Israel’s government is accusing some cannabis companies of violating the law

Israeli cannabis companies ‘Seach’ and ‘Canzen’, and perhaps a few others, are allegedly violating the drug ordinance by manufacturing and marketing overseas cannabis products in leisure markets, not under “medical” regulation – although this is not prohibited by section 38 of the Ordinance of Israel’s law.

This section of the Drugs Ordinance, called “Foreign Offenses,” states that an Israeli citizen is not allowed to own, use, manufacture or market cannabis abroad – even if he does so in a country where it is legally permitted. If caught, it would be considered a violation of Israel’s drug laws.

If you want to know more about cannabis, how some cannabis industries in Israel are violating the law by marketing overseas cannabis-based products, and to find out the latest hemp news, download the Hemp.im mobile application.

Both companies are doing businesses with their products in overseas markets

While “Seach” is allowed to manufacture and market cannabis for medical purposes in Israel, and has been doing so with a license for over a decade, production and marketing in the leisure market, which is not for medical purposes, is prohibited both in Israel and abroad, even if done in a country where such activity is legal.

For example, “Seach” holds 42.5% of Trichome Shell’s company that manufactures cannabis products with THC and CBD, prohibited components in Israel, and markets them in the US leisure markets, according to a stock exchange announcement.

In addition, “Seach” has also recently reported to the stock exchange that it has started additional CBD manufacturing and marketing operations abroad, in the Netherlands, in collaboration with a company called ‘Green Elements’, in which it holds 40% together with ‘Trichum’ – again, contrary to the instructions in the law.

“Canzen”, another public company traded on the Israeli stock exchange, also operates overseas in the CBD field, and also apparently does so in contravention of the drug order. The company has recently reported on operations in Bulgaria and earlier in Luxembourg, as well as in direct marketing, and more.

The Israeli government is already looking into this legal issue

The Securities and Exchange Commission, the body that oversees the activity of the stock exchange, issued a formal announcement about a month and a half ago regarding Section 38, based on the Justice Department’s position, that an Israeli corporation should not engage in non-medical cannabis markets.

According to the Ministry of Justice, any activity in the cannabis leisure market abroad is prohibited in any case by a company owned or controlled by Israel. The clarification states that the company will also be able to operate on the stock exchange even if it operates in a legal market, provided that foreign ownership.

“In accordance with the Justice Department’s position, it is not possible to list securities of a corporation incorporated in Israel if it directly or indirectly engages in cannabis recreational activities,” the official announcement from the Israel Securities Authority said.

Nevertheless, the authority does not work for enforcement and companies continue to operate normally. Inquiries to the Israel Securities Authority continued for a long time and on Tuesday, the Israel Securities Authority threw the responsibility and in reply to Cannabis magazine said that it was only the Ministry of Justice’s authority.

This created a situation where large, wealthy stock companies such as “Seach” seemingly act contrary to the drug ordinance while turning a blind eye on the authorities, whereas when it comes to citizens ordering CBD products from abroad it is considered a drug offense that is enforced as much as a drug offense.

CBD does not appear in the drugs ordinance

“Seach” and “Canzen” Companies declined to comment fully into the matter, but Canzen did present an opinion on behalf of the law firm Caspi & Co., in which the attorneys claimed that CBD does not appear in the drug order and therefore the activity was allowed.

However, contrary to the claims of Canzen’s attorneys, and although CBD does not appear in its explicit name in the drug ordinance as the THC compound appears, this component is considered illegal in Israel but for medical purposes only – and therefore marketing to the leisure market abroad is prohibited.

In the past, the police agreed to claim that since CBD does not appear in the order specified, it is not a dangerous and prohibited drug. However, after inquiring with the Ministry of Health, the police decided to withdraw from the notice and adopt the firm’s policy.

Recently, a petition has also been filed in the court where Israeli citizens who ordered CBD products from abroad have claimed that the component does not appear in the drug ordinance, and therefore it is permissible. However, the judge ruled that despite this, as the Ministry of Health argued, it is currently a prohibited drug.

Therefore, CBD is still considered illegal in Israel, although there are initiatives to deviate from the drug ordinance already in the coming weeks or months. There is even a draft bill prepared by the Ministry of Health and ready for government approval.

__

(Featured image by NickyPe via Pixabay)

DISCLAIMER: This article was written by a third party contributor and does not reflect the opinion of Hemp.im, its management, staff or its associates. Please review our disclaimer for more information.

This article may include forward-looking statements. These forward-looking statements generally are identified by the words “believe,” “project,” “estimate,” “become,” “plan,” “will,” and similar expressions. These forward-looking statements involve known and unknown risks as well as uncertainties, including those discussed in the following cautionary statements and elsewhere in this article and on this site. Although the Company may believe that its expectations are based on reasonable assumptions, the actual results that the Company may achieve may differ materially from any forward-looking statements, which reflect the opinions of the management of the Company only as of the date hereof. Additionally, please make sure to read these important disclosures.

First published in קנאביס, a third-party contributor translated and adapted the article from the original. In case of discrepancy, the original will prevail.

Although we made reasonable efforts to provide accurate translations, some parts may be incorrect. Hemp.im assumes no responsibility for errors, omissions or ambiguities in the translations provided on this website. Any person or entity relying on translated content does so at their own risk. Hemp.im is not responsible for losses caused by such reliance on the accuracy or reliability of translated information. If you wish to report an error or inaccuracy in the translation, we encourage you to contact us.