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Germany unveils scaled-down recreational cannabis legalization plan

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The German government is backpedaling on its plan to implement nationwide recreational cannabis legalization, instead opting for a two-track, scaled-down approach with limited commercial opportunities – for now.

Germany’s new blueprint for a regulated cannabis industry, unveiled Wednesday, features two pillars:

Germany is the latest country to scrap, postpone or otherwise present significantly watered-down cannabis legalization plans after originally promising full-scale legalization.

These policy pivots offer an important lesson to businesses on the importance of acting strategically and not reflexively.

Israel, Mexico and New Zealand have all unveiled ambitions to legalize and regulate adult-use cannabis in recent years, only to see those plans fizzle out for various reasons.

After unveiling a blueprint in October 2022, Germany’s draft framework was sent to the European Commission, the European Union’s executive branch, for approval to ensure compatibility with EU and global drug laws.

It’s clear that process did not go to according to plan for the current German government.

Germany’s government said it agreed to rethink its cannabis legalization blueprint after discussions with the EU Commission and taking international law into account.

The new scaled-back plan aims to:

  • Control quality.
  • Prevent the transfer of contaminated substances.
  • Protect minors.
  • Protect the health of consumers.
  • Curb the black market.

Germany’s federal government said it intends to present a draft law to parliament soon in addition to continuing efforts to promote the German approach of cannabis regulation to its European partners, particularly through missions abroad.

In the medium term, Germany is also examining the extent to which a sufficient number of EU-member countries could initiate their own cannabis regulation initiatives to comply with the relevant EU legal framework.

“The previous restrictive handling of cannabis in Germany has failed,” Federal Minister of Justice Marco Buschmann said in a news release.

“It’s time for a new approach that allows more personal responsibility, pushes back the black market and relieves the police and public prosecutor’s offices.”

‘Reality check’

Marla Luther, chief strategy officer at Avextra, a medical cannabis company in Germany, said the country was restricted by EU treaties in a way that Canada wasn’t when it legalized recreational cannabis in 2018.

Germany’s hands were tied because it’s part of the Schengen-area countries, which don’t have border controls.

“This was the biggest challenge on the European level – upholding the Schengen rules,” Luther said in an interview with MJBizDaily.

Avextra, a medical cannabis company with roots in plant-based medicine, is on a path to evidence-based cannabis medicines, similar to United Kingdom-based GW Pharma.

The Bensheim-headquartered company cultivates cannabis in Portugal and focuses on extracts-based innovation in Germany, where it sells into the medical market.

“The Germans have now found a way to figure out how to make this possible and still be compatible with EU treaties,” Luther said. “Maybe they were too robust in what they thought they could get through with the (EU Commission).

“They’ve had quite a reality check with (the EU Commission).

“There has to be a European-wide legal framework in order to make it possible. I think what you’re going to see now is Germany working a lot closer at the EU level to get a coalition together of seven countries or more.

‘Two-column’ model

Under the legalization plan Germany presented Wednesday, the nonprofit associations allowing personal cultivation and possession would be evaluated after four years.

If need be, this plan could be adjusted to account for issues related to health and youth protection as well as combating the illicit market.

Penalty-free possession would be allowed for personal consumption of up to 25 grams of cannabis.

Under narrow, clearly defined legal frameworks (which have not yet been determined), the associations would be able to jointly cultivate cannabis for recreational purposes for members to consume.

Commissioning third parties outside the association for cultivation would not be allowed, the government said.

Approval and monitoring would be carried out by state authorities, according to the news release, including compliance with quantity, quality and youth protection specifications and on-site inspections.

The German government said it might ban membership in more than one association.

Other details include:

  • Up to three female flowering plants would be allowed for home cultivation.
  • The number of members per association could be capped at 500, with a minimum age of 18. Members would have to live in Germany.
  • Reporting and documentation would be required for the quantities produced and delivered.
  • Membership fees would cover the association’s expenses.
  • The possibility of importing seeds from third-party countries for the associations is being examined.
  • A general advertising ban would be imposed on associations and for cannabis, but the government said “factual information” is acceptable.

The second pillar will focus on regional pilot projects with commercial supply chains.

Luther, the Avextra executive, said the key for the recreational-focused industry would be to see how strong the key performance indicators are for the proposed regional trial programs.

“At the end of the day, the biggest issue is going to be how big or small these model regions will be, and that’s how you know whether the business model is going to work,” she said.

The German government characterizes this pillar as “the next step on the way to a nationwide regulation,” according to the release, implying full legalization could still occur in the future.

The public policy goal of this step would be to create and collect data to scientifically examine the effects of a commercial supply chain on public health and youth protection as well as the illicit market.

Details for this pillar weren’t as fleshed out as they were for the nonprofit pillar.

