Federal Marijuana Rescheduling Would Ease Restrictions On Advertising By The Industry, Congressional Researchers Say

If marijuana is rescheduled—as President Donald Trump directed in a recent
executive order—congressional researchers say the move could ease current
restrictions on advertising for cannabis products.

Moving marijuana from Schedule I to Schedule III of the Controlled
Substances Act (CSA) wouldn’t federally legalize the plant. But while it’s
commonly understood that the reclassification would have tax policy and
research implications, a lesser known effect concerns federal advertising
laws.

In a report from the Congressional Research Service (CRS) that was
published on Tuesday, analysts reiterated that many penalties associated
with marijuana would remain in effect if it’s rescheduled. That’s because
the CSA distinguishes cannabis from other Schedule III drugs with respect
to most criminal penalties.

“If marijuana moves to Schedule III, this does not mean that all marijuana
products would be lawful to manufacture, distribute, or possess,” CRS said,
noting that the only exceptions that could apply would require Food and
Drug Administration (FDA) approval of cannabis products in order for them
to be lawfully sold. Experts generally agree that the chances of such
approval for botanical marijuana that’s available in state-legal markets
are slim.

But rescheduling would mean that advertising restrictions applied to
Schedule I drugs would be lifted for marijuana, the report says.

“Some CSA penalties for marijuana are specific to its Schedule I
classification. For example, CSA advertising offenses are written
specifically for Schedule I,” it says.

“It is unlawful knowingly ‘to place in any newspaper, magazine, handbill,
or other publications, any written advertisement [that] has the purpose of
seeking or offering illegally to receive, buy, or distribute a Schedule I
controlled substance,'” CRS said. “The penalties for doing so are up to
four years in prison and/or a criminal fine. These penalties would no
longer apply if marijuana moves to Schedule III.”

The report also addresses the tax policy implications of reclassifying
cannabis under the CSA. If marijuana is moved to Schedule III, it would
make an Internal Revenue Service (IRS) code known as 280E “inapplicable to
marijuana businesses,” meaning they could take federal tax deductions
available to other traditional industries.

CRS also described the collateral consequences of past or current marijuana
use, regardless of rescheduling. That includes potential adverse employment
actions, a ban on gun possession, loss of federal housing opportunities,
immigration-related penalties and ineligibility for federal benefits such
as grants, loans, contracts and licenses.

“Most of the consequences for marijuana use or for marijuana-related
convictions would remain the same if it is moved to Schedule III,” it said.
“While the use of marijuana by prescription for medical purposes would
become lawful, marijuana products that are available in dispensaries in
many states across the country are not currently available via lawful
prescription.”

CRS also laid out considerations for Congress, which it said may take
actions to “affect the classification of marijuana and the consequences of
its use in any number of ways.”

“It could alter the schedule, declassify it as a controlled substance, or
even create a new schedule classification,” the report says. “Further,
Congress could seek to ease the criminal and collateral consequences of
marijuana use and marijuana-related convictions, leave them as they are, or
make them more severe.”


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Also last month, CRS put out a separate report clarifying that president
simply directed the reclassification of marijuana—but it must still be
finalized by the attorney general. And there’s a chance the Justice
Department could opt to start the process all over again, or even not
complete it at all.

Meanwhile, a coalition of Republican state attorneys general are
criticizing Trump’s decision to federally reschedule marijuana, saying
cannabis is “properly” classified as a Schedule I drug with no accepted
medical use and a high potential for abuse.

Last month, groups of House and Senate Republican lawmakers also sent
letters urging Trump not to reschedule cannabis. Trump, however, dismissed
those concerns—pointing out that an overwhelming majority of Americans
support the reform and that cannabis can help people who are suffering from
serious health issues, including his personal friends.

*Photo courtesy of Martin Alonso.*

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