Sensing an opportunity to tap into a burgeoning market and steal an economic march on the UK mainland, they have gone their own way and introduced legislation aimed at making it easier for investors and companies alike to capitalize on hemp and medicinal cannabis cultivation on the islands.

They have been able to do this as the Crown Dependencies are both self-governing and have independent judicial rights, allowing them considerable autonomy, although in practice the UK does still represent them internationally and has some say in what goes on.

But exactly how does Jersey, Guernsey and the Isle of Man’s cannabis legislation now differ from the UK mainland? And how much say does the UK government still have in practice on their drug laws?

Guernsey

Cannabis possession, cultivation, supply or import is illegal in the States of Guernsey.

The plant is scheduled as a Class B drug, which means possession can and, in some cases does, result in a prison sentence.

However, Guernsey’s existing cannabis licensing system accepts applications from providers over the age of 18 who propose to cultivate and/or process low THC hemp plants, which are principally used for the creation of CBD products.

Licences are issued by the Director of Environmental Health and Pollution Regulation and renewed annually.

Holders must provide evidence on all facets of the operation from strain type, batch samples and extraction process to the security measures, staff DBS checks and main investors.

In the EU cannabis is deemed illegal if it has a THC content of more than 0.2%. But in the Bailiwick it works on a ratio basis of CBD to THC. It is legal to have a THC content of no higher than 3% of the gross CBD% in any single batch.

This means that for every 1,000g of CBD there can be no more than 30g of THC present.

To help support the development and regulation of this emerging industry, officers of the island’s Committee for Health and Social Care are currently working with the UK Home Office to agree a Memorandum of Understanding (MoU) in relation to the cannabis industry.

A spokesperson for the States of Guernsey said it is anticipated that these discussions will also provide routes for successful applications to produce Cannabis-based Products for Medicinal use (CBPM) and guidance for sample and product exports into the UK.

Confirmation of the agreement is expected to coincide with revisions to the existing licensing process.

Providing the MoU is agreed between the UK and the States of Guernsey, all applications and renewals for either CBD or CBPM cultivation and process are likely to be reviewed jointly with the Home Office.

The law in Guernsey does allow local doctors to prescribe cannabis-based medicine products privately, provided they are made to a pharmaceutical standard.

Residents are also allowed to obtain a prescription from the UK and arrange for the importation of cannabis products.

Guernsey Adult-Use Proposal

Last year 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 benefit financially from.

The proposal was passed by 24 votes to 14 and a Sursis Motive (deferral) adopted requiring the Committee for Health and Social Care and the Committee for Home Affairs to “report back to the States with options for alternative and non-punitive approaches to the possession and use of small quantities of illegal drugs”, which will be reviewed in December 2022.

Guernsey has also introduced clarification on potential Proceeds of Crime Act (POCA) conflicts, making it easier to invest in medicinal cannabis production.

As the law stands, if a UK-based person or company invests in a medicinal cannabis firm which also has a recreational cannabis arm to its operation – such as in the USA or Canada where both are legal – they could face a prison term or heavy fine.

This is because any dividends could be classed a proceeds of crime, as recreational cannabis remains illegal in the UK.

But new guidance issued in Guernsey means firms can invest in recreational cannabis if it is lawful in the country of origin.

Jersey

Jersey’s drug laws are not dissimilar from those in force on the UK mainland. Cannabis is a prohibited Class B drug and carries the relevant penalties.

However, on January 1, 2019, it became legal in Jersey to prescribe cannabis-based products for medicinal use.

A further relaxation in the law followed in April 2019, making it legal to import CBD-based products onto the island with a maximum 3% THC content by weight.

The coronavirus pandemic has resulted in further changes. Prior to Covid eligible patients from Jersey were allowed to visit private UK cannabis clinics in person for a consultation and prescription for a 28-day supply of medicinal cannabis which they could bring back to the island.

But on July 27, last year, this was updated to allow a three-month supply of medication to be imported.

A number of medical cannabis clinics have also legally opened on the largest of the Channel Islands, offering private prescriptions.

Jersey Farmers Can Use Hemp Flowers

Even before these recent changes, however, Jersey had a more relaxed attitude – especially when it comes to hemp.

In contrast to the island’s counterparts in England, Scotland, Wales and Northern Ireland, by law Jersey’s farmers have long been able to process the entire hemp plant, including the commercially valuable flowers.

With Jersey’s laws since 2017 allowing a 3% ratio of THC to CBD, it means that a product which is 50% CBD can legally contain up to 1.5% THC – making it easier and more efficient for farmers to process their crop.

In May 2017, Jersey Hemp became the first company in the Channel Islands to be granted a licence to grow the plant in more than 100 years by the Health Minister under the provisions of the 2009 Misuse of Drugs (General Provisions) (Jersey) Order.

Several additional licenses for hemp cultivation and processing have since been provided by the Government – including the processing of hemp flowers for the extraction of cannabinoids.

A licence for medicinal cannabis cultivation was first issued in December 2020 to Northern Leaf by the Jersey Cannabis Agency under an MoU with the UK Home Office.

