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US House passes historic bill to legalize cannabis at federal level

US House passes historic bill to legalize cannabis at federal level

US house passes historic cannabis legalization bill MORE Act

In a groundbreaking vote, the U.S. House of Representatives on Friday passed a comprehensive bill that removes marijuana from the Controlled Substances Act, ending the federal government’s decades-old prohibition on the plant.

Lawmakers in effect voted to legalize marijuana by approving the social justice-focused Marijuana Opportunity, Reinvestment and Expungement (MORE) Act by a margin of 228-164 after an hour of debate. A handful of Republicans voted for the measure.

The vote – while largely symbolic because the bill still must pass the Senate – comes only two days after the United Nations took the historic step of reclassifying cannabis as a less dangerous drug.

Opponents of the MORE Act criticized Democrats for prioritizing marijuana during the coronavirus crisis and voiced concerns about health risks for youth.

The MORE Act

The legislation could potentially open up an already fast-growing, multibillion-dollar industry to billions of dollars of additional business opportunities and interstate commerce over time.

However, the vote Friday will prove to be emblematic unless Democrats gain control of the U.S. Senate by winning two run-off races in Georgia on Jan. 5.

Even then, the more conservative Senate might be resistant to such a major change in federal marijuana policy.

“I have been waiting for this historic moment for a long time. It is happening (Friday) because it has been demanded by the voters, by facts and by the momentum behind this issue,” U.S. Rep. Earl Blumenauer, co-chair of the Congressional Cannabis Caucus and a Democrat from Oregon, said in a statement distributed late Thursday.

The House Judiciary Committee advanced the bill a year ago in what then was seen as a landmark development.

What’s misunderstood about the MORE Act

The measure wouldn’t create a federal licensing or federal regulatory framework. States would, however, continue to regulate marijuana as they see fit, without federal interference.

The MORE Act decriminalizes and deschedules cannabis,” said Randal Meyer, the executive director of the Global Alliance for Cannabis Commerce.

“It would allow state-legal businesses to operate in a federally legal environment, with business-tax deductibility and access to legal processes, and permit states to set their own cannabis policy, be it total prohibition or not.”

Steve Fox, strategic adviser to the Cannabis Trade Federation, said: “The MORE Act is a wonderful piece of legislation that would end cannabis prohibition at the federal level and take some critical and much needed steps toward restorative justice. It would provide major benefits to cannabis businesses, which would become legal at the federal level.”

Businesses, he said, would have greater access to financial services and be freed from Section 280E of the federal tax code, which currently prevents marijuana companies from taking deductions for ordinary business expenses.

“The MORE Act does not, however, establish a regulatory framework for cannabis at the federal level. So, from an industry perspective, the MORE Act is just one step in a longer process,” Fox said.

Vincent Sliwoski, a cannabis attorney at Harris Bricken in Portland, Oregon, echoed Fox, noting that licensed marijuana commerce will remain in place unless changed by states or local jurisdictions.

“What the MORE Act actually does is remove marijuana from control under the federal Controlled Substances Act while adding a 5% federal excise tax and tacking on key provisions like expungement for past marijuana convictions under federal laws. As with alcohol, there will be no federal business licensing element.”

He also emphasized that there would be “a lot of benefits here for state-licensed cannabis businesses, including everything from banking options to tax relief under (Internal Revenue Service) code 280E to federal trademark availability.”

Experts also note that they expect a number of federal agencies, such as the Food and Drug Administration, the Federal Trade Commission, the Department of Treasury and the Department of Agriculture, to weigh in on various issues, including health claims, cultivation standards and banking issues.

United Nations votes to reschedule cannabis in historic vote

United Nations votes to reschedule cannabis in historic vote

UN cannabis vote to list as medicine

The United Nations Commission on Narcotic Drugs (CND) on Wednesday accepted a World Health Organization (WHO) recommendation to remove cannabis and cannabis resin from Schedule IV of the 1961 Single Convention on Narcotic Drugs.

The historic vote in Vienna could have far-reaching implications for the global medical cannabis industry, ranging from regulatory oversight to scientific research into the plant and its use as a medicine.

The eagerly awaited approval of Recommendation 5.1 had a slim majority in favor with 27 votes for, one abstention and 25 votes against.

The CND – the main drug policymaking body within the United Nations – turned down all five remaining recommendations.

The passage of Recommendation 5.1 carries broad symbolic significance for medical cannabis, as it could help boost medical cannabis legalization efforts around the globe now that the CND tacitly acknowledges the medical utility of the drug.

