February 2019 Cannabis News Highlights
Canada finalizing rules for marijuana edibles
Canadians have until Feb. 20 to submit feedback to Health Canada before final marijuana edible regulations are released this summer. Canada legalized adult-use cannabis sales in Oct. 2018, but restricted the sale of marijuana edibles, infused beverages, concentrates, and topicals until Oct. 17, 2019.
Unlike regulations in the U.S., the proposed Canadian regulations will limit marijuana edibles and infused beverages to 10 milligrams of THC, regardless of whether it’s sold for medical or recreational use. Some experts in the marijuana industry worry that the low-THC limit will encourage black market sales.
“By limiting the entire packages to 10 milligrams of THC, the regulators will increase the amount of packaging waste associated with edible cannabis products and make legal businesses less competitive against the black-market operators that aren’t restrained on edible potency,” said Jordan Wellington, chief compliance officer at Denver-based Simplifya.
Unlike edibles, the limit for marijuana concentrates and topicals will be significantly higher, allowing up to 1000 milligrams of THC for both medical and recreational use.
Legal marijuana sales reach $6 billion in Colorado
Since legal adult-use sales began in 2014, Colorado has sold $6 billion in medical and recreational marijuana. Recreational cannabis sales in the state have continued to increase, while medical marijuana sales have fallen. According to Marijuana Business Daily, there was a 20% decrease in MMJ sales between 2017-2018, from $416 million to $332 million. Medical marijuana sales reached a market high in 2016, at $445 million.
Recreational sales in Colorado have grown steadily since 2014. Adult-use cannabis sales in 2017 reached $1 billion, while sales in 2018 reached $1.2 billion, an 11% increase. There was a huge leap in cannabis sales between 2016 and 2017 when sales increased by 49%. In 2014, the state sold just $303 million in adult-use cannabis.
European Parliament votes to increase access to medical marijuana
The European Parliament voted in favor of a resolution that would incentivize cannabis research, clinical studies, and access to medical marijuana among European Union countries. The vote follows a recommendation from the World Health Organization (WHO) that cannabis should be rescheduled under international drug treaties.
The resolution is non-binding, meaning that it doesn’t actually change any marijuana laws in EU countries, but it does show increased support for ending cannabis prohibition. In addition, the resolution calls for a commission to “define the conditions required to enable creditable, independent scientific research based on a wide range of material to be conducted into the use of cannabis for medicinal purposes” and to “address the regulatory, financial and cultural barriers” that have prevented cannabis research.
Congress holds cannabis banking hearing
Access to banking has long been an issue in the cannabis industry, with marijuana businesses having little-to-no-access to banking services. For the past six years, Reps. Ed Perlmutter (D-Colorado) and Danny Heck (D-Washington) have filed the “Secure and Fair Enforcement Banking Act” (SAFE) that would eliminate restrictions that prevent insurance and federal financial institutions from working with marijuana businesses. On Wednesday, the SAFE Banking Act received its first hearing in the House Financial Services Committee.
For cannabis companies, lack of access to banking creates challenges that companies in other sectors don’t have to tackle. Cannabis businesses are often forced to run cash-only operations, increasing the risk of crime, and regular business transactions like getting a loan, or paying employees and taxes are much more difficult.
Some credit unions have taken on banking for cannabis companies, but the American Bankers Association told the House Financial Services Committee that, “the majority of financial institutions will not take the legal, regulatory or reputational risk associated with banking cannabis-related businesses without congressional action,” and that access to banking services would make cannabis businesses “safer and better regulated.”