Just four years have passed since the enactment of the Cannabis Act of 6 March 2017. This represented a milestone in Germany for dealings with cannabis since the Act first recognized the marketability of cannabis products for medical purposes and their eligibility for reimbursement in the context of health insurance. However, it can already be seen from the coinciding plans of the possible new governing coalition made up of the SPD, FDP and the Greens (the so-called Traffic Light Coalition), that the legalisation of cannabis products for consumption purposes could lead to another fundamental legislative decision in the near future. In addition to the implications for law enforcement and road traffic, the regulatory framework of a possible cannabis supply chain is of particular importance. A system with licensing of production, transport, wholesale trade and distribution to the end user for consumption would be a first in Europe. At the same time, such a system would be complex, but ultimately indispensable in order to prevent legalisation giving rise to further criminality along the new cannabis supply chain.
1. Current regulation of cannabis products
According to the current legal position, cannabis is classified as a non-marketable narcotic under Annex I of Section 1 (1) BtMG (German Narcotics Act), meaning that dealings in cannabis products are basically illegal and punishable. However, as an exception, according to Schedule III of Section 1 (1) BtMG, cannabis products are marketable if they are prescribed by a doctor for medical purposes and the active substance has been cultivated under strict state control. There are currently three producers in Germany authorised to cultivate cannabis under state supervision. The distribution of this cannabis “Made in Germany” is handled by a single wholesaler. In addition, demand is met by imports from countries where cannabis is also cultivated under state control, especially from Canada and EU countries such as the Netherlands. The cannabis is then only available for distribution in pharmacies.
2. Plans of the Traffic Light Coalition
Even according to the plans of the traffic light coalition, further imports from abroad will initially be necessary to cover the expected increase in demand. Manufacturers, importers and wholesalers will have to be prepared for tight-knit controls and strict personnel and technical requirements. However, there is justified hope for interested parties that with the new legislative impulses, economic competition can be established in the long term despite complex regulation. Furthermore, there is agreement among such parties that cannabis products should only be dispensed to adults and that mail-order sales remain excluded because of the risk of abuse. However, it is still unclear which entities should be responsible for dispensing cannabis products for consumption purposes. While the SPD is in favour of pharmacies and the Greens are pushing for specialised shops, the FDP wants to open up the distribution of cannabis products to any shop, subject to licensing. Further problems arise from the fact that the dispensaries have to face economic competition with the illegal market and the controversial amount of the planned cannabis tax in particular carries great weight in the context of such competition. Ultimately, it also remains relevant for the market whether cultivation at home finds its way into the law and what effects home cultivation would have on the demand for cannabis products. In any case, there is hope that the good regulatory system which has been established in recent years for the cultivation and distribution of medicinal cannabis will be sufficiently respected in the new regulation.
3. Conclusion
It is evident that beyond the fundamental willingness to reform shown by the parties to the possible governing coalition, much is still unclear. What is clear, however, is that a completely new (legal) business sector would be established, which on the one hand would offer considerable business opportunities, but on the other hand would also pose a multitude of legal challenges.
Authors:
Dr. Daniel Tietjen
Christoph Behm
