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Southwestern Ontario cities may not find out until next month whether they'll get one of the province's first 25 cannabis stores The Alcohol and Gaming Commission of Ontario, the province's pot regulator, announced the results from its much-anticipated lottery for a chance to get one of the first retail licences for when the bricks-and-mortar businesses are allowed to open April 1.

Seven licences are allocated in the west region, an area that stretches from Windsor to Waterloo to Niagara and includes London, but only the names of the individuals and companies selected to apply for one of the coveted dretail licences have been published.
Nearly two-thirds of the applicants were sole proprietorships essentially individual entrepreneurs while the remaining submissions came from corporations and partnerships.The lottery winners now have until Jan. 25 to submit a store application to the AGCO, a process that includes an exact address for the proposed store.

"We the public may not know until sometime in February," cannabis lawyer Trina Fraser said of the store locations Adding to the uncertainty, Fraser and other cannabis industry insiders are skeptical that many of the 25 lottery winners will be able to open by April 1, given the large number of individuals - not corporations - that took part in the lottery.Nearly two-thirds of the more than 17,000 applicants to the lottery were sole proprietorships, essentially individual entrepreneurs, while the remaining submissions came from corporations and partnerships.The winners in the west region are Steven Fry, Lisa Bigioni, Ranjit Basra, Santino Coppolino, Christopher Comrie, the Niagara Herbalist and an Ontario numbered company. Five of the seven are entrepreneurs who appear to have no connection to the cannabis industry.

With less than three months until successful applicants are expected to be in business - those that aren't open by April face hefty fines - cannabis experts doubt many of the winners have done the necessary preparation to pull it off."A lot of people may not have actually realized what the requirements will be after the winning ticket is pulled," said Karina Lahnakoski of Cannabis Compliance, an industry consulting firm.Experts warn that marijuana stores shouldn't be run through sole proprietorships because that exposes owners to financial risks and limits their ability to secure capital.

"It's very, very high-risk for the individual that owns that business, and you can't transfer ownership," Lahnakoski said, referring to the AGCO's rule that requires lottery winners to open the dispensary under the name they used to apply.Fraser also warned that operating a pot shop through sole proprietorship is "limiting." "Any lawyer would have advised them strongly to incorporate a company for the purpose of applying, or would have explained what the limitations would have been had they applied as a sole proprietor and won," Fraser said.

By Friday, lottery winners must submit a retail operator licence application with extensive detail on the timeline for getting a cannabis store up and running. They'll be subject to a background check, which includes scrutiny of tax records and financial statements. The 25 winners also have to submit a $50,000 letter of credit and a non refundable $6,000 fee payment to the AGCO If applicants don't pass the AGCO background check, the province will turn to a wait list. Retailers that fail to open by April 1 will be fined $12,500, while those still not in business at the end of the month get dinged $50,000.About 20 individuals and companies are on the wait list in the west region.Both Fraser and Lahnakoski predict only around five dispensaries will pull off an April 1 opening.