“The medical cannabis wave has accelerated in recent years already, but this will give it another boost,” Martin Jelsma, drugs and democracy program director at the Netherlands-based Transnational Institute, told Marijuana Business Daily.

“And for those countries that basically mirror the U.N. scheduling in their domestic legislation, it may lead to national descheduling and remove obstacles to use cannabis for medical and research purposes.”

The vote could encourage countries to reevaluate how cannabis is classified on their own lists of narcotic drugs, potentially paving the way for more research into medical marijuana and its use as a treatment for a variety of ailments and conditions.

“While the move doesn’t totally free the plant from treaty control, it’s a giant step toward the normalization of cannabis in medicine above all but also in our societies generally,” independent researcher Kenzi Riboulet-Zemouli of CND Monitor told MJBizDaily.

“Decades of efforts have been necessary to remove cannabis from Schedule IV, with implications that will slowly but surely be seen over the next decades.”

Drugs in Schedule IV of the 1961 treaty – where, until Wednesday, cannabis sat alongside heroin – are a subset of those already in Schedule I.

Schedule I – which includes fentanyl – already requires the highest levels of international control.

The schedules of the international drug-control conventions categorize drugs considering their medical utility versus the possible harm they could cause.

Only the 53 current member states of the CND had an opportunity to vote, but the decision applies to all signatories of the international drug control conventions.

What should not be expected is a loosening of international controls governing medical cannabis.

 

Read the rest of the story from Marijuana Business Daily

Mexico Cannabis Legalization Could Change The Industry

Mexico Cannabis Legalization Could Change The Industry

mexico cannabis legalization the real dirt podcast

The United States will soon be sandwiched between two nations with federally legalized cannabis.

The United States of America is close to becoming stuck between two countries with legal cannabis. Canada legalized cannabis in 2018, and Mexico is currently moving forward legislation that would legalize cannabis across the country.

The U.S. missed the opportunity to get its own markets, the NASDAQ and the New York Stock Exchange, involved when Canada legalized due to the Department of Justice’s leadership at the time. However a legal cannabis market in Mexico would be bigger, and likely already well-established due to the illicit markets there compared to Canada.

United States Legalization

The full blown legalization of cannabis on the federal level in the United States hasn’t even become a part of the conversation. While likely president-to-be Joe Biden has said he wants to decriminalize cannabis, and the MORE Act sits in the House aiming to do the same thing, a federal legalization that would establish an nationwide legal marketplace, tax system, etc. is not on the horizon yet.

Many don’t see an issue with the country’s lack of legalization at this point considering there are only six states left in the Union that still keep cannabis fully illegal, i.e. not decriminalized, medical or recreational. That means that the other 44 states all have cannabis laws on the books that either reduce penalties for cannabis or legalize it medically or recreationally.

The real issue is that if Mexico does indeed legalize cannabis, the country would have a massive cannabis industry. Due to the current laws in the United States, we would be missing out on a huge opportunity. Unfortunately that is looking like the most plausible outcome at the moment.

Interstate commerce in the cannabis industry doesn’t even exist in the U.S., let alone a system that would allow American cannabis companies to work alongside, collaborate or do business with Mexican cannabis companies. If the Mexico cannabis legalization passes, it should be a wake up call to the U.S. government that we are missing out on massive financial opportunities with our neighbors to the north and the south.

Mexico Cannabis Legalization

The Mexico cannabis legalization bill will establish a regulated cannabis market to allow those eighteen and older (the drinking age in Mexico is also eighteen) to purchase and possess up to 28 grams of cannabis. It also allows a personal cultivation provision for individuals to cultivate up to four plants for personal use.

While the bill is looking promising, there are still some technical requirements that need to be hammered out before outright passage, including whether or not the government should be able to track personal cultivation use. Mexico seeks to regulate and legalize the plant, put strict controls on ownership and the supply chain in place, and to engage in domestic and, most importantly, international commerce surrounding cannabis.

International commerce surrounding cannabis in which the United States likely won’t be allowed to participate. However it won’t be an easy path for Mexico either.

Mexico has a long history of drug-related crime ran by gangs known as cartels which control distribution of a plethora of narcotics to entire regions of the country and South America. Cannabis has been a staple of cartels for decades, and took a major hit when states in the U.S. began to legalize, followed by Canada’s federal legalization which did even more damage.

While it is too soon to say who will be running and operating in the industry when/if it becomes federally legal, it is likely a safe guess that some cartels will “go legal” and distribute their cannabis across the country legally in order to profit again.

