30 November, 2019
The term cannabis has been in the spotlight recently not only in Thailand but also around the world as there have been many recent developments regarding medical and recreational cannabis that are worth noting and have spurred investments in many parts of the world, notably North America and some parts of Europe. For Thailand, with the recent legalization of medical cannabis, the topic is still a new one as regulations are still shaping up. However, it cannot be denied that investment opportunities come with such development, either in the short or long run, and this is where we must try to understand the full extent of what is possible now under both international and domestic laws and what to look out for, as well as to learn practical issues from other countries with more established regulatory environments and investments in these areas. Thailand, which is moving with caution, can learn from other countries' experiences how best to go forward.
Amidst these developments there are various interviews given by relevant government agencies, discussions among investors, the private sector, both locally and internationally, as well as those in relevant circles, including financial and project advisors. When one looks into the press or interviews given by various government agencies or potential stakeholders at different timings (before and after the Narcotic Act was revised to accommodate the government's policy on this matter), possibility of misunderstanding and confusion might occur.
Like all types of legal requirements and relevant investments, one needs to understand clearly the legal framework before deciding to make an investment. If one decides to proceed, choosing the right time to invest and finding a suitable investment partner would be among key issues to consider.
This article intends to answer some of the frequently asked questions and provide information that will address some of the issues which many people seem to have misunderstood.
Myth: The revisions of Narcotic Act have liberalized the use of Cannabis fully.
Reality: The revisions allow Cannabis to be used for medical, science and research and development only. Use for recreation purposes is still deemed illegal.
Myth: People can grow six cannabis trees in their backyard for personal or household use.
Reality: Cultivation must be approved by the relevant government agency (i.e. FDA) and during the first five years from the date that the Narcotics Act (No. 7), B.E. 2562 (2019) (the Act) came into effect (19 February 2019), the applicant must only be those in the following categories:
- a government agency that has the duties to research or educate people or provide services on medicine, pharmacology, science, or agricultural science to facilitate medical or pharmacological benefits, or to protect against, suppress, and solve narcotics problems, or the Thai Red Cross; or
- the above-mentioned government agency working in cooperation with a medical practitioner, a Thai traditional medicine practitioner, a higher education institution under the law regarding private higher-education institutions that have duties to conduct research and education on medicine or pharmacology, or agricultural practitioners who group together as community enterprises, social enterprises, or agricultural cooperatives.
Myth: One can now import cannabis or bring in the same for personal use.
Reality: All importation must be approved by the FDA and during the first five years from the date that the Act became effective (19 February 2019), only the categories of applicants as described above and patients travelling across borders who need to carry cannabis to or outside the Kingdom for their specific medical treatment may apply for such a license. Bringing in for personal use must be for medical treatment purposes and has to be in accordance with the medical prescription and the total amount must not exceed the necessary quantity for medical treatment. Aside from the license to import, the applicants are also required to apply for the license to possess, however the period for applying for the license to possess already expired on 19 May 2019. Applicants now cannot apply for a license to possess.
Myth: All cannabis-related products are controlled under the Narcotic Acts.
Reality: Certain concentrations of cannabis extracts are exempted from Narcotics of Category V. These are (i) extracts with a concentration of at least 99% of CBD with not more than 0.01% of THC, which can be used as a reference standard; and (ii) cannabis extracts with CBD as a main ingredient with not more than 0.2% THC, which can be used as drugs or herbal products according to the Drug Act and the Herbal Product Act. The exemption is for five years after the Notification of the Ministry of Public Health re: Naming of Narcotics of Category V (No. 2), B.E. 2562 (2019) came into effect (31 August 2019), and it applies only to the local productions.
Myth: Cannabis may be used in all Thai traditional medicines.
