criminal code AND OTHER LEGISLATION AMENDMENT (Removing Commonwealth Restrictions on Cannabis) BILL 2018
OUTLINE
The Criminal Code and Other Legislation Amendment (Removing Commonwealth Restrictions on Cannabis) Bill 2018 removes Commonwealth barriers to the legalisation, regulation and taxation of cannabis. As such, the passage of this bill would allow any State or Territory Government to legalise and regulate cannabis.
Adults should be free to make their own choices as long as they do not harm others.
The prohibition of cannabis casts otherwise law-abiding citizens as criminals, increases pressure on the criminal justice system and props up organised and violent crime.
Legalising cannabis is estimated to reduce annual Commonwealth law enforcement expenditure by around $100 million and increase annual GST revenue by around $300 million. A costing from the Parliamentary Budget Office outlining these estimates is attached to this explanatory memorandum.
Cannabis use is less harmful than alcohol use and tobacco use.
Legalising cannabis would improve access to cannabis for recreational, medicinal, industrial and other purposes. Access for medicinal purposes is currently hamstrung through excessive regulation.
Fears that legalising cannabis would threaten Australia’s poppy exports appear unfounded.
· Legalising cannabis would violate Australia’s treaty obligations (except if Australia were permitted to make a ‘reservation’ with respect to these obligations).
· These treaty obligations are overseen by the United Nation’s International Narcotics Control Board. This Board also oversees Australia’s poppy exports.
· In theory, the Board could threaten Australia’s poppy exports as retaliation for Australia legalising cannabis.
· However, Uruguay, Canada, the Netherlands, the United States and Jamaica are subject to the same treaty obligations but have nonetheless taken steps to legalise cannabis.
· In each case the Board has merely responded by stating that such steps violate treaty obligations. No more serious response has been forthcoming or proposed.
NOTES ON CLAUSES
Clause 1: Short Title
1. This clause provides for the Bill, when enacted, to be cited as the Criminal Code and Other Legislation Amendment (Removing Commonwealth Restrictions on Cannabis) Act 2018.
Clause 2: Commencement
2. This clause provides that the substance of the Bill commences on the day after the end of the 12 month period beginning on the day the Bill receives the Royal Assent.
Clause 3: Schedules
3. Each Act specified in a Schedule to this Bill is amended or repealed as is set out in the applicable items in the Schedule. Any other item in a Schedule to this Bill has effect according to its terms.
Schedule 1—Amendments to the Criminal Code Act 1995
Item 1 – Section 300.2
4. This item inserts a definition of cannabis, being a cannabis plant, any part of a cannabis plant and any product obtained from a cannabis plant.
Item 2 – Before section 301.1
5. This item inserts section 301.1A. This section prevents a regulation listing cannabis as a controlled or border controlled drug, plant or precursor, or a serious drug. It also prevents the Minister determining that cannabis is a controlled or border controlled drug, plant or precursor, or a serious drug.
6. As a consequence of preventing cannabis from being treated as a controlled or border controlled drug, plant or precursor, or as a serious drug:
a. a substance will not be treated as a serious drug alternative simply because it is an alternative to cannabis or has a psychoactive effect that is the same as, or is substantially similar to, the psychoactive effect of cannabis;
b. a substance will not be a drug analogue simply because it is an analogue of cannabis; and
c. the serious drug offences in the Commonwealth Criminal Code will not cover:
i. trafficking, cultivating, selling, manufacturing, importing, exporting or possessing cannabis,
ii. procuring children for these purposes,
iii. supplying cannabis to children, or
iv. exposing children to manufacturing of cannabis.
7. In line with laws banning the involvement of children with alcohol and tobacco, laws banning the involvement of children with cannabis will remain a matter for State and Territory Governments.
Item 3 – Section 301.2(2)
8. Subsection 301.2(1) defines ‘controlled plant’. Subsection 301.2(2) states that the purpose of the definition is to permit growing plants that are covered by the United Nations Convention against Illicit Traffic in Narcotic Drugs and Psychotropic Substances to be treated as controlled plants. This item limits this statement of purpose to ‘certain’ growing plants covered by the Convention. This limitation ensures that the statement of purpose is consistent with the exclusion of cannabis from the meaning of ‘controlled plant’, achieved by item 2.