A big driver in these changes has been Jersey’s desire to attract cannabinoid investors and companies as it looks to take a lucrative slice of the rapidly growing European cannabis market.

The island sees itself as a gateway to Europe, and with experts predicting that growing medicinal cannabis in Jersey could increase the island’s economic output by as much as £300m a year, it wants to carve out a niche for itself whilst the UK mainland dithers.

Not everyone on the island is happy about Jersey’s medicinal cannabis licensing regime, however.

In April this year, the Economic and International Affairs Scrutiny Panel was set-up to assess how robust the medicinal cannabis application process is to “ensure thorough due diligence is undertaken on applicants”; look at the impact on Jersey’s international reputation; and consider how economically beneficial this new sector will be for the island.

Once the review has been carried out, recommendations will be presented to the Minister for Economic Development, Tourism, Sport, and Culture and the States Assembly.

Isle of Man

The Isle of Man Tynwald (parliament) passed a new law allowing the cultivation, distribution and export of cannabis, in January this year.

The new rules permit a licensed person to produce cannabis-based products, including for medicinal use.

The regulations are designed to provide a safe and regulated export market for cannabis products ranging from industrial hemp to high quality medical cannabis.

The regulations are also aligned with current UK cannabis regulation and practice and do not change the Isle of Man’s domestic policy toward the use of cannabis by residents, which is still illegal for recreational purposes.

The changes follow a 2019 island-wide consultation in which 95% of all respondents were in favour of allowing the growing of cannabis for medicinal purposes.

The Canna Consultants drafted the legislation for the IOM last year. Co-founder and director Matt Lawson said: “Having assisted the government and the GSC, we have now transitioned to assisting market participants with their applications and we will engage with the GSC forthwith in order to progress matters on behalf of those clients. It is very exciting to have guided the government to this position and now to be guiding applicants onwards to medicinal cannabis production within sight of the UK.”

Under the update to the island’s Misuse of Drugs Act 1976, licenses are being issued by the island’s Gambling Supervision Commission (GSC) and will cost between £250 and £45,000 depending on the type of permit.

The government has estimated that the regulated production of cannabis could bring up to £3m per year into the Manx exchequer and generate around 250 jobs.

Applications for licenses for hemp production are opened last week and the island’s regulators are currently finalizing their approach to more sensitive, high-THC cannabis crops – the most relevant for the medical market – with detailed guidance expected soon.

Specialist doctors have been able to prescribe cannabis in certain situations on the UK mainland since November 2018 – a change in the law which also applied to the Isle of Man.

However, in practice this hasn’t been happening, and changes in the island’s own legislation to allow GPs to prescribe the cannabis-based drugs have been paused due to the coronavirus pandemic.

The UK

The UK is the world’s largest exporter of medical cannabis, yet the nation’s own drug laws don’t reflect this position.

It is illegal to possess, sell or distribute cannabis in the UK under the terms of the  Misuse of Drugs Act 1971, except in accordance with a Home Office license issued for research of commercial operations.

Cannabis is regarded as a Class B drug – having briefly been downgraded to a Class C in 2004 before being moved back into the higher category five years later. It sits with amphetamines, barbiturates, ketamine and codeine.

The government reviewed its drugs policies in 2019, but decided not to make any changes and maintains the position that it has no plans to decriminalize any on the banned list – including cannabis.

However, in November 2018 medical cannabis products were legalized in the UK. But access is restricted to a limited number of specialist practitioners and just three products.

The Home Office stated at the time that this meant ‘that senior clinicians will be able to prescribe the medicines to patients with an exceptional clinical need’.

Whilst the production and manufacture of cannabis in the UK is banned, it is legal to grow industrial hemp with a government license, although it is not considered an agricultural crop.

And unlike Jersey, growers are prohibited from using the flower and the bud of the plant under the Misuse of Drugs Act 1971. Only the mature stalk, seeds and fibre can be used in preparations.

However, importing processed hemp extract is legal in the UK, as long as it contains no controlled substances.

CBD Novel Food

CBD in its purest form is not a controlled substance in the UK and it is legal to market and buy products containing it. However, no CBD oil can contain more than 0.2% THC and no claims can be made about medicinal benefits.

The CBD industry currently operates under something of a regulatory grey area, which is why the UK and the EU is tightening up the rules when it comes to consumer marketing.

As CBD can’t make any medicinal claims and is not classed as a narcotic, it has instead been categorised as a Novel Food. Whilst the EU is still getting to grips with regulating CBD as Novel Foods, the UK’s Food Standards Agency has leapt ahead. Anyone wanting to market CBD had to submit its application – including a detailed dossier – by March 31.

After that date, products that have not submitted an application can no longer be sold in the UK. The FSA has also said that while it processes the applications, no new products can be introduced to the market.

To secure a licenses to grow cannabis with a THC content of more than 0.2% an application has to be made to the UK Government Home Office pursuant to the Misuse of Drugs Act 1971.

These applications generally fall into two categories with a Phase One license being granted for research purposes and a Phase Two license applicable to commercial growing and extraction operations.