The Growing International Cannabis Industry

Mexico wouldn’t be the first neighbor to our south that has legalized cannabis. Uruguay legalized cannabis for recreational use all the way back in 2013. It wouldn’t be until 2017 that the country began sales of legal cannabis, but the country has seen success.

Additionally in Latin America, some form of medical cannabis is allowed in Argentina, Brazil, Chile, Colombia, Mexico, Paraguay, and Peru. Ecuador has reformed its Criminal Code, which opens the door to developing access to cannabis for “therapeutic, palliative or medicinal” purposes. A legal market in Mexico could encourage more Latin American countries to follow suit, creating a new international cannabis industry.

The United States has been a leader in cannabis reform and legalization despite cannabis still remaining illegal on the federal level. However with Canada to the north and Mexico to the south, that could all change. As these markets develop and grow, they will be able to compete, outpace and outperform the American cannabis industries that still operate at the state level.

If Mexico cannabis legalization goes through, the entire conversation surrounding cannabis legalization in the U.S. will likely shift. We have to decide if we want to stay stuck in the past with dated, discriminatory laws that do more harm than good, or move forward with our neighbors and the rest of the world as cannabis becomes an unstoppable global industry.

Michigan Designated Consumption Establishments Explained

Michigan Designated Consumption Establishments Explained

cannabis cafes coming to Michigan

Michigan legalized cannabis in 2018, and passed emergency rules to get the industry rolling in July 2019.

In addition to creating your run of the mill rules regarding licensing for growers, processors, distributors and retailers, Michigan also created some new license types. These new licenses include a Marijuana Event Organizer license, a Temporary Marijuana Event license and an Excess Marijuana Grower license.

But what has the consumers excited is a different license. A Designated Consumption Establishment license.

Michigan Designated Consumption Establishments

A Designated Consumption Establishment (DCE) license allows the license holder, with local approval, to operate a commercial space that is licensed by the Marijuana Regulatory Agency and authorized to permit adults 21 years of age and older to consume marijuana and marijuana products on premises. A DCE license does not allow for sales or distribution of marijuana or marijuana product, unless the license holder also possesses a Retailer or Microbusiness license.

It is common for public cannabis possession public arrests to rise after a state legalizes cannabis. This happens because most states only allow consumption on private property, and many people who rent may have to go outside to smoke. Michigan saw this problem in other states and is aiming to deal with it before it grows with DCEs, more commonly known as cannabis cafes or lounges.

This license is available to any applicant regardless of if they are currently holding any other licenses. The DCE license is also open to marijuana retailers, microbusinesses or anyone wanting to operate a “bring-your-own-cannabis” model.

DCE Requirements

Applicants for a DCE license must have met a multitude of key criteria. The foremost is a location approved and supported by the local municipality. Next, the facility must have:

  • An identified area specifically suitable for marijuana consumption, as well as smoke-free areas. DCE rules do allow facilities in which only non-smokable cannabis is consumed; in these spaces, no specified place for smoking cannabis is required.
  • A smoke-free area for employees to monitor the marijuana consumption area. Facility operators must ensure employees are not subjected to indirect or unintended cannabis consumption while working at the facility.
  • The facility must have a ventilation system that directs air from the marijuana consumption area to the outside of the building, through a filtration system designed to remove visual smoke and odor.
  • The facility must have sufficient walls and barriers to ensure smoke does not infiltrate into nonsmoking areas or adjacent spaces.

Additionally, when applying to be a Designated Consumption Establishment for marijuana in Michigan, microbusinesses will need to submit the following information as well:

  • A Designated Consumption Establishment Plan, or diagram of the facility that explains layout, defines facility locations, and indicates distinct areas or structures distinguishing a DCE from other licenses that may be applicable in adjacent locations.
  • Building, Construction and Zoning Details so the MRA can verify a safe operation including building and fire safety review, plus ensure a detrimental impact will not occur on adjacent businesses and residences.
  • A Business Plan that must include proposed hours of operation and, if part of the plan, the intended mechanisms for consumers to acquire cannabis at the facility.
  • A Plan for Responsible Operations such as an employee training program, how consumption will be monitored, plus prevention of over-intoxication, underage access, and the illegal sale or distribution of cannabis within the establishment.
  • Waste Management Plan for handling and disposal of any waste at the facility, including unconsumed cannabis products left by patrons of the facility.

Applicants for a Designated Consumption Establishment for Marijuana in Michigan also must undergo a preliminary background check. The Initial Applicant fee for a Designated Consumption Establishment is currently $1,000 and is valid for one year. The renewal fee is also $1,000. Like all other Michigan dispensaries and other licenses, MRA reserves the right to increase fees collected by 10% each year.

