Here’s the ruling

It can be found at

https://uitspraken.rechtspraak.nl/inziendocument?id=ECLI:NL:RBAMS:2021:123&utm_medium=email&utm_source=newsletter&utm_campaign=INTL_20210123_NEWS_Weekly

 

Authority Court of Amsterdam

Date of judgment 21-01-2021

Date of publication 21-01-2021

Case number AMS 20/6671, AMS 20/6840, AMS 20/6915, AMS 20/6916, AMS 20/6917

Jurisdictions Administrative law

Special characteristics Preliminary injunction
Content indication Rejection of requests for interim relief after substantive assessment. Criticism of draw. The fact that allocation mechanisms other than drawing lots are also conceivable does not mean that the regulator’s choice of drawing lots is unlawful. That this choice conflicts with one or more binding legal norms has not been stated and has not been proven. A choice for (additional) draw is also not uncommon.
The defendants were obliged to implement the three previous rulings of the preliminary relief judges. The fact that the defendants have acted on these statements does not mean that the defendants have unlawfully changed the rules of the game of the cannabis cultivation experiment or that they have not complied with the underlying laws and regulations of the experiment. The three applicants still admitted have the same right to participate in the draw as the applicants.

The defendants’ assessment is also careful.

Locations Rechtspraak.nl

Statement

COURT OF AMSTERDAM

Administrative law

case numbers: AMS 20/6671, AMS 20/6840, AMS 20/6915,

AMS 20/6916 and AMS 20/6917

Judgment of the preliminary relief judge of 21 January 2021 in the cases between

Canna Hood BV,

Green BV ,

CANPRO BV ,

DutchCanGrow BV ,

So Green BV ,

TYCH BV ,

Can Dutch Connextion BV ,

collectively referred to as: applicants

(authorized representative: mr. EMF Opering),

and

the Minister for Medical Care and

the Minister of Justice and Security,

the ministers, hereinafter the defendants

(attorneys: mr. E. van Brandwijk and mrs and mr. IS Vreken-Westra).

Process course

In letters dated 3 December 2020, the defendants informed the applicants that the processing of their applications for designation as growers for the closed coffee shop chain experiment had been placed on the waiting list. Applicants were assigned a ranking number for the draw and the processing of their application was suspended.

The Applicants have objected to this. They have requested the preliminary relief judge to make a temporary provision.

By order of 22 December 2020, the Rotterdam District Court decided to refer the requests, registered under case numbers: AWB 20/6623, AWB 20/6624 and AWB 20/6626, to the Amsterdam District Court. This means that the Amsterdam District Court will take over the handling of the applications. The cases are now registered under case numbers AWB 20/6915, AWB 20/6916 and AWB 20/6917.

The defendants submitted statements of defense on December 24, 2020 and January 5, 2021.

The hearing took place on 7 January 2021. The Applicants appeared, assisted by their representative. The defendants were represented by their attorneys.

Considerations

1. The judgment of the preliminary relief judge is of a provisional nature and does not bind the court in (possible) main proceedings.

What happened before?

1.1.In the coalition agreement of 2017 it was agreed that an experiment will be conducted with the cultivation and sale of hemp and / or hashish (hereinafter: hemp) for recreational use. The aim of the experiment is to see whether and how a closed coffee shop chain is possible. During the experiment, it will be possible in the participating municipalities 1 to sell regulated hemp produced in the coffee shops.

1.2.The laws and regulations for the closed coffee shop chain experiment entered into force on 1 July 2020. A maximum of ten growers in total are allowed to produce and sell hemp. These growers are appointed by the ministers. To be eligible for a designation, prospective growers must submit an application. The submitted applications are assessed by experts on content and quality. 2The ministers also ask the mayor of the municipality where a grower wants to settle for advice. This advice concerns the possible consequences of a cultivation location for public order and safety in that municipality. The ministers can reject a grower’s application if the mayor’s advice gives good reason for this. An advice from the mayor weighs heavily in the assessment. If, after the applications have been assessed, there are more than ten applicants who are eligible for a designation, a draw will be made. After the draw, applicants will be screened through a Bibob 3 screening .