Item 4 – After paragraph 320.2(2)(b)
9. This item excludes cannabis from the offence of importing psychoactive substances.
Schedule 2—Amendments to the Criminal Code Regulations 2002
Item 1 – Regulation 5B
10. This item repeals regulation 5B, which lists cannabis as a ‘controlled’ plant.
Item 2 – Subregulation 5E(1) (table item 1)
11. This item removes cannabis plant from a list of ‘border controlled’ plants.
Item 3 – Schedule 3 (table items 50, 51, 95 and 238)
12. This item removes cannabis, cannabis resin, HU-210 (a synthetic cannabinoid) and THC from a list of ‘controlled’ drugs.
Item 4 – Schedule 4 (table items 34, 35, 36, 71 and 194)
13. This item removes cannabinoids, cannabis, cannabis resin, HU-210 and THC from a list of ‘border controlled’ drugs.
Schedule 3—Amendments to the Crimes (Traffic in Narcotic Drugs and Psychotropic Substances) Act 1990
Item 1 – Section 3
14. This Schedule removes references to cannabis from the Crimes (Traffic in Narcotic Drugs and Psychotropic Substances) Act 1990. This makes the definitions of cannabis, cannabis plant and cannabis resin redundant. Accordingly, this item removes the definitions.
Item 2 – Section 3 (paragraph (c) of the definition of manufacture
15. This item amends the definition of ‘manufacture’ so that it no longer notes that the manufacture of a narcotic drug does not include the separation of cannabis or cannabis resin from a cannabis plant. This element of the definition becomes unnecessary given item 7, which excludes cannabis from the definition of narcotic drug.
Item 3 – Paragraph 6(1)(a)
16. This item amends the definition of ‘dealing in drugs’ so that it no longer includes the cultivation of cannabis plant with the intention of producing narcotic drugs.
Item 4 – Paragraph 6(1)(b)
17. This item amends the definition of ‘dealing in drugs’ so that it no longer includes the separation of cannabis or cannabis resin from a cannabis plant.
Item 5 – Subsection 15(2) (table item dealing with cultivation of cannabis plant)
18. Subsection 15(2) sets maximum penalties for offences involving ‘dealing in drugs’ by way of cultivation. Items 3 and 7 ensure that such offences do not cover the cultivation of cannabis plants. As a result, the reference in subsection 15(2) to the cultivation of cannabis plants is redundant. Item 5 removes that redundant reference.
Item 6 – Subsection 15(5) (table)
19. Subsection 15(5) sets maximum penalties for offences involving ‘dealing in drugs’ by way of the sale, supply or possession with the intention or sale or supply of a narcotic drug or psychotropic substance. Item 7 ensures that such offences do not cover the sale, supply or possession of cannabis. As a result, the reference in subsection 15(5) to cannabis is redundant. Item 6 removes that redundant reference.
Item 7 – Schedule 2 (table items dealing with Cannabis, Cannabis Oil and Cannabis Resin)
20. Item 7 removes cannabis, cannabis oil and cannabis resin from the definition of narcotic drugs.
21. Items 3, 4 and 7 together serve to exclude dealings in cannabis from the definition of ‘dealing in drugs’ in section 6. This in turn serves to exclude cannabis from the offences established by the Crimes (Traffic in Narcotic Drugs and Psychotropic Substances) Act 1990.
Item 8 – Part 1 of Schedule 3 (table item dealing with Tetrahydrocannabinols (THC) and their alkyl homologues)
22. Item 8 removes tetrahydrocannabinols (THC) from the definition of psychotropic substances, as well as their alkyl homologues, except where separately specified in Schedule 3.
23. This serves to exclude dealings in THC from the definition of ‘dealing in drugs’ in section 6. This in turn serves to exclude THC from the offences established by the Crimes (Traffic in Narcotic Drugs and Psychotropic Substances) Act 1990.
Schedule 4—Amendments to the Defence Force Discipline Act 1982
Item 1 – Section 59
24. Section 59 establishes offences for activities involving prohibited drugs. For the purposes of section 59, ‘prohibited drug’ means an ‘anabolic steroid’ or a ‘narcotic substance’, and ‘narcotic substance’ means a ‘border controlled drug or plant’, as defined under the Commonwealth Criminal Code.