Some key points include:

  • The project duration is expected to last five years.
  • Approval of the sale of edibles is being examined.
  • The trial would be scientifically monitored and evaluated, and the results will be shared with European partners and the EU Commission.

Source: https://mjbizdaily.com/germany-unveils-scaled-down-recreational-cannabis-legalization-plan/

Business

EU Pressure Builds on Google as Regulators Face Calls for Massive Fine Over Search Practices

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A growing coalition of European industry groups is intensifying pressure on regulators to take decisive action against Google over allegations of unfair search practices that could reshape competition rules across the region’s digital economy.

Investigation Under Digital Markets Act Gains Momentum

The case is being examined by the European Commission under the European Union’s landmark Digital Markets Act (DMA), introduced to curb the dominance of major technology platforms and ensure fair competition.

Launched in March 2024, the investigation focuses on whether Google has been prioritising its own services in search results, potentially disadvantaging rival businesses that rely on online visibility to reach customers.

Industry Groups Demand Swift Action

Several prominent European organizations have jointly urged regulators to conclude the probe without further delay. They argue that prolonged investigations allow alleged anti-competitive practices to continue, putting European companies—especially startups—at a disadvantage.

Signatories include the European Publishers Council, the European Magazine Media Association, the European Tech Alliance, and EU Travel Tech.

In a joint statement, these groups warned that delays in enforcement are affecting innovation, profitability, and growth prospects for regional businesses competing in digital markets.

Google Denies Allegations

Google has rejected claims of bias, stating that its search algorithms are designed to deliver the most relevant and useful results to users. The company has also proposed adjustments to address regulatory concerns.

However, critics argue that these changes are insufficient and fail to address the core issue of market dominance.

Potential Billion-Euro Penalties

If found in violation of the DMA, Google could face significant financial penalties. Under EU rules, fines can reach a substantial percentage of a company’s global turnover, potentially amounting to billions of euros.

Regulators may also impose corrective measures requiring changes to business practices, which could have long-term implications for how digital platforms operate in Europe.

Wider Implications for Big Tech

The case highlights ongoing tensions between European regulators and major U.S. technology firms. In recent years, the EU has taken a more aggressive stance in enforcing competition laws, aiming to create a level playing field for local businesses.

A final ruling against Google could set a major precedent, influencing future enforcement actions and shaping the regulatory landscape for global tech companies operating within Europe.

As scrutiny intensifies, the outcome of the investigation is expected to play a critical role in defining the future of digital competition across the European Union.

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Amazon Faces Potential Criminal Trial in Italy Over €1.2 Billion Tax Evasion Allegations

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Milan: U.S. tech giant Amazon is facing the prospect of a major legal showdown in Italy, after prosecutors in Milan formally requested a court to move forward with criminal proceedings over alleged tax evasion totaling approximately ₹12,500 crore (€1.2 billion).

The case targets Amazon’s European division along with four senior executives, marking one of the most significant tax-related investigations involving a global e-commerce platform in Europe.

Trial Push Despite Multi-Million Euro Settlement

The move comes even after Amazon reached a financial settlement with Italian tax authorities in December, agreeing to pay around ₹5,500 crore (€527 million), including interest, to resolve part of the dispute.

Typically, such settlements lead to the closure of criminal investigations. However, Milan prosecutors have opted to proceed, signaling a tougher stance on alleged corporate tax violations.

A preliminary hearing is expected in the coming months, where a judge will decide whether to formally indict the company and its executives or dismiss the case.

Allegations of VAT Evasion Through Marketplace Sellers

At the center of the investigation are claims that Amazon’s platform enabled non-European Union sellers to avoid paying value-added tax (VAT) on goods sold to Italian consumers between 2019 and 2021.

Prosecutors allege that the company’s marketplace structure allowed thousands of foreign vendors—many reportedly based in China—to operate without fully disclosing their identities or tax obligations. This, authorities argue, led to substantial VAT losses for the Italian government.

Under Italian law, online platforms facilitating sales can be held partially liable if third-party sellers fail to comply with tax requirements, a key point in the prosecution’s case.

Italian Government Named as Affected Party

In their filing, prosecutors identified Italy’s Economy Ministry as the injured party, citing significant financial damage resulting from the alleged tax evasion.

Legal experts say the outcome of the case could have wide-ranging implications across the European Union, where VAT systems are harmonized and similar compliance rules apply to digital marketplaces.

Multiple Investigations Add to Pressure

The VAT probe is just one of several legal challenges facing Amazon in Italy. The European Public Prosecutor’s Office is reportedly examining additional tax-related issues covering more recent years.

Meanwhile, Milan authorities are pursuing separate investigations into alleged customs fraud linked to imports from China and whether Amazon maintained an undeclared “permanent establishment” in Italy—potentially exposing it to higher tax liabilities.

In a separate regulatory action, Italy’s data protection authority recently ordered an Amazon unit to stop using personal data from over 1,800 employees at a warehouse near Rome.

