Israeli Economy Ministry Halts Cannabis Dumping Investigation Over Procedural Error
The Israeli Ministry of Economy abruptly closed its investigation into alleged dumping of medical cannabis imports from Canada due to a procedural oversight. The investigation, announced less than a month ago on June 29, was terminated after officials failed to notify Canadian authorities as required under World Trade Organization (WTO) rules. Danny Tal, the Ministry's Trade Levies Commissioner, informed cannabis growers, importers, and industry stakeholders of the closure, citing a "human error" that prevented prior notification to the exporting country's competent authority.
The decision to close the probe came just one day before the deadline for industry responses and questionnaire submissions related to the investigation. However, Tal clarified that the closure was purely procedural and did not address the substantive merits of the complaint. He left open the possibility of reopening the investigation with proper notification to Canadian authorities, emphasizing that no rights or claims are waived by this procedural dismissal.
This development follows a contentious history surrounding cannabis import tariffs. In April 2025, Economy Minister Nir Barkat had supported imposing an anti-dumping levy on Canadian medical cannabis imports based on a prior investigation, but Finance Minister Bezalel Smotrich vetoed the decision, preventing the tariff's implementation. The renewed investigation was prompted by a new complaint from two Israeli cannabis producers, Evergreen Solomon Pharma and Trichom, alleging dumping at a rate of approximately 125% based on price disparities between Canadian export prices and local Canadian market prices.
The investigation's reopening sparked strong opposition from the Israel Chambers of Commerce, led by CEO Gilit Rubinstein, who threatened legal action and argued that reopening the probe without new substantial evidence was unwarranted and harmful to the industry. Tal defended the decision, citing significant changes in market conditions, including the collapse of local growers and increased imports of diverse cannabis strains that threaten domestic producers.
Industry sources criticized the Ministry's handling as "puzzling," especially given the timing near elections and the prior failed tariff attempt. The Ministry stated that the procedural flaw was identified during the process, leading to the current halt to avoid unnecessary legal disputes, and affirmed that any future proceedings would comply fully with legal requirements. The Ministry also stressed that the issue is unrelated to elections and concerns protecting the Israeli cannabis industry from unfair trade practices.
