The past decade has been marked by a great deal of upheaval in laws governing the use of marijuana around the globe. Many countries have moved to legalize or decriminalize recreational use. Spain has experienced its share of upheaval, and there’s a lot to know if you’re thinking about getting involved in cannabis-related commerce in that country.
How do you open a cannabis coffee shop in Spain? The simple answer is that you don’t. Amsterdam has coffee shops. Spain has Cannabis Social Clubs (CSC). It’s important to know the difference before you decide whether opening one is right for you. Even if opening a CSC seems like something you’d like to try – there’s a lot you need to know.
With more than 700 Cannabis Social Clubs operating in Spain, you might be thinking that it is time for you to get involved. There are plenty of sites on the internet promoting individual clubs and Spanish cannabis tourism in general. Before you rush to cash in on the green gold-rush, be aware of Spain’s laws and the decade of legal uncertainty that hangs over the CSCs.
Can You Open a Cannabis Coffee Shop in Spain?
Does it really matter what you call a cannabis coffee shop? Would a coffee shop by any other name still sell weed? The answer is no. The differences between the coffee shops you’ve heard about in Amsterdam and the Cannabis Social Clubs you’ll find in Spain are important to know before you consider investing in a CSC.
CSCs first appeared in Spain around 2010. They took advantage of the particularities of Spanish law to create growers’ collectives that would allow marijuana users to grow and consume in a way that was both legal and social. It wasn’t long before the government pushed back on this idea, and the past decade has been marked by a series of court cases.
The lack of clear legal guidelines for operating a CSC has led to a wide range of approaches. Every CSC is established as a non-profit, members-only club. While some CSCs have tried to stay as close to the spirit of that designation as possible, others have decided to commercialize their clubs and hope that they don’t get shut down, fined, or sent to jail.
The present moment in Spanish cannabis culture is one marked by uncertainty. The most recent court cases have provided clarification on some important questions but created new confusion related to enforcement. While some clubs have shut down or restructured, others have continued to advertise and welcome visitors and tourists.
What Are You Getting Yourself Into?
It’s important to know how things came to be the way they are at present. Opening a CSC in Spain isn’t going to be the same in 2019 that it was in 2012. What operating a CSC will look like in the future is far from certain. For the rest of this article, we’ll try to give you the most current and relevant information available on everything related to CSCs in Spain.
The process of creating a CSC is fairly straightforward. Whether your CSC will be granted a license is another matter and worth discussing as a lead-in to the complex set of issues that surround the rules for CSCs and how they are enforced. There have been three precedent-setting Supreme Court Cases in recent years that help shed further light on the subject.
Once you understand how to create a CSC, what you’re getting yourself into if you choose to do so, and what the history of the clubs can reveal about what the future might look like—you’ll be able to decide whether opening a CSC is right for you. If you decide to go through with it, you’ll have to decide how to balance risk and opportunity for your club.
How to Open a Cannabis Social Club in Spain
In Spain, it is legal to consume marijuana – but it is only legal to grow or possess it in private. Before there were CSCs, anyone who needed access to medical marijuana or who wanted to use it recreationally would have to get by on what they could grow for themselves or go to the black market.
CSCs were meant to be a way for members to help each other out. Not everybody has a green thumb. Not everybody has the space to grow. Not everybody is comfortable with making legally risky purchases to get a product of unknown quality. By forming a club, everyone could pool their collective resources and get the added benefit of a place to socialize.
There are four basic steps required to establish a CSC in Spain. They are:
- Creation and Registration of the Club
- Membership Registration and Consumption Estimates
Creation and Registration of a Cannabis Social Club
Creating a CSC begins with holding a Constituent Assembly. This requires that you have at least three founding board members: a President, a Secretary, and a Treasurer. You must also have articles of association and a foundation charter that is approved, signed, and ratified by all members. The foundation charter must indicate the legal or registered name of the club.
