Germany: The Traffic Light Coalition agrees to the legalisation of cannabis products as outlined in the new Coalition Agreement

A major step towards the legalisation of cannabis products for consumption purposes has been taken. The future governing Traffic Light Coalition of the SPD, FDP and the GREENS has agreed on a Coalition Agreement, and, in keeping with their election pledge, this also includes the legalisation of cannabis products. On page 87 under the heading Drug Policy, the Coalition Agreement states:

“We are introducing the controlled distribution of cannabis to adults for consumption purposes in licensed shops. This will control the quality, prevent the passing on of contaminated substances and ensure the protection of minors. We will evaluate the law for social impact after four years. We shall facilitate and expand drug checking models and harm reduction measures. In alcohol and nicotine prevention, we are focusing on increased education with a special focus on children, adolescents and pregnant women. We are tightening the regulations for marketing and sponsoring of alcohol, nicotine and cannabis. We constantly measure regulations against new scientific findings and correspondingly align health protection measures.”

Distribution in licensed shops

The distribution is to take place exclusively to adults and in licensed shops, meaning the sale through licensed dealers in specialised so-called “cannabis stores”. This seems to have settled the central issue that was the subject of heated discussion between the Traffic Light parties in the run-up to the election. According to this, pharmacies and general retail shops are likely to be excluded from the circle of those entitled to dispense cannabis for consumption purposes. However, the specialised licenced dealers have to meet strict quality standards, which should prevent the passing on of contaminated substances. From an economic point of view, it is also to be welcomed that home cultivation has effectively been rejected. Companies in the cannabis supply chain can therefore look forward to continuous demand from the market, which should compensate for the considerable regulatory effort. However, it is not clear from the Coalition Agreement which forms of cannabis are covered by the legalisation. In addition to marijuana, which is the dried flowers of the female plant, there is also the cannabis resin hashish, which is extracted from the resin of the plant and then pressed, but which has so far evaded political discussion. It is also unclear whether cannabis can be bought legally in Germany in the long term. In any case, the Traffic Light parties want to review the law after four years with regard to its social effects, such as problems relating to addiction.

Drug checking of illegal drugs

In addition to the availability of cannabis in licensed shops, the future government is also planning models to control illegally acquired cannabis and other drugs. What these models have in common is that they are anonymous, non-judgemental and free of charge for the users. The term “drug checking”, meaning the chemical analysis of narcotics for impurities, could develop into a lucrative (side) line business, especially for companies in the laboratory sector. Although drug checking services are free of charge for consumers, reimbursements made by the state to such companies are likely to be attractive.

Marketing and sponsoring

Despite legalisation, the cannabis market must first prepare itself for further restrictions with regard to marketing and sponsoring. Until now, according to Section 14 of the German Narcotics Act, the advertising of cannabis products for consumption purposes was subject to a complete prohibition, and for medicinal cannabis as a finished medicinal product, the participants in the supply chain were only allowed to advertise to specialist circles, pharmacies and doctors. The statements of the Coalition Agreement, however, point to a complete ban on advertising. This would mean that only factually necessary information would still be allowed. However, much will depend on how the legislator embeds cannabis for consumption purposes in the regulatory context in the future.

Conclusion

The statements of the Coalition Agreement are in line with the previous reform efforts for the legalisation of cannabis products and, even though it is not yet binding, it should be enthusiastically welcomed by potential participants in the cannabis supply chain. However, there is no definitive timeframe as to when the new law can be expected. The swearing-in of the new Federal Government is planned for the beginning of December, but in view of acute issues arising from the pandemic, the start of the legislative process can only be expected during the course of next year.