The decision leaves cannabis users in Canberra in legal limbo. Things look set to stay that way unless the ACT government goes back to the drawing board on its legislation, or until someone fights a test case.

The ACT government was not clear on its next step, but implied the possibility of a court showdown.

"If Commonwealth agencies, either under the direction of their conservative ministers or by their own volition, prioritise the prosecution of Canberrans caught with a small amount of cannabis, then that is a matter for them and for the federal Attorney-General to defend," a spokesperson for the ACT government said.

"If more people are going to be incarcerated under these laws, then the conservative Liberals better have a plan for how they are going build more prisons."

The ACT government legalised cannabis for adults in late September, and the law was to take effect at the end of January. It allows Canberrans to grow two plants per person, or four plants per household, and possess 50 grams in dry form. But federal law still makes it illegal to possess cannabis, punishable by a hefty jail term.

The ACT government thought it could circumvent the federal law because the federal law contains a defence for anyone charged with possessing cannabis if it conflicts with state law.

But Attorney-General Christian Porter said he now had legal advice that the defence did not apply.

"Their law has not done what they think it does, which is provide some kind of defence or out for people who would be possessing cannabis in the ACT. It doesn't do that," Mr Porter said.

That meant the Commonwealth did not need to intervene to overturn the ACT laws, he said. He wrote to Mr Ramsay on Sunday with the news and told him he expected ACT police to "continue to enforce ACT and Commonwealth drug laws".

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In fact, ACT Policing has operated for some years under the ACT law, which had already decriminalised cannabis use, apparently without invoking the federal criminal law.

Asked which law the police should enforce, Mr Porter said: "The police enforce laws that are on the books and the Commonwealth law is on the books. The expectation is that police enforce the law. And the law is, as I have been advised and which advice I completely accept, it remains unlawful at Commonwealth law to possess cannabis in the ACT."

The ACT decision to legalise cannabis began with Labor backbencher Michael Pettersson, who opted for simply removing small amounts of cannabis use and cultivation from the criminal code. An ACT Assembly inquiry foresaw the problem that has now arisen, after hearing evidence from police and legal experts.

ACT police told the committee that if they had to enforce the harsher Commonwealth laws, users could face bigger fines and jail time - a more punitive regime than decriminalisation.

In June, the committee said the bill should be changed to include an express authorisation for the use or cultivation of cannabis to deal with the conflict with federal law. It also called for a new system of roadside drug testing because cannabis remains detectable well after its effects have worn off, and it called for "cannabis social clubs" and artificial cultivation to deal with other problems in the legislation - that it remains illegal to buy or give away seeds so there is no legal way to begin growing, and that Canberra's climate doesn't lend itself to growing.

But the inquiry's recommendations did not make it into the final ACT law, which took the simplest route - leaving existing cannabis laws in place but exempting adults from those laws if they stay under the two-plant limit.

That decision has created the conflict with federal law. The Commonwealth criminal code makes cannabis illegal but has a section (313.1) that allows conduct that is "justified or excused by a state or territory law".

Commonwealth Director of Public Prosecutions Sarah McNaughton wrote to the ACT on September 17 saying anyone charged under Commonwealth law could use that section as a defence, so her office wouldn't prosecute. But a week later she backtracked, citing unspecified "legal complexities", after her advice was questioned by the federal Attorney-General's Department.

Mr Porter said on Sunday section 313.1 could only be used as a defence if the ACT had created "a positive right" in law to use cannabis - which it had not.

"The legal advice that I've got, which I agree with, which I've relayed by a letter today to the ACT Attorney-General, is that it is still an offence under Commonwealth law in Canberra to possess an amount of cannabis less than 50 grams. That's the state of the law," Mr Porter said, dismissing the ACT laws as "terrible laws for a variety of reasons".

"The ACT laws removed the criminal component at a territory level, but didn't establish anything that is a positive right to possess, which means there's no defence to the Commonwealth law."

The Coalition has been highly critical of the ACT's move, calling it crazy and dangerous. On Sunday, Mr Porter did not rule out intervening if the ACT Assembly decides to legislate to create a positive right to use cannabis.

"What they do from here is up to them, and we'd consider the situation into the future," he said.

In June, Mr Ramsay said he had the power to instruct the Solicitor-General to conduct a high-level intervention if someone was prosecuted, but that would be more about arguing the principles of law than stopping a prosecution. Such an intervention was "several steps down the track", he said then.

On Sunday, a spokesperson for the government said ACT police had been able to charge people for many years under Commonwealth law.

"The Commonwealth Attorney-General's new 'advice' must have vastly changed from the original advice provided from the Commonwealth Director of Public Prosecutions to the ACT that there is a reasonable defence under Commonwealth law for Canberrans caught with a small amount of cannabis," the spokesperson said, referring to the advice that Ms McNaughton gave and then withdrew.