Lidl just experienced a grocery store chain being raided, and all because of CBD cookies.
In a rather amusing or shocking incident, depending on where you sit, the German police have raided a Lidl grocery store in Bavaria (known locally not only as Bayern but also somewhat accurately as the “Texas of Deutschland”) over some CBD cookies. Plus, it was reported they raided the establishment for another assorted, otherwise innocuous 20 products including “cannabis energy drinks” and “hash brownies.”
The incident, as reported in the München Abendzeitung (an evening newspaper of the digital kind), is a testament to how difficult the local cannabis market still is, even for big companies that decide to join the hemp parade.
Beyond the legal issues and technicalities, the humor in this story (not to mention the cautionary tale) is manifest. It is certainly a cannabis-scented grim fairy tale gone rather bad.
The “Texas of Germany” and Cannabinoids
To set the scene for those who have never experienced Bavaria in the flesh, this is a bucolic part of the world known for a few things that are also broadly popular elsewhere—football (albeit of the soccer kind) and beer (of the German variety).
And, of course, it’s also known for strange fashion ideas that lead to adult human beings being not the least bit self-conscious in walking down the street even at high noon in “traditional” German clothing. This attire is known as lederhosen or leather shorts (for gentleman) and Dirndls, a kitsch, Cinderella-Disney kind of outfit with lots of cleavage and poof as well as a lace up corset (for ladies). The locals do this even in months that are not October (known, of course, locally for Oktoberfest and internationally for Halloween).
Beyond the rather odd local fashions, there is certainly an aspect to Bavaria that is picturesque if not familiar elsewhere on the planet, minus a language that is tongue-twisting (just ask Mark Twain). Walt Disney certainly took a great deal of inspiration from this part of the world (as did Adolph Hitler).
Bavaria also has a few other characteristics. Rules here, particularly for Auslanders—read: even Germans not “from here” are strict to a degree that is teeth-numbing for those unaccustomed to the same.
As in all such bizarrely strict places on Earth to live, it is also a state with one of the highest numbers of cannabis patients in Germany, in part because the cops do not think twice about busting even patients for small amounts of weed (although post 2017 this has relaxed somewhat). It is no accident that Gunther Weiglein, the patient whose lawsuit changed the federal law here in 2017, is also from Bayern.
If there was to be a mainstream grocery store that might be raided by the fuzz over hemp cookies, it would probably be a place like Munich. And of course, the cops did not disappoint.
If this was a skit, it would be like German, cannabis-themed Monty Python. The only thing that is missing here is the dead parrot.
“Several articles have been secured,” according to police spokesman Stefan Sonntag after a Rosenheim branch of the grocery store was raided by the polizei. The items are currently being tested–even though the items are from a manufacturer who only produces THC-free products.
Lidl and Corporate Embarrassment
Here is the next disaster. Lidl, the fifth-largest retailer in the world, with annual sales in the multiple billions, decided to jump into the cannabis frenzy with a no-holds barred lack of caution that was rather shocking to anyone with any experience in the actual cannabis industry, certainly in Europe if not Germany.
Namely, as of this spring, brightly coloured inserts began arriving in households all over the country, delivered not via digital means but rather through post-boxes, proudly advertising CBD products on the front of their garishly adorned (and wrapped in plastic) mailers. Whoever was corporate counsel on this one was absolutely sleeping. A whole marketing department somewhere should probably lose their jobs.
Here is the first reason. For those unfamiliar with German law, CBD is still part of the German Narcotics Act. Namely, it may not be “advertised,” and certainly not to consumers via a grocery store mailer, delivered through the post. Major cannabis companies (starting with Tilray) have ended up on the wrong side of German law in court for less.
Here is the next bummer. The discounter signed an agreement with a start-up company, The Green Dealers, to deliver about 1.5 million CBD and THC-free articles to the company.
Of course, this should also come as no surprise in a country where the sellers of hemp tea have also been targeted routinely. So far, the rulings on this, even at the federal level, have not removed CBD from the Narcotics Act, but rather focused on the levels of THC in seized items. Beyond this of course, the start-up distributor sells products from a Czech-based manufacturer. If there were ever a test case in Germany to match the French decision last year (namely that imported CBD products, in this case, vapes from another part of the EU, when legally produced could not be banned from sale) this would be it.
It is hard to believe that this is not a set up if not fake news. However, this being Bavaria right now, if not Deutschland, it is also very easy to understand that it is not.
The Strange, Grey Area of the German Hemp Market
Here is where all of this gets weird in a country where (at least in Frankfurt in the adjoining state of Hesse albeit also home to the international banking set) local hemp shops advertise freely on the outside of street cars, and in a way semi familiar to Americans.
Here is the bottom-line reality. There is no real cannabis reform in Germany. The medical change that happened over the past four to five years has certainly begun to reset the conversation, but the huge and looming gaps between the haves and have-nots is already in the room. The young and innocent believe that cannabis reform might be a victory in the election, but this is largely a false hope—at least at the ballot box. German politics do not allow the kind of voter-driven, state referendums as seen in America.
