Portugal Delays Recreational Cannabis Bills as Luxembourg Also Signals Delay

These are curious days in Europe on the recreational cannabis question. On one hand, the stated intentions of both Portugal and Luxembourg to establish recreational markets as early as next year and certainly by 2023 has been on the drawing board for the past three years. On the other, as the clock ticks down to the final quarter of 2021, politicians in both countries are suddenly pushing the pause if not long-term delay button.

Luxembourg has the longest track record outside of Holland as a country committed to a recreational market, theoretically by 2023. That said, it is suddenly being reported as of the last week of September that the ruling coalition here is now also considering the delay of the same, citing concerns about the legality of the same given current policies at the EU level. This is a little strange given the fact that the Dutch seem to have no issue with the EU policies as they go about implementing a national recreational infrastructure for the first time. Regardless it also points to a need for at least a fig leaf of legitimacy at a regional level so far missing from the discussion.

Beyond the stalling now seen in Luxembourg, for those who were hoping that at least one country in the EU will commit to a recreational market before the end of the year, Portugal had remained a beacon of hope. Portugal has long had one of the most tolerant drug policies generally because of a reaction against the policies of the late dictator Antonio Salazar which ended four years after his death in 1974.

However, the parliament in Portugal has dragged its feet this year and as of last week, began delaying discussion on a bill, which was supposed to go into effect late this year or early next.

Indeed, the timing of both decisions may have everything to do with the German elections in however backward a manner. Namely, that other countries in the EU on the verge of real reform are now stalling to see what Germany will do.

It appears that as of now, Holland remains the only country in Europe with a recreational market that is now federally regulated, and Switzerland the only sure-fire bet to go forward on a rec trial as of next year.

What Gives in Portugal and Beyond?

There are all sorts of rumors flying about why the sudden slowdown of politicians to engage on the recreational reform question especially given the results of the German election. Beyond this, the Luxembourg discussion is particularly intriguing given the fact that Canopy Growth, according to local media, has just inked a deal to sell medical cannabis to the Luxembourgian government at 100 euros a flower gram. To put this in perspective, the German bid set the price of the same at 2.20 euros a gram as of 2017, dropping to 1.87 with volume sales.

The fact that officials in Luxembourg seem unaware of the same is one problem no matter how closely they have studied the Canadian market. The second of course is that this is highway robbery of a kind not even seen so far in the rest of Europe (even as the German market was opening). The closest comparison in fact to this kind of pricing is only seen in the liquid Dronabinol market in Germany (where prices are still at a shockingly high 100 euros a liquid gram wholesale).

The fact that this outrageous sale is occurring almost simultaneously with the news of a now slowed down schedule for a rec market on the timeline since the last national election is just one more reminder of how political the discussions about forward progress are—and how much the larger public Canadian companies still shape debate if not the speed of progress here.

Indeed, the slower the pace of change, the more of these kind of short term, arbitraged commodity medical plays will occur.

Will Germany Really Drive Rec Reform in Europe?

There are all sorts of speculations afoot these days about not only the shape of the coalition that will guide Germany through the next four years, but the pace of cannabis reform here. If the statements coming out of Berlin are to be believed right now, cannabis reform, even if only decriminalization, but probably something more than that (like rec trials) is clearly on the agenda. This is because it is a clear win politically for all those in the new coalition, whatever that is likely to be.

However, Germany is not necessarily the only if not most powerful driver here. The Dutch are proceeding with the region’s first completely federally regulated recreational market. And of course, just across the border with Germany, Switzerland, while not in the EU, is not likely to slow down with its own plans to launch trials next year.

This alone, beyond the elections will certainly allow local advocates in at least Germany and potentially Austria, both in the DACH trading alliance, to face up to the fact that the momentum may be slightly slowed, but there is no stopping the great green train.

The idea of recreational reform has hit Europe, and while it may hit legal objections at every level (see not only the political yellow lights of late but the decision of the court in Strasbourg against Albert Tió), the horse has left the barn.

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