25. The maximum penalties for the offences established by section 59 currently differ depending on whether the activity in question involves cannabis or a prohibited drug other than cannabis. The maximum penalties with respect to cannabis are below or equal to the maximum penalties with respect to a prohibited drug other than cannabis.
26. This bill amends the Commonwealth Criminal Code so that cannabis is no longer considered to be a ‘border controlled drug or plant’. As a result, cannabis is no longer considered to be a prohibited drug for the purposes of section 59.
27. Accordingly, this item amends section 59 to remove redundant references to penalties where the activity in question involves cannabis.
Schedule 5—Amendments to the Narcotic Drugs Act 1967
28. Schedule 5 limits the Narcotic Drugs Act 1967 to the regulation of drugs other than cannabis.
Item 1 – Section 3
29. This item amends the simplified outline of the Narcotic Drugs Act 1967 to remove reference to the regulation of cannabis for medicinal purposes. Reference to the licensing and permit schemes relating to other drugs is retained.
Item 2 – Section 4 (definition of cannabis)
30. This item removes a narrow definition of cannabis (namely, the tops of the cannabis plant) and adopts the broad definition in section 300.2 of the Criminal Code inserted by this bill.
Item 3 – Section 4
31. This item removes redundant definitions relating to cannabis.
Item 4 – Section 4 (definition of licence)
32. This item removes redundant references to cannabis licences from the definition of licence.
Item 5 – Section 4 (definition of permit)
33. This item removes redundant references to cannabis permits from the definition of permit.
Item 6 – After section 4
34. This item inserts section 4A.
35. Subsection 4A(1) states that nothing in the Act makes it an offence or contravention of a civil penalty provision for any person or body corporate to participate in the:
a. cultivation, production, manufacture, extraction, preparation,
b. transportation, distribution, delivery, brokerage, dispatch, trafficking,
c. offering, purchase, sale, trade,
d. exporting, importing,
e. use, consumption or possession of cannabis.
36. What subsection 4A(1) achieves would be achieved even in its absence, given subsection 4A(3). Hence subsection 4A(2) states that subsection 4A(1) is enacted for the avoidance of doubt.
37. Subsection 4A(3) states that a reference in the Narcotic Drugs Act 1967 to a drug does not include a reference to cannabis. This achieves the purpose of limiting the Narcotic Drugs Act 1967 to the regulation of drugs other than cannabis. This purpose could have been achieved by amending the Act’s definition of drug to exclude cannabis. However, this would have involved creating a legal fiction. Alternatively, the purpose could have been achieved by replacing the Act’s references to ‘drug’ with references to ‘drug other than cannabis’. However, this would have made the wording throughout the Act more long-winded and difficult to follow.
Item 7 – Section 7A
38. This item repeals section 7A of the Narcotic Drugs Act 1967.
39. Section 7A states that Chapter 2 and section 25A of the Narcotic Drugs Act 1967 apply to the exclusion of any State or Territory law that either provides for the granting of licences relating to medicinal cannabis, or prohibits activity authorised by Chapter 2 or section 25A.
40. This bill removes Chapter 2 and section 25A of the Narcotic Drugs Act 1967. Hence section 7A of the Narcotic Drugs Act 1967 is redundant.
Item 8 – Section 8
41. This item amends section 8, which allows regulations to provide that a substance is a drug for the purposes of the Narcotic Drugs Act 1967, so that this does not apply to cannabis.
Item 9 – Chapter 2
42. This item repeals Chapter 2 of the Narcotic Drugs Act 1967.
43. Chapter 2 establishes licences for persons to cultivate, obtain and produce medicinal cannabis. It then imposes criminal and civil penalties on persons who are licensed or authorised under a licence, if they cultivate, obtain or produce cannabis, or do associated things, in a way that is not authorised by the licence.
44. Following the repeal of Chapter 2, the Narcotic Drugs Act 1967 will impose no criminal or civil penalty on persons who cultivate, obtain or produce cannabis, or do associated things.
Item 10 – Section 11F
45. This item amends the simplified outline of Chapter 3 of the Narcotic Drugs Act 1967 so it no longer states that manufacture licences authorise manufacture for purposes relating to medicinal cannabis.
