A leaked document from German health minister Karl Lauterbach that lays out the regulatory framework to legalize cannabis includes many positive steps, but could temporarily decrease supply with a ban on imports, executives at a German cannabis company told MarketWatch.
Niklas Kouparanis and Anna-Sophia Kouparanis, co-founders of the 250-employee Bloomwell Group, said in order to initially meet expected demand in the estimated $6 billion German market, cannabis would need to be imported.
“Domestic production alone will hardly be able to meet Germany’s demand for adult-use cannabis from day one,” Niklas Kouparanis said.
Germany would need permission from the European Union (EU) to allow imports of cannabis. This process could take as little as three months, although it could take longer, Kouparanis said.
If all goes well, advocates expect Germany’s adult-use market could launch as early as 2024 after the proposed health minister guidelines win support from the German Bundestag and the Bundesrat, as well as potential approval for imports from the EU.
Overall, the draft rules from German Health Minister Karl Lauterbach aim to create a nationwide supply at prices comparable to the illicit market, as well as quality control for cannabis and protection for minors, Kouparanis said.
Some U.S. companies currently have cannabis grow facilities in Germany, but much of the medical market in the country is supplied through imports.
Also Read: These cannabis stocks could benefit from adult-use cannabis legalization in Germany
German publication Redaktions Netzwerk Deutschland (RND) reported on Wednesday that the draft cannabis rules include allowance for the purchase and possession of up to 20 grams of cannabis starting from the age of 18.
Cannabis sales would be limited to products containing less than 10% of THC, the psychoactive component of cannabis, for consumers under 21.
The government would also allow an individual to grow up to two plants.
It would declassify cannabis as a narcotic, a move that Bloomwell Group regards as a major boost to cannabis in Germany.
“This historic step will also significantly ease the administrative burden of medical cannabis therapy and may finally lead to more chronically ill people benefiting from cannabinoid-based therapy,” said Bloomwell Group’s Anna-Sophia Kouparanis.
Also Read: Akanda pivots to German market as cannabis reform gains traction
German Chancellor Olaf Scholz endorsed cannabis legalization when he was elected in late 2021. Over the summer, the country’s health ministry has been holding meetings over the issue. More details have been expected in the fall, according to a report from Politico.
Aurora Cannabis Inc.
Cannamedical Pharma GmbH, Canopy Growth Corp.
Four20 Pharma GmbH and Tilray Brands Inc.
supply a majority of the cannabis flower market in Germany.
in September acquired a 55% stake in Four20 Pharma GmbH .
Also Read: Cannabis legalization goes up for a vote Nov. 8 in five states with a combined adult population of 13 million