Israel Investigates Canadian Cannabis: Examining the Impact on International Trade and Local Industry

Israel Investigates Canadian Cannabis: Examining the Impact on International Trade and Local Industry. Israel has initiated an investigation into Canadian cannabis firms, suspecting them of ‘anti-dumping’ practices. This inquiry, launched by Israel’s Trade Levies Unit in mid-January, probes the import of medical marijuana from Canada. The investigation stems from alleged harm to Israel’s domestic cannabis market due to these imports.

Israel is a significant market for Canadian cannabis, importing over 21,000 kilograms in 2023 alone for commercial and scientific purposes. This move to potentially restrict imports could severely impact Canada’s already delicate cannabis export sector, as Israel represents over a third of Canada’s cannabis exports by weight.

The investigation, triggered by the alleged financial harm suffered by Israeli companies from cheaper Canadian imports, covers the period from January 1, 2023, to December 31, 2023, for dumping activities and extends to December 31, 2023, for assessing damage to local businesses.

Danny Tal, of Israel’s Ministry of Economy and Industry, has requested detailed information from interested parties. Global Affairs Canada expressed disappointment over Israel’s decision, promising to review the details and engage with the affected Canadian exporters.

Ten Canadian firms have been named in the investigation, including Auxly Cannabis Group, Canopy Growth Corp., Cronos Group, and others. They have 30 days to respond with information and arguments.

Tilray, one of the named companies, has acknowledged receiving the inquiry but maintains that their exports to Israel have been lawful, originating from their Portugal facility.

This investigation is part of a broader issue, with countries like Australia, Colombia, and Jamaica previously accusing Canada of favoring its domestic cannabis industry over foreign imports. These concerns have been raised in various forums, including the World Trade Organization, highlighting the global implications of Canada’s cannabis trade policies.

Israel Investigates Canadian Cannabis: Examining the Impact on International Trade and Local Industry

Health Canada, overseeing cannabis imports and exports, states that such activities are strictly regulated, with international trade limited to countries compliant with United Nations’ drug control conventions. The agency emphasizes that each shipment requires a specific permit, ensuring adherence to international and Canadian laws.

The period of investigation will be:

• Jan. 1, 2023-Dec. 31, 2023, for any anti-dumping activities.
• Jan. 1, 2021-Dec. 31, 2023, for any damages to local business.

“The determination whether provisional measures are required and the estimated rate of the anti-dumping duty – according to which the provisional duty is set – will not be made before the interested parties have had the opportunity, within the time constraints of the law, to submit further information, evidence, their arguments and an answered questionnaire, if they so wish,” Tal wrote.

Canadian companies identified

As part of the investigation, 10 Canadian companies have 30 days to submit “information, evidence and their arguments” and answer a lengthy questionnaire.

The Canadian licensed producers (and headquarters) named in the investigation are:

• Auxly Cannabis Group (Toronto).

• Canopy Growth Corp. (Smiths Falls, Ontario).

• Cronos Group (Toronto).

• Decibel Cannabis Co. (Calgary, Alberta)

• Organigram Holdings (Toronto)

• SNDL (Calgary, Alberta)

• Tilray Canada and its subsidiary Hexo Corp., which have headquarters in Ontario and Quebec, respectively.

• Village Farms International (Delta, British Columbia)

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