Item 11 – Section 11K
46. Item 6 ensures that the licensing regime for the manufacture of drugs established by Chapter 3 of the Narcotic Drugs Act 1967 does not apply to cannabis. This makes section 11K, which provides particular rules for manufacture licences involving cannabis, redundant. Accordingly, this item repeals section 11K.
Item 12 – Paragraph 11N(i)
47. This item repeals paragraph 11N(i), which requires manufacture licences to specify the purpose for which cannabis manufactured under the licence is to be supplied. As the licensing regime will not apply to the manufacture of cannabis, such a requirement is redundant.
Item 13 – Section 12F
48. Section 12F states that conditions of a manufacture licence may relate to various things. With the enactment of this bill, manufacture licences will not relate to cannabis. Accordingly, this item amends section 12F to remove reference to conditions relating to:
a. the use of names of symbols that may suggest or imply a particular effect upon humans of a drug or narcotic preparation that contains cannabis;
b. advertising in relation to drugs or narcotic preparations that contain cannabis; and
c. the labelling of medicinal cannabis products.
Item 14 – Section 12L
49. Section 12L states that requirements in section 11K, which is repealed by item 10 of this bill, are conditions of a manufacture licence relating to cannabis. This item repeals section 12L as, with the enactment of this bill, manufacture licences will not relate to cannabis.
Item 15 – Section 12M
50. Section 12M imposes a condition on manufacture licences relating to cannabis. This item repeals section 12M as, with the enactment of this bill, manufacture licences will not relate to cannabis.
Item 16 – Section 14H
51. Section 14H is the simplified outline of Chapter 5, which deals with matters such as the Secretary’s powers and the review of decisions. This item removes from the simplified outline a reference to directions powers with respect to cannabis and a reference to the authorisation of State and Territory agencies to carry out activities relating to cannabis.
Item 17 – Paragraph 14N(h)
52. Section 14N authorises information disclosures by the Secretary in various circumstances including circumstances relating to medicinal cannabis research. This item removes the reference to medicinal cannabis research as the Secretary will no longer gather information relating to medicinal cannabis research under the Narcotic Drugs Act 1967.
Item 18 – Paragraph 14P(1)(d)
53. This item amends section 14P so that it no longer allows the Secretary to give directions to past and present licence holders in relation to cannabis.
Item 19 – Section 15
54. This item amends section 15 so that it no longer allows the Secretary to require the destruction of cannabis.
Item 20 – Section 15B
55. This item amends section 15B so that it no longer states that directions may be given in respect of cannabis.
Item 21 – Section 15E
56. Section 15E lists decisions that are reviewable decisions. This item removes from section 15E references to decisions relating to cannabis, as these references are redundant.
Item 22 – Section 25A
57. Section 25A allows the Secretary to:
a. approve a State or Territory agency to engage in or contract out activities relating to cannabis; and
b. impose conditions on such an approval.
58. This item repeals section 25A. As a result, following enactment of this Bill, nothing in the Narcotic Drugs Act 1967 would prevent or constrain a State or Territory engaging in or contracting out activities relating to cannabis.
Item 23 – Subsection 27(4)
59. Section 27 sets out what regulations made under the Narcotic Drugs Act 1967 may provide for. This item amends section 27 to remove references to cannabis.
Schedule 5—Amendments to the Therapeutic Goods Act 1989
Item 1 – After section 52E
60. This item prevents the Secretary from applying the Poisons Standard to cannabis, as defined by section 300.2 of the Criminal Code. Not applying the Poisons Standard to cannabis will be consistent with the non-application of the Poisons Standard to nicotine in tobacco prepared and packed for smoking.
Statement of Compatibility with Human Rights
Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011
NARCOTIC DRUGS AND OTHER LEGISLATION AMENDMENT (REMOVING COMMONWEALTH RESTRICTIONS ON CANNABIS) BILL 2018
This Bill is compatible with the human rights and freedoms recognised or declared in the international instruments listed in section 3 of the Human Rights (Parliamentary Scrutiny) Act 2011.