Amazon Denies Allegations

Amazon has consistently denied wrongdoing and indicated it will strongly contest the allegations in court if the case proceeds. The company has also warned that prolonged legal uncertainty could impact investor confidence and Italy’s appeal as a destination for international business.

Broader Impact on Europe’s Digital Economy

If the case moves to trial, it could become a landmark moment for the regulation of global e-commerce platforms in Europe. Governments across the region are increasingly scrutinizing how digital marketplaces handle tax compliance, especially in cross-border transactions.

With online retail continuing to expand, regulators are under mounting pressure to ensure that multinational platforms and third-party sellers adhere to the same tax rules as traditional businesses.

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Aviation

IndiGo Crisis Exposes Risks of Monopoly: What If Telecom or E-commerce Collapses Next?

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Airports across India witnessed scenes of distress and confusion as thousands of passengers were stranded due to IndiGo’s massive flight disruptions. Families with medical emergencies, funerals, and personal crises were left helpless as the airline cancelled hundreds of flights without adequate communication or support.

Passengers described desperate situations — a mother pleading for sanitary pads for her daughter, a woman unable to transport her husband’s coffin, and others stranded while trying to reach family funerals or hospitals. “It was like a lockdown at the airport,” one passenger said, describing the panic that unfolded as IndiGo’s mismanagement crippled operations nationwide.

Root Cause: IndiGo’s Market Monopoly

The turmoil, industry experts argue, stems from IndiGo’s monopolistic control over India’s domestic aviation market. The airline operates nearly 2,100 flights daily and holds around 60% market share — meaning every second plane flying within India belongs to IndiGo.

This dominance has given the company unparalleled influence. When IndiGo falters, the entire aviation system suffers. Passengers are left with few alternatives, as other airlines lack capacity to absorb stranded travellers. The result: skyrocketing ticket prices, chaos at terminals, and total dependence on a single private operator.

Aviation pioneer Captain G.R. Gopinath, founder of Air Deccan, criticised the government’s inaction, noting that on some routes, IndiGo’s economy fares surged to ₹1 lakh. He compared the situation to a hostage crisis, writing that the airline “held the system ransom” and forced regulators to defer new safety rules meant to protect pilots and passengers.

Government Intervention and Regulatory Weakness

The crisis erupted after IndiGo failed to comply with the Flight Duty Time Limitations (FDTL) — rules introduced by the DGCA in January 2024 requiring adequate rest for pilots. Despite having nearly two years to adapt, IndiGo blamed the rule for operational disruptions, citing a shortage of pilots.

Under mounting public pressure, the government stepped in, temporarily relaxing FDTL norms and capping airfare hikes. Officials claimed the move was to protect passengers, but analysts say it exposed the state’s vulnerability to corporate monopolies. “The government had no option but to yield,” said one aviation policy expert, pointing out that ignoring safety regulations for short-term relief could have long-term consequences.

The crisis also rekindled memories of the June 2025 Air India crash near London, which claimed over 240 lives. Experts warn that compromising pilot rest and safety standards to maintain flight schedules could risk another tragedy.

If Telecom Giants Fail: A National Paralysis

The article raises a troubling question — what if a similar crisis struck the telecom sector, where Jio and Airtel together control nearly 80% of subscribers and serve over 780 million users?

If both networks failed simultaneously, the repercussions would be catastrophic. Internet shutdowns would halt UPI transactions, online banking, OTP verifications, video calls, OTT streaming, and emergency communications. Critical services such as airports, hospitals, stock exchanges, and small businesses — many of which rely on WhatsApp and digital payments — would come to a standstill.

In essence, a telecom breakdown could paralyse India’s digital economy, exposing the nation’s dependence on a duopoly.

E-commerce Monopoly: Another Fragile Ecosystem

The same risk looms over the e-commerce sector, where Amazon and Flipkart dominate nearly 80% of the market. A disruption similar to IndiGo’s could cripple daily life — halting delivery of groceries, medicines, and essential goods, freezing refunds and customer support, and leaving small sellers without platforms to trade.

Local retailers, freed from competition, might exploit shortages by inflating prices. Such a scenario underscores the perils of market centralisation in sectors critical to everyday living.

A Wake-Up Call for Regulators

The IndiGo crisis, analysts say, is a warning shot for policymakers and regulators. A single company’s operational failure exposed systemic weaknesses in India’s infrastructure and consumer protection mechanisms.

As the aviation regulator DGCA investigates and IndiGo works to restore normalcy, the broader lesson remains clear: unchecked monopoly power in any essential service — whether air travel, telecom, or e-commerce — poses a direct threat to economic stability and citizen welfare.

Without stronger competition laws, redundancy frameworks, and regulatory oversight, India risks repeating this crisis across multiple sectors — each time with millions of citizens paying the price.

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