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Canadian Chamber Of Commerce Weighs In On Legislative Review Of The Cannabis Act

Written by Hazel Norman on . Posted in Business, Policy.

Canada was the first G-7 nation to legalize cannabis for adult-use at the national level, and the second nation to do so on earth, only behind Uruguay. Yet, unlike Uruguay, Canada allows adult-use sales to anyone of legal age regardless of their residence status.

In many ways what has gone on in Canada since the launch of legalization in 2018 has served as the greatest cannabis public policy experiment since the dawn of prohibition. Many countries around the globe have kept a close eye on legalization unfolding in Canada to gain any insight and lessons learned.

Back in September Canada’s government launched a legislative review of the Cannabis Act so that it could determine any internal lessons to be learned.

“The objective of the Cannabis Act is twofold. First, it aims to protect the health and safety of Canadians while serving as a flexible legislative framework that adapts and responds to the ongoing and emerging needs of Canadians. Second, it provides for the establishment of a diverse and competitive legal industry made up of small and large players to displace the illicit market.” the government stated at the time of the launch of the review.

“Parliamentarians recognized the need for an early assessment of the Government’s new approach to cannabis control, and included a provision requiring a review in the Act. The review will help ensure that the Act adapts to the current situation and continues to meet Canadians needs and expectations.” the government stated back in September.

Part of the legislative review process involves soliciting feedback from the general public. On the four year anniversary of legalization in Canada, Health Canada announced that it was opening an online questionnaire and encouraged all Canadians to provide comments regarding their views on how legalization was going.

“As we look to the future, the Government of Canada will continue to provide clear, consistent and evidence-based information on the health and safety effects of cannabis use to people across the country, so they can better understand the risks and make more informed choices.” Health Canada stated back in October. The public comment period has since closed (on November 21, 2022).

Canada’s Chamber of Commerce recently offered up its recommendations regarding legalization in Canada and what the government can do to help cannabis businesses battle the unregulated market in a meaningful way.

“As part of the legislative review, the NCBC is proposing several recommendations to help businesses in the legal sector remain economically competitive in the long term and continue to displace the illicit market per the tenets of the Cannabis Act.” the Chamber of Commerce stated in its submission to the government.

The Chamber’s recommendations include:

  • Minimizing harms to protect Canadians
  • Education and awareness to support informed choices
  • Progress towards establishing a responsible supply chain
  • Access to cannabis for medical purposes

Canada’s legal cannabis industry is at a crossroads of sorts, in that a favorable legislative review combined with public policy and regulatory improvements could set up the nation’s industry for robust growth and reduced uncertainty well into the future.

Conversely, a review that yields an outcome that is not favorable could result in kneejerk public policy changes. If so, that would likely ensure that the unregulated industry thrives at the expense of the regulated market in the future. People can read the Chamber’s full submission language at the previously cited link found earlier in this article.

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Pilot Project In Switzerland To Import Cannabis From Canada?

Written by Frank Schuler on . Posted in Business, Policy.

Cannabis pilot programs are part of an interesting public policy concept that is springing up in Europe. Essentially, cannabis pilot programs provide for limited adult-use cannabis commerce in a designated area and research from the pilot programs provide insight to lawmakers for if/when they craft national cannabis laws and regulations.

A cannabis pilot program already exists in Copenhagen, Denmark and lawmakers there are trying to expand pilot programs to other cities in the European country. All cannabis for Copenhagen’s pilot program is domestically produced.

Two other European countries previously announced plans to launch their own pilot programs, the Netherlands and Switzerland, although both countries have experienced setbacks. For the pilot program in Basel, Switzerland specifically, domestic cannabis failing to meet stringent pesticide requirements has resulted in the program looking elsewhere to source it’s cannabis, particularly in Canada. Per SRF News:

Possibilities of importing hemp from neighboring countries were clarified. According to the health department, the focus was on Germany. But because no solution was found, the Basel company switched to imports from Canada. “Canada has individual suppliers who legally sell organic hemp products.”

The ball is now in the hands of the Federal Office of Public Health, which grants approval for the pilot test and must also approve the import. Investigations are ongoing. “Whether a possible import is eligible for a permit, we can determine if there is a corresponding application or after its examination,” says the Federal Office.

