaning that my business would no longer be able to cultivate.
    • Investor provided a $250,000 loan with a 5-year term at 10% interest. This loan has the condition that I hire the investor's child as my quality assurance person. (QAP). The investor is in a position to exercise indirect control through a family relationship.
    • Investor provided money in exchange for 10% of the common shares of my business. The common shares give them voting rights, and these are a sufficient number of shares to allow them to have control over my business.

Part 3: For licence holders only: Transaction that made the investor become a key investor

If you're a licence holder, you need to fill out this part only if the investor became a key investor after your licence was issued. If you had a licence under the Access to Cannabis for Medical Purposes Regulations and it migrated to the Cannabis Act, then you only need to fill out this part for investors who became key investors on or after October 17, 2018.

In your report, include:

• type of transaction
  • such as money, goods, services
• date
• amount of money or fair market value of goods and services in Canadian dollars at the time of the transaction
• description, such as:
  • amount of money provided
  • share acquisition
  • loan
  • assets
  • contractual arrangements
  • ownership interest
  • ability to vote
  • family or historical connection

  For example: the investor provided $1,000,000 in cash in exchange for 60% of the common shares of my business.

  For example: the investor provided $800,000 in harvesting equipment for my cultivation business.

• any terms and conditions
  • such as:
    • interest rate
    • sole supplier
    • maturity date or when repayment is due

    For example: the loan must be repaid within 5 years, interest rate of 20%, can be recalled with 24 hour notice

    For example: as part of the loan agreement, my business may only purchase processing equipment from a company specified by the investor.

Part 4: For licence holders only: Each time the key investor provides money, goods or services

Indicate each transaction when the key investor provided you with money, goods or services.

Licence holders submitting an annual report only need to report transactions from the reporting calendar year.

If you need room for additional entries in Part 4, you may include a spreadsheet.

For each transaction, include:

• type of transaction
  • such as money, goods, services
• date
• amount of money or fair market value of goods and services in Canadian dollars at the time of the transaction
• description (such as amount of money provided, share acquisition, loan, assets, contractual arrangements, ownership interest, ability to vote, or family or historical connection) and any terms and conditions (such as interest rate, sole supplier conditions, and the maturity date or when repayment is due)

For example: $10,000,000 loan must be repaid within 3 years, interest rate of 15%, can be recalled with 24 hours notice.

For example: investment provided on the condition that my business only use the key investor's personnel to perform maintenance as required.

Part 5: Any benefits that the key investor receives due to their investment

Licence holders and applicants must list all benefits (at least 1) that the key investor receives as a result of:

• having provided money, goods or services to the licence holder
• holding an ownership interest or other right or interest in relation to the holder's business or, if the holder is an organization, the organization

Licence holders must also list which transaction from Part 4 the benefit is related to.

• Indicate which transaction the benefit is associated with by transaction number.
• If a benefit is associated with multiple transactions, list all associated transaction numbers in the same field.

Licence holders submitting an annual report don't need to report benefits from years prior to the reporting calendar year. Benefits from the reporting calendar year, or that could be received in future years, must be reported.

If you need room for additional entries beyond what can be entered in Part 5, you may include a spreadsheet.

In your report, include:

• type of benefit
• date when it was received
• amount of money or fair market value in Canadian dollars, if applicable
• which transaction the benefit is related to
• description of the benefit received
  • such as:
    • sole ownership
    • loan interest
    • dividends
    • influential position within the business
    • priority vote
    • payments based on business performance
  • for example, the key investor:
    • gained a seat on the Board of Directors
    • was given priority votes on certain topics
    • has a child who gains a job in a position of control in the business
    • receives $50 in interest payments on the $1,000 loan
    • receives $100 in dividends from their common shares
    • receives a $10,000 payment based on business performance
    • is the sole owner of the company, holding 100% of the shares which are valued at $5,000,000

Part 6: For licence holders only: Repayment or return of goods to the key investor

Indicate the repayment or return of goods you gave the key investor.

If you need room for additional entries beyond what can be entered in Part 6, you may include a spreadsheet.

