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MEXICO CANNABIS LEGAL UPDATE #23 TIME FOR A REALITY CHECK

MEXICO CANNABIS LEGAL UPDATE #23

TIME FOR A REALITY CHECK
June 10, 2022

Over a year ago, we reported on a General Declaration of Unconstitutionality (Declaratoria General deInconstitucionalidad; “DGI“) issued by the Mexican Supreme Court of Justice (the “SCJN“) due to the failure by our Legislative Branch to regulate in accordance with the SCJN’s jurisprudence published on 2018. In theory, the main effect of the DGI is the elimination of the absolute prohibition of cannabis recreational use, which will now be allowed provided a permit is obtained from the Federal Commission for the Protection against Sanitary Risks (Comisión Federal para la Protección contra Riesgos Sanitarios; “COFEPRIS“). In practice, COFEPRIS has been omissive in responding to the filings for such permits as such agency continues to struggle with underfunding, overload of work and, in some instances, corruption.

It is worth remembering that the DGI does not regulate or establish the basis for a legal commerce in Mexico and that cultivation, transportation or storage of cannabis for purposes other than pharmaceutical or medical use are still penalized by our Federal Criminal Code.

Over the last year, however, additional developments have taken place not with the transcendence we had hoped for, but indeed signaling that the legalization movement is moving slowly but surely:

1.- Amparo Granted for Industrial Hemp Production. On December 1, 2021, the SCJN granted an amparo (an injunction-like resolution issued to protect against violations to a private person’s fundamental rights) to a company that had requested from COFEPRIS an authorization to cultivate and produce industrial hemp. COFEPRIS denied the petition based on current limitations set by the Mexican Health Law. However, the Nation’s Highest Court ruled that the prohibitions were unwarranted and that industrial hemp (i.e. not to exceed the 1% THC limit) cultivation could be carried out provided the right “monitoring, control and security conditions” are in place as determined by the authority in order “to protect public health and order”.

It is important to note that this resolution does not establish binding caselaw for all Mexican courts. However, it does strengthen the legal argument to separate hemp from psychoactive cannabis in the interpretation of our current laws. It also paves the way for other parties to design and carry out a litigation strategy with the same goal.

2.- SCJN Resolution Provides Flexibility on Marihuana Possession Limits. Consistent with the progressive thinking that the SCJN has shown in the past years regarding recreational use, a relevant step was taken towards decriminalization through a resolution issued on May 11, 2022. The court declared unconstitutional the wording of a Mexican Health Law provision limiting possession to 5 grams, provided the carrier individual has it for personal or dependent use. Just like the hemp resolution previously mentioned, this only has legal effects for the party in the amparo procedure. However, it also provides solid legal precedent that can be useful by other parties. Perhaps more importantly, both resolutions represent yet another advance coming out of the judiciary front – not the legislative or executive branches.

3.- Presidential Decree banning Vaporizers and E-Cigarettes. On May 31, 2022, President Lopez signed a decree banning the import and sale of vaporizers and electronic cigarettes. This was not the first action by the Executive Power regarding said devices; a Presidential Order had been issued last year banning the import of vaporizers and COFEPRIS had also recently issued a sanitary alert about the risks brought by such products. Similar to the situation of CBD products (still generally prohibited for import and sale), lack of regulation and acknowledgment of the already existing -and growing- markets.

With this brief summary of recent developments and considering the overall recent regulatory and judicial history, the current state of cannabis affairs in Mexico can be summarized as follows:

  • Recreational personal use is allowed provided you have an amparo or a COFEPRIS permit, as discussed above. Our Criminal Code still prohibits wholesale cultivation and general commerce.
  • Avenues for strategic litigation are opening for production of industrial hemp, though in general terms our laws and regulations still don’t allow it.
  • Medical and pharmaceutical use of cannabis is underway pursuant to the January 2021 regulations, though criteria and harmonization of other rules are still pending.

Finally, with respect to the bill that would legalize all uses at a federal level which had been previously approved by both legislative chambers, we remain skeptical that the current Administration will coordinate the efforts to finally pass it. We hope our President and Legislators prove us wrong.

If you would like an English translation of the Medical Rules or the last recreational cannabis legalization bill at a discounted price, please reply to this message.

If you would like to consult our previous Mexico Cannabis Updates, please click here.

If you are interested in learning more about the Mexican legalization process and what you or your clients can start doing to enter the Mexican market, please contact us at larmendariz@caamlegal.mx.

Luis Armendariz
LinkedIn: luisarmendariz
Twitter: @MexCannaLaw

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