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Is Germany on the Verge of Legalizing Recreational Cannabis?

As Germany debates the Cannabis Act the landscape for startups and investors is poised for transformation.

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Legalization could significantly boost Germany’s already substantial medical cannabis market, projected to reach €7.7 billion by 2028. PHOTO COURTESY OF WIKI COMMONS

The German federal parliament will today deliberate on a cannabis reform bill proposed by the federal government. The proposed legislation, backed by Chancellor Olaf Scholz, represents a important shift in Germany’s approach to cannabis, which is currently illegal for recreational use.

The bill aims to legalize controlled cannabis usage for adults under specific conditions, promoting responsible consumption. It includes provisions for private cultivation, non-commercial community farming, and controlled distribution through cultivation associations. This revised bill, initially introduced in April, adopts a more gradual approach to cannabis legalization following consultations with the European Union.

The driving force behind this proposal is the growing use of illicit cannabis, which poses health risks due to uncertain THC levels and potential contaminants. Under the new regulations, adults would be allowed to possess up to 25 grams of cannabis and grow up to three plants for personal use while maintaining strict safeguards to protect German youths.

Cultivation associations would face strict regulations, limiting them to distributing 25 grams per day or 50 grams per month to their members, with a membership cap of 500 residents in Germany. Young adults aged 18 to 21 would have lower possession limits, with a THC content cap.

To ensure the safety of children and young adults, advertising of cannabis would be prohibited, and an awareness campaign led by the Federal Center for Health Education (BZgA) would work to educate the public about cannabis’s effects and risks.

Obviously, this development is of great interest to both cannabis enthusiasts and startup businesses. It is expected to significantly boost Germany’s already substantial medical cannabis market, projected to reach €7.7 billion by 2028, reports Sifted. Several German weed tech startups, including Cantourage, Sanity Group, Demecan, Bloomwell Group, and Cansativa (backed by Snoop Dogg), have already seen substantial increases in funding since medical marijuana was legalized in 2017.

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However, not all factions support such a progressive approach. The CDU/CSU, a prominent political group in Germany, opposes cannabis legalization. They argue that the proposed reform could have negative effects, especially on individuals under 25. Despite these reservations, the federal government remains optimistic about the potential benefits of decriminalization, including substantial cost savings resulting from a reduction in cannabis-related prosecutions.

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