Mexico has quickly become a big opportunity for cannabis entrepreneurs globally!
The regulations and details for the Federal Law for the Regulation of Cannabis in Mexico a.k.a. cannabis legalization, are still being defined and we will keep this blog post updated as we learn more from Mexico’s lower house of Congress. Read on for our cannabis compliance team’s analysis on Mexico applications.
We are building our agent network internationally, if you are interested in opportunities in Mexico, please take a moment to contact us for our expert cannabis application support in Mexico.
Table of Contents – Mexico Cannabis Regulations
- Mexico Cannabis Applications / Regulations / Legalization Overview
- Official Mexico Chamber of Deputies Marijuana Bill
- Our Compliance Team’s Analysis on Mexico’s Regulations
- Who Controls Cannabis Licensing?
- What Cannabis / Marijuana License Types are Available?
- When Can You Apply for a License?
- Who Can Apply for a License?
- What are the Canopy Limits for Cannabis Cultivation?
- Can I Grow Cannabis at Home in Mexico??
- Cannabis Import and Export Rules
- Mexico Cannabis Regulations vs. USA vs. Canada
- How Can I Get a Cannabis License in Mexico?
Why Did Mexico Legalize Cannabis?
This is an exciting chance for the country to lessen the influence of the country’s powerful drug cartels, increase tourism, and change “the false belief that cannabis forms part of Mexico’s serious health problems…” as said by Simey Olvera, a member of President Andres Manuel Lopez Obrador’s left-wing Morena Party.
In this article, we have outlined the license types, canopy limits, licensing control bodies, and more about the recent changes to Mexican cannabis legalization. Our team of consultants, real estate agents, compliance experts, funding specialists and more are ready to support your journey to a legitimate cannabis business. Remember to contact us with questions below.
Mexico Cannabis Applications / Regulations / Legalization Overview
Mexico is still early in their legislation after making serious progress when the supreme court ruled in 2018 that the nations ban on cannabis was unconstitutional and implemented a current deadline of April to pass legislation to legalize. (This deadline has previously been extended several times)
Just recently on March 8th, the Mexican Chamber of Deputies voted 316-129 vote, with 23 abstentions to advance the bill. After adding the floor amendments, the body voted again, 250-163, with 14 abstentions, to formally send the bill back to the Senate for final approval with the new amendments.
If you read Spanish, here is the entire 376 page bill to peruse the details or scroll down to read our full analysis on what is current and what is to come with Mexican cannabis regulations.
Official Mexico Chamber of Deputies Marijuana Bill
Read Our Compliance Team’s Analysis on Mexico’s Regulations
This is our breakdown of the cannabis application and regulation information that has currently been defined by the Mexican government. We’ll keep updating and please reach out with more questions for us to define.
Who Controls Cannabis Licensing in Mexico?
Under previous versions of Mexico’s cannabis legalization bill, a new cannabis regulatory commission would have been created to draft regulations and oversee and monitor licenses awarded.
Recent amendments passed in Mexico’s Chamber of Deputies scrapped these plans, instead passing on the responsibility of overseeing the new cannabis market to the National Commission Against Addictions, a branch of the Ministry of Health. Hemp production and licensing, on the other hand, will be overseen by the ministry of agriculture.
What Cannabis / Marijuana License Types are Available?
Under the current form of the bill, there will be six license types available:
- Retail Sales Licenses will allow licensees to acquire cannabis products from licensed distributors to sell to individual customers from their stores.
- Production Licenses allow the holder to cultivate cannabis for commercial use.
- Distribution Licenses will allow the acquisition of cannabis from licensed suppliers to resell to Retailers.
- Marketing/Merchandising Licenses function similarly to manufacturing or processing licenses in the US, allowing licensees to package and create cannabis products, although notably a new amendment in the bill restricts the sale of edibles for at least three years, until further research can be conducted into the products.
- Research Licenses allow production or acquisition of cannabis for scientific research.
