Over the past few months, Thailand and its Ministry of Public Health (MOPH) have taken strides to deregulate certain cannabis and hemp plants. These actions have the potential to change the future of the cannabis and hemp industry in Thailand, in ways that are set out in further detail below.
I. Thailand’s Ministry of Public Health Notification Exempts Certain Parts and Extracts of Cannabis and Hemp Plants from Regulated Narcotics
On 14 December 2020, the MOPH published a notification regarding the determination of category V narcotics B.E. 2563 (2020) (“the New Notification“) in the country’s Royal Gazette.
The New Notification, which became effective on 15 December 2020, repealed and replaced previous MOPH notifications regarding determination of category V narcotics which were issued in 2018 and 2019. The key changes in the New Notification are summarized below.
The following parts and extracts of the cannabis or hemp plants, for which permission to manufacture in Thailand has been obtained, are exempted from the list of category V narcotics:
- The following parts and extracts of the cannabis or hemp plants, for which permission to manufacture in Thailand has been obtained, are exempted from the list of category V narcotics: (i) bark, trunk, fiber, stem and root of cannabis and hemp; (ii) leaves without shoot tip and flowers of cannabis and hemp; (iii) cannabis and hemp extracts containing cannabidiol (CBD) and containing tetrahydrocannabinol (THC) not exceeding 0.2% by weight; (iv) cannabis and hemp residues after extraction containing tetrahydrocannabinol (THC) not exceeding 0.2% by weight; and (v) hemp seed, hemp seed oil, or hemp seed extracts.
- Importation of parts and extracts of the cannabis and/or hemp plants which are exempted from the list of category V narcotics will be subject to the Narcotics Act, except for dried bark, dried trunk core and dried fiber of cannabis and hemp plants.
- The category V narcotics which are used as quality control substance for analysis and quality control of narcotics substance detection in the body are also exempted from the list of category V narcotics.
II. Thailand’s Ministry of Public Health Rolls Out Long-Awaited Regulations on Cannabis and Hemp in Food
Following the MOPH’s creation of “exempted cannabis” and “exempted hemp” from Thailand’s category V narcotics list, on 25 February 2021, the MOPH further issued a highly anticipated notification that amended the designation of foods which are prohibited from being produced, imported or sold (the “Prohibited Food Notification“). The Prohibited Food Notification no longer prohibits the use of exempted cannabis and exempted hemp in food products.
The Prohibited Food Notification repealed the previous MOPH notification that prohibited every part of the cannabis plant and the hemp plant from being used as food ingredients and amended the list of prohibited plants or parts of plants to remove exempted cannabis and exempted hemp from the list. Business operators will be able to use exempted cannabis and/or exempted hemp as an ingredient in food products in accordance with the applicable MOPH regulations to be issued in respect of the related food quality and standards.
Accordingly, another implementing regulation prescribing food products, food quality and standard of hemp seed, hemp seed oil, hemp seed protein and food supplement which contains hemp seed, hemp seed oil, and hemp seed protein as an ingredient was also issued on 4 March 2021 and became effective on the following day.
We expect additional implementing regulations with respect to hemp based food products to be issued in the near future.
III. Cannabis Outlook: What’s on the Horizon?
As we approach the second anniversary of the historic amendment of the Thai Narcotics Act to allow the use of cannabis for medical purposes for the very first time in Thailand, the first country in Southeast Asia to do so, we take this opportunity to assess and forecast the outlook for the cannabis industry in Thailand and the region.
With the increasing awareness and recognition of the benefits of the cannabis plant and in particular hemp from more research and use of the plants, in particular the active ingredient cannabidiol (CBD), we saw the Thai government easing restrictions that it had traditionally placed on cannabis and hemp, as discussed above.
Nevertheless, due to the legacy of cannabis and hemp having been strictly regulated as narcotics, the laws and regulations and their interpretation and enforcement by the authorities are not straightforward. Against this backdrop, here are some of the trends we are likely to see in 2021 and beyond, and our forecast for the cannabis and hemp industry in Thailand and the region, as well as the regulatory implications.