A model to follow?

Many states have the same issue that Michigan is trying to deal with right now. As previously mentioned, most states require cannabis consumption to take place on private property, but very few states have cannabis consumption establishments. This leads to more public consumption, and more arrests or citations.

A few states like Colorado have attempted to create consumption establishments, but have fallen short due to restrictions on smoking indoors in Denver. While dabbing and vaping is popular, most people are comfortable doing that in a place they rent since the smell doesn’t stick around.

We have yet to see how the Designated Consumption Establishments will pan out in Michigan or if certain municipalities will ban them all together. The Marijuana Regulatory Agency plans to finalize their rules and begin implementation in January 2021.

Cannabis Edibles Coming to Maryland

Cannabis Edibles Coming to Maryland

medical cannabis edibles in Maryland

As they say, it’s better late than never!

Maryland legalized cannabis for medical use in 2013, but it wasn’t until 2017 that the medical cannabis industry actually opened for business. For this reason it isn’t unusual for Maryland to drag its feet when it comes to cannabis edibles in Maryland.

While medical cannabis sales have been steadily soaring since they began in 2017, the state has never had edibles on the menu. But that will be changing as soon as December.

Legalization of Medical Cannabis Edibles in Maryland

In May, 2019 Governor Larry Hogan signed cannabis edibles into the law. Over the last year and a half it has been quiet as the Maryland Medical Cannabis Commission pulled together well-rounded regulations for cannabis edibles in Maryland.

In early November 2020, the Maryland Medical Cannabis Commission released its draft regulations for the new cannabis edibles in Maryland law. It is a lengthy script of requirements for manufacturing, processing, packaging, dosages, retail and more. But these regulations aren’t set in stone, hence why they are “draft” regulations.

The regulations are currently on the Maryland Register website for a 30-day public comment period. So for a month following its release, the public will have the ability to comment and criticize the regulations, which will lead to another editing session.

After this 30-day period, all comments will be taken in and edits on the regulation will begin. The MMCC does not specify how long this process may take. Once completed, the regulations will be submitted for one last 15-day notice period.

While they don’t specify how long their editing process may take, the MMCC did claim that the final regulations should be approved by late December or early January.

Regulation Proposals

The draft regulations span several pages with details pertaining to every aspect of cannabis edibles in Maryland, from transportation to retail packaging. But there are some key regulations that cover the basics.

For dosages, the MMCC will require all cannabis edibles in Maryland to contain no more than 10mg of THC per dose, and no more than 100mg of THC per package. They also recommend having 2.5mg and 5mg options as well. As for the packaging of the edibles, labelling will be consistent with the industry standard in Maryland with a THC label. With the addition of the edible element, packaging is also required to include ingredients and even a list of any synthetic or natural preservatives added into the product.

To go a step farther, the regulation will actually require those interested in producing cannabis edibles in Maryland to submit their complete recipe, including the production process in order to be approved. Similarly to other states, cannabis edibles in Maryland can’t resemble any shape that might be appealing to children, with the MMCC specifying that edibles should be designed in a “geometric” shape.

And like other states with cannabis edibles, Maryland will require lab testing of edibles for THC and other cannabinoids in addition to any microbiological impurities.

Regulations subject to change

Like we said, these regulations for cannabis edibles in Maryland are subject to change after the 30-day public comment period. However it is unlikely that much will change from the original regulation so that it can move forward before the end of the year.

Once approved, manufacturing and retail sale of cannabis edibles in Maryland will be permitted, and there are already dispensaries ready to take on the challenge.

Culta in Baltimore designed their vertically integrated operation to include a kitchen that could be used with the anticipation of edibles eventually being made legal. Culta’s owner Mackie Barch commented on the big move.

“Getting into food manufacturing or beverage manufacturing requires very different tools and skillsets than we have had in the industry so far,” Barch explained. “Entirely new spaces are required for food manufacturing, and there are very specific rules about how the rooms have to be designed… A lot of people are going to have to go back and redesign their facilities to get ready for this.”

Weed delivery coming to Masschusetts

Weed delivery coming to Masschusetts

weed delivery in massachusetts

Home delivery of recreational marijuana in Massachusetts is on track to begin in 2021, after the state Cannabis Control Commission moved to lock in detailed regulations for the service.

On a 3-1 vote at a meeting Tuesday, the agency affirmed among other policies that it would issue two types of weed delivery licenses. Officials said they should help cut into the unregulated pot delivery market — while also fulfilling the commission’s legislative mandate to create a more equitable playing field for Black and brown entrepreneurs who have so far struggled to enter the capital-intensive legal marijuana business.

