A Guide to the Regulated Cannabis Sector on the Isle of Man

In recent years, the medicinal cannabis industry has experienced rapid growth worldwide, with many countries implementing regulations to capitalise on the expanding opportunities within the sector. As the legal framework for cannabis cultivation and distribution varies significantly from one jurisdiction to another, entrepreneurs, investors, and startups are increasingly seeking established, regulated jurisdictions that offer a secure and stable environment for investment. They are also looking for forward-thinking governments supporting the industry and recognising its potential.

Nestled in the Irish Sea between England and Ireland, the Isle of Man is a self-governing British Crown dependency known for its stable political and legal landscape. This article explores why the Isle of Man is emerging as a premier jurisdiction for medical cannabis companies to establish their operations. We will discuss the island’s robust regulatory environment and progressive outlook that embraces innovation and new industries. We will also share the success story of a medical cannabis company that has flourished since structuring its corporate entity on the Isle of Man.

The medicinal cannabis industry on the Isle of Man

In 2021, the Isle of Man regulated the cultivation, extraction, manufacturing, importation and exportation of medical and industrial-derived cannabis products.

The regulator on the Isle of Man is the GSC Cannabis, which is part of the Gambling Supervision Commission (GSC). This regulatory framework offers a multitude of licenses, providing flexibility for interested parties with varying areas of expertise and industry backgrounds, thereby fostering innovation throughout the sector. The diverse range of licenses includes Industrial Hemp, High THC Cultivation, Import/Export, Manufacturing and Extraction, Analysis, Research and Development and Transport and Storage.
To obtain a license for the cultivation, processing, or distribution of medical cannabis products, companies must comply with the EU’s Good Manufacturing Practice (GMP) guidelines.

The guidelines state that production processes must meet specific quality standards, including appropriate equipment, facilities, trained personnel, and effective quality control procedures. As a result, the Isle of Man has investment from global companies and has created a first-class environment for industry innovation, research, and product development.

Key facts and stats about the medical cannabis industry

Increasing legalisation, changing social attitudes and extensive scientific research into cannabis as an effective treatment choice for a number of medical conditions are key drivers behind the industry’s growth.

In 2022, the global medical cannabis market was valued at over $30 billion and based on current trends and projections, the market will be worth almost $60 billion by 2028 (Research & Markets).

Here is a breakdown of some of the market trends, policies, and major growth factors:

• There are more than 6 million registered medical cannabis patients in the United States alone, according to a study by the Marijuana Policy Project (ASA).
• Medical cannabis is used therapeutically by patients for a wide range of conditions, including chronic pain, anxiety, depression, seizures, nausea, Alzheimer’s disease, amyotrophic lateral sclerosis (ALS), Crohn’s disease, glaucoma, multiple sclerosis, and muscle spasms.
• Over 13,000 physicians in Canada prescribe medical cannabis, with the average administration of 2.1 grams of cannabis per day (CBC).
• 72% of British adults said they strongly support the legalisation of cannabis-based medicines by the British government, while 18% disagree (Hill Dickinson).
• At the end of 2019, there were less than 250 active medical cannabis users in the UK. By the end of 2024, that number is expected to rise to 400,000 (Statista).
• There is no such thing as a typical medical cannabis patient. A 2018 report from the Cannabis Consumers Coalition found medical cannabis patients come from all walks of life, ages, and backgrounds.

Choosing the Isle of Man

Favourable Tax Policies
With a 0% corporate tax rate, the Isle of Man has a very pro-business-friendly environment.
Geographical Location

The Isle of Man provides easy access to UK and European markets, making it an ideal location for companies seeking to expand their operations in these regions. The island’s strategic location also serves as a gateway to worldwide markets in North America, South America, and Asia.

People power
The Isle of Man has a highly skilled workforce with a strong emphasis on technology and innovation.

The Isle of Man is well-known for its forward-thinking approach and is a recognised hub for other industries, including cryptocurrency, eGaming, and FinTech. Regulators create an effective public-private partnership that helps new companies grow quickly while remaining 100% compliant.

The island’s robust legal framework creates a stable and secure environment for medical cannabis companies. The government has proactively established a supportive regulatory environment for the emerging cannabis industry. An example is introducing the Misuse of Drugs (Cannabis) Regulations 2020, the Transfer of Functions (Cannabis) Order 2020, and the Misuse of Drugs (Cannabis Licences) (Data Processing) Regulations 2022, which supplement the Misuse of Drugs Act 1976.

GrowLab Organics; an Isle of Man success story

Affinity Group assisted GrowLab Organics with bespoke corporate services to structure their entity in the Isle of Man.

GrowLab Organics is revolutionising how companies grow, process and utilise cannabis in the British Isles. The company brings together an interdisciplinary team of experts with backgrounds in agriculture, pharmaceuticals, marketing, and business, using the most advanced growing methods and cutting-edge equipment to produce the highest-grade medicinal cannabis.

The company built its own blockchain software to trace all its plants from soil to oil. It has already grown hemp under license in England with a sister company, and is about to begin the construction phase for a fully licensed medicinal cannabis research facility.
GrowLab Organics is thriving on the Isle of Man. Alex Fray, CEO of GrowLab Organics, credits much of the firm’s success to its location.

“The legal cannabis industry is highly regulated and exceptionally complex. As the first license holder in the Isle of Man, and one of the first in the British Isles, we are walking a largely untrodden path and as a result our business requirements are diverse and often time critical.
Working with Affinity feels like a partnership as they go above and beyond to deliver for us. They took the time to understand our unique business model and provided bespoke structuring to meet our needs. The team are committed to our success and are technically strong, professional and personable.
I can highly recommend Affinity’s services.”

How Affinity can help

As an established corporate service provider, Affinity helps companies set up and grow organisations in overseas jurisdictions. Our experience working with innovative companies in the eGaming and digital assets sectors gives us an in-depth understanding of the Isle of Man’s regulatory framework. This is demonstrated by our 100% licensing application success rate.

We have developed excellent working relationships with a network of intermediaries on the Isle of Man and the local government.
We offer a range of services to cannabis companies looking to expand to the Isle of Man, including:

• Cannabis consultancy
• Business plan assistance
• License application compilation
• Assistance with government grant applications
• Liaison with regulators, lawyers, and auditors
• Provision of company directors and secretaries.

“We approach the cannabis sector with the same commitment as other sectors,” says Andy Morgan, Affinity Group CEO. “As a multi-award-winning corporate service provider, we provide bespoke services tailored to each sector, with cannabis no different. Our team members hold exceptional expertise in licensing and the regulatory environment on the Isle of Man, and we welcome all inquiries from both the medicinal and industrial cannabis space.”