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Is Cannabis Legalization Moving In France?

Written by Marguerite Arnold on . Posted in Politics.

A group of French politicians has specifically called for cannabis reform linked to COVID-19 relief efforts in the country. And this is a giant step forward in a country known for dragging its feet on the latter.

France is one of the slowest moving reform countries in Europe when it comes to cannabis. Even efforts at basic decriminalization have been put in the deep freeze of bureaucratic deliberation, and furthermore, even since Emmanuel Macron, France’s president, promised more reform. 

Ignoring the issue, however, is a temporary holding pattern. There is no more ignoring cannabis reform in Europe and of both kinds. With the World Health Organization on track to tackle cannabis reregulation in December, and numerous European countries publically announcing reform, France is being dragged by both global and more regional developments to take a stand.

Political reluctance is also beginning to fade. This month, a group of 60 French elected officials called for greater movement on legalization. Their arguments range from economic ones (i.e. as COVID relief and redevelopment efforts) to reducing the amount of money spent on policing for a legitimizing market. 

Further, foreign models, in particular Canada, the American states of Washington, California and Colorado, and of course, beyond Uruguay, the European country of Portugal, have all been cited by French politicians as a way to look to the future of cannabis not only as a “drug” but rather a fully recreationally legal substance.

What Is Likely To Happen?

The French have also moved slowly on the medical question. Unlike Germany and the UK, there have been no mass adoptions of cannabinoids into the health system, or at least calls for the same. Unlike Spain and Portugal, and other agrarian European economies, there has also been no advance on the cultivation of even hemp, let alone medical standard GMP crops for economic reasons.

Beyond the early movers in the medical game, even in Europe (and at this point that includes Denmark, Holland, Poland, Malta, Italy and Switzerland) there is of course now Luxembourg’s recreational experiment looming ever closer on the horizon. 

For this reason, it is not inconceivable that the French will move fairly major reform quickly after refusing to examine the smaller issues for so long. However, as everyone knows, in this industry, there are many instances of two steps forward and several back. With German states now deciding to interpret EU laws on CBD, it is conceivable that France could follow the guidance of both the WHO and the EU rather than the rebel states across Europe who are absolutely at this point, beating a different rhythm and on a rapid march into the future of reform.

The International Cannabis Business Conference will return to Europe. In the meantime, keep up with us by following the blog!

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Yelp Chooses To Discriminate Against Cannabis Businesses

Written by Johnny Green on . Posted in Business.

Yelp is one of the most popular websites in the United States. Yelp is a website and mobile app which houses reviews about businesses. Yelp also provides a reservation service called Yelp Reservations.

For many businesses, a positive footprint on Yelp can mean the difference between thriving or failing because of how many consumers rely on reading reviews on the platform when making their purchasing decisions.

Unfortunately for cannabis businesses that are licensed in legal states, the Yelp platform chooses to discriminate against cannabis companies on its platform, as recently covered by Marijuana Moment:

Yelp is no longer offering two key advertising features to marijuana-related businesses, the company confirmed to Marijuana Moment.

Two cannabis businesses have shared an email from Yelp announcing the policy change. It states that the company had “unfortunate news” and that it will be removing both the “Business Highlights and Portfolio advertising options for cannabis-related businesses, effective immediately.”

We have come a long way as a cannabis movement and industry, however, as this latest development clearly demonstrates, we still have quite a ways to go. Cannabis might be going mainstream, however, as long as this type of discrimination against the industry exists, we clearly have not reached the finish line.

Hopefully, Yelp restores its previous policy. Legal cannabis businesses deserved to be treated equally with other businesses that are legal at the state level in so many states.

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Israel’s Ministerial Committee On Legislation Advances Cannabis Legalization Bills

Written by Johnny Green on . Posted in Politics.

Cannabis legalization is on the move throughout the globe. As it stands right now, only two countries have legalized cannabis for adult use (Uruguay and Canada), however, several other countries are moving in the right direction when it comes to pushing for cannabis legalization.

Two other countries, Mexico and Italy, have seen court decisions rendered which declared cannabis prohibition unconstitutional, so those two countries will join the list of legalized nations once they get measures passed and implemented.