The privately insured everywhere can gain access to the kind of cannabis they want. In places like Frankfurt, however, patients on public health insurance (90 percent of Germans) are facing doctors who are refusing to take more than two patients because of the regulatory requirements they face. This is also not uncommon in places like Bayern, where doctors are threatened by regular visits from the police as well.
Advertising is also in a strange place including social media issues familiar to anyone in the U.S. market—as is the ability of even licensed medical cannabis companies to achieve recurrent patient sales. The only “sure thing” here is actually dronabinol, the supposed “generic extract” that is currently being sold as an on-market drug for the benefit of both distributors and pharmacies.
The problem of safe access to cannabis products, of both the medical and “adult use” kind, starting with safety for not just patients and other customers but vendors is much in the news here as it is elsewhere.
Ziya Gaziyev, the CEO and co-founder of a Berlin-based online cannabis platform called HelloMary, which uses doctor trained artificial intelligence (AI), said, “The market has never been more direly in need of a safe, secure, digital platform to buy, sell and transact in legal cannabis products.”
That is, at least, a universal theme, no matter where you are in the world of international cannabis. Strange costumes notwithstanding.
Original Source: hightimes.com
Rhode Island Rakes In $1.6 Million in First Week of Recreational Pot Sales
Rhode Island’s new adult-use cannabis market opened for business earlier this month, and so far, business is good.
Local news station WPRI, citing the state’s Department of Business Regulation, reported this week that “Rhode Island’s six marijuana dispensaries — five of which are currently authorized to sell to recreational customers — collectively sold just over $1.63 million worth of marijuana from Dec. 1 to Dec. 7.”
“Less than half of those sales were for recreational marijuana, at about $786,000. The rest, about $845,400, were sales to medical marijuana patients,” the station reported. “For comparison, during the last week of October — the most recent full week available prior to recreational sales — the dispensaries collectively sold $1 million worth of medical marijuana.”
Rhode Island legalized recreational cannabis use in May, when Gov. Dan McKee signed a bill that was passed by lawmakers in the state General Assembly.
The law made it legal for adults aged 21 and older to cultivate and possess marijuana, while also establishing the regulatory framework for cannabis sales.
“This bill successfully incorporates our priorities of making sure cannabis legalization is equitable, controlled, and safe,” McKee, a Democrat, said in a statement at the time. “In addition, it creates a process for the automatic expungement of past cannabis convictions. My Administration’s original legalization plan also included such a provision and I am thrilled that the Assembly recognized the importance of this particular issue. The end result is a win for our state both socially and economically.”
Additionally, the law “will give courts until July 1, 2024, to automatically expunge past convictions, and those who want their expungement sooner may request it,” the governor’s office explained in a press release at the time.
Late last month, McKee and the state’s Department of Business Regulation’s Office of Cannabis Regulation announced that “five licensed medical marijuana compassion centers have received state approval to begin selling adult use marijuana on or after December 1.”
The five “compassion centers” that were given approval to begin adult-use sales are: Aura of Rhode Island (Central Falls); Thomas C. Slater Center (Providence); Mother Earth Wellness (Pawtucket); Greenleaf Compassionate Care Center (Portsmouth); and RISE Warwick (Warwick).
“This milestone is the result of a carefully executed process to ensure that our state’s entry into this emerging market was done in a safe, controlled and equitable manner,” McKee said last month. “It is also a win for our statewide economy and our strong, locally based cannabis supply chain, which consists of nearly 70 licensed cultivators, processors and manufacturers in addition to our licensed compassion centers. Finally, I thank the leadership of the General Assembly for passing this practical implementation framework in the Rhode Island Cannabis Act and I look forward to continuing our work together on this issue.”
Matt Santacroce, who is serving as interim deputy director of the Rhode Island Department of Business Regulation, said last month that the state was “pleased with the quality and comprehensiveness of the applications we received from the state’s compassion centers, and we are proud to launch adult use sales in Rhode Island just six months after the Cannabis Act was signed into law, marking the Northeast’s fastest implementation period.”
“We look forward to continuing to work with the state’s cannabis business community to ensure this critical economic sector scales in compliance with the rules and regulations put forward by state regulators,” Santacroce said.
The launch of recreational sales on December 1 was only one change to Rhode Island’s existing marijuana policy to arrive this month.
WPRI reported that, on the same day, “the state also stopped charging medical patients to obtain or renew their medical marijuana cards,” adding that “there is an expected revenue loss from the pending plan to expunge marijuana possession charges, which will eliminate court fees from those crimes.”
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D.C. Council Approves Cannabis Bill To Promote Equity, Provide Tax Relief And Eliminate Medical Marijuana License Caps
On Tuesday, lawmakers in Washington, D.C., approved a bill that would significantly alter the city’s medical marijuana program. The bill would, among other things, remove licensing caps on cannabis businesses, reduce taxes for operators, increase efforts to promote social equity, and establish new categories of regulated businesses, such as on-site consumption facilities and cannabis cooking classes.
Additionally, it would allow current “gifting” operators, who sell non-cannabis items in exchange for “free” marijuana products, to transition into the permitted market while granting authorities the ability to crack down on those who continue to operate unlawfully.
