Legal cannabis could see surpluses diverted to dark web

Success of the removal of restrictions on cannabis depends on enforcing the legal supplies grown by the cannabis clubs, to stop it from entering the stream of illicit marijuana

Safe and user-friendly... the dark web will become a new outlet for cannabis surplus growth in Malta
Safe and user-friendly... the dark web will become a new outlet for cannabis surplus growth in Malta

Malta’s bold step to legalise recreational amounts of cannabis has its critics concerned over various social aspects surrounding the creation of cannabis clubs, the not-for-profit associations that will dispense legally-grown cannabis.

As one lecturer in criminology told MaltaToday, much of the success of the removal of restrictions on cannabis also depends on enforcing the legal supplies grown by the cannabis clubs, to stop it from entering the stream of illicit cannabis.

Cannabis has consistently been the most used illicit substance among the Maltese: the European School Survey Project on Alcohol and Other Drugs, or ESPAD, found that one-third of 15-16-year-olds in 2019 found it easily obtainable –  in 1995, only 10% thought the same.

The legalisation of buying, dispensation, and home cultivation of cannabis will make that access even easier, allowing users to get their supply from regulated clubs rather than their dealer.

But there is opportunity in the new reform for those with a foot already in illicit territory. Demand for cannabis is high on the global market, and suppliers producing legal cannabis supplies could also be tempted into trafficking surplus volumes to illicit, high-value markets: one cannabis production facility in California with the capacity to process over 500 million pounds of marijuana was raided by police, which found only 20% of the cannabis grown being legal.

The question is to what extent could legalised cannabis clubs, specifically with their own growing facilities, end up dabbling in the illicit market.

Sandra Scicluna, a criminology lecturer, notes that the Bill being debated is not clear enough when it comes to supply. “How can you control the amount of plants being cultivated? It’s impossible,” she said.

If someone wants to buy 20kg of ‘licit’ cannabis, people will be pushed into a new black market. The defining factor for the reform is how supply limits will be enforced. Under the new law, people would be allowed to grow up to four cannabis plants in a single residence. When cultivating, one can keep up to 50 grams of dried cannabis in a residence.

Meanwhile, cannabis associations will only be able to distribute 7 grams per day to each member, with a maximum 50 grams per month.

Assuming that government is able to enforce these restrictions, risks of legalised cannabis clubs spilling into the illicit market are low. “This is because of economies of scale,” Scicluna explained. “It’s not entirely unlikely, but the profit margin for this product locally isn’t high. I’m not sure if it will be profitable.”

But as Scicluna said earlier, enforcing supply limits could be close to impossible. In this situation, Malta could also risk being used as an illicit production hub for cannabis to be sold on in places where the substance is banned. “It could facilitate the black market,” Scicluna said.

Existing organised crime groups who profit from Malta’s cannabis black market are unlikely to  face disruption through the new reform. The Criminal Intelligence Service of Canada reported in 2019 that such crime groups involved in cannabis were unlikely to be disrupted by legalisation, because they had other streams of revenue to benefit from.

And while Canada’s cannabis legislation made it harder for these crime groups to infiltrate the legal regime, these groups were adapting to changes in the market. Indeed, the EU Agency for Law Enforcement and Training says COVID-19 prompted a rise in the use of internet and social networks for purchase and distribution of drugs with DarkNet and postal services.

“Criminals have used courier companies, food deliveries and car-sharing services to distribute drugs. Retail of illicit products has shifted from streets to rented accommodations. Cannabis indoor cultivation and cannabis consumption have increased.”

The European Monitoring Centre for Drugs reports that the use of labour exploitation at cannabis cultivation sites is “a well-known phenomenon and remains an issue in some EU member states.”

Organised crime groups target vulnerable victims, mainly male irregular migrants, to work at indoor cultivation sites, where they are typically kept at the cultivation site, often in very poor conditions, to look after the cannabis plants.

The real challenge for Malta will be to stop legal growing facilities from turning into illicit production factories in an attempt to use cannabis-growing technology and expertise to generate high volumes of cannabis beyond the legal limits – and then export the surplus to other EU member states.

READ ALSO: Ministry plays down risk of proposed legal cannabis clubs feeding the black market