Guillermo Nieto
National Association of the Cannabis Industry (ANICANN)
Expert Contributor

Largest Legal Cannabis Market in the World

By Guillermo Nieto | Wed, 03/31/2021 - 12:56

On March 10, 2021, Mexico’s lower chamber approved a bill to legalize cannabis in the country. This new law is a modified version of that approved by the Senate in November 2020 that regulates all cannabis-related activities: medical, recreational and industrial. This comes two years after the Supreme Court declared that cannabis prohibition laws are unconstitutional.

The judges ruled in favor of the cannabis users in five appeals presented to them, then they instructed lawmakers in both chambers to create a new law for cannabis and gave them a six-month deadline. That deadline had been postponed three times but the court issued one final date, April 30, 2021.

The same process occurred with the rules for medical cannabis. Mexico legalized this area in 2017 but the rules for the operation of the law took three years to publish. In fact, the rules were published by the Federal Commission Against Sanitary Risks (COFEPRIS) just a couple of months ago, on Jan. 12, again by court order.

One of the biggest changes in the bill passed by the House of Deputies is the elimination of the Mexican Institute of Cannabis, proposed by the Senate to rule over all cannabis activities and coordinate different government branches such as tax, agriculture and sanitary authorities. President Andrés Manuel López Obrador has declared a policy of “republican austerity,” and the creation of a new office rather than using the existing one goes against that idea.

Thus, it was decided that the National Commission Against Addictions (CONADIC) would be in charge of everything related to the cannabis, such as granting and suspending licenses. It will also have the task of limiting access to the plant to people between 18 and 25 years old.

The new project has five cannabis licenses: to produce, transform, sell, import/export and research cannabis and all its related products. The previous bill included four categories, excluding research. This new license is intended for schools and research centers and it would allow them to work with as much cannabis as required by a previously authorized protocol. The cost of the license hasn’t been defined yet but they will have one- to five-year terms.

If the law is approved as is, native communities, indigenous people and small, agricultural cooperatives, along with some of the poorest farmers in the country, will have by law, a three-year period in which they will have preference in the applications for production licenses. The Senate stated that the licenses were inter-restrictive, meaning only one type of license for one person and limited vertical integration. In the lower chamber, this restriction was removed and anyone can have more than one.

The bill also makes a difference between industrial cannabis, known as hemp, and recreational cannabis, the plant known as marijuana. For example, according to this law, if you want to grow recreational cannabis out in the open you can do so only on 1 hectare (about 2.5 acres) while hemp will be regulated by rules similar to those of cotton or tomatoes.

It is not considered a decriminalization law because of the limits it imposes and the punishments they carry. An adult would be able to carry 28 grams (an ounce) on the streets but if he’s caught carrying anything between 1.01 ounce and 9 ounces it would mean a fine, over 9 ounces it would carry judicial consequences that could go as far as 15 years in jail. The deputies also imposed a limit to the number of plants a cannabis association for self-cultivation can have. These groups can include up to 20 members, each member can have up to four plants, but the club can’t have more than 50 plants total. In a household, the limit is eight plants.

In the next step, the new version of the Federal Cannabis Law will return to the Senate where it will be discussed, voted, and approved again. If no changes are made in the high chamber, then it will just need the presidential signature. This has to be done before the end of April, according to the Supreme Court.

If approved, this law will make Mexico the biggest market for legal cannabis in the world, and more than 120 million people would potentially benefit from one of the more than 25,000 products derived from this plant. It also means tens of thousands of much needed new jobs and opportunities, especially for the farmers in the countryside, allowing them to participate in a market with an estimated global value of over US$20 billion. Imagine an industrial crop from which we can obtain medicine, fabrics, fibers, bioplastics, biofuels, and much more.

Photo by:   Guillermo Nieto