Another nation, Israel, could join the list of legalized countries sooner rather than later. Per JPost:

The Ministerial Committee on Legislation decided on Sunday to advance two separate bills that would legalize cannabis, guaranteeing the coalition’s support for them in the Knesset.

The bills were submitted by Likud MK Sharren Haskel and Blue and White MK Ram Shefa. Haskel said she has fought for the bill for five years but her persistence on behalf of what she said are more than a million cannabis users paid off.

Israel has a long history when it comes to cannabis research and medical cannabis policy. However, it has been slow to move towards full legalization, as Likud MK Sharren Haskel pointed out.

If/when Israel legalizes cannabis for adults, it will hopefully encourage other countries to follow suit. Cannabis prohibition is a failed public policy, both inside the borders of Israel, and beyond.

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Calling Dutch Growers: Government Tenders Up For Grabs

Written by Marguerite Arnold on . Posted in Business.

It sounds like a dream job, right? Grow cannabis (legally) in Holland.

Here is the good news: The Dutch government is opening up ten slots for aspiring cultivators between July 1 and 28. Like Willy Wonka factory tour tickets, this has been a cherished (and long-secret) process that has been in various stages of “strategic leaking” for at least the last year.

Just to put this into perspective, the last kind of tender held by the government was on the medical side (for two lots and which closed a year ago last week).

This time, ten municipalities will participate in a government-led experiment to better regulate the Dutch cannabis industry better, generally. The entire vertical has long been a grey zone, although for the last decade, a remarkably if more gradually regulated and legit one.

A total of 26 municipalities signed up for the experiment, although the larger cities (including Amsterdam, Rotterdam and the Hague) refrained from participating based on conflicts between existing city policies and the procedure of the new “experiment.” Indeed, based on the flourishing of the industry in particularly Amsterdam, it is curious if not a clearly politically sticky wicket in an already strange world. 

Regardless, the federal plan is proceeding and, despite COVID, on schedule (which is more than can be said about the German distribution tender which has now been delayed for the third time). Conditions, regulations and requirements for the entire value chain of growers, owners, municipalities, packagers have been produced by the government over the last months. 

Here is the interesting news. Unlike the German cultivation bid for medical cannabis, this application requires that successful applicants are Dutch residents, with a business that already exists and a certificate of good conduct. Application forms can be found here (all in Dutch).

The experiment will undoubtedly begin to regulate a complex supply chain nationally. This will also put undoubted pressure on the larger cities to at least cooperate. Given the looming spectre of recreational reform in at least one if not two European countries outside Holland in the next few years (beyond Switzerland), there is zero way the federal government will put this on a slow burner. 

The lower house of the Dutch parliament (the Tweede Kamer) approved the plan for a test of regulating the Dutch cannabis market in January 2019.

For more up to date information on the European cannabis industry, be sure to attend the International Cannabis Business Conference’s Berlin conference when it returns to Europe.

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Irish-French Alternative Investment Fund Launched In Search Of Long-Term Cannabis Returns

Written by Marguerite Arnold on . Posted in Business.

Óskare Fund – a joint venture between Irish and French firms (Crossroads Capital Management and Óskare Capital) is an alternative fund now seeking investors and longer-term returns in the industry (no small feat). Neither is its existence. This is the first such fund to be domiciled in Ireland, approved by the Central Bank only last month.

In January, a (separately managed) exchange-traded fund (ETF) was first listed on the Irish exchange.

Private investors in the Óskare Fund must be able to invest at least €100,000 in portfolios based on the development and sale of medical-only cannabinoid-based products. The first round of the fund seeks €30 million in its first tranche, however, managers said that they sought up to €120 million more in successive rounds.

The prospectus describes the fund this way: “A long-term, potentially high-risk investment which is suitable only for sophisticated institutional and high-net-worth investors which are able to bear the risk.” A good start for sure in a niche that is already known for high volatility (see the Canadian public market if not the U.S.)

Investment strategy is to invest primarily in unlisted cannabis-related companies with broad and global exposure to the industry. This includes those firms involved in R&D in the medical space (including the development of pharmaceutical products and extracts) and all things (from production to equipment) on the hemp side of the equation.

The fund will seek stakes and boardroom representation in early-stage start-ups across the medical vertical, but not directly in cultivation. The investments will also be weighted in favour of Europe.

