As Canada eases into a new legalization framework, it is interesting to consider the global perspective as well, in terms of understanding both the global state of cannabis regulation, but also to identify opportunities and synergies in other jurisdictions. In this article, we will look at the jurisdictions of Australia, Denmark and Jamaica, and provide a high-level overview of the state of affairs in each country as it relates to cannabis regulation.
Australia
Australia is certainly among the countries to watch in 2019 as the debate over the legalization of recreational cannabis develops and the medical cannabis industry continues to evolve. Significant investment in the Australian cannabis market suggests that, regardless of the state of the recreational adult-use debate, the cannabis industry in Australia will continue to expand.
Australia currently has a medical cannabis framework, with The Office of Drug Control (“ODC”) serving as the regulator. With legislation passed in February 2016 and the prescription of medical cannabis becoming legal in 2017, the ODC has provided for 3 types of licenses in the areas of cultivation/production, cannabis research, and manufacturing. Similar to Canada, license applicants must submit information related what the ODC refers to as the “fit and proper person” test, including information related to a person’s criminal record, financial and business background, and a demonstrated capacity to comply with all licensing requirements. Licensees can hold multiple licenses, but there are strict controls around mixing crops, say for medical cannabis and industrial hemp. The ODC shares information about licensed producers on their website, and currently 21 licenses have been issued for cultivation, with another 12 for research and another 16 for manufacturing. Many companies have licenses in more than one category.
Currently, recreational cannabis is not legal in Australia, although there is ample evidence that there would be demand for recreational cannabis, with a 2016 national survey putting support for legalization at 35%, and some estimates about the scope of the potential Australian recreational cannabis market as high as 8.8 billion AUD annually. As of November 2018, a private member’s bill to legalize recreational cannabis has been introduced and is said to have broad support. If passed, it would allow adults to possess up to 50g of cannabis or 4 plants.
While the debate over recreational cannabis in Australia develops, large Canadian cannabis companies are making moves to capture the medical market by partnering with Australian licensed producers. This is also being done in anticipation of what some believe is the inevitable legalization of adult-use recreational cannabis. Examples include Canopy Growth partnering with AusCann Group Holdings on medical cannabis supply as well as launching an Australian version of their medical subsidiary, Spectrum Cannabis. Canopy also plans to build a facility for locally grown cannabis. Aurora Cannabis Inc. has also been very active in the Australian jurisdiction, partnering with Cann Group Ltd., Australia’s first licensed producer, on a GMP-compliant facility.
Additional evidence of the vibrance of the Australian cannabis industry are events held in the region. CannaTech Sydney had the intriguing tagline: “If you think this is just another cannabis conference, think again.” and specifically noted bringing in contributors from Israel and “welcoming international speakers from all different verticals of the cannabis industry and featuring some of Australia’s best and brightest.” Another major event in the industry is the Hemp, Health and Innovation Conference, held in Melbourne. The event boasts a wide array of exhibits, “showcasing everything from Hemp fibres, clothing, bedding, beauty and health products, medicinal hemp products, building materials, hydroponic equipment and supplies for industry.”
Needless to say, Australia will be a jurisdiction to watch closely, with the impending possibility of the legalization of recreational cannabis, and as investment in the region continues to expand.
Jamaica
Jamaica has a storied history with cannabis, with noteworthy examples like its connection to Rastafarian culture and, relatedly, its irrevocable embedding in the image of Jamaica’s most popular export, international reggae star Bob Marley. And yet, Jamaica’s history with cannabis, or ganja, is similar to other countries in that use of cannabis was and is socially accepted across demographics, and yet the laws of the land have only recently begun to change in favour of more progressive policies.
Cannabis law in Jamaica was significantly changed in 2015 when the country established a framework to legalize the cannabis and hemp industry. Under the interestingly named Dangerous Drug (Amendment) Act, or DDA, the Cannabis Licensing Authority (CLA) was established to issues licenses and to monitor compliance. Under the authority of the CLA, licenses can be issued in the categories of cultivation, processing, transport, retail, and research and development. Some of the license categories are further divided into subcategories, such as tiers of cultivators and retail licenses that allow for consumption onsite and retail licenses that only allow for sale. License applications would include requirements to disclose prior criminal activity, regulatory violations, history of litigation and financial history. Note that all cannabis licenses are for medical or scientific purposes only – but many believe that the prohibition on adult-use recreational cannabis is not too far off. It should be noted that Jamaica has already decriminalized possession of 2 ounces of cannabis (yes, you read that right). Households can also grow up to five ganja plants. Public consumption is still prohibited, although adherents to the Rastafarian faith and Rastafarian organizations can apply for a license to cultivate cannabis for sacramental purposes and can smoke ganja in places registered as places of Rastafarian worship.