The measure, which had been revised by the Committee of the Whole earlier in the day, was passed by the full D.C. Council by a vote of 7 to 4.
A second reading vote by the Council is still required before it can be sent to the mayor’s office.
Pro-reform lawmakers have voiced concerns that the bill’s most recent iteration may have unintended consequences for social fairness by granting preferential treatment to already established medical cannabis outlets.
Legally, adults would be able to selfcertify their medical marijuana use according to the Medical Cannabis Amendment Act.
Council Chairman Phil Mendelson (D) introduced the legislation on behalf of Mayor Muriel Bowser (D).
A note prepared for the hearing by the Committee of the Whole states that the most recent print “retains a majority of the adjustments and additions made by” the Committee on Business and Economic Development (CBED), which passed the measure last week.
It had progressed out of a different panel before.
Dispensaries’ Cashless ATM Transactions Get The Ax
Cannabis dispensaries in several states were left scrambling to find ways to process transactions without cash when a popular workaround to federal banking regulations known as cashless ATMs stopped working for many retailers beginning last week. Cashless ATMs, also known as “point of banking” systems, allow customers to use bank cards instead of cash at cannabis dispensaries, giving retailers and their patrons alike more flexibility when processing transactions for marijuana purchases.
But beginning last week, some of the biggest ATM transaction processors including NCR Corp.’s Columbus Data Services have shut down the ability of cashless ATM transaction processors to use their service, according to unidentified sources cited by Bloomberg. NCR declined to comment on the situation, according to the report.
“This is a pivotal point in cannabis banking,” Ryan Hamlin, chief executive officer of payment technology provider Posabit Systems Corp., told Bloomberg about the cashless ATM shutdowns.
Notice Given Last Year
Late last year, international payment processing giant Visa announced in a memo to retailers that it “was aware of a scheme where POS devices marketed as ‘Cashless ATMs’ are being deployed at merchant outlets.”
The system worked by rounding up purchases, often to multiples of $20, to make the transaction appear to be cash disbursements. Instead, only the change from the transaction would be returned to the customer, and the dispensary would keep the rest to cover the payment for the purchase.
“Cashless ATMs are POS devices driven by payment applications that mimic standalone ATMs. However, no cash disbursements are made to cardholders,” the December 2021 memo continues. “Instead, the devices are used for purchase transactions, which are miscoded as ATM cash disbursements. Purchase amounts are often rounded up to create the appearance of a cash disbursement.
In April, Bloomberg reported that cashless ATM transactions were able to be processed because they were disguised by listing an address of a nearby business such as a fast food restaurant instead of the actual dispensary address. An estimate put the portion of cannabis sales processed through cashless ATM transactions at 25% of the $25 billion in projected annual dispensary sales.
“Those sales could generate more than $500 million in fees for payment processors, based on average purchase sizes,” Bloomberg reported.
Banking Laws Hinder Legitimate Cannabis Businesses
The popularity of cashless ATM transactions is indicative of the difficulty federal regulations pose for cannabis businesses, even those operating legally under state law. Federal banking and money laundering laws put restrictions on the banking industry, making it difficult for financial institutions to provide traditional services such as credit card processing, loans, and deposit and payroll accounts. But cashless ATMs fail to pass muster with the federal regulations.
“The cashless ATM trend is damaging to investors, dispensaries, and consumers, as when it comes down to it, it’s blatant money laundering,” CannaTrac CEO Tom Gavin told High Times. “Instead of creating loopholes and using a cashless ATM, dispensaries should take advantage of other solutions currently on the market that are safe, legal, and transparent. A proper financial solution should be registered with FinCEN and have a money transmitter license, or be the agent of a sponsor or bank with a money transmitter license in their state.”
Hamlin of Posabit said that signs of the cashless ATM shutdown began to appear in November and increased last week. He estimated that by the end of the weekend, only about 20% of the cannabis industry was still able to use cashless ATM payments.
Cannabis dispensaries in Arizona, California, and Massachusetts have reportedly been affected by the shutdown of cashless ATM transactions, with employees at those shops recommending that they pay for their purchases with cash instead. Curaleaf Holdings, one of the largest cannabis retailers in the United States, reported in April that approximately one-third of the company’s dispensary transactions were processed through cashless ATMs.
“It’s left merchants in the lurch because it happened overnight, but the writing has been on the wall for a while now,” said Peter Su, a senior vice president at Green Check Verified, a consulting and software company that specializes in cannabis and banking.
Sahar Ayinehsazian, a partner at Vicente Sederberg LLP and co-chair of the law firm’s Banking and Financial Services Access Group, said that the shutdown of the cashless ATM system illustrates the need for the passage of legislation now pending before Congress that would allow legal cannabis businesses access to banking services.
“This shutdown further underscores the ongoing need for banking and financial reform for cannabis businesses and the passage of the SAFE Act,” Ayinehsazian wrote in an email to High Times. “While there can be no guarantee that the Act will open up payment processing for cannabis operators, the industry is very optimistic that its passage will facilitate access to legal and legitimate cashless payment options for cannabis operators.”
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