“We’ve shown we can regulate this industry safely and fairly,” commission chairman Steve Hoffman told reporters. “I believe this is a necessary, imperative step to create equity in this marketplace . . . and minimize the illicit market.”

Two weed delivery licenses

One license, a more limited “courier” permit under which drivers would pick up individual orders on demand from brick-and-mortar marijuana shops and bring them to customers’ doorsteps for a fee, is already available to businesses; so far, 37 companies have received initial certification and are pursuing local and state approval.

The second is a new category of expanded “warehouse” weed delivery licenses (formally, “marijuana delivery operator” licenses) that essentially allow companies to operate like retailers without physical storefronts, buying marijuana products in bulk from suppliers and reselling the inventory online via home weed delivery. Applications for the expanded licenses should become available in the first half of 2021.

Entrepreneurs in the commission’s social equity and economic empowerment programs — largely Black and brown entrepreneurs affected by the war on drugs — will have exclusive access to both types of delivery licenses for three years, beginning when the first marijuana delivery operator opens for business.

Brick and Mortar dispensaries opposed

The addition of the expanded retailer-like delivery licenses to the commission’s proposed regulations in August drew howls of protest from many existing brick-and-mortar marijuana stores, which had been poised to serve as the source of all home pot deliveries under the earlier, courier-only model.

Dispensary owners argue the expanded weed delivery operations will unfairly undermine their main street businesses and, in turn, deprive municipalities of tax revenue. The Massachusetts Municipal Association and a handful of state legislators allied with the dispensaries also weighed in against the new licenses, saying in part that more time was needed to review the change.

Critics further questioned whether the warehouse-type businesses, which are subject to the same intensive security regulations as other marijuana facilities, would be affordable for disenfranchised entrepreneurs; a selling point of the original courier-only model was that it required only a van with security cameras and a small dispatch office where no cannabis was stored.

“We’re very disappointed,” David Torrisi, president of the Commonwealth Dispensary Association, said in an interview. “The public, municipalities, and legislators haven’t had enough time to digest this proposal, and I don’t think the commission has done enough analysis to determine the impact on the supply chain and the marketplace.”

He added the association was weighing possible legislative or legal action in response.

More social equity in weed delivery in Massachusetts

Proponents of the expanded licenses counter that the courier licenses are financially unviable. And, they argued, white-owned recreational dispensaries that emerged from the existing medical marijuana program — which gave no consideration to equity when awarding licenses — have already had the cannabis business mostly to themselves for years.

Besides, they said, weed delivery services in other states with legal cannabis account for perhaps 20 to 30 percent of the market, hardly an Amazon-style retail armageddon.

“This is a huge step forward,” said Christopher Fevry of the Massachusetts Cannabis Association for Delivery. “Couriers are at the mercy of the retailers. If they don’t give you orders, you die, and when the exclusivity period ends, they’ll just say, ‘we don’t need you anymore.’ Now we’re in control of our own destiny.”

Regulators did take steps to address the concerns raised by critics, including limiting the number of weed delivery licenses any company can own to two.

The commission also voted to ban third-party marijuana delivery technology platforms — such as Eaze and Lantern, an offshoot of alcohol delivery firm Drizly — from having a “financial interest” in more than one cannabis delivery licensee. The policy is meant to prevent the popular websites from preferentially steering consumers to delivery companies they’re invested in while freezing out independent operators; it could also help assuage brick-and-mortar dispensary owners who feared a large Amazon-like platform would back numerous delivery firms and dominate the market.

Commissioners further opted to ban what they deemed the “ice cream truck” model, under which weed delivery operators might have prepositioned vans loaded with packaged pot products in strategic locations to fulfill anticipated orders. Instead, every order must originate from the company’s warehouse. And they left in place earlier security restrictions, including a mandate that two workers must ride in every delivery vehicle and a prohibition on delivering recreational marijuana to cities and towns that have banned retail marijuana storefronts. (Medical marijuana deliveries have long been allowed anywhere in the state.)

Commissioner Jen Flanagan, who has long opposed launching delivery operations on public safety and health grounds, made a last-ditch attempt to delay the program’s launch until 2023.

However, her motion failed 3-1, with Hoffman noting that the commission had originally planned to launch deliveries in 2018 before pulling back under pressure from Governor Charlie Baker and others who urged the agency to “crawl before it walks.” Outgoing Commissioner Britte McBride, who conceived of the original courier-only model, also opposed a delay.

“I don’t think we can wait [to address] equity or the illicit market any longer,” she said.

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