Once you have held the assembly, you need to present your documentation to the registry of the autonomous community where your club is located in order to formalize the association. At that point, it is a good idea to join the Federation of Cannabis Associations (FAC) to give your club legitimacy and help contribute to the growth of the movement nationwide.
Membership Registration and Consumption Estimates
Each member of your club will have to formally register and provide you with a monthly estimate of their cannabis consumption. The sum of your members’ estimates will determine how much marijuana your club can grow or purchase without being exposed to the risk of trafficking charges.
Your members will also have to pay a membership fee and provide identification that proves they are of legal age. Members must acknowledge that they are regular users of cannabis and express their desire to belong to the club. They must not have a record of any crimes against public health.
All of these rules satisfy the state’s requirement that CSCs be an extension of efforts to combat trafficking and addiction. The desire to avoid negative consequences associated with drug use and trafficking is one of the primary reasons that Spain has avoided the commercial model found in some other countries in favor of the non-profit CSC model.
In an ideal situation, the CSC will grow all of the cannabis that its members consume. When that is the case, the club can only produce at the level of the membership’s total estimated consumption. Growing amounts that exceed the estimated consumption exposes the club to charges of trafficking. Each member is limited to 60 grams per month maximum consumption estimate.
When the club is not able to produce enough cannabis to supply its members, it is able to make a joint purchase on behalf of the membership. Again, the purchase must align with the estimated consumption of the club to avoid legal exposure.
Whether the club’s cannabis supply is grown or purchased, the club must communicate the costs of production or acquisition to its members with complete transparency. The final product price must be broken down, explained, and justified.
A CSC, in order to stay on the right side of the law, must not encourage or promote cannabis consumption to non-members. It must also offer assurances that all of its decision-making processes are democratic and that it provides mechanisms for member participation.
In any club, you are going to have some members who are very actively involved and others who are less so. As the association grows and it becomes necessary to appoint members to positions that are responsible for production, administration, accounting, management, and other roles – the process of filing spots must be democratic, and members have to participate.
Anyone who works for the club must have a contract, a salary, and all of the other requirements to satisfy labor and regulatory matters associated with employment. And, of course, all of this must be done in accordance with the club’s non-profit status.
What You Really Need to Know About Opening a Cannabis Social Club in Spain
Anyone who has spent a little bit of time researching cannabis culture in Spain knows that there are plenty of CSCs that look and act like for-profit businesses similar to the coffee shops of Amsterdam or the dispensaries in some U.S. cities. Are they getting away with stretching the rules? If they are, why shouldn’t you jump at the chance to follow suit?
CSCs began with an idea. Someone thought that they found a loophole in Spanish law and a good way to take advantage of it for the benefit of cannabis users who were tired of buying on the black market or smoking alone to avoid the legal risks of public consumption.
That original idea wasn’t a clearly defined statute, and so it was open to interpretation. In many instances, the courts have pushed back on the idea or sought to clearly define its boundaries. At the same time, others have taken the idea and run with it to set up CSCs that differ from coffee shops in name only.
There are plenty of ways that clubs can stretch the rules to increase their “membership,” which will correspond to an increase in the amount of cannabis that they can grow or purchase. But there are a lot of legal risks to running a club more like a business than a club. Beyond that, there are plenty of ways that could potentially go wrong.
Stretching the Membership Rules
One of the most common ways that CSCs stretch the rules to benefit their bottom-line is in the area of membership registration.
They can do this by relaxing the standards on membership age to the extent that the law allows, getting creative with how sponsorship works, or eliminating the waiting period most clubs have before new members can take cannabis out of the club or sponsor new members.
Most reputable clubs require members to be 21 or older, but Spanish law permits them to relax that standard to 18 years of age if they choose to do so. As we discussed, all members have to complete a registration form and pay dues when they register. Most clubs require a current member to sponsor an applicant for a new membership.
