August 22, 2019
Key learnings from The Cannabis Legal Report
The Cannabis Legal Report launches today against a backdrop of global regulatory change, as the international cannabis market begins to enter the mainstream. However, in a market worth a potential €123 billion by 2028 to Europe alone, the landscape of cannabis law remains complex and disparate with local regimes and international treaties shifting to make way for a newly emerging market.
The State of Play
Global cannabis legislation is a patchwork of, at times, entirely contradictory laws. While the US Food and Drugs Administration (FDA) licensed cannabis medications in 2018 for the treatment of debilitating forms of epilepsy, the Drug Enforcement Agency (DEA) and the federal legal system still considers cannabis to be a Schedule I narcotic. In other words, a narcotic, “with no currently accepted medical use and a high potential for abuse.”
Similarly, the World Health Organisation (WHO) recommended in 2019 that its parent organisation, the United Nations, remove cannabis from Schedule IV—the most restrictive category of the 1961 drug convention. The body that makes such decisions, the UN Economic and Social Council (ECOSOC) and specifically ECOSOC’s Narcotic Control Board, however, has persistently postponed ruling on amendments to cannabis guidelines, “in order to provide States with more time to consider the recommendations.”
Likewise, the European Union voted to develop a common standard for medical cannabis across the bloc – which is expected to be the single largest market for cannabis over the next five years. Indeed, our findings suggest that in 2018 alone, the market grew more in 12 months than it did in the previous six years, with medicinal cannabis alone estimated to be worth €58 billion by 2028 in Europe.
However, the EU also introduced a widely ignored ban on sales of CBD. As The Cannabis Legal Report notes, without “international agreement, regulatory arbitrage is common given the myriad approaches taken by regimes looking to boost state finances by growing, selling and taxing the drug.”
The Cannabis Legal Report also looks at the crucial issue of how the global regulatory regime will be shaped by legislation working its way through US Congress. This gives hope that the SAFE Banking Act will free banks, in the global economy’s most important economic and legislative jurisdiction, from persecution from US federal authorities. The passage of the SAFE Banking Act is crucial for international trade, not least because most banks have exposure to American banking and could, therefore, be in danger of prosecution if they provide services to cannabis enterprises.
Traditional and politically stubborn stances remain in many bodies and jurisdictions, producing the kind of confusion that prevents the development of business clarity or uniformity. Not least because, owing to cannabis’ huge historic ‘underground’ acceptance and black-market medical uses, it has emerged with almost unprecedented speed and market stature.
Despite hesitance from regulators at international levels, regulatory surprises have emerged at the local level. For example, Thailand and the United Kingdom are both going through politically challenging times and seem set for conservative central governments over the short-term. Thailand has been going through a period of political uncertainty over the last few years while the UK is paralysed by Brexit. Both are run by governments with slim democratic mandates. Similarly, both countries have long been committed to costly, draconian and yet ineffectual ‘wars on drugs’.
Yet both countries pushed through historic medical cannabis legislation changes at the end of last year. This has produced an opening for medical cannabis in both countries – which for Thailand could be worth more than US$237 million by 2024 and almost €9 billion for the UK by 2028.
This unpredictability makes for an international regulatory regime which is difficult to navigate. Crucially, The Cannabis Legal Report reports on the incredible plethora of domestic legislative changes that will shape the market in respective jurisdictions. Thus, we attempt to take perspectives from the international to the national to provide comparative and specific snapshots of the industry and its regulation, as the industry continues to drive acceptability and access for those who need it most.