Reality: There are only the 16 following Thai medicine formulas in which cannabis and cannabis extracts may be used as an ingredient:
- Akkiniwakana medicine, Tat Phra Narai scroll;
- Sukkasaiyad medicine, Tat Phra Narai scroll;
- Nawanariwayo medicine for gas, from inscription in Wat Phra Chetuphon Wimon Mangkhalaram;
- Sanantraipob oil medicine, from inscription in Wat Phra Chetuphon Wimon Mangkhalaram;
- Medicine for gas running upwards, from inscription in Wat Phra Chetuphon Wimon Mangkhalaram;
- Fai Awut medicine, Pattayasatsongkror Volume 1, Phraya Pitsanuprasatwet;
- Insomnia medicine and medicine for Pom Leurng fever, Pattayasatsongkror Volume 1, Phraya Pitsanuprasatwet;
- Medicine for Santakart or Klon Hang, Pattayasatsongkror Volume 2, Phraya Pitsanuprasatwet;
- Ammaritosot medicine, Pattayasatsongkror Volume 2, Phraya Pitsanuprasatwet;
- Apaisali medicine, Wetsuksa, Phraya Pitsanuprasatwet;
- Medicine for gas and tendon, Wechasatwanna;
- Medicine for psychosis, Ayurawetsuksa (Kunnittedsukkit) Volume 2;
- Paisali medicine, Ayurawetsuksa (Kunnittedsukkit) Volume 2;
- Medicine for hemorrhoids and skin disease, Ayurawetsuksa (Kunnittedsukkit) Volume 2;
- Tamlai Prasumen medicine, Traditional Thai Medicine Scroll, Volume 2, Kunsopitbannalak; and
- Tappayatikun medicine, Traditional Thai Medicine Scroll, Volume 2, Kunsopitbannalak.
Myth: Any Thai traditional physician may prescribe the above approved Thai traditional medicines.
Reality: Thai physicians who may prescribe the "Thai Medicines" must be those licensed by the FDA only.
Myth: The private sector may participate in research and development projects with universities or government agencies.
Reality: The private sector can participate in research and development projects with government agencies only if they fall into the one of the following categories:
- a medical practitioner, a pharmacology practitioner, a dental practitioner, a first-class veterinary practitioner, a Thai traditional medicine practitioner, an applied Thai traditional medicine practitioner, or a folk doctor under the Thai medicine profession law; or
- a higher-education institution under the law regarding private higher-education institutions that have duties to conduct research and education on medicine or pharmacology; or
- agricultural practitioners who group together as community enterprises, social enterprises, or agricultural cooperatives.
In addition, if the private sector is a natural person, he or she must have Thai nationality and have his or her place of residence in Thailand. If the private sector is a juristic person, it must be registered in Thailand, have at least two-thirds of the directors, partners, or shareholders possess Thai nationality, and have an office located in Thailand.
Myth: The law should be soon liberalized to allow the private sector to directly invest in cannabis manufacturing/import and sale/export.
Reality: The Ministry of Public Health by the Narcotics Control Board is monitoring the performance of the measures regarding the permission to manufacture, import, export, sell, or possess cannabis by conducting evaluations every six months during the first five years from the date that the Act came into effect (19 February 2019).
The criteria to grant permission can be amended, if the board is of the opinion that the criteria should be improved and proposes that the Minister of Public Health review the permission criteria to make it more appropriate and up-to-date. Presently, there are no provisions that allow private sector entities to directly invest in cannabis. After the first five years, the law may become more liberal or more restrictive. It depends on the performance evaluation in the first five years from the date that the Act came into effect.
Myth: UN allows cannabis to be used for both medical and recreation purposes.
Reality: According to the Single Convention on Narcotic Drugs, 1961, there is no provision on the convention allowing cannabis to be used for recreation purposes. Narcotics drugs are limited to be used for medical and scientific purposes only. The convention indicates that the convention shall not apply to the cultivation of the cannabis plant exclusively for industrial purposes (fibre and seed) or horticultural purposes and the party shall adopt the measures as may be necessary to prevent the misuse of, and illicit traffic in, the leaves of the cannabis plant.
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