When clubs streamline the membership registration process to make their clubs accessible to tourists, they are stretching (some would say abusing) the system. Because more members mean a higher consumption estimate, those clubs can grow or purchase more. When those members are tourists, their future shares can add up to a stockpile for the club.
Stretching the Consumption Rules
When a club stretches its membership rules – or simply grows its membership rolls by way of infrequent visitors – it can end up with a monthly consumption estimate that far exceeds what its regular membership will use. With excess stock on hand, clubs find ways to stretch consumption rules to their advantage.
By law, the cannabis that a club has belongs to its members. Most clubs allow members to take small amounts out of the club with them for personal use at home. But the goal of the CSC system is to take cannabis use away from the black market and keep it away from the commercial market. The idea is that this is the best way to avoid abuses.
However, if a club can possess a hug stockpile and offer same-day membership to anyone who applies, they can also make the membership dues a way to skirt the laws against selling cannabis. Are the “members” paying dues, or are they really paying for the amount that they’re going to take with them when they leave?
Stretching Democracy and Transparency
If a club adheres to the spirit of the law, then it would be up to all of the members to decide whether to relax membership rules, push the limits with their consumption estimate, or anything else associated with the club’s operation.
Some of the largest CSCs in Spain reportedly have memberships in the hundreds. This makes it seem unlikely that every member participates in the club’s business – or even that the clubs do what is necessary to make sure every member has the opportunity.
Looking at these common areas where some clubs take liberties with the rules gives you a better idea of how CSCs can range from small, intimate organizations that stick to the letter of the law on one end of the spectrum all the way to the glamorous and exclusive clubs that you see advertising on the internet.
If you’re looking into opening a club in Spain with an Amsterdam coffee shop as the model for your expectations, you’ll have to adjust those dreams to accommodate the realities of the legal situation. That model goes against most of the goals that the Spanish government seems to have in choosing to permit CSCs but resist commercialized legalization.
The Evolution of Regulations and Enforcement Related to Spanish Cannabis Social Clubs
The most famous CSC in Spain is Pannagh. They were the first club to form an association using the model that we outlined above. It remains the model that CSCs use to create and register their associations in Spain. But the pride and prestige that comes with blazing the trail haven’t always been an easy road for Pannagh.
In 2006, very soon after Pannagh established its association, they experienced government pushback. The results of that original trial were mostly positive for the association. This led to a proliferation of clubs all over Spain. Between 2010 and 2014, their numbers increased from 40 to over 700. This period also saw the spread of the abuses that we outlined above.
As you might expect, the period of rapid expansion was met with another wave of government pushback. Many autonomous regions either placed a moratorium on issuing new licenses or severely curtailed the numbers. Three major court cases came out of this era. Each of the three took years to reach a resolution. Those resolutions are the foundations of where things stand for CSCs in Spain at the present moment.
The Case Against the Ebers Association
In September of 2015, Spain’s Supreme Court issued a ruling against the Ebers Association of Bilbao. The court’s decision resulted in €5,000 fines for each of the members of the association’s management board as well as eight-month prison sentences. The prison sentences were suspended in recognition of it being the first offense for each board member.
In the court’s ruling, they acknowledged the ambiguity of the laws regulating cannabis and that the defendants could have had reasonable doubts about the illegality of their actions. However, the court also stated:
cultivation and organized, institutionalized distribution of cannabis, on a long-term basis, among a collective consisting of 290 persons constituting an Association open to new members is a drug-trafficking crime.
The ruling didn’t do anything to clarify what a CSC could do to remain on the right side of the law, but it did establish a very clear line that CSCs could not cross without breaking the law.
The Case Against the Three Monkeys Association
The way that Spain’s legal system works make a second concurring ruling an important part of setting precedent in law. So, when Barcelona’s Three Monkeys Association received the same ruling and same sentence in December of 2015, the Ebers ruling gained even more authority.
Both Ebers and Three Monkeys appealed the Supreme Court’s decision. In each case, the ruling was declared admissible.
