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Lack of regulation, questions over quality control, planning problems, unclear Ministerial responsibility... a panel of politicians says its "extremely concerned" about Jersey's burgeoning medicinal cannabis industry, and is warning that the island's reputation could be tarnished if the issues are not fixed.
The criticism comes in a 149-page report released today by the Economic and International Affairs Scrutiny Panel, which has been reviewing the regulations for the licensing, production and export of medicinal cannabis for nearly a year.
Back in 2019, Economic Development Minister Senator Lyndon Farnham announced his intention for Jersey to become a "centre of excellence" in medicinal cannabis production at a London conference. Since then, the industry appears to have developed at pace, with licences approved and planning applications to create medicinal cannabis farms registered.
But today's Scrutiny report expresses concerns that Jersey hasn't drafted its own dedicated set of regulations to control this development. It also notes that producers do not need a recognised EU safety mark to operate on the island, meaning that Jersey's exports might be considered lower grade.
Questions are also raised over whether the potential economic benefit to the island of the industry has been overstated by Government.
In the report, panel Chair Deputy David Johnson explained that the group had “major concerns” over the fact two medicinal cannabis licences had been granted despite an apparent lack of regulations for the industry.
He added that the review had confirmed the Panel’s concerns were “justified” and prompted 24 recommendations.
Pictured: Deputy David Johnson chairs the Economic and International Affairs Scrutiny Panel.
One of the main issues raised by the Panel is that the island does not have its own regulations for the industry and is instead relying on a Memorandum of Understanding (MoU) with the UK Home Office Drugs and Firearms Licencing Unit (DFLU).
To enter the MoU, the Jersey Cannabis Agency (JCA) was set up. The JCA is made up solely of the Health Minister, Deputy Richard Renouf, with no other Ministerial input, and is administered by the Chief Pharmacist.
The Panel believes this arrangement is “inadequate” and called for a single piece of bespoke legislation to be created locally to control the emerging medicinal cannabis industry.
While Economic Development Minister Senator Lyndon Farnham has largely been the face of announcements on the island's burgeoning industry, the panel said that the lines of accountability were in fact "blurred".
They explained that at the outset of the review, they believed Senator Farnham had overall responsibility for the industry, but that it later emerged that no single Minister had such responsibility, with the industry appearing to cut across the portfolios of the Health, Home Affairs and Environment Ministers too. They also suggested that the latter should have had more input, particularly in relation to Planning matters, when in fact he hadn't.
Pictured: The Panel said the lines of accountability for the industry are blurred.
“It is the Minister for Health and Social Services (in his capacity as sole member of the JCA) who has responsibility for the issue of licences with the Minister for EDTSC being responsible for the overall economic development and rural economy," the panel explained.
"...Further, whilst the Minister for the Environment currently has little or no input in relation to the licence application process, or indeed some basic matters relating to the planning process (which are discussed in more detail within this report), we have recommended that officers of the Planning and Environment Department be responsible for the assessment and approval of any Environmental Impact Assessment submitted with the licence application.”
They recommended “a more holistic approach” for the future of this industry.
The Panel also noted that cannabis can be exported without a European Union Good Manufacturing Practice (EU GMP) certification, which they described as “the highest recognition available to pharmaceutical companies” as it requires rigorous testing to ensure compliance with strict EU regulations.
The Panel said all medicinal cannabis exported from Jersey should be under the EU GMP certification, as otherwise they fear the island could be viewed as exporting “lower grade medicinal cannabis”, which may tarnish its reputation.
Pictured: The Panel said a full business case should be "essential" when applying for a licence.
The Panel also mentioned the industry’s future revenues are “speculative” and profitable tax intake is likely to remain “minimal” for several years, even though the medicinal cannabis industry might be financially successful through employment, taxation and investment.
They also questioned the economic viability of the medicinal cannabis licence application fee, which is low compared to other jurisdictions, and recommended an immediate review. They also called for the licence application process to include a full business case.
“The cultivation of medicinal cannabis in Jersey is promising as it demonstrates the potential for a thriving new sector within our island’s economy,” Deputy Johnson, said.
“However, we wish to ensure that it operates within a strong regulatory framework to encourage investment and enhance Jersey’s strong international reputation. We hope that the Council of Ministers will seriously consider our recommendations as to the implementation of robust levels of regulation and other measures designed to ensure that this emerging industry maintains the high reputational standards for which Jersey is recognised.”
Follow Express tomorrow for further analysis...
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1. Which other European offshore jurisdiction is competing with Jersey to establish a viable medicinal cannabis industry?
2. Which other jurisdiction is looking to attract as much inward investment as possible from medicinal cannabis?
3. Which offshore jurisdiction would love to see Jersey's medicinal cannabis industry fail and its own cannabis industry thrive?
4. From which offshore jurisdiction did scrutiny - in its wisdom - seek professional advice on tax and revenues, regulation and license requirements?
Answers to 1-4? Malta
Would any of your readers in the finance industry, agricultural industry, fishing industry or hospitality industry welcome a States of Jersey Scrutiny Panel taking advice on how to tax and regulate them from a Guernsey, France or Luxembourg based firm of accountants competing for business with Jersey? Here's a Key Finding for the Scrutiny Panel "You displayed rank stupidity seeking advice on how to regulate Jersey's medicinal cannabis industry from an advisor in a competitor jurisdiction keen to see Jersey's cannabis industry flounder". And here is a Recommendation "Take advice from an independent advisor, not a competitor".
Can you imagine if potato growing or fishing was a new start up industry in Jersey today? Scrutiny would have a field day looking to impose as much regulatory red tape as it could possibly imagine. I wonder if today those industries would pass the economic benefit hurdles now being joyfully thrown in the path of the medicinal cannabis industry? Why worry about the OECD black list, lack of housing, lack of labour, failing retail, etc. when the Islands politicians seem so willing to completely stifle a potential revenue generator for the Island at birth. For goodness sake leave private enterprise to entrepreneurs and concentrate on solving the Island's real problem which is the massive deficit it faces from covid and the hospital.
Now, if only someone could think of a diverse new industry for the Island....