Knesset c'ttee approves cannabis export bill

Cannabis

The bill will now go to the Knesset plenum for first reading, but it is still unclear how the government will deal with the matter.

The Knesset Internal Affairs and Environment Committee today approved a bill to allow medical cannabis exports from Israel for its first reading in the Knesset plenum. "The bill is designed to give Israel Police the supervisory authority needed to open the medical cannabis market for export without jeopardizing public security," the announcement read. "Minister of Public Security Gilad Erdan and Internal Affairs and Environment Committee chairperson Yoav Kisch (Likud) agreed to promote the bill, which will allow exports of medical cannabis and give the police the necessary tools for supervising the medical cannabis industry and preventing dangerous drugs from getting outside Israeli territory."

The shares of cannabis companies listed on the Tel Aviv Stock Exchange (TASE) - Medivie Therapeutic (TASE: MDVU), Together (TASE: TGDR), Ophectra (TASE: OPCT), and InterCure (TASE: INCR) - rose following the announcement.

Despite the optimism among the cannabis growers and shareholders in companies operating in the sector, it is hard to tell how events will unfold.

In August 2017, an inter-ministerial committee that included representatives of the Ministry of Finance, Ministry of Health, Ministry of Agriculture and Rural Development, Ministry of Justice, Ministry of Economy and Industry, and Ministry of Public Security recommended legalizing cannabis exports from Israel. 280 farmers and 100 companies obtained preliminary permits from the state to establish farms for growing medical cannabis designated for export. Prime Minister Benjamin Netanyahu, however, recently suspended this decision, thereby increasing pressure on the cannabis sector on the TASE.

Erdan said, "As Minister of Public Security, my primary responsibility is to protect Israeli citizens and children from a flood of dangerous drugs in the country, with all of its consequences. I therefore backed the demand by the police for the authority needed to supervise the cannabis growing sites and for enforcement measures against anyone violating the terms of the license given to them, for the sake of preserving public security. A year ago, I agreed with the Ministry of Finance on the necessary conditions for making progress in the matter, but it breached the agreement and cut the police's budget and oversight capabilities. I therefore decided, together with Internal Affairs Committee chairperson Yoav Kisch, to promote his bill giving the police the necessary authority and allowing exports to begin without delay."

Kisch said, "The government has been talking to itself for a long time. One of the problems was arranging the budget for the Ministry of Public Security to supervise the additional cannabis farms that will probably be established if exports are approved. The police felt uncomfortable with going ahead with a plan that does not anchor supervisory authority in legislation. On the other hand, the other ministries were afraid that the bill would take a long time. We got the cart out of the mud through legislation. We took a bill I already had and adapted it to the government's decisions."

Kisch says that without this solution, a government decision on the matter cannot be taken. At the same time, he is careful to avoid promising that a government decision will be made when the bill passes. In principle, the processes should progress simultaneously when the bill removes the Ministry of Public Security's opposition. If this is the only barrier to the government's decision, as was officially stated, the bill is likely to release the logjam. On the other hand, if there are other interests in the way, the bill will probably have no effect on them.

At any rate, while the Israeli cannabis industry spent recent months hoping that Netanyahu would approve the beginning of exports, it now appears that the situation is more complicated.

Published by Globes, Israel business news - en.globes.co.il - on November 15, 2018

© Copyright of Globes Publisher Itonut (1983) Ltd. 2018

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