Webinar Takes on Bans & Enforcement

I gave a quick take-away shortly after the webinar:

“The DEA doesn’t have the resources, or the framework to work with currently, to prioritize cannabis enforcement.”

While I think that statement is accurate, there was a lot discussed that the statement doesn’t cover. 

Rescheduling 

State law takes precedence. Concerns of federal overreach into state programs are misplaced. State license holders will not be required to file for DEA registration. However, if registered with the DEA those licenses will be restricted to only conduct business with other DEA registrants. That begs the question of; why become a DEA registrant as a state-licensed business? I’m assuming the answer has a lot to do with U.S. tax code 280E, but that was an additional question on rescheduling for Jason Adelstone I thought of too late! 

All of that said, rescheduling is still effectively in limbo. There’s no finalized framework. This makes it difficult for regulators, enforcement officials, and especially operators to plan accordingly. The fact that registrants will be limited to only conducting business with other registrants, could lead to almost no state-licensed rec operators registering at all. It seems like a poorly conceived rule to put forward, but such is cannabis. It will be interesting to see how it all shakes out. 

Farm Bill Revisions

My thoughts on the bans are a little more nuanced than my quick take-away above. The synthetic stuff hits the chopping block on November 12, and honestly, good riddance. 

My primary concern coming into the webinar was the December 11 seed sales ban, and I do believe we got some clarity there. Nobody on the panel tried to crystal ball future pauses or extensions, so our discussion was based on the current December 11 timeframe. While Matt didn’t speak directly for the DEA, he was able to speak more broadly about department priorities. The reality is, the DEA does have limited resources and manpower. They cannot pursue everything, and cannabis takes a back seat to harder schedule 1 drugs (rightfully so). The idea that the DEA will be in a position to enforce any cannabis related bans by year's end is unlikely. There are a few circumstances in which enforcement could be quicker, but overall, it’s simply a lower priority. 

Now, that’s not to say that I think seed producers or breeders are in the clear post December 11. Far from it. I still believe this is setting up to be fairly devastating for many of them. However, it doesn’t appear that there will be any DEA enforcement immediately upon execution of the legislation. I suspect many of the larger outfits will likely fold (shut down seed sales), with medium to smaller outfits rolling the dice until the first arrests are made. 

Outfits holding federal FDA. USDA. or seed seller's licensing, especially those operating in illegal states, will face enforcement. Even licensing obtained prior to the original 2018 farm bill will not take precedence over new legislation. 

I have concerns about seedlings, clones, & tissue culture confiscation. While the new legislation specifically mentions seeds, was the omission of other starter material a mistake or by intent? Considering most cannabis legislation comes from politicians that don’t understand anything about cannabis, it’s easy to see how banning seed sales might disrupt the entire market. For a layman, seed represents “from the start”, and it’s likely clones or tissue culture weren’t considered last November. That said, would it be that crazy for a senator to add new language prior to December 11 that includes clones and tissue culture? Not really. It happens all of the time with bills. Furthermore, what’s going to prevent enforcement from confiscating clones & tissue culture once the ban is enacted, only to let a judge ultimately decide what’s legal or not?