For decades, marijuana was widely considered to be taboo. However, in more recent times, shifting public perception has led to marijuana being legalised in several jurisdictions. Opponents of marijuana legalisation point to social welfare and health concerns, while advocates point to marijuana’s medicinal value and the potential economic benefits of a legalised marijuana industry.
There is no doubt that legalised marijuana has become big business in places like Colorado and Washington. Even our Caribbean neighbours are seeking to cash in on this “green rush”. Jamaica recently decriminalised marijuana and is actively developing a wellness tourism industry around it, while Belize and Antigua are considering legislative reforms.
In T&T, marijuana remains very much illegal. However, it may be interesting to explore what a hypothetical legalised marijuana industry could mean for business here. Is it really a fabled pot of gold at the end of the rainbow, or just another half-baked idea?
Brand protection and intellectual property
Marijuana legalisation could create many business opportunities—not just for marijuana itself but also for related products and services like food, cosmetics and clothing. It would be important for any budding marijuana entrepreneurs to understand how to protect and leverage their intellectual property rights.
For this reason, the Jamaican Intellectual Property Office is one of the key stakeholders in Jamaica’s nascent legalised marijuana industry and has received trademark applications for everything from ganja tea to clothing to apps. Beyond basic branding and trademarks, entrepreneurs could also seek protection for any new and unique plant varieties that they develop as well as patents for new production tools or methods.
One particular area of focus in Jamaica is “geographical indication”. A geographical indication is a product that is protected as intellectual property based on characteristics directly related to its geographic origin.
Geographical indication protection has typically been applied to wine and spirits—think champagne, cognac or Scotch whiskey. However, Jamaica is hopeful that its marijuana can also attract geographical indication status. This would mean that in order for marijuana or related products and services to be branded as “Jamaican” they would need to originate there.
It would also protect against the use of misleading terms such as “Jamaican-style”. Jamaica probably has the edge over T&T when it comes to leveraging its historical association with marijuana, but there could still be opportunities for creative local entrepreneurs to add a “Trini” touch—like pairing marijuana with our world renowned cocoa to create the ultimate gourmet brownie, or with the Pitch Lake to create a unique wellness spa experience. In any case, it is worthwhile for entrepreneurs to be mindful of the unforeseen intellectual property rights and protections that they may be able to access.
Business risks and insurance
Marijuana is an agricultural crop. This means that any legalised marijuana industry would be subject to the same risks that currently plague other agricultural businesses—including pests, praedial larceny, droughts, floods and other natural disasters.
Many legal marijuana farmers in California saw their investments literally go up in smoke when their crops were devastated by widespread wildfires.
While insurance could be one way of potentially mitigating these risks, insurers have proven reluctant to insure marijuana businesses in those jurisdictions that have legalised it, leaving many entrepreneurs vulnerable.
Entrepreneurs could also face the risk of product liability claims from consumers who have bad experiences or reactions to their products. For example, edibles like brownies, cookies and cakes take longer to digest and produce a high. This can sometimes lead consumers to ingest greater quantities in order to feel the effects faster, with dangerous results.
Moreover, our understanding of the potential health risks of long term marijuana use, in particular its impact on pregnancy, cardiovascular and psychiatric health is still evolving and may leave a legalised marijuana industry open to lawsuits similar to those that have been brought against the tobacco industry in recent times. It would be important for businesses to utilise appropriate directions, warnings and disclaimers on their labels, though this alone would not eliminate the risk of product liability claims.
Licence fees and taxes
Licence fees and taxes have been a lucrative source of government revenue in jurisdictions that have legalised marijuana, earning Colorado an estimated US$200 million in tax revenue in 2016. However, complex licensing regimes have proven difficult for some entrepreneurs to navigate.
Additionally, even in jurisdictions with legalised marijuana industries, the black market remains competitive because its products are cheaper without the addition of taxes. For a legalised marijuana industry to be profitable, both for entrepreneurs and the State, there must be a robust and efficient regulatory and tax system in place.
Employment
Employers would likely be concerned about the potential impact of marijuana legalisation on workplace safety, productivity and absenteeism.
Employers would generally be entitled to prohibit the use of marijuana in the workplace, particularly where it would create a clear and obvious safety risk, such as where workers are required to operate heavy machinery.
However, there may be grey areas. Would a disabled worker, for example, be entitled to claim disability discrimination where he is terminated for using medicinal marijuana?
It would be important for employers to put in place clear policies to address marijuana use by their workers. Such policies should focus on the operational impact that marijuana use could have on the employer’s business, like the risks to workplace safety.
Public safety and regulation
Advocates of marijuana legalisation often argue that it would lighten our currently overburdened criminal justice system. While there may be truth to this assertion, even if marijuana were legalised, there would still need to be regulations and protections in place.
For example, there are currently strict advertising and packaging controls over alcohol and tobacco products, to ensure public safety and guard against such products being marketed to children. These types of controls should also apply to any legalised marijuana industry. It would also be important to implement clear road safety regulations and guidelines to ensure that people do not drive under the influence of marijuana.
This is particularly important given that, because blood and alcohol tests can detect marijuana weeks after it is used, field sobriety tests remain the main method of determining whether individuals are driving while under the influence.
Additionally, it would also be critical to implement strict controls to insulate any legalised marijuana industry from contamination with illicit funds derived from money laundering or trade in illegal substances.
Legalised marijuana is now a booming and profitable business in many jurisdictions. However, like with any business, it is fraught with both legal risks and opportunities.
While T&T is a long way from having a legalised marijuana industry, some of the issues discussed in this article can also apply to other industries. It is important for any entrepreneur in any industry to understand their legal rights, risks and obligations in order to ensure that any entrepreneurial seeds that they plant ultimately bear fruit.
Catherine Ramnarine is a partner at the law firm M Hamel Smith & Company
CATHERINE RAMNARINE