The fund, named after the Mohawk Indian name for cannabis, believes that this region offers the best regulatory environment for innovation, research and development of cannabinoids used for medical purposes.

Why Is This Interesting To Foreign Investors?

One of the more difficult aspects of investing in the European space is language barriers. The second is all the Brexit-related financial and compliance issues that go with the divorce. For that reason, Dublin, where the fund is located, is a hotbed for “alternative” investments if not cannabis (yet). Give it time.

The reason? There are financial incentives on both sides of the Brexit barrier, for one, that those in Ireland are well used to navigating (and far from just the cannabis front specifically). With feet in both the UK and Europe, in other words, this fund, as well as others, if properly managed, stands to play an increasingly important role in a Euro-market hungry for access to equity and a British market that is full of potential but still way behind with money sloshing around looking for “foreign” adventures.

For the latest on European cannabis developments, including financing and investing, be sure to attend the International Cannabis Business Conference when it returns to Europe.

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Rumbles In The German Cannabis Distribution Jungle

Written by Marguerite Arnold on . Posted in Business.

As Germany opens up its economy again, cautiously, of course in the aftermath of the first COVID-19 scare, there are certainly moves afoot in the cannabis industry on the B2B side.

Most of this is also due to shake out this year as events beyond the Pandemic continue to develop in a predictable path.

Here are the broad, general outlines:

  1. The German distribution contract for all German grown cannabis has been delayed YET AGAIN. For those who missed it, the contract bid was issued by the Federal Institute for Drugs and Medical Devices (BfArM) earlier this year, and like the original cultivation contract that kicked off the entire shebang, this too has been delayed several times (now to June 23). This tender competition is seeking the fairest cannabis distributor of them all to deliver the entire domestically cultivated crop to any pharmacy in the fair (German) land who places an order for any kind of it. This fairy tale is also likely to go down to the same kinds of shenanigans seen during the cultivation bid except that this time there are a few more sources available. Look for an established Mittelstand to take the bid this time. This ain’t start-up territory.
  2. In an act of remarkably well-timed (or badly timed) government interference in the market, the Dutch government, home of Bedrocan, has recently announced a change in policy. Namely, it will be limiting the number of German importers it will sell medical product to. As of late, this had gotten to be fairly ridiculous territory. Namely that any qualified German distributor could show up and get an equal share of the regular allotment. This led (predictably) to smaller and younger distributors in the market reselling their Bedrocan product to others, also predictably driving up the cost of Dutch medical cannabis in the German market.

Both developments spell a period of intense competition in the domestic distribution market for cannabis. There are according to recent reports, 40 cannabis distributors who were showing up for Bedrocan product although even this is not the entire picture. All one needs to do to distribute the drug is to have a general narcotics license (not a cannabis license specifically). This means, predictably also that there will be a shakeout in the entire landscape – and in the works now. The larger producers have established a bulwark with both flower and extract. But the only way to survive, as the most nimble of the distributors have already discovered, is to source product from several different international supply chains.

The International Cannabis Business Conference will be returning to Europe soon!

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Where Goes The Canadian-German Export Market?

Written by Marguerite Arnold on . Posted in Business.

For the past several years (since 2016), Canadian exporters have sent ever-larger amounts of medical cannabis to Germany. The amount grew from a mere 44 kilograms to 3,740 by the end of last year according to Health Canada.

But will this exponential growth continue?

The answer is largely no, and for a variety of market-driven reasons although savvy Canadian exporters should be paying especially close attention now:

  1. German grown cannabis is coming (finally), with a few bumps and hitches, and expected to be here by the end of 2020. While this will not be nearly enough to meet the growing demand here, it will clearly put a damper in Canadian sales especially because:
  2. The Dutch government is getting more efficient with cannabis distribution – namely, it is beginning to limit the number of distributors it will work with. This downward pressure on the market in terms of the competition will also create German distributors in desperate search of product, but that is another issue.
  3. As popular as Germany has been as a destination (on the medical market), there are no other countries which regularly import as much Canadian product as Germany.
  4. There are other factors which will now impact the medical market, namely the growth of legitimate cannabis cultivations around Europe and the entry of Israel into the cannabis market globally.

