Cannabis Tracking System Reporting Is Being Streamlined: What LPs Should Do Before the Fall 2026 Gazette

Every month, on or before the 15th, hundreds of Canadian licence holders log into the Cannabis Tracking System and submit the same long list of inventory numbers, book values and surface areas. Most teams treat it as a routine chore. Health Canada now agrees that a good part of that chore is unnecessary.

On 30 August 2025, Health Canada published a Notice of Intent in the Canada Gazette, Part I, announcing a review of the Cannabis Tracking System Order. The department's own Forward Regulatory Plan says the resulting proposal is expected to reach Canada Gazette, Part I in fall 2026. For licensed producers, that leaves a narrow and valuable window: enough time to understand your own reporting before the rules move, and not so much time that it can be left to next year.

This article explains what the Cannabis Tracking System Order requires today, what Health Canada has signalled it wants to change, what remains legally binding in the meantime, and the practical steps a licence holder should take between now and pre-publication.

What is the Cannabis Tracking System Order?

The Cannabis Tracking System Order is the federal instrument that requires licence holders and provincial bodies to report cannabis inventory and movement to Health Canada every month. It was made under subsection 82(1) of the Cannabis Act, registered on 12 June 2019, and came into force on 17 October 2019. Its purpose is to track cannabis so it is not diverted out of the legal market, and so illegal cannabis does not become a source of supply inside it.

The Order is short but demanding. Under section 2, a holder of a licence for cultivation, processing, or sale for medical purposes must, no later than the 15th day of each month, report on the previous month for the site named in the licence. The required information covers opening inventory of cannabis products and unpackaged cannabis, additions to inventory, reductions from inventory, the number and book value of products sold or distributed, quantities used in production, and closing inventory. Each figure must be broken down by class using Schedule 1 for cannabis products and Schedule 2 for unpackaged cannabis, expressed in the prescribed unit of measurement, and, for several fields, reported province by province and in Canadian dollars net of sales tax.

Section 3 adds licence number, reporting month, and surface area data: the total authorized building area on the site in square metres, the area used for cultivating, propagating or harvesting (square metres indoors, hectares outdoors), and for processors, the area used to produce cannabis. Where growing surfaces are stacked above one another, each surface counts.

Section 4 requires provincial and territorial public bodies authorized to sell cannabis to report by the 15th as well. Section 5 requires private retailers and distributors to report to the relevant public body by the 10th, subject to the conditions in subsection 5(5). Section 6 requires submission through the dedicated website Health Canada established for the purpose. Section 7 requires that records, reports and electronic data be retained for at least two years from the day the information is provided, held in a way that allows a timely audit, and kept at the licensed site or a Canadian place of business.

What is changing, and when?

Nothing has changed yet. Health Canada is at the consultation stage. The Notice of Intent published on 30 August 2025 opened a 60-day comment period that closed on 29 October 2025. A regulatory proposal has not yet been published. Health Canada's Forward Regulatory Plan states that the Canada Gazette, Part I comment period on the proposal is expected to take place in fall 2026. Only after that consultation, and after any resulting amendments are finalized in Canada Gazette, Part II, would your obligations actually change.

The Forward Regulatory Plan describes the intent plainly. Health Canada is proposing to amend the Order to reduce regulatory burden while continuing to track the high-level movement of cannabis through the supply chain as a means of preventing the diversion of cannabis to the illegal market or its inversion into the legal market, and says the amendments would simplify reporting by limiting reporting to information essential for tracking the movement of cannabis. The initiative was identified in Health Canada and the Public Health Agency of Canada's report on red tape review and was added to the Forward Regulatory Plan in December 2025.

The gap between a Notice of Intent and a final amendment is routinely two to four years in this space. Treat fall 2026 as a planning marker, not a promise. Regulatory timelines published in a Forward Regulatory Plan are departmental intentions and can move.

What Health Canada is actually asking about

The Notice of Intent is unusually specific, which makes it a reliable guide to where the changes are likely to land. Health Canada named four areas for feedback: streamlining the Order while maintaining regulatory oversight, improving reporting requirements and data accuracy, reducing reporting burden, and adapting to industry evolution and innovation.

