President Trump’s executive order directing federal agencies to loosen restrictions on marijuana is being welcomed by cannabis businesses and researchers, but experts caution that the practical effects will unfold slowly and unevenly. While the move signals a shift in federal posture, it does not immediately dismantle decades of drug policy.
The order instructs Attorney General Pam Bondi to move marijuana toward Schedule III under federal law, a lower-risk category than its current classification. However, executive action alone does not rewrite the Controlled Substances Act, which has governed drug scheduling since 1970.
According to Gillian Schauer, executive director of the Cannabis Regulators Association, rescheduling typically requires a formal rulemaking process or congressional involvement, neither of which happens overnight.
How quickly the change takes effect depends largely on the path the Justice Department chooses. Bondi could revive a proposal initiated under the previous administration or use a less common provision of federal law that allows faster action. Schauer notes that the accelerated option limits procedural steps but may expose the administration to legal challenges, particularly from groups opposed to loosening marijuana laws.
Public participation could also affect the timeline. A traditional notice-and-comment period would slow the process, while bypassing it could speed implementation. When federal agencies previously floated rescheduling, tens of thousands of public comments poured in, underscoring the political sensitivity surrounding the issue.
For cannabis companies, the most immediate impact could come through taxes. Businesses that sell marijuana currently face higher tax burdens because they are barred from claiming standard deductions. Sam Brill, chief executive of multistate operator Ascend Wellness Holdings, says moving marijuana out of its most restrictive category would eliminate those penalties, easing cash flow and reducing the need to set aside large reserves for potential tax disputes.
Other restrictions are less certain. Even with rescheduling, marijuana would remain illegal to transport across state lines, and access to banking services would likely stay limited. Many financial institutions still avoid the industry, forcing dispensaries to operate largely in cash. Patrick Sims, who owns a dispensary in New York, says the inability to accept credit cards remains one of the biggest barriers for both businesses and customers.
Medical research stands to benefit, though gains may be modest at first. Scientists would no longer need the most restrictive licenses to study marijuana, and laboratory rules would become less burdensome. Neuroscientist Staci Gruber, who studies cannabis at a Harvard-affiliated hospital, has said regulatory requirements have long discouraged researchers from entering the field.
Even so, sourcing marijuana for studies remains tightly controlled by federal agencies, a limitation unaffected by rescheduling. Schauer notes that unless those policies change as well, research will continue to face bottlenecks. Taken together, the executive order marks progress, rather than a clean break from the past. The direction is clear but the pace will depend on legal choices, agency follow-through, and whether broader policy reforms follow.
The entire marijuana industry, including leading companies like TerrAscend Corp. (TSX: TSND) (OTCQX: TSNDF), will be hoping that meaningful changes come sooner rather than later so that the regulatory environment is characterized by fewer onerous bottlenecks to businesses.
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