24 December 2021

Overview

The Narcotic Drugs Amendment (Medicinal Cannabis) Act 2021 (Amendment Act) provides for amendments to the Narcotic Drugs Act 1967 (Narcotic Drugs Act) to implement changes recommended by Professor John McMillan AO in his review of the Act on which he reported in 2019. The Amendment Act commenced on 24 December 2021 (commencement date).

The amendments to the Narcotic Drugs Act:

  • implement a single, perpetual licence model for medicinal cannabis regulation
  • support an innovative Australian medicinal cannabis industry for the benefit of Australian patients
  • reduce the regulatory burden and provide benefits to businesses.

Regulation amendments that are consequential to, and support, the above changes to the Narcotic Drugs Act were registered on 10 December 2021 on the Federal Register of Legislative Instruments and began on the same commencement date as the Amendment Act.

The Narcotic Drugs (Licence Charges) Amendment (Medicinal Cannabis Licences) Regulations 2021 amended the Narcotic Drugs (Licences Charges) Regulation 2016 to:

  • complement changes to the Narcotic Drugs Act for the single licence model
  • simplify or clarify existing requirements
  • provide for transitional requirements.

The Narcotic Drugs (Licence Charges) Amendment (Medicinal Cannabis Licences) Regulations 2021 amended the Narcotic Drugs (Licences Charges) Regulation 2016 to:

  • align terminology with changes to the Narcotic Drugs Act and Regulation
  • provide for arrangements over a transitional period to the end of the 2021-22 financial year.

Significant reforms to the medicinal cannabis permit framework have commenced at the same time.

New licences granted on and from the commencement date will be single licences under the amended Narcotic Drugs Act.

For existing licence holders, a transition process is underway to review their existing licence and permit documentation and to reissue them in the new formats following the above reforms.

The most recent stakeholder webinar undertaken on 13 October 2021:

Summary of changes

Licences

The main change for licences is to adopt a single licence model for medicinal cannabis regulation. In most cases, the licence will also be perpetual, meaning it will be granted for an unlimited period of time (but is subject to surrender, suspension or revocation in accordance with the Act).

Additionally, the licence template has been updated to provide clarity about the activities that are authorised, the premises and facilities where the authorised activities take place, and the people authorised to conduct activities. Imposed conditions have also been reviewed, with conditions regularly applied to all licences now included in the Narcotic Drugs Regulation 2016.

Sample documents

Example of new template - Medicinal cannabis licence - PDF 367KB

If you wish to apply for a licence, information and application forms are available at Application forms and guidance.

Permits

The changes to permits include significantly reducing the level of detail required, such as:

  • removing the need for individual plant strains and cropping schedules to be listed in the instruments, and
  • moving to approved supply categories to provide greater flexibility for licence holders to respond to changing business needs and opportunities.

Sample documents

Medicinal cannabis permit - Cultivation & Production - PDF 310KB

Medicinal Cannabis Permit - Manufacture - PDF 300KB

If you wish to apply for a permit, information and application forms are available at Application forms and guidance.

Fees and charges

In light of these reforms, changes will also need to be made to the medicinal cannabis fees and charges framework.

The existing fees and charges will remain applicable over the transitional period from the commencement date until the end of the 2021-22 financial year, 30 June 2022. Further information on fees and charges is published in the Medicinal Cannabis Cost Recovery Implementation Statement (CRIS).

During the transitional period, a review of the cost recovery model and fees and charges will be conducted, in light of the revised legislative framework and in accordance with the Australian Government Charging Framework. Industry will be consulted during this process, including on the timing of any changes to fees and charges to apply after 1 July 2022.

Reporting

Reporting will assist with education and compliance and maintaining Australia’s obligations under international drug conventions.

Reporting on cannabis stock held will include cannabis produced, purchased or imported, and the market it is supplied to (ie. domestic or international sales or retained for own manufacture activities).

Some requirements, such as the monthly reporting of cropping and strain information currently undertaken by some cultivators, will not be required once the new scheme takes effect.

It will not be necessary for certain genetic material (ie, seeds and tissue culture) to be included in regular reports, noting that oversight of those materials will be undertaken through record-keeping, ad-hoc reporting, and inspections.

ODC will continue to work with industry on implementing these reporting requirements.

Medicinal cannabis quarterly reporting template and guidance can be found at Application forms and guidance.

FAQ

How will the single licence framework be more efficient and effective?

The consolidation of three licences into one licence will remove duplication, while still regulating the activities authorised under the licence. Additionally, the majority of single licences will be perpetual, reducing regulatory burden. For example, there will no longer be a requirement to go through a regular licence renewal application and assessment process for potentially multiple licences relevant to an entity's business operations.

What is a perpetual licence?

A perpetual licence is a licence granted without a fixed end date. It is anticipated that most licences with be granted on a perpetual basis, although the ability to grant a time limited licence where appropriate will be preserved. Licences that authorise non-commercial research will be time limited.

Licence holders will still be able to surrender a licence when it is no longer required. The Office of Drug Control will still be able to suspend or revoke licences where necessary or appropriate, such as for non-payment of annual charges or compliance matters.

The actual carrying out of activities authorised by a licence is controlled by permits, which will continue to be time-limited.

Will the single licence mean that every cannabis licence holder can cultivate, produce and manufacture?

No. Within the single licence structure, each licence will specify the activities which are authorised. This is because some aspects of the licencing process depend on which of these activities are proposed. For example, manufacture may require different security arrangements to cultivation.

This structure gives more flexibility to expand the coverage of the licence depending on the circumstances of each licence holder, rather than requiring a licence holder to apply for separate licences for different parts of the cannabis lifecycle.

Licensees can apply for a variation to add an activity at any time, for example, to add manufacture to a single licence that only authorises cultivation.

Will refunds be provided to licence holders that have paid multiple annual licence charges and site charges in 2021 once their licences are transitioned to the single licence model?

No. The existing structure and amounts for fees and charges remain applicable for licences and permits held prior to 24 December 2021.