1.3.The applicants submitted applications for designation as a grower for the closed coffee shop chain experiment. The assessment of the applications as to whether the applicants meet the formal and material conditions set in the regulations for the experiment has already been completed. The results of this resulted in the applicants taking part in the draw. The draw for aspiring cannabis growers took place on December 3, 2020 at 11:00 AM.

2. By letters of 3 December 2020, the defendants informed the applicants that they had not been drawn. The following ranking numbers have been assigned to the applicants’ applications: 18, 19, 23, 33, 34, 36, 39 and 41. Their applications have been placed on the waiting list. This means that its treatment has been suspended. Applications on the waiting list can still be processed if one or more of the applications with rank numbers 1 to 10 are canceled or withdrawn. The order on the waiting list is the same as the ranking number.

Position of the applicants

3. The applicants cannot associate themselves with this and have asked the preliminary relief judge to make a temporary provision. They argue that the defendants wrongly arranged for the draw to take place with the participation of parties who, on the basis of the rules drawn up in advance, should not have taken part in the draw. To this end, the applicants refer to three judgments of the preliminary relief judge. 4In those three cases, the growers’ applications to be designated as growers for the experiment were first rejected, but the preliminary relief judge ruled that the growers may still participate in the draw. The fact that the defendants allowed the draw to take place with three rejected applications without reassessment has resulted in the draw being negatively affected. The draw is also in violation of the Closed Coffee Shop Chain Experiment Act. After all, Article 2 of that law states that applications that have been rejected may not participate in the draw. That has now happened.

In taking the decision not to postpone the draw, the defendants did not take sufficient account of the interests of the applicants initially admitted. This addition reduced the applicants’ chances by 2%, from 10 in 39 to 10 in 42. This has led to distortions of competition. The applicants could assume that there would be 39 participants, because this was stated in the letter to parliament from

27 November 2020. The Applicants could have trusted that their legal position would be respected in the selection procedure with regard to the draw. Adjusting the playing field in the application process in an unexpected and incalculable manner is contrary to the fair play principle.

The draw is also unlawful because, after the deadline for submitting the applications, the defendants allowed applicants to change their application in the meantime so that they could participate in the draw with more than one lottery number. This is contrary to the principle of equality. Nor has it been checked whether the funding of the participants’ applications is guaranteed, according to the applicants. The defendants should have postponed the draw. The draw should now be declared invalid.

3.1The Applicants are also of the opinion that the decision of the defendants to have the draw take place is a decision and / or a preparatory decision within the meaning of the General Administrative Law Act, hereinafter, Awb, against which separate objection and appeal are open, because it directly ( and regardless of the decisions yet to be taken) are in their interest.

3.2At the hearing, several applicants made more general criticism of the selection. The quality and drive of the growers in the cultivation (and sale) of hemp is insufficiently central. It is very important that the experiment succeeds, but growers of insufficient quality have now been drawn. Not only does this harm the interests of the applicants, it is also contrary to the public interest that is served by a good, professionally conducted and successful experiment.

Position of the defendants

4. According to the defendants, a total of 51 applications passed the selection. Applicants have been allocated 39 lottery numbers. Some applicants have submitted multiple applications with alternative locations. In cases where the applicant intends to start at only one of those locations, this applicant has been assigned one lot number. In cases where the applicant intends to establish several cultivation companies, multiple lot numbers have been assigned.

In view of the verdicts of the preliminary relief judges, three extra applications were added to the draw shortly before the time of the draw. As a result, there was ultimately drawn among 42 lottery numbers. The draw took place on December 3, 2020. This means that the applications of the three parties involved have not (temporarily) been rejected. In view of this, they must be admitted to the draw in accordance with Article 2 of the Regulation on the closed coffee shop chain experiment. Moreover, these applicants are admitted to the draw on the condition that if the application is drawn, the applicant can only actually participate in the experiment as a grower if the rejection decision is revoked in the objection.

4.1.