- Finally, a new amendment to the bill allows for fully integrated licenses which allow a license holder to operate each stage of the cannabis supply chain.
In order to combat concerns that these fully integrated licenses could lead to a few large corporations cornering the market and edging out small traditionally marginalized groups, the bill includes language that gives the Federal Economic Competition Commission to have the authority to issue “measures to prevent undue concentration,” meaning there may be future limits placed on the number of licenses awarded to a single entity.
Potential for Monopolies in Cannabis?
Mexico has had considerable issues with monopolies in the beer industry and it is plausible this would also happen in the cannabis industry, yet President Andres Manuel Lopez Obrador appears to be working to remove that issue with legislation allowing more small craft breweries. This article from 2013 explains how the large brands in Mexico were able to gather too much market share:
“The two goliaths inherited practices that include enticing clients to sign exclusivity contracts by providing them with refrigerators, tables and chairs, and display awnings with their own beer logos. In some cases, the brewers would even advance money to new cantinas and restaurants – up to the equivalent of tens of thousands of dollars – in exchange for a cut of future beer sales. The practice that is most heavily criticized, though, particularly in the north, is the big brewers’ ownership of all permits to dispense or sell beer.” Source
When Can You Apply for a License in Mexico?
While there is no set start date for license applications at the moment, Mexico has plans to move quickly towards establishing their legal cannabis market.
The Mexican Supreme Court has given the legislature an April deadline to pass a final cannabis legalization bill. Following this, the bill calls for the National Commission on Addictions to be fully operational within 90 days of the bill being fully harmonized and is given another 90 days after this to issue relevant monitoring programs. At this stage the commission will have 60 more days to issue all rules and guidelines for the new industry. If the timeline stays intact, we expect the Mexico’s cannabis market to be fully open for business mid to late 2021.
Who Can Apply for a License?
As of this moment, there will be no limits on the amount of foreign investment. Additionally there will be no requirement that the companies applying are Mexican, and as of now there are no residency requirements. The bill does make a commitment to priority for licensing to traditionally marginalized and indigenous communities, but does not provide any specifics about the percentage of licenses that will be set aside for these communities.
What are the Canopy Limits for Cannabis Cultivation in Mexico?
At this point we do not know what the initial maximum limits for cultivation will be. The bill provides the National Commission on Addictions, in consultation with the Ministry of Agriculture, the authority to set a maximum canopy for indoor/outdoor growing per issued license, as well as the national maximum on an annual basis.
Can I Grow Cannabis at Home in Mexico?
Yes. The Federal Law for the Regulation of Cannabis allows each adult 18 and older to cultivate up to six plants at home, and households with more than one adult can grow eight. The bill however, requires each person intending to cultivate at home to obtain a permit from the government.
Mexico’s Cannabis Import and Export Rules
The new rules dictate that only hemp will be allowed to be imported or exported.
All cannabis produced in Mexico must be expressly sold and marketed in Mexico, and no imports of cannabis products will be allowed.
Mexico Cannabis Regulations vs. USA vs. Canada
With the expected final passage of this cannabis bill in Mexico’s senate later this month, Mexico will become the world’s most populous country with fully legalized cannabis nationwide, and a market larger than that of the US’s legalized states.
Even as several individual states move forward with legalization, America now finds itself the only country in North America with a federal prohibition on cannabis, sandwiched between two countries benefiting from newly established legal markets. Facing looming economic struggles following the COVID pandemic and historically unjust prison rates for minorities for cannabis convictions, the US may need to look to its neighbors for inspiration, and finally take steps towards ending its antiquated federal prohibition.
How Can I Get a Cannabis License in Mexico?
Currently our team is investigating the key players and decisions makers in the market. Let’s chat about your interests!
We would be happy to introduce you to our contacts and get the ball rolling for your business in Mexico. Fill out this form with more information and we will follow up with details of how our Cannabis Application Services in Mexico will get you licensed. We look forward to hearing from you soon.