Underneath those headings, the questions get concrete. Health Canada asked what information is genuinely most important for detecting inversion and diversion, and what could be simplified or removed. It cited its own recent example: the requirement to report the weight of plant trimmings pruned from whole cannabis plants each month was removed because it did not provide relevant tracking information. That change was made by the Order Amending the Cannabis Tracking System Order (Cultivation Waste), SOR/2025-45, which came into force on 1 April 2025 and is the reason the current section 2 carves cultivation waste out of the unpackaged cannabis addition and reduction fields.

Three questions point directly at specific fields:

• The "other" categories. Health Canada asked reporting bodies how they actually use "other" class of cannabis products, "other" class of unpackaged cannabis, "other additions to inventory," and "other reductions to inventory," and asked for detailed examples of what goes in them. Heavy or inconsistent use of "other" is a signal that a category structure is not matching operational reality.
• Vegetative versus whole plants. Health Canada asked whether these should remain separate sub-classes or be combined into one, and what the advantages and disadvantages would be.
• Financial transactions. Health Canada asked which financial transactions are difficult to account for under the current requirements. Book value reporting, net of sales tax, by class and by province, is one of the most labour-intensive parts of the monthly submission and one of the least intuitive for operations teams.

Health Canada also asked provinces and territories which requirements under sections 4 and 5 they would reduce or eliminate, and which they consider essential. That matters to producers indirectly: if provincial reporting is trimmed, the reconciliation you perform against provincial data may change shape too.

Separately, Health Canada sent a voluntary cost-benefit analysis survey to reporting bodies only. That data would feed the Regulatory Impact Analysis Statement published alongside any proposal. If your organization completed it, keep a copy. The assumptions you submitted about time and cost are the assumptions the department may use to justify the change.

Which reporting fields are most exposed to change?

No field is confirmed to be changing. Health Canada has not published a proposal, and any statement that a specific field will be removed would be speculation. What follows is MFLRC's assessment of exposure, based only on what Health Canada asked about in the Notice of Intent and what it has already done. Use it to prioritize your mapping work, not to stop reporting anything.

The pattern across the Notice of Intent is consistent: Health Canada wants to keep the data that shows cannabis moving between parties and out of the legal system, and is willing to reconsider data that describes internal operational states or duplicates what another federal department already collects. Excise reporting to the Canada Revenue Agency is the obvious overlap, and "duplicative reporting requirements with other federal departments" is language Health Canada used in the Notice of Intent itself.

Why waiting for the Gazette is the wrong strategy

Because the value of this change is only realized by companies that know what they currently do. A reduction in required fields does not automatically reduce your workload. It reduces your workload only if you can identify which of your procedures, spreadsheets, system configurations and staff hours are attached to the fields that go away, and retire them deliberately.

Most licence holders cannot do that today. In our experience, CTS reporting is one of the least documented recurring processes in a cannabis post-licensing compliance program. It is often held by one person, assembled from a mix of seed-to-sale exports and manual spreadsheets, and reconciled by memory rather than by procedure. That creates two problems, and the second one is the expensive one.

The first problem is inspection risk that exists right now. Health Canada inspectors regularly probe the link between the numbers submitted under the Order and the underlying records required by section 7. Common inspection findings in this area include monthly figures that cannot be traced back to a source record, inventory adjustments made without a documented rationale, reliance on an undocumented spreadsheet that has never been verified, and no evidence that anyone reviewed the submission before it was filed. Section 7 requires that the calculations, measurements and other data on which the information is based be documented in a way that allows timely examination. A number that only exists inside one person's workbook does not meet that standard comfortably.

The second problem is that a company with no process map cannot respond to a change. When the Gazette proposal lands, the licence holders who benefit fastest will be the ones who can open a document, see that fields X, Y and Z feed a controlled SOP and a validated report in their seed-to-sale platform, and scope the update in an afternoon. The ones who cannot will spend the transition period rediscovering their own process under time pressure, which is precisely how errors enter a regulatory submission.

There is a third reason, and it is the one most often missed. Mapping your reporting almost always surfaces problems that have nothing to do with the amendments. Teams that map their CTS process routinely find that "other" categories have been absorbing transactions that belong in a defined class, that book value has been reported gross of sales tax in some months, or that closing inventory has been rolled forward rather than counted. Those are current compliance gaps, not future ones.

How to map your CTS reporting before pre-publication

This is a scoped exercise, not a project. For most single-site licence holders it is a few days of focused work. Follow these steps.