Moreover, the letter of 3 December 2020 is not a decision within the meaning of Article 1: 3 of the Awb. Nor is it a preparatory decision open to objection or appeal. By adding the three applicants to the draw, the decisions of the preliminary relief judges have been implemented. The defendants are bound by this. Of a

(consideration and) decision of an administrative body aimed at legal consequences has not yet been taken. It has not yet been decided on the applications that have taken part in the draw. After the Bibob procedures have been completed, it will be decided whether the ten applicants will be granted a license. If this is the case, the other applicants on the waiting list will receive a negative decision. Objections or appeals can then be lodged against these decisions. The legal consequence only takes effect at that time.

4.2The letter of 3 December 2020 can be seen as a decision regarding the preparation of the decision to designate or reject the application. However, this preparatory decision is not subject to objection and appeal. The legality of the lottery can be raised in the final decision or rejection decision. Moreover, the letter does not contain the decision to admit the three applications to the draw. The defendants did not take a procedural decision to admit the three previously rejected applicants to the draw. The applicants are admitted as a result of the decisions of the preliminary relief judges. The defendants are of the opinion that the application should be declared inadmissible.

In the alternative, the defendants take the position that there is no urgent interest. The consequences of the draw are irreversible. Running a new draw will have disproportionate consequences for those applicants who have already been drawn or for those who have a high place on the waiting list. In the further alternative, the defendants take the position that the lottery was drawn in accordance with the applicable legislation and regulations and with due observance of the decisions of the preliminary relief judges. Nowhere in the law or regulations is it specified how many applicants can participate in the draw. It only follows from the decision that the defendants can designate a maximum of ten growers to participate in the experiment.

The applicants never trusted or guaranteed in advance that there was a 10 out of 39 chance of being drawn. The three applicants who were added to the draw at the last minute had indeed received a rejection decision, but these decisions were not legally inviolable, so that the applicants cannot derive legitimate expectation from this either that these parties could be admitted to the draw. The defendants do not follow the applicants’ position that they have acted in breach of the principles of legal certainty, proportionality and the

fair play principle. There has been no question of changing the application or supplementing its content. In accordance with Article 4: 5 of the Awb, the submitters of an incomplete application were given the opportunity to complement their application. The assessments were made on the basis of the financial data. The defendants have indeed checked whether the financing is secured. The Applicants argue that this is not the case, but that remains with allegations and lacks substantiation, according to the defendants.

Assessment of the preliminary relief judge

5. The preliminary relief judge first of all establishes that the defendants opted for drawing lots as an additional allocation mechanism when allocating the designation as grower for the experiment. At the hearing, the applicants outlined that other mechanisms exist for the allocation of scarce permits. According to the preliminary relief judge of certain applicants, they would rather have seen an approach in which quality assessments would have a prominent place.

5.1However, the fact that other allocation mechanisms are conceivable does not mean that the defendants’ choice of drawing lots is unlawful. That this choice conflicts with one or more binding legal norms has not been stated and has not been proven. A choice for (additional) draw is also not uncommon. In addition, this point was brought in very late. The regulations were adopted after consultation with, among others, the Association of Cannabis Retailers, and entered into force on 1 July 2020. The Applicants could therefore have raised the issue much earlier. Then this point can no longer benefit the applicants.

Three applicants were still admitted to the draw

6. Provisions judges of the courts Central Netherlands, Rotterdam and Utrecht in three judgments of 2 and December 3, 2020 5 found that the previously rejected requests from three prospective farmers (yet) may participate in the draw on

December 3, 2020 at 11:00 am.

6.1.Just as the parties are bound by this ruling, the defendant was also obliged to implement those three rulings. This is a key point of the legal order.

6.2.In the opinion of the Preliminary Relief Judge, the fact that the defendants acted on these rulings does not mean that the defendants have unlawfully amended the rules of the game for cannabis cultivation or that they have not complied with the underlying laws and regulations of the experiment.

6.3.Furthermore, the reliance on the applicants’ principle of legitimate expectations is not successful. In the opinion of the preliminary relief judge, the defendants correctly assumed 39 participants in their letter to parliament of 27 November 2020. After all, that was the actual state of affairs at that time. The three applicants still admitted were, according to the preliminary relief judges, wrongly excluded from the draw and therefore have the same right to participate in the draw as the applicants. Their admission therefore serves the principle of equality.

