This bulletin was prepared by Fasken partner Martha Burnett (Nee Smit) and candidate attorney Roxanne Gilbert.
During President Ramaphosa’s State of the Nation address (SONA), he cheekily said about cannabis: “I can see when I start to talk about Cannabis, people get quite excited. I begin to wonder because they know about it, or know how it is used or are users themselves.”
He clearly read his audience correctly. The developments over the past two years in the cannabis industry locally, has seen the rise of many companies, cultivation and manufacturing sites. There has also been an increased craving for formal regulation and legislative guidelines to ensure that it is a legal substance within the boundaries of safety and acceptability
The President speech continued to give hope to many: “This year we will open up and regulate the commercial use of hemp products, providing opportunities for small-scale farmers; and formulate policy on the use of cannabis products for medicinal purposes, to build this industry in line with global trends.”
What is so exciting about this?
The strict regulatory requirements for cultivation and manufacture of cannabis for medicinal purposes raise the risk of excluding small-scale subsistence farmers from this growing industry.
In September 2019 President Ramaphosa attended an imbizo in Lusikiki, near Manhlaneni, Eastern Cape, where he addressed the local community and confirmed that “the cultivation of cannabis…can play an important role in uplifting the poorest regions in the country.” He recognised the importance of the cannabis industry in South Africa’s battle against unemployment.
The Eastern Cape has long been known for the growth of cannabis by subsistence farmers, despite it being illegal. We need to evolve in our thinking about Cannabis as being negative and harmful. When a farmer is trying to feed his or her family, they should be provided with legal and achievable means to do so – this does not translate to approval or condoning of the illegal use of drugs.
The community in the Pondoland village of Manhlaneni raised their concerns during a meeting last year with a small delegation of the Eastern Cape Department of Rural Development and Agrarian Reform.
They wanted to know where they fit into the bigger picture once cannabis is legalised. They confirmed that they are simply not able to compete with the big commercial cannabis market especially since they have extremely limited resources. The sheer cost of obtaining all the required licences from the South African Health Products Regulatory Authority (SAHPRA) to be able to cultivate the product is insurmountable for them.
It is with this in mind that we turn to Canada and how they managed to ensure that smaller farmers or companies are not excluded from the cannabis industry.
The Cannabis Regulations in Canada provides four different types of cultivation licences - standard, micro, nursery and hemp. Micro-licencing allows for smaller facilities to legally make a profit as it is unique in its security standards, operates with a minimum number of employees and storage monitoring is not as stringent as with standard licences.
One of the reasons for micro-licencing in Canada was to keep small scale companies out of the black market.
This model could potentially be applied successfully to the subsistence and smaller farmers and companies in South Africa wanting to join the cannabis industry. According to the New Frontier Data Report 2019 the inclusion of small-scale, rural farmers is a necessity. It states “they are often those most in need of the benefits of legalisation, with many cultivating the plant out of financial necessity. Furthermore, if they are not integrated into the regulated market, they will likely continue cultivating illegally, strengthening the illicit market, which could threaten the legal industry."
From the Presidents mouth to the Ministers‘ ears – “this year we will… formulate policy on the use of cannabis products for medicinal purposes to build this industry in line with global trends.”
This has been a long-awaited confirmation from the leader of our country that the formalities will be addressed with the relevant urgency it requires.
As we know the cannabis industry moves at a shockingly fast pace and with every new product that is reaching the market, whether legally or illegally, the need for proper regulation increases.
SAHPRA has been doing a good job, together with the Department of Health, but more support and assistance is required to provide them with the necessary platform in order to address the growing need for proper regulation.
Hopefully, 2020 will see a change in the South African Cannabis legislative framework with the Presidents plans and promises coming to fruition.