Each repayment or return of goods includes:

• type of repayment or return, such as money or goods
• date
• amount of money or fair market value of any goods at the time they were returned in Canadian dollars
• description such as repayment of loan, return of equipment

Here are some situations and the information to include in your report.

• Situation 1: Your key investor provided you with a $1,000 loan last year. During this reporting year, you repaid $500 of the $1,000 loan. In your records and report, you would indicate:
  • type of repayment or return: Money
  • date of transaction: 2019-01-05
  • description: Partial repayment of $1,000 loan (provided on 2018-12-05)
  • amount of money or fair market value of the goods at the time of transaction: $500
• Situation 2: Your key investor provided you with machinery on 2020-09-01. You returned the machinery on 2021-07-15. The machinery is valued at $1,000 at the time of return. In your records and report, you would indicate:
  • type of repayment or return: Goods
  • date of transaction: 2021-07-15
  • description: Returned machinery that was provided on 2020-09-01
  • amount of money or fair market value of the goods at the time of transaction: $1,000
• Situation 3: Your key investor purchased goods (for example, soil, pots) for your cultivation business on 2020-08-01. During this reporting year, you repaid the investor the full cost of the goods on 2021-06-01. In your records and report, you would indicate:
  • type of repayment or return: Money
  • date of transaction: 2021-06-01
  • description: Full repayment of costs for soil and pots that were provided on 2020-08-01
  • amount of money or fair market value of the goods at the time of transaction: $5,000

Part 7: Transfer of ownership interest or other interest or right

If known, include if the ownership interest or other type of right or interest held by the key investor relating to the business or the organization has been, will be, or could be, in whole or in part:

• sold
• pledged
• assigned
• mortgaged
• hypothecated

Include ownership interests or other rights or interests that are transferred from the key investor to another individual or to a corporation or organization. Any new ownership interest or other types of interests or rights held by the key investor is reported in Part 5.
In your report, include the following information about the investor that will receive the ownership interest:

• first and last name or full name of the corporation or organization
• mailing address
• ownership interest or other interest/right affected and an explanation of the transfer (for example, which one was mortgaged to a bank)

For example: pursuant to a secured creditor agreement dated 2021-09-01, all of the shares owned by the key investor have been pledged to ABC Bank as security for a $10,000,000 loan.

Note: If the person who now holds the ownership interest or other right or interest meets the requirements of a key investor, you'll also need to keep records for them and include them in your report.

Here are some situations that you would need to include in your records and report.

• Situation 1: Your key investor holds 51% of the voting shares. They had to pledge their shares to a bank as collateral for a personal loan. You need to provide information on the bank that provided the loan to the key investor.
• Situation 2: Your key investor holds 51% of the voting shares. They sold their shares to someone else. You need to provide information about the person who bought the shares.

Part 8: Key investor who is no longer a key investor

For licence holders, only report key investors who stopped being an investor in the reporting calendar year. If you reported key investors in this section in a previous reporting year, you don't need to list them afterwards.

If they become a key investor in the future, report them in the relevant year.

Attestation

The responsible person for the licence must attest to the report.

How to submit your Key investor report

You need to submit 1 report per licence containing 1 form per investor. Merge the completed forms into a single file when submitting.

Applicants

You need to upload your Key investor report on the "Key investor report" page in the CTLS when you apply for a new licence. Name your document "KeyInvestor_APP-#_Report _YYYY-MM-DD.PDF".

Licence holders

Licence holders are required to submit a Key investor report annually, and may need to submit reports at other times during the year on the "Key investor report" page.

• For your annual report: Before January 31^st of each year, select "Annual" as your "Reason for report"
• For corrections to a previous report: Select "Change" as your "Reason for report"
• When you renew your licence: If you need to upload key investor information during your renewal, select "Renew" as your "Reason for report"

Name your document "KeyInvestor_LIC-#_Report _YYYY-MM-DD.PDF". The responsible person or anyone identified as a reporter for your licence can upload the report.

Contact us

If you have questions about how to submit your report, email licensing-cannabis-licences@hc-sc.gc.ca. The subject line of the email should be either:

• "Key investor reporting for applicant APP#"
• "Key investor reporting for licence holder LIC#"