Why legal cannabis probably won't be a business boon for Britain

The world is heading towards legalisation, but reform in the UK will be slow and tightly regulated.

by Jack Torrance
Last Updated: 27 Apr 2017

There’s dosh in dope, MT declared three years ago as our cousins across the Atlantic waved in a new period in relaxed marijuana laws. Colorado and Washington became the first states to legalise the sale and possession of cannabis in 2012, heralding a boom in businesses doing everything from cultivating the plant to turning it into cookies. Could something similar happen here?

Several other states have followed suit (though cannabis remains technically illegal on a federal level) and around the world many other countries are softening their position on the drug. In 2014 Uruguay legalised the growing of small amounts at home and created a system of state-controlled dispensaries. South Africa’s prohibition was declared unconstitutional this year and now Canada’s heartthrob prime minister Justin Trudeau is pushing through legalisation too.

Reform has been slower in Europe. Though the Netherlands tolerates personal use of cannabis it remains technically illegal, as in Portugal where police turn a blind eye to the use of much harder drugs as well. Several countries have relaxed the laws on medicinal use. But here in the UK reform seems a distant possibility.

That’s not to say it won’t ever happen. Attitudes towards legalisation are much more favourable among young people and successful changes in other countries could make Britain more relaxed about the idea. There’s an easy case to make - legalisation would take control of the drug away from violent gangs and reduce the harm to users who have no way of checking the purity of what they buy. But for the time being the politics look difficult.

In her time at the Home Office Theresa May took a hard line on drugs - the former government advisor David Nutt branded her an ‘extremist’ on the issue. Given their lead in the polls ahead of June’s election it seems unlikely the government’s position will change any time soon.

Even when (if?) reform does come, it’s unlikely to look like the free-for-all that’s been seen in Colorado, where businesses have raised millions of dollars to build recognisable consumer brands. This week the drug reform think tank Volteface published a report that painted a picture of a much more controlled and discrete market that could conceivably come to the UK in the future. Authored by the journalist Mike Power, The Green Screen eschews the idea of bricks and mortar cannabis shops or ‘dispensaries’ in favour of an online-only market where adults can buy cannabis from government approved sources.

Read more: There's dosh in dope - could America's pot boom come to the UK? 

‘If we have cannabis sold on the internet, exclusively on an online digital market, [the advantage we’ll] have is it will not be in our streets and in our communities, it won't be stinking up pubs and bars, but it will be available for purchase, for consenting adult use in private,’ Power said.

Rather than framing the debate as a battle for personal choice, Power suggests legalisation should be seen as about taking power away from criminals that currently profit from the market, and protecting children – some of whom he suggests can get their hands on cannabis more easily than alcohol. This model would allow the government to regulate the strength and purity of what is sold and limit the total amount a person can buy. Identity checks would ensure that only adults could buy cannabis through the market, in theory.

In terms of branding, it’s hard to imagine the government taking a softer line on cannabis than they do on tobacco, which must now be sold in plain, drab packaging to discourage children from taking up the habit. So the rise of a cannabis-focused equivalent of Diageo or Philip Morris seems unlikely (in the UK at least).

‘I would argue that we remove marketing and branding concepts from these markets that I propose and just have strains, strengths and effects listed,’ says Power. Nonetheless he suggests there’s plenty of room for profit to be made. ‘The main costs in cannabis cultivation are in keeping it secret - the smell, the light, the heat.’ Eliminating that and making farming more efficient and commercial process would allow prices to come down while leaving a decent margin for the producer and, of course, a slice for HMRC to toke on. 

There are big opportunities in pharma too. Research on cannabis’s medicinal properties has been limited by its legal status but it has been used to treat everything from cancer to epilepsy and multiple sclerosis. Our puritanical PM may not be convinced by arguments for an adult’s right to smoke up recreationally but could perhaps be persuaded to help those in ill health.

Globally the legal cannabis industry is set to grow massively over the next few decades. It’s a huge opportunity for entrepreneurs seeking to make a buck, but those based in the UK will likely need to look elsewhere to find success.


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