Germany’s coalition negotiations could become tense as the Christian Democrats (CDU) and Social Democrats (SPD) clash over the country’s marijuana law. The SPD, which championed the legislation last year, considers it a key achievement, while the CDU has always opposed legalization.
Following initial post-election discussions, CDU leader Friedrich Merz expressed optimism about forming a coalition government with SPD, describing the talks as productive. However, this cooperative atmosphere may not last.
The SPD-led coalition, which included the Greens and Free Democrats (FDP), pushed for the legislation in April last year, bringing Germany in line with the Netherlands, Portugal, Spain, Malta, and Belgium in decriminalizing marijuana.
Merz previously stated his party’s opposition to the law, telling Tagesschau before the election that the CDU intended to “fix” the law. Their manifesto went further, labeling legalization a failure and pledging to remove it.
The SPD, on the other hand, is still committed to cannabis reform and even called for further changes aligning with European standards.
Ahead of coalition discussions, CDU health policy representative Tino Sorge criticized the law as a “dangerous mistake,” arguing that it should be repealed. However, he acknowledged that coalition talks would ultimately determine the outcome. Given the differing positions and economic factors at play, a compromise appears likely.
The industry remains hopeful that a complete rollback is unlikely. Bloomwell Group CEO Niklas Kouparanis expressed confidence that major changes wouldn’t disrupt Germany’s medical marijuana market. He argued that reclassifying marijuana as a narcotic would be a complex and time-consuming process. Instead, he expects adjustments such as stricter regulations on nonprofit marijuana clubs and home cultivation limits.
From an industry perspective, the SPD’s legalization effort has positioned Germany as a key player in the medical marijuana sector. Any reversal could break an election promise and expose the government to legal challenges.
By November last year, nearly 400 marijuana social clubs had applied for licenses, though only a fraction had received approval. Kouparanis warned that revoking the law could lead to legal claims from already licensed clubs seeking compensation.
Beyond legal concerns, the economic impact is substantial. Sales of cannabis-based medicines covered by health insurance have doubled in three years, with further growth expected. Imports of medical marijuana quadrupled in 2024, with shipments rising to 31.7 tons over the year.
The CDU’s economic priorities might influence future policy. A CDU-led government could take a state-controlled but economically sensible approach to healthcare. Given the SPD’s weaker position in coalition talks, their ability to protect cannabis legislation remains uncertain.
Major North American marijuana companies like Trulieve Cannabis Corp. (CSE: TRUL) (OTCQX: TCNNF) are likely to keep tabs on the unfolding situation in Germany in order to assess whether potential market opportunities emerge or the new government scuttles the progress made in reforming the country’s drug laws.
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