How cannabis is sourced for adult-use commerce is tricky, which is being demonstrated by the ongoing effort in Germany to legalize adult-use cannabis sales. Germany is reportedly going to source all of the cannabis for its eventual adult-use market domestically. Apparently lawmakers and regulators seem to feel that while cannabis can be imported and exported for research and medical use, it cannot be imported for adult-use sales.

What is being proposed in Basel is somewhat interesting, in that someone could make a strong argument that the cannabis is indeed for research purposes, albeit to research whether adult-use sales can be properly regulated at a local level prior to being regulated at a national level. Only time will tell if the request in Switzerland is granted, and if so, what it would mean for other pilot programs.

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Governments Need To Embrace Cannabis Tourism

Written by Hazel Norman on . Posted in Business, Entertainment, Policy.

A common misconception about cannabis reform is that once a jurisdiction’s lawmakers or voters initially approve an adult-use legalization measure, that there’s nothing left to do. In reality, that couldn’t be farther from the truth. The fact of the matter is that the push for reform continues well after a successful legalization vote. The effort behind pushing for sensible cannabis policies doesn’t change. Only the direction of where that effort is focused changes.

Immediately after an adult-use cannabis legalization measure is initially passed, the focus then shifts to more nuanced and granular aspects of cannabis policy. In the instances in which a jurisdiction’s legalization model permits legal sales, making sure that sensible regulations are adopted is extremely vital. One area of cannabis commerce that seems to often be overlooked, or at least is not properly embraced by governments, is cannabis tourism.

More Than Just Clubs And Lounges

Typically, when people think of cannabis-based tourism they think of coffeeshops, clubs, and lounges. While those are certainly valid examples of cannabis tourism, the sector of the emerging cannabis industry is much more complex these days, and evolving constantly. People still travel to Amsterdam to frequent the city’s historic coffeeshops, however, people now have far more options, and those options create additional opportunities for entrepreneurs and innovators.

Canada is home to the only nationwide, legal adult-use cannabis industry that is open to anyone of legal age. Uruguay also permits legal adult-use sales, however, they are limited to residents only. Malta passed an adult-use legalization measure late last year, and eventually the country will have cannabis clubs. However, no legal clubs are currently in operation.

Being that it’s a legal oasis to the world in many ways, Canada is a top international cannabis tourism destination. Consumption in public is still prohibited, so social use establishments like lounges play a vital role. Canada is home to a growing number of cannabis-friendly lodging choices, industry tours, and other ancillary cannabis tourism businesses, many of which do not ‘touch the plant’ directly.

A Growing Opportunity Cost

Some parts of the world are already established as top cannabis tourism destinations. It doesn’t take a cannabis historian to name some of them – The Netherlands, Spain, Jamaica, etc. For reasons that don’t quite make sense, very few of the current high-profile destinations seem to embrace cannabis tourism. That seeming lack of enthusiasm for cannabis tourism creates opportunities for other countries that want to fill the void.

For example, leaders in the Czech Republic have indicated that they want to follow Germany’s lead in passing an adult-use legalization measure, with a specific interest in becoming a cannabis tourism destination given the fact that current legalization plans in Germany do not appear to include cannabis clubs at this time.

“They do not have cannabis clubs that we are supposed to. I’m pretty sure I want to hold on to cannabis clubs until my last breath.” stated national anti-drug coordinator for the Czech Republic, Jindřich Vobořil in a post on his Facebook page.

People are going to travel to far off places for, among other things, cannabis experiences. This will be true even where cannabis remains illegal. Given that every country on earth needs increased public revenue, job creation, and boosts to local economies, cannabis tourism should be embraced by governments and not shunned. Any concerns about the sky falling if/when social use is permitted in a given jurisdiction are overblown, and the only people that claim otherwise are likely profiting directly off of prohibition.

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Costa Rica Authorizes First Hemp Project

Written by Hazel Norman on . Posted in Business, Policy.

Cannabis reform may be spreading across the globe at an ever-increasing pace, and with it, the emerging international cannabis industry, however, the process has moved slower in some countries compared to others, with Costa Rica being a great example of that.

