Jersey: forward thinking authorities

Jersey granted a license in 2019 to a group of local farmers who will use the plant to make various hemp and cannabidiol (CBD) products. Of these, an innovative building material that has excellent fire-resistant qualities is expected to be produced by the company who was granted the license, as well as oils and supplements.

What does the license mean for financial services?

It would be easy to write off the new license as entirely unrelated to Jersey’s thriving financial services industry; however, the approval underlines that Jersey adopted a very pragmatic and forward-thinking approach compared to other jurisdictions in Europe.

Hemp and the CBD oils that are derived from the plant are becoming increasingly mainstream, although few countries in Europe have been keen to facilitate the growth of the plant. In granting the license, Jersey shows that it is a jurisdiction that’s unafraid to establish itself in new ways.

As an example, since the legalisation of cannabis in Canada for medical and recreational use in October of 2018, there are suddenly hundreds of cannabis companies on the market, with 175 listed on the Canadian Securities Exchange alone. Venture capitalists and private equity firms have started seriously investing in the sector and Jersey could perfectly be positioned to serve those investors.

Forward-thinking authorities

The license also shows that the local government is genuinely interested in evolving the regulatory environment to benefit the local and international companies who want to do business on the island. By diversifying and attracting new business sectors, the island is encouraging new, sustainable industries that benefit the local economy to do business in Jersey.

In other jurisdictions there can be trepidation in approaching authorities with innovative ideas and products that are in some cases, ground-breaking, but not in Jersey, where dialogue is encouraged.

Rather than shutting down a business, service or product concept because it is complex from a regulatory perspective, the Jersey authorities want to discuss these topics and potential solutions with the parties involved. With this approach, they are bringing new and lucrative opportunities to the island, be these local or international initiatives.

Future opportunities

Granting the license sets the path for Jersey to become a leading grower of hemp in the UK. In time, we expect Jersey will see more applications to grow hemp. As a result, we expect there will be a requirement for the island’s financial services sector to assist and provide valuable solutions for these businesses.