Canada has passed a bill to legalise recreational marijuana - the first G7 nation to do so.

The Senate voted 52-29 in favour of the bill, paving the way for a fully legal cannabis market within the next three months.

The bill controls and regulates how the drug can be grown, distributed, and sold.

It will probably receive Royal Assent this week, and the government will then choose an official date when it will come into force.

Yesterday, the elected House of Commons passed the bill by 205 votes to 82.

The measure ends prohibition of cannabis that had been in place in Canada since 1923. It was effectively legalised for medical use nearly two decades ago, in 2001.

Prime Minister Justin Trudeau's Liberals had made legalising recreational use of marijuana part of their successful 2015 election campaign, arguing the new law would keep the drug out of the hands of underage users and reduce related crime.

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While production of cannabis is regulated by the federal government, provinces and cities have more powers over retail sales either through private or government-owned stores.

"I'm feeling just great," CBC News quoted Tony Dean, who sponsored the bill in the Senate, as saying.

"The end of 90 years of prohibition. Transformative social policy, I think. A brave move on the part of the government."

As the first major economy to fully legalise cannabis, Canada's regulatory rollout will be closely watched by other nations considering the same path and by global investors, who have already poured billions into Canadian marijuana firms.