In the Western Hemisphere, cannabis reform has spread faster than its Eastern Hemisphere counterpart. After all, Uruguay was the first nation to legalize cannabis for adult-use, followed by Canada becoming the first G-7 nation to do so. Significant cannabis reform can be found elsewhere in the hemisphere as well.

Yet, cannabis policy reform and standing up a regulated industry has proceeded at a slower rate in Costa Rica. As we previously reported, lawmakers in Costa Rica passed a cannabis reform measure in 2021 and sent it to the President for sign off. That sign off never occurred, and instead, Costa Rica’s president issued a veto and sent the measure back to lawmakers instructing them to make the measure more strict.

Eventually things moved along a bit, and finally, after a lot of political wrangling and foot dragging, Costa Rica has issued its first hemp project license. Per The Tico Times:

The Minister of Agriculture and Livestock (MAG), Víctor Julio Carvajal Porras, signed the resolution authorizing the first project for the use of hemp this Friday.

Ingenio Taboga S.A. made the request. It is located in Bebedero de Cañas, Guanacaste, developing a hemp cultivation and processing project in a 150-hectare area.

According to the reporting by The Tico Times, there are eight more industry applications being considered – seven for hemp-related projects, and one for medical cannabis. It’s unclear if/when any of those additional projects will gain approval.

According to Statista, Costa Rica’s gross domestic product (GDP) ranked 11th in 2021 out of countries located in the Latin America and Caribbean regions. Any jobs and economic boost that the cannabis industry can provide Costa Rica is surely welcomed.

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Canadian Study Arrives At Obvious Conclusion Regarding Cannabis Purchasing Decisions

Written by Johnny Green on . Posted in Business, Policy.

I am one of those lucky people that lives in a legal cannabis jurisdiction, and in my opinion, I live in the best legal market for cannabis consumers on earth. The State of Oregon in the U.S., where I reside, passed an adult-use legalization measure in 2014, with regulated sales beginning in 2015. Since the start of regulated sales, Oregon’s unregulated market as it pertains to domestic consumers has progressively shrunk, so much so that it’s virtually non-existent these days. That has resulted in me often being asked by cannabis observers around the world how Oregon did it?

Oregon is obviously not the only place to allow regulated sales, and yet, most other legal markets struggle with competing with the unregulated market. To be sure, unregulated cannabis is still cultivated in Oregon, however, none of it stays within the state’s borders from what I can tell, which is not a coincidence in my opinion given that Oregon has the lowest prices for legal cannabis products in the nation. Presumably, unregulated Oregon cannabis goes to other jurisdictions that have yet to legalize sales, and in some cases, some of it likely even goes to other legal markets where the price of legal cannabis is exponentially greater.

Price Matters

I have read my fair share of theories and expert analysis pertaining to ‘what needs to be done to combat the unregulated cannabis market’ and while much of it provides some level of insight, at the end of the day it’s an extremely straightforward ‘riddle’ to solve. As with anything, price matters, which is what yet another recent study determined, this time out of Canada.

“Higher prices and inconvenience of legal sources were common barriers to purchasing legal cannabis,” researchers concluded. “Future research should examine how perceived barriers to legal purchasing change as legal markets mature.”

A previous study from 2018 determined that cannabis consumers are willing to pay a bit more for regulated cannabis from licensed outlets compared to the regulated market, however, there’s a limit to how much more they are willing to pay. Every dollar that gets added to the price of legal cannabis results in some percentage of customers choosing to go the unregulated route, and thus, lawmakers and industry regulators should strive to do what they can to keep prices low.

Reasonable Taxes And Regulations

When people think of the government’s involvement in the cannabis industry, they often seem to oversimply it. After all, there’s more to operating in the industry than just initial licenses and taxes. Every regulation that is added to the cannabis industry contributes to a higher final price at the point of purchase. Evolving packaging requirements, security requirements, and many other regulatory components make operating a cannabis business expensive.

