Minden Gross: Israel – Cannabis Around The World Series

Cannabis in Start Up Nation

Cannabis for medical purposes has been permitted in Israel since the early 1990s. With the support of its Ministry of Health (and a dedicated budget of just over CAD$3 million/year), Israel has become a global leader in cannabis research and innovation.

To grow its business interests, on January 27, 2019, following Canada and the Netherlands, the Israel Ministry of Economy signed a Free Export Order (“FEO“) approving the export of Israeli-grown medical cannabis with the intent to expand its distribution. Under the FEO, successful applicants are permitted to export cannabis to foreign markets.

The Current Status: Israel and Recreational Cannabis

Despite 27% of Israel’s adult citizens consuming cannabis recreationally, Israel has historically held a stringent and punitive approach to personal use. Cannabis was included in the Dangerous Drug Ordinance (inherited from the British Mandate) and possession was punishable by criminal charges. However, in 2018, the government issued a three-year temporary order that partially decriminalized recreational use by setting fines, as opposed to more serious criminal consequences for initial offenders. Although recreational use of cannabis remains illegal in Israel, the country is on its way to implementing a legislative regime to legalize it.

On June 24, 2020, the Knesset plenum (the parliament of Israel) approved the preliminary reading of two bills that aim to decriminalize and fully legalize the recreational use of cannabis and its supply chain.  This is the first of three votes that the Bills must pass to become law.

The first proposed Bill’s initial vote passed with overwhelming support. If accepted, it would decriminalize the possession of up to 50 grams of cannabis by individuals above the age of 21. Currently, the penalty for possession of the same amount is up to three years in prison. The proposed Bill would shift the penalty to an administrative offense.

The second proposed Bill’s initial vote also passed with a significant majority. This Bill, if accepted, would fully legalize personal possession of up to 15 grams of cannabis for recreational use by individuals above the age of 21. However, any individuals working in security positions would be prohibited from possessing any cannabis for recreational purposes. “Cannabis for self-consumption” is defined as “any product derived from the cannabis plant, excluding medical cannabis and industrial cannabis.”

The Bill proposes key items in its framework for recreational cannabis such as:

• Consumption: Consumption of cannabis in private residences only and not in the presence of individuals under the legal age of 21;
• Driving: The Minister of Transport and Safety develops rules, regulations, and penalties for driving after consuming cannabis;
• Packaging and Labelling: Similar to Canadian legislation, packaging would include health warnings, such as warnings about the use by pregnant women. All packaging would have to be child-proof;
• Sales: Subject to Health Ministry licensing and regulations, permits would be required for private retailers. A dedicated regulatory body, determined by the Minister would be given the authority to set conditions and a licensing framework for licensing such retailers;
• Taxation: The Minister of Finance will determine the tax on cannabis and its entire chain of production and marketing; and
• Education: A national advocacy fund would be created to educate individuals about the proper use of recreational cannabis.

It appears that home grown cannabis will not be permitted for recreational use, as both Bills maintain criminal penalties for the unlicensed growing of cannabis.

The Road Ahead: Next Steps

Both Bills are in the process of being transferred to the House Committee for further consideration. They are expected to be combined into one piece of legislation that will govern the Israeli recreational cannabis framework. Once the Bills are considered by the House Committee and any necessary amendments are made, a date will be set for the final version(s) to be returned to the Knesset plenum for a second and third vote.

Licensed producers in Canada have long seen the potential in the Israeli market. Many have signed agreements with Israeli stakeholders to capitalize on the market. As Israel continues to progress in its cannabis-related policies, more opportunities will likely arise and Canadians companies will be able to continue to capitalize on this growing lucrative market.

Stay tuned for the next country profile in our Cannabis Around the World series.

Originally published by Canada Cannabis Legal on July 9, 2020.

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