The Bengal Bite 🐯 - Culture of Compliance - 03/27/2020
Cannabis is here to stay, and we see being “long regulation” as a way to back the ultimate winners in an industry that has a massive market opportunity. Operators able to navigate the rapidly-changing regulatory landscape are in a pole position to capture market share in a growing, multi-billion dollar market vs. competitors that are unable to process regulatory change.
Cannabis legalization throughout the United States generally has unfolded in a pretty consistent manner:
A state legalizes medical use to treat a short list of conditions where cannabis generally has been accepted to be therapeutic.
After getting comfortable with its initial medical use program, the state expands its list of qualifying conditions eligible for cannabis treatment.
The state adopts full adult use (recreational) legalization of cannabis.
The state updates and adds regulations as its medical and recreational cannabis programs evolve.
The natural progression is for a jurisdiction to "dip a toe in the water" with really basic/limited medical use legalization to start, followed by an expanded cannabis program with increased regulations as the state gets comfortable with the industry.
Each step of the legalization process requires a massive regulatory lift from operators, and those operators able to navigate the complexity of regulation often have an advantage when a jurisdiction expands its cannabis program further.
Operators that are able to navigate regulation are viewed favorably by government entities, and we see them as having a huge advantage. We back operators that demonstrate a "culture of compliance" since we believe it is those operators that will be awarded the industry's best opportunities.
Canada working on action plan against illegal online cannabis sales
Canada is working on a plan to hinder its thriving online market for illegal cannabis, potentially to the benefit of legal operators that have to compete with the illicit market and its lower cost of compliance.
Two New Cannabis Bills Would Set Violation Fines as High as $50,000 Per Day
Illegal cannabis operators, especially retailers, are prevalent in California and outnumber their legal counterparts. The California state legislature is attempting to correct this imbalance by targeting landlords and other third parties that assist and abet these illegal businesses with fines reaching as high as $50,000 per day.
Australia to increase scrutiny of imported medical cannabis
In Australia, over 90% of cannabis prescriptions are supplied via the import market. In order to ensure the safety of these products, the Australian Therapeutic Goods Administration plans to increase the inspection of imported products.
State plan to ‘harmonize’ marijuana programs would wreak havoc, critics say
The Maine legislature is moving to “harmonize” (consolidate) their medical and recreational cannabis programs across the state. A new bill would apply the same regulations to both programs and would allow the state to impose hefty fines on violators. Mass expansion of regulation with little advance notice is not uncommon in states where cannabis is already legal. An operator’s ability to navigate surprises on the regulatory landscape is vital to survival.