One thing is for sure. The market will never “be the same” as it was in 2016 and 2017. That period has morphed into one where deep-pocketed cannabis companies approach the entire proposition as a medical product. That is a world, so far (major pharma) that the Canadian market with a few major exceptions has not jumped into, namely because there is so far little need to for domestic sales. The market there may be driven by medical sales, but the recreational question changed the entire conversation.

Here, while that may also happen too, as the next decade countries all over Europe will be grappling (as Israel is currently) with the recreational question, it will almost certainly happen more slowly.

However the change will not be fast enough to save many of the newer, exclusively cannabis focussed wholesalers unless they develop tactics that take them outside of just Germany, or perhaps beyond this one drug.

The distributor market, in other words, is about to go through a series of mergers and buyouts just as the first German cultivated product hits the shelves. Canadian producers who are smart and savvy would do well to look for hungry distributors no longer getting products from across the Dutch border.

Find out more about trends on the ground in Europe’s largest cannabis market when the International Cannabis Business Conference returns to Europe this fall.

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Cannabis Decriminalization Bill Delayed In Israel

Written by Johnny Green on . Posted in Politics.

Israel has long been a leader when it comes to medical cannabis research. After all, Israel is where renowned scientist, and International Cannabis Business Conference speaker alumni, Raphael Mechoulam became the first person to ever isolate the cannabinoid tetrahydrocannabinol.

Cannabis prohibition throughout the globe has resulted in medical cannabis research efforts being hindered in most countries. Many of the significant scientific breakthroughs in cannabis research have occurred in Israel because the country embraces it.

Unfortunately, some of Israel’s other cannabis policies have not matched its cannabis research policies. Specifically, Israel still prohibits cannabis for adult-use purposes. A bill that would address the current prohibition policy was expected to receive consideration recently, however, that vote was delayed. Per JPost:

The Ministerial Committee on Legislation postponed for a week a bill that would decriminalize cannabis, due in part to a dispute between Likud and Blue and White.

The bill was initiated by Likud MK Sharren Haskel, who was appointed to work on cannabis legislation jointly with Blue and White MK Ram Shefa. But Haskel still hoped to advance the bill that she submitted before the partnership.

It is unclear what the chances are of the bill passing, or for that matter if it will even receive consideration any time soon. The bill vote was initially delayed by a week, yet it’s quite possible that the delay could linger longer if political disagreements continue.

Israel is well-positioned to become an international leader for cannabis commerce, just as it already is for research. However, that will not happen until prohibition ends in Israel for its citizens.

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Mayor Of Azcapotzalco, Mexico Sends Draft Cannabis Legalization Legislation To Federal Lawmakers

Written by Johnny Green on . Posted in Politics.

In late 2018 Mexico made international headlines when the Supreme Court ruled that cannabis prohibition was unconstitutional. The Court, via its ruling, tasked lawmakers in Mexico to pass legislation that would implement a regulated cannabis legalization system.

Lawmakers were given a one-year deadline in which to comply with the Court’s decision. That deadline was not complied with and an extension was granted. Due to the ongoing pandemic, that extension was not met either, and another extension was granted. Lawmakers now have until the end of the year to comply with the Court’s directive.

Proposals are being kicked around right now, with some appearing to be gaining more traction than others. The Mayor of Azcapotzalco has offered up their suggestion for what legalization should look like in Mexico, as covered by La Silla Rota:

The mayor of Azcapotzalco, Vidal Villegas Morales sent an initiative with a draft decree to the Congress of Mexico City to allow the recreational use of marijuana.

The initiative proposes to reform and add provisions of the CDMX Law for the Comprehensive Care of Psychoactive Substance Use, in the field of cannabis.

The suggested changes are a reform to section XXXII of article 3 of said legislation on the reduction of risks and damages, among others.

Only time will tell if the proposal gains traction and ultimately becomes law in Mexico. One way or another, at some point Mexico will implement an adult-use legalization cannabis system, and it will be a very significant victory for not just Mexico, but also for the rest of the world.

Mexico has long been a major source for unregulated cannabis for the other countries, especially the United States. If/when Mexico can transition away from an unregulated system to a regulated one, it will send ripple effects around the globe.