Could European Cannabis Legalisation Come from Change in the Channel Islands?

By Oliver Bennett, Special Contributor to New Frontier Data

Primarily known either as tourist destinations or tax havens, the Channel Islands – a tiny archipelago positioned in the English Channel between the United Kingdom and the Normandy coast of France – are not traditionally known for being bastions of politically progressive policy. Nevertheless, the two British crown dependencies (i.e., bailiwicks) of Guernsey and Jersey find themselves leading the way for cannabis reform in Europe.

Guernsey (estimated population of 63,400) includes the islands of Alderney, Sark, and Herm, with smaller islands divided between it and Jersey (estimated population of 107,800). Technically part of neither the U.K. nor the EU, the islands instead are possessions of the British Crown, maintaining independent administrations. Their inhabitants are British citizens, though about one-sixth of Jersey’s residents are EU nationals.

Though Guernsey legalised medical cannabis in 2019, a lack of any licenced clinicians left patients required to import it from licenced clinicians in the U.K. For the past five months since the first dispensary opened in Guernsey, however, local doctors have been following medical-cannabis programs similar to those found in Canada, the U.S., and Australia – while doctors in the U.K. are only able to prescribe it in strictly limited terms via the National Health Service (NHS).

In the bailiwicks, medical cannabis can be prescribed for illnesses including chronic pain, gastrointestinal issues, side effects brought on by chemotherapy, and mental health issues. The Channel Islands recently exceeded 2,000 prescriptions while burnishing the program’s reputation.

So it is that the islands are leading the way in Europe, as local clinician Dr. Charlotte Cocks of Medicann Jersey described last fall.

They are in the “early steps of a promising new sector”, according to Neil Inder, president of Guernsey’s Committee for Economic Development, and one which has been attracting interest and investment both local and from overseas as a foothold for the inexorable advance of legal cannabis to Europe.

The COVID-19 pandemic hit as Guernsey officials were enthusiastic about its rising income from tourism. Mike Hopkins, Guernsey’s director of Marketing & Tourism, described 2019 as a positive year for visitor growth, “the key target segment of Guernsey’s tourism market in terms of both visitor volume and spend value. Following more than 20 years of decline, it is particularly encouraging to see the stabilisation and modest increase of staying leisure visitors, which started in 2015, continue into 2019.”

Guernsey’s law allows for local doctors to privately prescribe cannabis-based medicine products, provided that they are made to a pharmaceutical standard. Residents may also obtain a prescription from the U.K. to obtain their cannabis products via importation.

Last year, however, two deputy ministers submitted proposals to fully legalise recreational cannabis on Guernsey, similar to the model adopted in Canada, saying its use is widespread on the island and that there is a multi-million pound underground industry that the bailiwick could financially benefit from. The island’s former chief minister, Gavin St. Pier, lent his support to legalisation to better regulate, license, and tax the industry to boost the island’s economy.

New Frontier Data’s Chief Knowledge Officer John Kagia said that “across U.S. markets, we estimate that between 8% to 25% of visitors participate in recreational cannabis markets when visiting fully legal states, and so legalization would not only draw increased expenditures from cannabis consumers who currently visit the island but do not consume while there, but also attract new tourists who are interested in exploring the island’s cannabis offerings.”

Last year, the islands’ signed a joint Memorandum of Understanding (MoU) with the U.K.’s federal Home Office and the newly formed Bailiwick of Guernsey Cannabis Agency (BGCA).

The 2021 framework provided for up to seven cultivation licenses for medical cannabis in Guernsey, the first approval being afforded to 4C Labs, founded in 2018 in anticipation of the program. The licence cleared the way for the company to begin construction of a 40,000-sq.-ft., pharmaceutical-grade, organic cultivation facility.

Designed for genetics testing developed in Canada, 4C Labs’ CEO Greg Dobbin intends for the company to blaze ahead in development of the medical cannabis industry in the U.K., while seeking to broaden the company’s investor base as it develops and executes its growth strategy. Establishing cultivation this year, 4C Labs expects its first harvest in 2023.

Meanwhile, CBD production is likewise moving forward, as the BGCA issued the first  licence for that to Tina Bolding’s company Celebrated, which has been dedicating its efforts thus far to raising public awareness.

Watchers from the U.K. are bemused to consider Guernsey and Jersey as the avant-garde of cannabis. Yet, given Malta’s first-mover efforts late last year to establish a market ahead of Luxembourg, it has been left to relatively small countries to prove their agility ahead of more legislatively lumbering large states.

The next question for the bailiwicks is whether Guernsey will stir movement toward adult-use markets in the U.K. and EU, given the politically charged contexts for socioeconomic reforms on both sides of Brexit. Indeed, there are already calls for Guernsey’s legislative assembly to debate recreational uses of cannabis sometime before the summer.

St. Pier’s position that legalisation would bring gains for the island’s economy while reducing police costs have been echoed by others in the private sector, with Nicholas Morland, chief executive of Tenacious Labs, telling the Jersey Farming Conference that cannabis could rival the island’s successful finance industry. 

Of course, with a wide acceptance of the economic benefits of cannabis allied with their propitious financial and taxation arrangements, Guernsey and Jersey are already attracting investment. The cannabis wellness company Seed Innovations is incorporated in Guernsey. This year venture capital firm Leafy Tunnel launched the first-ever medicinal cannabis and psychedelics fund to be regulated in Guernsey, as part of a move to invest in alternative medicine. Bek Muslimov, co-founding partner of Leafy Tunnel, said: “We are proud to be the first-ever fund of this nature in Guernsey, and believe this jurisdiction will play a vital role in facilitating the growth of medical cannabis and psychedelic medicine soon.”

Cannabis giant Curaleaf, which acquired Emmac Life Sciences last spring, has established its Curaleaf International Holdings brand in Guernsey, with counsel provided by local legal specialist Collas Crill per several cannabis deals.

Might the Channel Islands’ example inspire the U.K.? That seems unlikely for the time being, despite the U.K.’s friendliness to CBD and the production – if not consumption – of medical cannabis.

For the time being, reform efforts seem to have stalled in the U.K., though London’s Mayor Sadiq Khan has announced three pilot efforts in the capital to decriminalise rather than prosecute those aged 18-24 for cannabis possession. It must be noted, however, that neither Khan’s own party nor the ruling Conservative majority favours that plan.

Dissent exists in the Channel Islands, too. Some politicians have feared that medicinal cannabis could tarnish Jersey’s reputation, and question the government’s ability to sufficiently regulate it. Neil Inder of the Committee for Economic Development shares the concern, admitting that “this is a new sector to Guernsey, so it’s really important we get it right.”

Should all continue to proceed apace, however, history may yet wind up being turned by the Channel Islands.

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