The Czech government has announced its plan to introduce a highly regulated cannabis market in the Czech Republic. Currently, cannabis is legal for limited personal use only, and sale and distribution remain prohibited. However, the Czech government is planning to change this, with the introduction of a mandatory registration system, annual fees, and a daily limit. The Czech government, consisting of 5 coalition parties, is expected to discuss the legalization proposal throughout April and May 2023.
According to the government representatives, the main aim of this reform is to mitigate risks, contribute to damage prevention and improve control options, while providing a source of additional income in the state budget. The Czech National Drug Coordinator, Mr. Vobořil, has stated that: "The Czech Republic is one of the few countries to have reached a ceiling with cannabis use. Although use is declining as one of the few countries in the EU, there are hundreds of thousands of citizens who actively use cannabis". He also adds that: "Last year, around one million people used cannabis. Most of them are functioning normally in life. That is why it is important to choose a strictly regulated market instead of repression and criminal sanctions. In this, it will be much more regulated than tobacco products." Germany, the Netherlands, Luxembourg, and Malta, for example, are also going down this route, he also noted.
The new regulation proposes to introduce licence fees and a so-called ‘cannabis tax’, which would operate on the same basis as an excise tax, which is used for example to tax alcohol. According to studies conducted by the Czech government, this new ‘cannabis tax’ could generate net earnings of approximately 2 billion CZK (equivalent to EUR 85 million or GBP 75 million) annually. In addition, further potential earnings could arise from export to other European countries which already have a regulated cannabis market, or are currently proposing to introduce one.
It is envisaged that an annual fee, estimated at CZK 50,000 (equivalent to EUR 2,100 or GBP 1,900) will be charged to small shops. The basic criteria for determining the amount of the fee should be the location of the cultivation facility or shop. Pharmacies will be exempt from the fees, but it is expected that they will mainly sell cannabis products for medicinal purposes such as pain relief and will not be targeted by recreational users.
At the same time, the new regulation will prohibit any advertisement of cannabis goods. Moreover, each dose of cannabis sold will have uniform packaging, no advertising, and no pictures, just a description of the quantity and a warning of the risks.
A controlled market will be a better preventive tool than a blanket prohibition. The Czech National Drug Coordinator supports this point by data from Canada, where after the liberalization and regulation of cannabis, the regulated market has replaced over 70% of the black market.
The current proposed legislation is not only targeting sellers and growers, but also consumers and the conditions under which they can legally purchase cannabis. It is proposed that a person, wanting to buy a cannabis product, would have to register in a special “register of users”. The nature and scope of data which will be required for registration is still the subject of debate. Additionally, customers would only be able to buy a limited amount per month to prevent them from trading the goods themselves. Sellers would then have access to the register via a specific code and could check the quantity already purchased, as explained by the Czech National Drug Coordinator. The proposed monthly maximum amount of cannabis is currently anticipated within the range of 100 – 150 grams per person.
The proposed register is however subject to harsh criticism from a number of experts and politicians, although similar concepts of a register can be found for instance in Switzerland or in the Spanish autonomous community of Catalonia. The other disputed and currently unclear topic is the required proportion of THC in the goods, and whether a minimal/maximal amount should be set by the legislation.
Overall, the regulation of the cannabis market in the Czech Republic is still in its initial stages, especially as the political parties of the current coalition are not all in support of the proposal. More detailed plans and concrete articles of this new regulation can thus be expected later this year, if the government decides to support a regulation of the THC market.
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