First German Cannabis Bill – Half Baked? – Implications for social clubs and commerce

The German health minister Mr. Lauterbach has presented - as announced - a first draft of a law that is to further open the cannabis market. The government is still discussing the bill internally; the bill therefore may still change. Nevertheless, the draft hints what the future legal landscape in Germany might look like with regard to cannabis.

The bill regulates only the 1st pillar of the 2-pillar-model envisaged by the health ministry (in this context refer to our blog post of 13 April 2023). Thus, the draft includes, in particular, provisions regarding the protection of minors, home cultivation and the planned non-profit associations. The bill aims to contribute to an improved protection of children and minors as well as to improved health protection, to strengthen education on cannabis and prevention and to curb the black market.

In addition to the protection of minors, non-profit associations are the central issue of the bill. According to the bill, the so-called cultivation associations are allowed to have a maximum of 500 members and it is not allowed to be a member in more than one cultivation association. According to the bill, only the cultivation associations will be allowed to distribute cannabis for non-medical personal use to members only and at cost price. Distribution and cultivation are subject to strict regulations. First, you have to obtain a permit to cultivate and distribute.

Second, cultivation associations can’t sell to third parties and are restricted to selling cannabis on the internet. Third, even the type of packaging (neutral packaging or unwrapped) and the information on the package leaflets will probably be regultated.

Since the 2nd pillar envisages model regions for the legal sale of cannabis, changes in the legal provisions are likely to occur at least in the long run. Insofar, the final bill remains to be seen as well as a draft for the implementation of the 2nd pillar. The way for trading cannabis seeds is already paved in the present draft; importing cannabis seeds would be permitted for

cultivation associations and home cultivation.

Pursuant to the draft, cultivation associations are only allowed to finance themselves through membership fees. So far, there are no information on how the associations would have to be structured, membership fees, termination options and monitoring. This, in turn, can open up some creative space for the creation of cultivation associations and subsequent investments.

The draft bill also provides extensive provisions regarding cannabis for medical purposes. Cannabis for medical purposes may only be distributed in pharmacies. Importing and exporting cannabis from cultivation for medical purposes should be permissible. Insofar, the possibilities for import, export and transit are open for cannabis for medical purposes. The German Federal Institute for Drugs and Medical Devices (Bundesinstitut für Arzneimittel und Medizinprodukte) will be responsible for granting permissions. Likewise, the control of cultivation and cross-border traffic of cannabis for medical purposes is to be subject to the German Federal Institute for Drugs and Medical Devices.

However, the bill also shows that the legislator attaches great importance to the protection of minors and the prevention of addiction. Accordingly, extensive documentation and reporting obligations are imposed on the cultivation associations. In particular, cultivation associations are to annually submit to the respective authorities comprehensive information on the quantities of cannabis and propagating material produced, dispensed and destroyed by the cultivation association in the previous year. Furthermore, the relevant authorities are to be given extensive powers to monitor the cultivation associations.

As the above comments show, the current draft bill provides strict regulations for the planned cultivation associations and overall, for the legal cultivation and distribution of cannabis. In this respect, founding such association must be well planned and prepared in detail in order to be able to overcome the high legal obstacles of the cannabis law. In this regard, and in the context of cross-border trade in seeds as well as trade in medicinal cannabis, careful consideration of the extensive legal framework that the Cannabis Act will provide, and thus in-depth legal advice, is required. It remains to be seen in how far the draft bill will change due to the internal coordination with the other ministries and after consultation with the associations to be appropriately involved in the subject matter.

Dr Silke Dulle
Moritz Kopp
Robert Schmid