Where Does Mexico's Cannabis Regulations Go Under AMLO?

Where Does Mexico's Cannabis Regulations Go Under AMLO?

Continuing on the exciting cannabis news out of Mexico, recently inaugurated President Andrés Manuel López Obrador’s administration has begun. Appointed to the position on December 1, the President often referred to as AMLO aims to take Mexico on a radical change towards leftist policies. AMLO’s recently launched Morena party swept through Congress as well, giving the party considerable power in reshaping the nation.

While some fear the President’s alleged authoritarian streaks, others laud the leader for dismantling an often corrupt government. That includes steps such as selling off the presidential Boeing 787. Refusing bodyguards and riding in the same old car he once had, AMLO assumes a new position of power in the same city he was once Mayor.

AMLO’s six-year term as President appears to serve cannabis considerably well. A month before the inauguration, Senator Olga Sanchez already tabbed to be the Interior Minister in the incoming cabinet, presented a bill to legalize cannabis use in Mexico. Sanchez explained that “The objective can’t be to eradicate the consumption of a substance that’s as prevalent as cannabis is."

Under the proposed bill, every citizen would be permitted to annually cultivate 20 marijuana plants and produce 480 grams on private property. However, edibles would remain prohibited. Additionally, the bill would refocus prosecuting policies that focus on low-level offenses rather than targeting more severe crimes.

With a Morena majority in Congress, some may assume that legalization is a foregone conclusion. However, polls in recent years have indicated that a majority of the country still opposes cannabis legalization. Opposition could come from within Morena’s own coalition, which includes a conservative party that continues to push back on cannabis reform.

That said, Morena is not the first administration that attempted to change public perception. University of San Diego political scientist David Shirk explained that despite substantial public opposition, Mexican officials had switched the focus to make the issue about public health for some time. Shirk noted that "Over the past two decades, however, Mexico has tried to move from outright prohibition toward a public health approach for managing drug use."

The public health debate extends from seniors receiving treatment to ending a bloody drug war. In 2017 alone, over 31,000 homicides occurred in the country. One of AMLO's most significant campaign promises was a call to end violence in Mexico. While experts expect cartels to shift their criminal activity to other illegal markets, likely keeping the homicide rate high, they will no longer have access to the illegal drug trade.

Shirk went on to explain that Lopez Obrador's government will hold public referendums on the issue to determine the course of action for cannabis. The referendum is expected to come within the next three years.

The Supreme Court has also opened the door to change in the country. An October ruling found that individuals should be permitted to grow and distribute cannabis for personal use. The verdict gives pro-cannabis supporters its most considerable boost in confidence to date. However, criminal chamber justices will have to come to the same conclusion five times. An additional path to legalization could come if eight of the eleven members of the court favor the petition.

Concerning cannabis and all other lawmaking, some have fretted over Lopez Obrador's penchant for pragmatism and authoritarianism. In some recent cases, he has fluctuated from pragmatism to populism. While startling markets, the moves have allowed AMLO to pick up considerable support of the people while stifling detractors.

Concerns over an unchecked government remain. Much like the United States over the past two years, Mexico will have a largely unchecked majority able to upend laws. With Lopez Obrador calling for Mexico's "fourth transformation" some wondered what changes would come and when.

Despite some concerns of his presidency, cannabis proponents received additional positive news in the build-up and early days of AMLO. A few days prior to his inauguration, Mexican authorities approved the sale of cannabis-derived products without a prescription. Additionally, authorities approved the first 38 products for sale. The products all contain 1% or less THC. Items approved include 21 food supplements, nine cosmetic products, six edibles, and two raw materials.

Another positive sign for cannabis' future in Mexico comes from major players entering the market. Early this December, Khiron Life Sciences Corp, a medical cannabis company with core operations in Colombia announced its entrance into the Mexican market after receiving approval from Federal Commission for the Protection Against Sanitary Risk. The company will operate under its wholly-owned subsidiary, Kuida Life Mexico S.A. Khiron joins other major international names in the Mexican market, including Canada’s Aurora Cannabis.

Recent rulings have given pro-cannabis advocates hope that Mexico will soon join Uruguay and Canada in allowing marijuana consumption. With several avenues, a change could come under the AMLO administration or the courts. With businesses entering the market and products being approved for sale, the result seems to be inevitable. That said, nothing is certain until it becomes laws. With citizens still largely opposed, AMLO may give the public what it wants despite the effort to curtail cartel drug violence. The change could come in months, possibly years or not at all.

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David Kani

David Kani is a Newport Beach, California based business lawyer with a focus on cannabis companies, their investors, employees and cannabis-related litigation.
To connect with David: [hidden email] or 714-907-0697.

To learn more about Hochfelsen & Kani LLP: hockani.com
To learn more about David's book Pot Inc.: suttonhart.com
For media inquiries or speaking engagements: [hidden email]



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