Current tax provisions for cannabis businesses are such that those business have to pay considerably higher taxes compared to other legal businesses, and for those that have banking access issues, additional security expenses may also be involved, such as armored transport services. Then there’s also, of course, the taxes on purchases themselves, which also adds to the final price for legal cannabis. Collectively, all of the costs and taxes can add up.

Meanwhile, nearly all of those aspects of the legal cannabis industry that drive up prices for legal products do not exist in the unregulated market, and as such, prices for regulated products will never be equal to prices for unregulated products. The goal is to get legal prices as low as reasonably possible so that the other benefits of regulated cannabis (testing, convenience, wider selection, etc.) are worth the extra cost. If lawmakers tax legal cannabis to death and regulators fearfully implement regulations that are obviously overkill, the unregulated market will always thrive, and it doesn’t have to be that way.

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Argentina Adds New Cannabis Varieties To National Catalog Of Cultivars

Written by Hazel Norman on . Posted in Business, Policy, Science.

Argentina has experienced a lot of cannabis industry and policy activity in recent months. For instance, right before the start of last summer lawmakers in Argentina passed a measure to boost the nation’s emerging cannabis industry.

Weeks later, Argentina’s Supreme Court rendered a decision that permitted medical cannabis patients to cultivate their own cannabis in some instances. Roughly a month ago, Argentina’s government issued its first domestic production license, shortly after which the government launched a public company to provide seeds, testing, and training to the emerging domestic industry.

The most recent activity out of Argentina involves new cannabis genetics being added to the nation’s cultivar catalog. Per Minuto Ya:

New varieties were incorporated into the National Registry of Cultivars of INASE , thus expanding the supply of propagation materials destined to supply the R&D projects approved by the Ministry of Health and the users registered in REPROCANN .

The new varieties are ANANDA001, from Anandamida Organic SAS; JEALOUS 10 by Diego Di Maggio; Polaris, by Lucia de Souza Madeira; and TROPICANA WFC, by Facundo J. Meligene.

Any time that growers have more cannabis genetics to select from it’s a good thing. And with that in mind, while it is great that four new cultivars were added in Argentina, it is not nearly enough.

Several countries around the world now permit medical cannabis to be cultivated for industry purposes. Many of them do not limit the types of cannabis strains that can be cultivated, and yet, they have experienced no issues related to strains (and why would they?).

Argentina’s medical cannabis industry is starting to make strides, however, there’s obviously still a lot of unnecessary restrictions and limitations in place. Hopefully Argentina’s program continues to expand, and at a more rapid pace, so that as many suffering patients can be helped as possible in the near future.

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Why Other European Countries Need To Be Like The Czech Republic

Written by Johnny Green on . Posted in Business, Entertainment, Policy.

Ever since the dust settled on the 2021 federal election in Germany cannabis observers around the globe have kept a close eye on the cannabis policy discussions going on inside of Germany’s borders. The new governing coalition made it clear that they would work towards legalizing cannabis for adult-use in Germany, and that effort moved one step closer last month when Health Minister Karl Lauterbach (SPD) made a formal presentation to the federal cabinet. The German prohibition domino is the largest in Europe, and thankfully, it appears that the Czech Republic may be on the same timeline.

As we previously reported, leading up to to the formal presentation in Germany the national anti-drug coordinator for the Czech Republic, Jindřich Vobořil, held a press conference to announce that he would be pushing for his nation to legalize cannabis for adult use, including regulated sales. Jindřich Vobořil also indicated in a social media post that the Czech Republic will proceed alongside Germany and seek to follow a similar timeline.

Coordinated Effort

As many cannabis observers have speculated, myself included, legalization in Germany will open up the floodgates to similar reform measures being adopted across the continent, if not the globe. We are now seeing some proof of that via what is going on in the Czech Republic.

“Germany and the Czech Republic go to a regulated market at the same time.” Jindřich Vobořil stated on his Facebook page. The post was made the same day that Minister Lauterbach made his formal presentation in Germany.

“Today, Germany announced through the mouth of its Minister of Health that it is launching the legislative process. It won’t be quite the free market, as some would expect. For example, colleagues from Germany talk about the allowed amount, they do not have cannabis clubs that we are supposed to. I’m pretty sure I want to hold on to cannabis clubs until my last breath. I find this model very useful, at least for the first years.” Vobořil went on to state in his post.