1. Growth in industrial hemp: hemp in cosmetics
Although cannabis and hemp both derive from the species Cannabis sativa, hemp with a lower concentration of THC and possibly a higher concentration of CBD, and arguably the “safer” of the two strains, has been the focus of the liberalization efforts in Thailand, with various new regulations being issued in order to develop the market for industrial hemp, including the recent policies from the Thailand Board of Investment (BOI) to promote the manufacture of oil, extracts, active ingredients and related products from hemp. Therefore, this article will focus on industrial hemp.
One area where the application of hemp is allowed is in the area of cosmetics. Studies have shown that hemp seed oil is rich in high essential fatty acid content, making it an ideal ingredient for cosmetics, and in particular, skin care and body care products. Due to this essential property of hemp, various cosmetics and skin care products have been launched in the international market, such as body lotion, lip balm and massage oil.
With the new Ministerial Regulation allowing the production and sale of cosmetics with qualified hemp seed oil and hemp seed extracts in Thailand, coupled with more guidance from the Thai Food and Drug Administration (FDA) to assist business operators with the marketing authorization (including labeling and advertisement requirements for cosmeceuticals, namely products which are essentially a combination of cosmetics and pharmaceuticals and making the related health claims), the laws and regulations and policies of the regulators seem inclined to encourage more investment in the area of cosmetics containing hemp and its extracts.
2. The next anticipated area: hemp in food
With hemp having cleared the regulatory hurdles for use in cosmetics, naturally, the next area is the applications of hemp in food. With hemp seed, hemp seed oil and hemp seed extract already exempted from being regulated as narcotics, the market is currently waiting for the much-anticipated implementing regulations to be issued, currently expected to be within the first quarter of this year, to allow product licenses to be obtained for the production and sale of hemp-based food products. With hemp seed being high in protein and also a great source of iron, there is also a lot of business potential for hemp seed, hemp seed oil and hemp seed extract being used as ingredients in food products, such as granola and hemp milk and other CBD-infused beverages.
3. Cannabis and hemp for modern medicinal use
Following the development of the legal regime for cosmetics and food containing hemp and the related industry, we anticipate to see developments in the industry and legal regime for modern medicine containing extracts from cannabis or hemp. Although a rigorous study of cannabis as a medicine was not possible given its previous narcotics status and the drug will need to go through the phases of clinical trials before it will be approved by the FDA, with more and more studies claiming the safety and efficacy of cannabis and its CBD (e.g. in the treatment of seizures and anorexia associated with weight loss – the therapeutic uses of certain drugs approved by the US FDA), we may soon see a new marketing authorization being issued for a new cannabis-derived drug product in Thailand.
4. A regional business: export of hemp products
When thinking about a potential business model for cannabis and hemp and the demand for the products, it is also important to factor in the possibility to export the products. Although the Thai regulations contemplate these products being approved for export, business operators must also bear in mind the regulations that apply in the importing country. For example, different countries may accept different levels of THC content in a cannabis-derived product or may even have different definitions for THC and may have different regulations on the labelling and advertising requirements for these products.
5. Thailand as medicinal cannabis tourism destination
Although this might be a little difficult to recall given the current COVID-19 pandemic, with Thailand already being a regional medical hub, with the growing interests in alternative treatments, the growth of medicinal cannabis tourism in Thailand may not be far-fetched after the situation with the current pandemic improves.
With more progress made in its regulatory framework when compared to other Asian countries and other promising features, such as its strategic position as a regional medical hub and prominent medical tourism sector, Thailand has the potential to become a leading player in the medicinal cannabis and industrial hemp market. Additional subordinate rules and regulations, as well as supportive environment for the business sector, would help ensure the realization of Thailand’s potential and its promising position in this market.