Similar to the experience in other jurisdictions, the 2015 DDA opened up the opportunity for Jamaica to finally build on years of experience in the black market, and secure a strategic position in the global medical cannabis market. Working with international partners, Jamaica has seen an influx of investment in the medical cannabis market. Of note is the recent signing of an agreement between the Jamaica Medical Cannabis Corporation Ltd. (JMCC) and the National Foundation for the Development of Science and Technology (NFDST), with a specific purpose of identifying and analyzing cannabis strains indigenous to Jamaica. In addition to JMCC, which is a Canadian based company, other Canadian companies have made significant strides in the region.
The Green Organic Dutchman has also made significant moves in the Jamaican market, partnering with Epican Inc., to open legal cannabis retail stores in Jamaica. While currently only available for medical cannabis patients, the several locations planned by Epican will entrench TGOD and Epican in the Jamaican retail market, providing a strong market position. Epican, of note, was issued Jamaica’s first cultivation license.
Canopy Growth has also made its foray into the Jamaican market with the establishment of Tweed JA, a local subsidiary which has recently been granted a 30,000-plant cultivation license, with construction of its facility already under construction.
Two events in the region are the CanEx Jamaica event and the Stepping High Festival. CanEx Jamaica is an annual business-to-business event, inviting cannabis experts from the Americas, the Caribbean, Europe and Australia. Notably, Cannabis At Work’s CEO Alison McMahon spoke at CaneEx Jamaica in 2018. Stepping High is much more of a cultural event, having existed for years prior to decriminalization and legalization of medical cannabis. There is still an industry presence, with cultivators showcasing their brands of ganja, but there is also what organizers refer to as a musical “extravaganza”, as well as a noted recognition of Rastafarian culture.
Jamaica will also be a country to watch in 2019, as its medical market continues to evolve and the ever-burning question around the adult use recreational market continues to enthrall observers. With its reputation as being a cannabis mecca, it will be interesting to see whether Jamaica can achieve its potential for increased global market expansion and a robust regional cannabis tourism regime.
Denmark
Denmark recently joined the ranks of nations with a medical cannabis regime, and activity has been swift both pre-and post the legislation coming into force. Investment in Denmark has been significant and it is widely believed that Denmark is on track to be the largest medical cannabis producer in Europe.
Denmark’s medical cannabis regulator, the Laegemiddelstyrelsen Danish Medicines Agency (“LDMA”), was given the authority to issue cultivation licenses effective January 1, 2018, in a 4-year pilot project. Applicants are subject to similar regulatory requirements as in other medical cannabis jurisdictions, including demonstrating that the operation can contribute to the cannabis pilot program, that the agricultural conditions are approved by the Danish agricultural authority, and that the Danish National Police have no concerns with the applicant. Over 20 cultivation licenses have been issued to date, and there are a handful of companies awaiting a decision on their applications.
The LDMA provides guidelines to healthcare professionals to prescribe cannabis, but the guidelines acknowledge that knowledge is not sufficient in all areas of health and wellness. In recognition of this, the LDMA is also allocating funds for research to develop the scientific basis for greater certainty with regard to treatment protocols. The LDMA also lists approved cannabis products which can be prescribed by doctors and which can then be prepared and dispensed by a pharmacy. Doctors are required to report on adverse effects experienced by patients, as part of the pilot requirements.
While the Denmark cannabis regulation has been described as tightly controlled, it matches the level of scrutiny required in other jurisdictions, and is a reflection of Denmark’s clear intention to proceed cautiously with a focus on expanding the scientific knowledge around medical cannabis. As in other countries, the regulations have not deterred significant investment in the region. The usual suspects abound in Denmark, with Canopy Growth partnering with Spectrum Cannabis, including the announcement of a 40,000 m2 facility, with import of cannabis being the main supply pending completion.
Not to be outdone, Aurora Cannabis, in a joint venture with Alfred Pedersen & Son, announced the creation of Aurora Nordic. Aurora Nordic will include the construction of a 1,000,000 sq. ft. cannabis production facility, which would establish Aurora Nordic as Europe’s largest cannabis producer.
Another notable investment was that of The Green Organic Dutchman Holdings Ltd (“TGOD”) which partnered with Knud Jepsen, to dedicate 200,000 sq. ft. of Knud Jepsen’s 1.3 million sq. ft. facility to the cultivation of high quality, organic cannabis produced by TGOD.
The North Grow Cannabis Expo was recently held in Denmark and was promoted as exploring the current and future state of Danish cannabis law. The promotional material for the conference specifically references adult-use recreational legalization in several US states and Canada, and raises the question of whether Denmark should follow suit or stick with medical uses as the only permitted use. The expo is attended by industry professionals as well as the general public, and has both an exhibition as well as a conference with number of seminars. A unique twist to the conference is that seminars are moderated by Danish stand-up comedians.
With the only recent legalization of medical cannabis in Denmark, and the LDMA’s inherent structure as being one of a pilot or experiment, it will be important to stay tuned on the Danish experience, to see if there are specific reports of adverse events and how this might affect public opinion, but also to what extent that scientific research will broaden the knowledge base and make medical practitioners more confident in including cannabis as a part of their treatment plans. At the same time, with large scale investment, particularly in infrastructure, it is hard to imagine that the end of the pilot will result in a reversal of policy.
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