“However, we are in live contact with our colleagues from Germany and have repeatedly confirmed that we want to coordinate ourselves, even practically by consulting each other on our proposals. I will also want their expert assessment of our proposals, which we will prepare in the above mentioned working expert group.” Vobořil also stated in his Facebook post.

A Growing Coalition

The push in the Czech Republic is significant beyond just the nation’s own borders, and beyond the borders of Germany as well. As we discussed in a prior article, Germany’s next step in the process is to try to gain approval from the European Union (EU) for its legalization plan, and that the approval would need to be granted prior to a measure being officially introduced. From that perspective, every EU nation that pursues legalization alongside Germany is significant, including the Czech Republic.

I am hopeful that with the winds of change picking up in the Czech Republic that it will encourage other European countries to get on the same path. It’s reportedly the goal for legalization measures to be introduced in both Germany and the Czech Republic in early 2023, and hopefully that will be followed by regulated sales being launched in both nations in 2024.

As I have repeatedly pointed out in my articles, there is an opportunity cost for every European nation that drags it feet on legalization, and that will become more apparent as the legalization process goes along. As Germany continues to inch towards launching the world’s largest regulated adult-use market, the publishing of industry projections will increase and the numbers are sure to be staggering.

It’s being reported that Germany will not be able to import cannabis for the adult-use market, and that creates opportunities in other countries to stand up their own regulated adult-use industries, which is something that the Czech Republic has apparently already picked up on. Hopefully they are not alone among European countries in recognizing that a sensible approach to cannabis policy is better than the failed prohibition status quo, and that Germany’s robust legalization model is a better fit for countries compared to Malta’s current limited legalization model.

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Seven Years In Prison For Possessing CBD?

Written by Hazel Norman on . Posted in Business, Policy.

At a time when many parts of the world are trending in the right direction in regards to cannabis policy, Hong Kong is going in the opposite direction. Cannabidiol (CBD) is very popular in Hong Kong, with many CBD-based businesses operating in Hong Kong in recent years. Yet, despite the cannabinoid’s popularity and thriving industry surrounding it, Hong Kong is proceeding with plans to outlaw CBD.

As of the posting of this article, a search on PubMed.gov for the term ‘CBD’ yields over 10,000 results of peer-reviewed studies, many of them demonstrating that CBD is indeed effective at treating various ailments and conditions. PubMed houses the results of peer-reviewed studies from all over the globe and is accessible to anyone with internet access.

Many of the studies on PubMed involving CBD have also found that the cannabinoid does not induce intoxication, unlike its cannabinoid counterpart tetrahydrocannabinol (THC). Despite the growing body of research, Hong Kong’s government is still set to ban CBD, with plans to categorize it at the same level as heroin. Per Bangkok Post:

Hong Kong will outlaw cannabidiol (CBD) by February, the government announced on Thursday, placing it in the same category as heroin, cocaine and methamphetamine with users facing hefty jail time.

The move is expected to wipe out businesses in the Chinese finance hub that had, until now, been able to sell CBD-infused products such as beers, coffee and health supplements.

The changes to Hong Kong’s drug control laws, pending a final round of vetting by the city’s rubber-stamp legislature, will take effect from Feb 1.

To describe the future penalty for CBD possession as being ‘hefty’ is likely not enough to properly put into context how horrific the penalty actually will be starting in February. According to Bangkok Post’s reporting, “anyone who possesses or consumes CBD faces up to seven years in jail and fines of up to HK 1 million (US $127,000).”

Seven years in prison for just having consumed CBD? That’s inhumane. What CBD prohibition enforcement as it pertains to individual patients and consumers will end up ultimately looking like in Hong Kong is something that we will all have to wait to see. Given how Hong Kong enforces many things, it’s likely a safe bet that invasions of privacy will occur, and that is unfortunate.

One thing that is seemingly guaranteed at this point is that the emerging CBD industry in Hong Kong is about to experience an enormous crackdown, and it would likely be wise for people that have CBD products to dispose of them in a manner that is safe. Otherwise they run the risk of serving many years in prison, in addition to having an enormous fine levied against them.