1. Build the field inventory. List every field you submit under sections 2 and 3, exactly as it appears in the Cannabis Tracking System, for each licence type you hold. Do not work from memory or from a vendor's summary. Work from your last submission.
2. Trace each field to its source. For every field, record where the number originates: which system, which report, which physical count, which person. Flag any field whose source is a manual entry or an unverified calculation.
3. Time it honestly. Record how long each part of the submission takes, including reconciliation and rework. This is the number that tells you what a change is worth, and it is the number Health Canada asked for in its cost-benefit survey.
4. Map fields to controlled documents. Identify every SOP, work instruction, form, validated report and system configuration that exists because of a specific CTSO field. This is the step that turns a future amendment into a scoped change request instead of a scramble.
5. Audit your "other" categories. Pull twelve months of entries classified as "other" in any of the four categories and check whether each one genuinely has no defined class. This is both a readiness step and a data-accuracy check with immediate value.
6. Reconcile against your excise filings. Compare what you report to Health Canada with what you report to the Canada Revenue Agency for the same period. Differences are expected because the definitions differ, but unexplained differences are a finding waiting to happen.
7. Verify your section 7 retention. Confirm that two years of submissions and their supporting calculations are retained, at the right location, and retrievable quickly enough to support an audit.
8. Assign an owner and a watch item. Put Canada Gazette, Part I pre-publication on your regulatory calendar for fall 2026, with a named owner and a standing instruction to review the proposal within the comment period.

What stays the same until the Order is amended

All of the following remain in force without qualification:

• Monthly reports under section 2 are due no later than the 15th day of each month, covering the previous month.
• Public bodies report by the 15th under section 4; private retailers and distributors report to the public body by the 10th under section 5, where subsection 5(5) applies.
• Section 3 surface area and licence identifier information is still required.
• Reporting must be done through Health Canada's dedicated Cannabis Tracking System website under section 6, and you must notify the Minister when the individual responsible for submitting changes.
• Records, reports and electronic data must be retained for at least two years from the day the information was provided, in an auditable manner, under section 7.
• If you cease all licensed activities, you must still provide outstanding information within 15 days under subsections 2(6), 4(4) or 5(7).

The cultivation waste change from SOR/2025-45 is the only recent amendment that has actually taken effect, and it took effect on 1 April 2025. Everything else in the current Order stands.

Compliance checklist

Use this before pre-publication.

• Every CTSO field you submit is listed in a controlled document, per licence type.
• Each field traces to a named source system, report or record.
• Manual calculations supporting any field are documented and verified, satisfying section 7.
• Time per submission is measured, not estimated.
• SOPs, forms and validated reports are cross-referenced to the fields that drive them.
• Twelve months of "other" category entries have been reviewed for misclassification.
• Book value is reported by class and province, in Canadian dollars, net of sales tax.
• Surface area figures under section 3 reflect the current site and stacked surfaces are counted.
• CTS submissions and supporting data are retained for two years at the correct location.
• The individual responsible for submission is current, and Health Canada has been notified of any change.
• Health Canada reports are reconciled against CRA excise filings, with differences explained.
• A named owner is scheduled to review the fall 2026 Canada Gazette, Part I proposal.

Common mistakes to avoid

• Treating the Notice of Intent as a rule change. It is a consultation. Reducing what you report today because you expect it to be removed tomorrow is a straightforward non-compliance.
• Assuming streamlining means less oversight. Health Canada has been explicit that it intends to keep tracking high-level movement of cannabis. Fewer fields may well mean sharper scrutiny of the fields that remain.
• Letting CTS reporting live with one person. Key-person dependency in a monthly regulatory submission is a business continuity risk and an inspection finding in waiting.
• Using "other" as a catch-all. It is the exact behaviour Health Canada asked about. If your "other" categories carry meaningful volume, expect that to be visible in the data the department already holds.
• Ignoring the cost-benefit survey. Companies that did not respond gave up the chance to influence the burden estimates used to justify the scope of the change.
• Skipping the excise reconciliation. Two federal datasets describing the same cannabis should be explainable against each other.
• Waiting for Part II. By the time an amendment is final, your comment window has closed and your transition period has started.

Frequently asked questions

Has the Cannabis Tracking System Order changed?

No. The Order was last amended on 1 April 2025 by SOR/2025-45, which removed cultivation waste, including plant trimmings, from monthly reporting. The streamlining amendments discussed here are still at the consultation stage. Health Canada published a Notice of Intent on 30 August 2025 and expects to pre-publish a proposal in Canada Gazette, Part I in fall 2026.

