How Brexit is Impacting the UK Cannabis Industry

What is happening to the UK cannabis industry during this time of governmental chaos?

'Brexit means British Exit'… but what does that actually mean?

You may have pondered this question to yourself when reading about Brexit in the headlines. So here is the breakdown: Brexit is the UK's attempt to strike a deal to withdraw from the European Union.

A public vote was held over three years ago, on Thursday 23 June 2016, to decide whether the UK should leave or remain. With over 30 million people in attendance, and a turnout at 72%, leave won with 52% of votes.

Now, over three years later and the UK is still trying to strike a deal, under the new leadership of Boris Johnson.

This has been a strenuous process for the tense United Kingdom that has been heavily discussed throughout the nation on a daily basis, since the referendum took place in 2016. After delaying the Brexit leave an absurd amount of times due to the chaos within the divided government, the deadline has now been set to 31st January 2020. 

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UK Laws on Cannabis

The UK has strict laws against recreational uses of cannabis, with some labeling the laws as a "prohibition-style access scheme."

Contrastingly, the European Union does not have a strict stance when it comes to marijuana laws. The European Commission has previously identified that member states have their own say when it comes down to setting the appropriate laws on drug use within their countries, which is why regions vastly differ in their policies.

For example, in Portugal, all drugs are decriminalized, whereas in the UK you can still face charges, fines, and jail time depending on what drug you possess.

When it comes to Cannabis in the UK, the plant is illegal to possess, grow, distribute or sell, as it is categorized as a Class B drug. This means there are penalties for unlicensed dealing, production, and trafficking of marijuana which can result in up to 14 years in prison. 

With smaller amounts of cannabis – generally, less than an ounce of raw flower – those found in possession may only get a warning from police.

Though in recent years, due to an increasingly relaxed stance on cannabis, and budget cuts to police expenditure, the police from certain counties have stated they won't be targetting people for growing cannabis for personal consumption.

As the UK is already easing its stance on cannabis, the result of Brexit shouldn't have any major influence on the UK's cannabis policy.

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Though when it comes to medicinal cannabis in the UK, things get a bit murky.

Despite the fact that medical cannabis is available to patients of the National Health Service (NHS), the UK is not known for its importation or distribution of medicinal cannabis, mostly for their exportation of CBD products and pharmaceutical-grade cannabis.

However, there is a lot of potential for the market. As of this moment, there is no EU legislation that limits the UK from the internal distribution of cannabis, making the UK extremely valuable in terms of market potential.

With the UK becoming more flexible in terms of its regulations regarding cannabis, the nation has also started to grant companies cultivation licenses for testing purposes. 

UK's Cannabis Market 

Currently, UK cannabis farmers are purely relying on imports to support their market, as the UK prohibits them from processing by-products in the form of flowers and leaves from their crops.

This means that cannabis importation mostly derives from the rest of Europe, and suggests that Brexit could be seen as a hindrance to cannabis importation into the UK if barriers to trade are increased.

Though when it comes to CBD, CBD-infused products are doing quite well in the UK. According to the Centre for Medicinal Cannabis, (CMC) the UK CBD market will be worth almost £1 billion per annum by 2025.

CBD products are being stocked in mainstream health and wellness stores like Hollands & Barrets, who sell CBD-based products such as night-creams, shampoo, and conditioners for hair growth.

Brexit could mean causing further obstacles for the UK's exportation of these CBD brands as many sell their products to nearby European countries. 

In terms of hemp, the UK striking a Brexit deal may actually be beneficial to the production of this crop. For countries within the European Union, their hemp crops must be chosen by other member nations from an officially approved European Commission catalog of hemp strains. This means little choice for countries deliberating which hemp strains are available to them for their production processes. Leaving the EU would mean the UK has more flexibility as they would not be tied down to following these protocols.

However, there would also be additional hurdles for certain companies. As it stands, the UK government does not allow the release of the list of companies that are legally allowed to manufacture cannabis in the country.

Sativex
A patient using GW Pharma's 'Sativex'

However, it is public knowledge that there are currently only two pharmaceutical companies that have official licensed products in the country, Nabilone by Eli Lilly and Sativex, owned by GW Pharmaceuticals.

As mentioned on their website, GW Pharma has gained its reputation for its multiple sclerosis treatment product Nabiximols, the first natural cannabis plant derivative with the purpose of gaining market approval. As one of the only cannabis cultivators in the country, GW Pharmaceuticals holds a lot of power in the market right now.

Although, due to the fact that cannabis treatments are not as widely used in the UK in comparison to other EU countries, the majority of the Sativex that is produced in the UK is exported.

As much as Brexit may be beneficial for the UK's medical cannabis market, it could disrupt GW Pharmaceuticals' exportation rates, due to many of their products being delivered to a wide array of locations within Europe.

GW pharmaceuticals rely on the EU's mandates and regulatory processes when distributing its exports to its customers, the UK undergoing Brexit will potentially cause disruption as new processes will have to be followed. These changes could harm the relationships GW pharmaceuticals have with their customers within Europe.

Furthermore, Brexit could also cause the UK's economy to fluctuate to begin with. This may be seen as unattractive to their international customers because it means there is a risk of uncertainty that the company will be able to deliver the same promises it did whilst it was under the EU regulations.

This also could potentially harm the relationship between GW pharmaceuticals and their customers.

What Happens Now?

For the UK, the initiative behind formulating a Brexit deal was to help the UK grow economically, independently.

Cannabis has proven to be of great potential from an economic standpoint to the countries and states that have legalized it, and this may also be the case if the UK leaves the EU.

However, we will not know until the UK actually does leave, whether this is on the 31st January 2020, or at a later date.

The UK's process of legalization of cannabis has been a slow and progressive process, but one must ask, what was the initial driving force behind this?

Was it the EU's influence on the nation or was it the nation itself forcing the issue? Some would argue that the EU's influence was the main driving force behind the gradual legalisation of cannabis.

The EU has been working on numerous projects that will gradually see member nations legalize cannabis completely.

The most recent of these being Luxembourg, which will become the first nation to legalize cannabis production and consumption. Residents over the age of 18 will be permitted to purchase the drug for recreational uses legally within the next 2 years. Who is to say that the UK was not in line for similar progressions before the Brexit discussion begun 3 years ago?

So, if the UK were to finally leave the European Union, would this mean a halt in the progression to legalize cannabis?

This is a very real possibility as none of the major political parties have expressed their interests in pushing this agenda, despite the Liberal Democrats being the first to support UK legalization.

Overall, pro-cannabis activists do have reason to worry, as leaving the EU may mean that one of the major driving forces behind cannabis legalization will no longer be part of the UK.

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Niki Mohazeb
Niki Mohazeb

Niki is a Sydney based writer, with a passion for promoting the health benefits of medicinal cannabis. Niki also enjoys researching and writing about the future of cannabis along with the many other benefits that the plant provides, such as the diverse utilities of hemp.

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