Location change

7. From the documents and the proceedings at the meeting it appeared that after the draw a number of applicants were unexpectedly confronted with the fact that, in view of public order, two municipalities set a maximum for the number of cultivation locations within those municipalities. In their statements of defense and at the hearing, the defendants have explained that this is not yet used as a ground for rejection against individual applicants. Nor has it been argued by the Applicants that this should be done. The defendants are now in talks with the municipalities and the applicants concerned, one of the options being to change the originally intended location. The preliminary relief judge does not see that the defendants have acted in violation of the law, more in particular the laws and regulations of the cannabis cultivation experiment.

Multiple requests?

8. The Preliminary Relief Judge also considers that there are applicants who have submitted one application, but stated several locations in it and that there are applicants who have submitted multiple applications. For the applicants who submitted a single application with multiple locations, the defendants’ assessment was based on the assumption that these are alternative locations. For the sake of certainty, with regard to applicants with multiple applications, the defendants have inquired by e-mail whether it is the intention to submit one application with alternative locations or multiple applications. Respondent thereby shows a careful assessment. The law did not oblige the defendant to immediately reject the application (s) in these cases. Furthermore, it has not become apparent to the preliminary relief judge that these applicants were treated differently by the defendants than other applicants with a comparable application (s). That is also not stated.

Request an addition

9. The defendants took the position in the defense and at the hearing that none of the applicants had the opportunity to change the content of the application themselves. However, submitters of an incomplete application were given the opportunity to complete their application in accordance with Article 4: 5 of the Awb. The preliminary relief judge sees no reason to doubt this in what the applicants argue.

Financing control

10. Finally, the Preliminary Relief Judge is of the opinion that the applicants have insufficiently substantiated their assertion that the defendants did not sufficiently check whether the funding was secured in the applications. The defendants have assessed whether there is a sound financial plan on the basis of the financial information that the applicant has had to provide. Financing required a letter of intent, among other things. At the hearing, the defendants explained that, as a whole, a certain threshold had to be met in order to approve the application, and that it may well be that there are differences in level between the applications. According to the respondent, it is also important that a Bibob test takes place.

10.1

The preliminary relief judge further concludes that this position of the applicants does not relate to the assessment of their own applications, but to that of others. In essence, their thesis tends to challenge the admission of those others now, months later.

The substantiation of their position on this point is based on little more than statements of hearsay, from which it cannot in any case be inferred that the assessment framework outlined above by the respondent was actually not followed in one or more cases. This position cannot therefore help the applicants either.

Conclusion

11. In view of the foregoing, there is no substantive reason to grant the requests.

11.1The question of whether there are admissible connexal proceedings on the merits or of sufficiently urgent interest, can and will leave aside the preliminary relief judge.

11.2As indicated at the hearing, it is not necessary to inspect the documents submitted by the defendant in accordance with Article 8:29 of the Awb in (so far some of the) cases. The preliminary relief judge will therefore have those documents returned to the defendant by the registrar.

12. There is no reason for an order for costs or reimbursement of the court fees paid.

Decision

The preliminary relief judge rejected the requests for preliminary relief.

This judgment was made by mr. HJ Tijselink, preliminary relief judge, in the presence of mr. LA Super, registrar. The decision was issued in public on January 21, 2021.

registrar interim relief judge

Copy sent to parties on:

Remedy

There is no legal remedy against this decision.

1Arnhem, Almere, Breda, Groningen, Heerlen, Hellevoetsluis, Maastricht, Nijmegen, Tilburg and Zaanstad.

2Rules for experiment closed coffee shop chain November 2020.

3Promotion of integrity assessments by the public administration.

4ECLI: NL: RBGEL: 2020: 6366, ECLI: NL: RBROT: 2020: 11300 and ECLI: NL: RBMNE: 2020: 5292.

5ECLI: NL: RBROT: 2020: 11300, ECLI: NL: RBMNE: 2020: 5292 and ECLI: NL: RBGEL: 2020: 6366.

 

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Dutch recreational cannabis experiment advances after court appeal rejected