The Case Against the Pannagh Association
Like we said before, being first hasn’t always been a bed of roses for the Pannagh Association. They found themselves in court once again in 2015. This time, the members of the board were sentenced to one year and eight months in prison and ordered to pay fines of €250,000.
The third ruling by the Supreme Court not only strengthened the legal argument that a club’s size and membership practices could be used to determine whether it was a permissible club or a drug-trafficking organization but also deprived clubs of the argument that the law was unclear.
The fallout from these decisions saw many clubs shut down, and many others re-organize to try to align with the new legal realities. At the same time some clubs, particularly those associated with the Catalan section of the Cannabis Association Federation, decided to resist the rulings and disobey what they consider to be an injustice.
Pannagh Association’s Appeal
As recently as January of 2018, the board members of Pannagh Association had their sentences overturned by the Constitutional Court of Spain. After nearly six years of negotiating the judicial process, the members were able to secure the verdict based on the Court’s interpretation of the legal process.
The case wasn’t overturned on anything related to the legality of CSCs, and the case goes back to the Supreme Court for a new verdict. The Pannagh Association remains closed according to the most recent information available – while they wait for the case’s ultimate resolution.
Where Things Stand with Cannabis Social Clubs in Spain
After more than a decade of feeling their way through the question of CSCs, there is much that remains clear about what is or is not legal in Spain. At the same time, there are some things that have become all too clear.
For example, we now know that anyone who organizes a club with a large membership, lax membership policies, and limited membership participation is in a very tenuous legal situation. A club called La Mesa Barcelona saw its managers sentenced because they lacked regular associative activity. The court ruled that the club was a smokescreen for a trafficking operation.
We also know that things seem to be relatively safe for small local clubs with strong member participation. It appears that clubs that adhere closely to both the letter and the spirit of the laws, their articles of association, and the practices that are outlined can breathe a small sigh of relief.
While these clubs won’t be as big and fancy as the ones that sprung up all over the country between 2010 and 2015, they will offer an opportunity for Spanish citizens to safely enjoy cannabis in a social setting without fear of criminal entanglements.
What This Means for You
If your interest in opening a “cannabis coffee shop” in Spain is driven by a profit motive, there doesn’t appear to be much upside at the present moment. Operating a club in ways that will attract large numbers of people, move large amounts of product, and allow you to make business decisions without submitting them to the membership are all red flags for the law.
If, on the other hand, you are motivated by a desire to create a place where friends gather to socialize and enjoy cannabis – then creating an association might be the right thing for you. If you run the operation responsibly, you can still draw a salary that will support a comfortable lifestyle. You just won’t be able to pursue profits the way a commercial business would.
Of course, the legal situation is still in a state of flux, and new court cases or new legislative regulations could change the situations completely. Many of Spain’s most active voices on cannabis culture are optimistic that more progress will be made in the next few years.
We’re not lawyers, so all of the advice that we have given you in this article is best understood as an overview of the current situation. Before you take any action on opening a CSC in Spain, you should probably consult an attorney in the region you hope to open your club in. We wrote this article to help answer your general questions.
The question we set out to answer was how you could open a cannabis coffee shop in Spain. The simplest reason that you can’t do that is that Spain doesn’t have coffee shops. As we’ve discussed throughout the article, there are plenty of more complicated reasons why that wouldn’t be a good idea.
We are pretty impressed with the unique solution that CSCs offer to the legal situation in Spain. We like the idea of giving everyone an opportunity to engage with members of their own community around a shared interest in cannabis without opening the doors to the negative consequences of commercialization in overdrive.
We will be following the situation to see how everything unfolds with future developments. If you decide that opening a CSC is something you’re going to do, we would be interested to hear about your experiences. If we learn of new developments that impact the usefulness of this article, we’ll make updates to it in the hopes of keeping it current and reliable.
Are you interested in opening a CSC in Spain? Contact us