Dutch Lawmakers Take Step Toward Regulating Marijuana Production

(Bloomberg) -- The Netherlands moved a step closer toward regulating the production of marijuana after a majority in the lower house of parliament signaled its support for a draft law.

With just three weeks to go until general elections, 77 of the 150 lower-chamber lawmakers supported a bill put forward by the Democrats ‘66 party to introduce government regulation of cannabis cultivation. Prime Minister Mark Rutte’s Liberals did not support the legislation in The Hague Tuesday, though Labor, their coalition partner, backed the measure, which will now go to the Dutch upper house.

“Soft drugs are part of Dutch society, but the current system doesn’t work, and this bill will fix that’’, Vera Bergkamp, the D66 lawmaker who introduced the bill, said during an earlier debate in parliament in The Hague. Her proposal aims to regulate the production and supply of marijuana through a closed system to so-called coffee shops that sell the drugs to customers. 

The bill may now be the subject of negotiations on a new government after the March 15 election, with the Liberals and D66 among the largest of the mainstream parties seen as likely to be in talks on forming a coalition to exclude Geert Wilders’s Freedom Party from power, despite the fact the Freedom Party is leading the polls.

The Netherlands effectively decriminalized the use of pot for recreational use in 1976 but did not regulate the supply chain for the shops selling the soft drugs. Smokers carrying less than 5 grams (0.2 ounce) for personal use aren’t prosecuted, even it officially remains an offense. Unlike in many U.S. states, no plans have been put forward in the Netherlands to fully legalize marijuana.

Economic Contribution

The Dutch national statistics bureau, CBS, has estimated that the cannabis business contributed about 1 billion euros ($1.1 billion) to the national economy in 2010.

The Association of Dutch Municipalities strongly advocates regulation, as the authorities in many cities have become fed up with problems caused by those frequenting coffee shops. They’ve moved to restrict the number of outlets and have imposed strict rules to keep nuisance to a minimum for residents. Recent shootings at coffee shops in Amsterdam and fires in places where weed is grown illegally have added force to the argument for further government intervention.

“Weed is the only product that is being sold in shops in the Netherlands that does not have a quality check. Smokers do not know what they are smoking,” Bergkamp said in an interview late last year. Not only are health issues an important argument in favor of regulation, many coffee-shop owners also want to run their stores like a “normal business’’ and many judges no longer know how to handle the current “policy of toleration,” she said.

The Dutch Treasury could benefit by as much as 300 million euros a year by regulating the supply chain, Bergkamp estimated. Costs for policing would come down since crime and nuisance behavior would drop, and there would be an increase in energy revenue and income and corporate taxes from shop owners and growers, she said. 

Despite the passage through the lower house, there is no majority yet in the indirectly elected Senate for the regulation bill. Rutte’s Liberals, who were unwilling to back the draft law with general elections on the way, are the largest party in the upper house. Liberal lawmaker Foort van Oosten described the bill as “too simple“ as it does not address the export of weed and might lead to a flourishing street trade.

--With assistance from Corina Ruhe

To contact the reporter on this story: Anne van der Schoot in The Hague at vanderschoot@bloomberg.net.

To contact the editors responsible for this story: Alan Crawford at acrawford6@bloomberg.net, Eddie Buckle