Pubdate: Sun, 11 May 2014
Source: Sunday Star-Times (New Zealand)
Copyright: 2014 Sunday Star-Times
Contact:  http://www.sundaystartimes.co.nz
Details: http://www.mapinc.org/media/1064
Author: Steve Kilgallon
Page: A9

COMPO CALL GETS SHORT SHRIFT

Synthetic-High Kingpins Are Angry at Lost Investments.

SYNTHETIC-HIGH manufacturers say the Government should compensate
them for now-worthless stock after last week's quickfire law change,
but health minister Peter Dunne has rejected their demands.
Photo: Chris Skelton Losses: Stephen Beere burns his now illegal highs.

Some wholesalers were left holding stock with a street value of
several million dollars, but Dunne had no sympathy and said the law
change specifically excused the Government from paying
compensation.

"And I think that is entirely as it should be. I don't think the
Government has any liability in this respect. The Government
intentions were made clear a good 10 days before [the ban]."

Dunne said anyone who held significant stock had " probably failed to
read the signs. And I would say to them they are probably part of the
problem . . . their enthusiastic supplying of the market. Had they not
gone completely overboard and created demand, it would not have caused
the public reaction and I suspect it would have carried on as much as
they were."

Dunne's words were met with amazement by Stephen Beere, whose company,
Orbital, had licences to import, manufacture, wholesale and retail
synthetic highs. He said stock took much longer than 10 days to order
and arrive - he still has some en route from China ordered well before
the ban.

"If this was any other business and the Government suddenly said 'you
can't sell it any more', there would be compensation. I did big deals
the week before the announcement and I am stuck with it now. If the
Government feel they have made a mistake and are trying to fix it,
surely that's their problem, not mine?"

Beere said he had also lost investments made in a planned expansion
into exporting, as well as a potential sale of his chain of sex shops
to Australian investors, which fell through when the law changes were
announced.

Shane Waaka, a director of wholesaler Risque, said he stood to lose
about $500,000 in immediate stock. He had about $ 250,000 worth at
hand when the law changed, with the rest owed or held by small
retailers who he suspected would "close up shop and disappear".

"I am angry, very angry at the way they've approached this last couple
of weeks," he said. "There is no doubt they have misled this industry
in terms of our investment to go forward. I guess compensation is
needed. We were given a timeframe to work with and invested in the
future. We can't trust them on anything now. "This was never a gold
mine." Among the results of the law change could be a raft of closures
of sex shops. Waaka said synthetic highs represented up to 80 per cent
of turnover for some shops as sales of traditional lines had declined.
Grant Bell of the industry body Star Trust said he expected one in
five retailers to close.

Waaka said tighter regulations had been working and many of the
dangerous synthetics were gone. " We've tried to act responsibly. But
it has been quite a battle."

Bell said media pressure and blatant electioneering was to blame for a
"moral panic".

"When the journalists have more power than the scientists, the public
suffers," he said. He also blamed the Government's decision to cap
retail outlets at 150, causing bottlenecks.

Bell said alcohol and tobacco were far more dangerous than natural or
synthetic cannabis, and control of the market had now shifted from
responsible retailers to gangs.

" If a child wanted to try cannabis, would you rather they went to a
licensed retailer with strict controls, ID checks, compliance and good
advice, or a gang and get crap product and maybe be given a free
sample of crystal meth?"

Bell said there would be no point trying to fight ahead of the
election, but said the industry was " resilient and adaptable". An
unmoved Dunne said: "I can't say the industry is dead; I can't say
it's alive."
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