Will Malta’s Cannabis Club Model Be Adopted By Germany And Spain?

In many ways the European continent seems like it is on the cusp of hitting warp speed for cannabis policy reform, and if so, a potential rapid spread of the legal cannabis industry could be on the horizon. The most noteworthy evidence of this can be found in Germany right now, where an adult-use legalization measure is expected to be introduced in the first quarter of this year. Once the measure is formally introduced in Germany it will likely be followed by similar measures being introduced in other European countries. Malta may not have as much political clout as Germany, however, its approach to cannabis clubs and adult-use regulation will also likely have a large butterfly effect on its continental peers whether people realize it or not.

In late 2021 lawmakers in Malta passed an adult-use cannabis legalization measure. It was the first time since the start of cannabis prohibition that a European country passed a national cannabis legalization measure that did not involve any limits on THC content for consumers over 21 years old. Only two other countries on the planet passed such measures prior to Malta doing so (Uruguay and Canada). Malta’s legalization model involves allowing people of legal age (18 or older) to possess up to seven grams of cannabis and for adult households to cultivate up to four plants per residence. Consumers that do not cultivate their own cannabis will eventually be able to make purchases at non-profit cannabis clubs, and the proposed approach to regulating cannabis commerce in Malta via non-profit clubs could become a blueprint for other European countries to copy in the near future.

The Malta Model

Starting on February 28, 2023, aspiring non-profit cannabis club operators can apply for a license through Malta’s Authority for the Responsible Use of Cannabis (ARUC). Regulations for such clubs include (but are not limited to):

• A maximum of 500 club members
• Cannot be located within 250 meters of a school or ‘youth center’
• No advertising
• Cannot use the word ‘cannabis’ in the club’s name, or anything that would ‘incite use’
• At least two club founders with no prior convictions of money laundering
• Clubs must have a legal representative
• Club administrators have to be residents for at least 5 years
• All cannabis has to be cultivated by the club itself (out of public view)
• Registration fee of €1,000
• License fee starting at €8,750
• Initial licenses valid for 1 year, with 3 year renewals
• Labeling requirements
• Ongoing government auditing
• Product testing
• THC percentage caps for consumers 18-20 years old
• Consumers can only have a membership at 1 club at a time
• Revenue dispersal requirements

It still appears to be up in the air as to whether people will be able to consume cannabis on-site at the cannabis clubs, and while the current rules are fairly extensive, it’s always possible that they could evolve over time. After all, these new rules and regulations in Malta are brand new to the world by many measures, and there will no doubt be a need to tweak things as time goes on.

Will Germany And Spain Adopt Malta’s Approach?

Now that Malta is rolling out its legal cannabis commerce model, two countries that are of particular interest to me from a cannabis public policy standpoint are Germany and Spain, as they seem to be the European countries that will benefit the most from a ‘Malta butterfly effect.’ Make no mistake – Germany is on its own path towards legalization, and regardless of what is going on in Malta, the process for German legalization will continue. However, whether Germany will eventually have cannabis clubs and/or allow social use is unclear at this time, and it’s feasible that a successful rollout of clubs in Malta could encourage Germany to incorporate aspects of Malta’s legalization model as it pertains to those types of entities.

Spain, in my opinion, is much more likely to experience a cannabis public policy butterfly effect from what is going on in Malta compared to Germany. Spain is already home to numerous private cannabis clubs, albeit unregulated ones, and so it’s much more of an apples-to-apples comparison. Many, if not all, of the non-profit club provisions that are being adopted in Malta could also be adopted in Spain if lawmakers were willing to make it happen. Malta has quite literally provided Spain with a blueprint of how to regulate non-profit cannabis clubs. Of course, enough time will need to go by in order to know that the current regulations are sensible, but Malta’s approach is already better than Spain’s in that a formalized approach actually exists and is being implemented.

Malta may not have a huge economy or enormous population, yet, its approach to regulating cannabis commerce is historic in many ways, and the significance of the approach cannot be overstated. Being the first country on a continent to regulate adult-use cannabis commerce at a national level is not easy. After all, there is no guidebook for such an endeavor other than what has gone on in Uruguay and Canada, and even strategies from those countries aren’t always applicable on the other side of the Atlantic Ocean. A successful launch in Malta would be a win not just for consumers within Malta’s borders, but also potentially for consumers across the European continent.