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German Legalization Plan Continues To Evolve After Public Outcry

Written by Johnny Green on . Posted in Business, Policy.

Last week I wrote about the reported leaking of components of a long awaited German legalization plan. The legalization details were reportedly from Health Minister Karl Lauterbach (SPD), and provided the first deep dive opportunity for global cannabis policy and industry observers who have all been heavily focused on all things cannabis and Germany ever since the dust settled on the 2021 federal election. German voters elected a new governing coalition in 2021 and the coalition, often referred to as the Traffic Light Coalition, quickly indicated its intent to pass a legalization measure and launch a regulated adult-use industry.

A new report is out today from The Rheinischer Post which indicates that Health Minister Karl Lauterbach will present a legalization plan to the federal cabinet tomorrow. The new report also indicates that some components of the plan have evolved after significant public pushback occurred regarding the previously leaked components.

As I touched on in my previous article, it’s a common political strategy to ‘float political balloons’ via leaks and public comments to see if the public ‘pops’ the metaphorical balloons in the form of public outcry. Lawmakers use that strategy during political negotiations from time to time to force their opponents to relent to some degree. I suspect that is what happened last week given the fact that the measure seems to have improved post-outcry, although admittedly, that is just conjecture on my part. Regardless, the evolved components of the plan are significant nonetheless, and are the exact ones that were the main focus of public pushback.

What Changed And What Remained The Same?

The legal age for adult-use cannabis, 18 years old, was unchanged in the reported latest version of Germany’s legalization plan, which was expected. The initial 20 gram possession limit appears to now be described as ‘a maximum of 20 to 30 grams.’ Public outcry regarding possession limits was not limited to just citizens, as deputy FDP chairman Johannes Vogel was also very vocal about his opposition to the 20 gram limit. A prohibition on advertising remained unchanged, as well as the types of outlets that may be allowed to legally sell adult-use cannabis (licensed stores and pharmacies).

Arguably the greatest differences between the components leaked last week compared to what is going to be reportedly presented tomorrow hinges on THC limits for products. Initially, it was being reported that there would be a 15% THC limit on products sold to people over 21, and a separate 10% THC limit on products sold to people of legal age under 21. Per The Rheinischer Post’s reporting (translated to English), there will be no cap for people 21 and over, however, “Because of the increased risk of cannabis-related brain damage in adolescence, it is being examined whether an upper limit for the intoxicating substance THC will be set for adults up to the age of 21, according to the paper.”

Another significant change from last week’s version of the plan compared to this week’s pertains to home cultivation. Last week’s version reportedly involved a two plant limit for home cultivation, however, this week’s version has a three plant home cultivation limit. By comparison, in Malta adult households can cultivate up to four cannabis plants. Malta is the only country in Europe that has passed an adult-use cannabis legalization measure, although adult-use cannabis sales remain prohibited in Malta.

Will There Be More Changes?

If there is one major takeaway from what has transpired in Germany over the course of the last week, it’s that the legalization process is still very much ongoing. It is virtually guaranteed that there will be further tweaks made to the legalization plan in Germany, and it’s largely just a question of what will change. Furthermore, even the evolved plan still leaves quite a few extremely important items to finalize, including the actual personal possession limit, potential THC limits for products sold to younger adults, and laws pertaining to edibles. And all the while there are still continental and international treaty concerns to be worked out.

As The Rheinischer Post stated in it’s coverage (translated to English), “The cabinet referral is an intermediate step.” The political process can be full of twists and turns, especially when it involves something as monumental as launching the world’s largest legal cannabis market. Currently, the only public policy and regulation ‘guidebook’ for launching a national adult-use cannabis industry open to the world is Canada, and for a multitude of reasons Germany is an entirely different situation compared to Canada. Germany can learn some things from Canada to be sure, however, much of the heavy political and regulatory lifting in Germany is completely unique, and as such, people would be wise to anticipate more changes in the future, albeit more on the fringes versus a complete overhaul. For cannabis advocates specifically, it’s wise to remain vocal and keep the pressure on because, as we witnessed over the course of the last week, that pressure can result in improved changes to what is being proposed in Germany.