Are monthly CTS reports still due on the 15th?

Yes. Section 2 of the Order requires holders of a licence for cultivation, processing, or sale for medical purposes to report no later than the 15th day of each month for the previous month. That deadline is unchanged and remains enforceable.

Will small and micro-class licence holders benefit most?

That is the stated intent. Health Canada's Notice of Intent specifically identified duplicative reporting requirements with other federal departments as a concern "particularly for small and medium-sized federal licence holders." Whether the final amendments include scaled requirements for micro cultivation and micro processing licence holders is not yet known and will only be clear at pre-publication.

Which fields will Health Canada remove?

Health Canada has not proposed removing any specific field. The Notice of Intent asked focused questions about the "other" inventory categories, whether vegetative and whole plants should remain separate sub-classes, and which financial transactions are difficult to report. Those questions indicate where the department is looking. They are not commitments.

Do I still have to keep CTS records for two years?

Yes. Section 7 requires records, reports and electronic data to be retained for at least two years beginning on the day the information is provided, held so that a timely audit is possible, and kept at the licensed site or a Canadian place of business. The retention obligation continues even if you stop reporting.

What should we do between now and fall 2026?

Map your current reporting. Document every field, its source, and the SOPs and systems attached to it. Audit your "other" categories, reconcile against your excise filings, and confirm your section 7 retention. Then assign an owner to review the Canada Gazette, Part I proposal inside its comment period.

How MFLRC can help

MF License and Regulatory Consultants supports Canadian cannabis and hemp licence holders through exactly this kind of regulatory transition, where the obligation has not moved yet but the preparation window is open.

We provide:

• CTS reporting reviews. A structured map of every field you submit, traced to source, with time and effort quantified and misclassification risks flagged.
• Gap assessments and QMS documentation. An assessment of your reporting process against sections 2, 3, 6 and 7 of the Order, and the quality system documentation to hold it, identifying the findings an inspector would reach before an inspector reaches them.
• SOP development. Controlled procedures for monthly reporting, review and approval, and record retention, written so they can be updated cleanly when the Order changes.
• Compliance-as-a-service. Ongoing regulatory monitoring and monthly reporting support, so the submission is not carried by one person.
• Audit and inspection readiness. Mock inspections and CAPA support focused on the traceability between what you submit and what you can prove.
• Post-licensing compliance programs. The broader system that CTS reporting sits inside, from Good Production Practices through to EU-GMP readiness.

With more than 20 years across cannabis, pharmaceutical, natural health product and food regulation, and led by a Health Canada security-cleared, approved Quality Assurance Person, we help licence holders turn regulatory change into a scoped project instead of a fire drill.

Conclusion

Health Canada has said what it wants to do: collect only the data that is essential to tracking cannabis through the supply chain, and stop collecting the rest. The Notice of Intent closed in October 2025, the cost-benefit work is done, and a proposal is expected in Canada Gazette, Part I in fall 2026.

For licence holders, the instruction is simple and the timing is comfortable, which is exactly why it gets deferred. Until an amending order is in force, report everything the Cannabis Tracking System Order requires, on the 15th, and retain it for two years. In parallel, spend a few days building the map of your own reporting that you should have had anyway. Companies that do will read the fall 2026 proposal and know within an hour what it costs them and what it saves them. Companies that do not will read the same proposal and start asking their own team what they currently report.

The regulatory burden is being reduced. The benefit goes to whoever is ready to collect it.

Sources and references

• Cannabis Tracking System Order, SOR/2019-202, Justice Laws Website
• Canada Gazette, Part I, Volume 159, Number 35 (30 August 2025), Notice of Intent: Consultation on potential amendments to the Cannabis Tracking System Order
• Health Canada, Consultation on potential amendments to the Cannabis Tracking System Order
• Health Canada's Forward Regulatory Plan: 2026 to 2028, Amendments to the Cannabis Tracking System Order
• Order Amending the Cannabis Tracking System Order (Cultivation Waste), SOR/2025-45, Canada Gazette, Part II, Volume 159, Number 6
• Cannabis Act, S.C. 2018, c. 16, Justice Laws Website
• Health Canada, Cannabis Tracking System: Monthly reporting guide