Overview of the Bill
The Bill removes Commonwealth barriers to the legalisation, regulation and taxation of cannabis. Its passage would allow any State or Territory Government to legalise and regulate cannabis.
Human rights implications
Adults should be free to make their own choices as long as they do not harm others.
The Bill protects the right of self-determination, the right to freely pursue one’s economic, social and cultural development, and the right to freely dispose of one’s natural wealth and resources. These rights are recognised in Article 1 of the International Covenant on Economic, Social and Cultural Rights and Article 1 of the International Covenant on Civil and Political Rights.
Conclusion
The Bill is compatible with human rights because it protects the right of self-determination.
Senator David Leyonhjelm
Appendix A—Parliamentary Budget Office Policy Costing
Policy costing—outside the caretaker period
| Name of proposal: | Legalising marijuana |
| Summary of proposal: | The proposal would legalise all marijuana/cannabis/hemp use by adults, as well as possession, cultivation, processing, transport, trade, import and export. No excise would be imposed on marijuana. This proposal would also reduce the budgets of relevant federal agencies including the Australian Federal Police (AFP), Australian Criminal Intelligence Commission (ACIC), and the Australian Border Force (ABF) by the level of funding directly associated with marijuana law enforcement. An estimate of the effect of this proposal on total marijuana usage was also requested. The proposal would have effect from 1 July 2017. |
| Person/party requesting the costing: | Senator David Leyonhjelm, Liberal Democratic Party |
| Did the applicant request the costing be confidential: | ☒ Yes | □ No |
| Date costing request received: | 9 August 2016 |
| Date costing completed: | 21 September 2016 |
| Expiry date of the costing: | Release of the next economic and fiscal outlook report |
Costing overview
This proposal would be expected to increase the fiscal balance by $342.0 million and the underlying cash balance by $292.0 million over the 2016-17 Budget forward estimates period. This reflects the net impact of an increase in Goods and Services Tax (GST) revenue and a decrease in federal law enforcement expenses over this period.
The fiscal balance impact of this proposal differs from the underlying cash balance impact because the expense accrued in relation to GST payments to the states and territories is based on GST cash collections each month, which lag behind the accrual of GST revenue that occurs when consumer spending occurs.
The PBO has not made any assessment of the impact of this proposal on state and territory government budgets.
Revenue estimates have been rounded to the nearest $50 million. Departmental expenses have been rounded to the nearest $1 million.
Data sources
Australian Bureau of Statistics, 2012. The Non-Observed Economy and Australia's GDP, Canberra: Australian Bureau of Statistics.
Australian Crime Commission, 2015. 2014-15 Annual Report, Canberra: Australian Criminal Intelligence Commission.
Australian Criminal Intelligence Commission, 2016. Illicit Drug Data Report 2014-15, Canberra: Australian Criminal Intelligence Commission.
Australian Federal Police, 2016. 2015-16 Annual Report, Canberra: Australian Federal Police.
Australian Institute of Health and Welfare, 2013. National Drug Strategy Household Survey, Canberra: Australian Institute of Health and Welfare.
Australian Public Service Commission, 2016. APS Statistical Bulletin 2015-16, Canberra: Australian Public Service Commission.
Clements, K., Lan, Y. & Zhao, X., 2010. The demands for marijuana, tobacco and alcohol: inter- commodity interactions with uncertainty. Empirical Economics, 39(1), pp. 203-239.
Commonwealth of Australia, 2016-17. Attorney General's Portfolio Budget Statements, Canberra: Commonwealth of Australia.
Commonwealth of Australia, 2016-17. Department of Immigration and Border Protection Portfolio Budget Statements, Canberra: Commonwealth of Australia.
Commonwealth of Australia, 2016. 2016-17 Budget, Canberra: Commonwealth of Australia.
Crawford, F., Deards, B., Moir, B. & Thompson, N., 2012. Human consumption of hemp seed: prospects for Australian production, Canberra: Department of Agriculture, Fisheries and Forestry.
Ritter, A., McLeod, R. & Shanahan, M., 2013. Government drug policy expenditure in Australia
- 2009/10. Sydney: National Drug and Alcohol Research Centre.
Williams, J., 2004. The effects of price and policy on marijuana use: what can be learned from the Australian experience?. Health Economics, 13(2), pp. 123-137.