Written especially for FNM’s Daily Nugs Blog By Nigel Despinasse

Introduction

Governments worldwide are engaging in debates and decisions regarding their stance on cannabis. Malta is a pioneering country that legalized medical cannabis in 2018 and became the first in the EU to legalize recreational cannabis in 2021. With strategic geographical positioning in the Mediterranean and the potential for growth in the European market, Malta's cannabis industry presents numerous investment opportunities and prospects for economic growth. This article provides an overview of Malta's cannabis industry, including its historical background, legal framework, and the landscape of medical cannabis.

Historical Overview & Legal Framework - History & Cultural Use

Cannabis use in Malta predates the concept of recreational or medical legality. Early on, it was utilized for pain relief, insomnia treatment, and relaxation. While undocumented, local accounts mention a Maltese Landrace variety eradicated due to law enforcement crackdowns on cannabis.

Although some documented cannabis use existed in Malta during the 1930s and 1940s, recreational consumption notably increased in the 1980s with significant importation and circulation of cannabis flowers. However, the influx of synthetic cannabis in the country caused numerous issues and further stigmatized the plant, making it even more taboo.

Activism and involvement in Malta's cannabis legalization gained momentum with the arrest and sentencing of Daniel Holmes and Barry Lee, who spent ten years in Maltese prison on cannabis possession and trafficking charges. Holmes' best-selling memoir, depicting his experiences as a cannabis prisoner in Malta and within the prison system, played a pivotal role in mobilizing support for cannabis advocacy and influencing the passage of medical cannabis laws.

Production of Cannabis for Medicinal & Research Purposes Act

Malta's medical cannabis program operates under the Production of Cannabis for Medicinal and Research Purposes Act. This legislation allows for the production of cannabis intended for medical and research purposes. The Malta Medicines Authority provides guidance and evaluates applications for importing and distributing cannabis-based products.

Licensed wholesale distributors are authorized to import cannabis-based or synthetic cannabinoid products that comply with the Medicines Act and EU Good Manufacturing Practice. The production of medicinal cannabis necessitates a Letter of Intent from Malta Enterprise and adherence to EU good practices during inspections.

The Cannabis for Medicinal and Research Purposes Unit actively seeks scientific collaborations and promotes advanced research initiatives. The Medicines Authority collaborates with local institutions and offers the International Fellowship Programme to enhance research capabilities.

Current Legal Status of Cannabis in Malta

Currently, Malta has legalized cannabis for adult use, allowing individuals to grow up to four plants and possess up to 50 grams in their homes. The sale and purchase of cannabis operate through a "club" model, where individuals must join a cannabis club that adheres to specific guidelines:

• Maximum membership limit of 500 individuals per cannabis club.

• Prohibited operation within a 250-meter radius of schools or youth centers.

• Restrictions on advertising, including the prohibition of using the term "cannabis" in the club's name or any content that encourages its use.

• Individuals can only hold membership at one cannabis club at a time.

• Cannabis clubs must appoint a legal representative, and club administrators must have a minimum residency of five years. Additionally, all cannabis cultivation must be conducted by the club itself.

• Registration fee of €1,000 and an initial license fee starting at €8,750, valid for one year with the possibility of three-year renewals.

• Cannabis clubs will be non-profit organizations.

Economic Potential & Medical Cannabis - Potential for Foreign Investment

As the first EU country to legalize adult-use cannabis, Malta holds significant economic potential and opportunities for innovation. Legalization attracts investment, and being an early adopter allows Maltese companies to establish themselves successfully in research and understanding consumer preferences.

Kearny Attard, CEO of July Inc., a Maltese company working towards obtaining licensing, is focused on developing cannabis cultivars and genetics tailored to the preferences of Malta. Attard emphasizes that what works in the American cannabis market may not necessarily be effective in Europe, and vice versa, including flavors, effects, and even legal systems.

Future of Malta's Cannabis Industry - Opportunities & Challenges

The potential challenges for Malta's adult-use cannabis market are multifaceted. Firstly, navigating the complex legal landscape poses a significant challenge. As the first EU country to legalize adult-use cannabis, Malta is bound to encounter growing pains and a learning curve in implementing and managing the new system. 

Additionally, due to the nonprofit structure of the cannabis clubs, exporting cannabis is prohibited, limiting the market size. With a maximum membership limit of 500 individuals per club and a limited number of clubs, the inability to cater to tourists could result in massive lost revenue for the country.

Potential as a Leading European Cannabis Destination

Malta's infrastructure, capable of accommodating 2.6 million tourists annually despite having just under half a million residents, positions the country for significant potential in cannabis tourism.

Events like Carnival and Easter attract hundreds of thousands of tourists to the island, allowing them to experience Malta's local cannabis and partake in the festivities.

Conclusion

Malta, a small yet influential nation, has positioned itself as a trailblazer in the European cannabis market. Compared to other European countries, Malta has swiftly transitioned from cannabis being a punishable offense to full legalization for recreational purposes and the establishment of comprehensive research systems. The future of cannabis innovation looks bright in Malta.