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UAE Defies Global Trend Towards Cannabis Liberalization

As the cannabis industry is growing across much of Western Europe and North America, businesses would be wise to familiarise themselves with the UAE framework to avoid any unintended consequences as seen in the recent case of Billy Hood (see here). The UAE maintains a strict zero tolerance policy on the use of cannabis as further explained below. UAE Framework: Federal Decree-Law No. 30/2021 On Combating Narcotics and Psychotropic Substances (the “Law”). The Law prohibits the procurement, import, export, manufacture, extraction, separation, production, possession, acquisition and abuse of narcotic drugs and psychotropic substances. Cannabis is specifically mentioned and its definition includes cannabis-derived products (including but not limited to hemp, hemp seeds, and THC and CBD-related products). Medical Use: The Law does allow for the use of cannabis for medical purposes strictly and as long as it is prescribed by a licensed physician in the UAE. Clinical trials can also be conducted, however only controlled medical applications of narcotic drugs and psychotropic substances may be administered…

UAE Zero Tolerance Policy on Cannabis

There have been multiple headlines concerning the recent imprisonment of a British football coach (Billy Hood) in the UAE who was found to be in possession of CBD vape oil that contained elements of THC, the psychoactive component of cannabis. Whilst legal in the UK and other western countries it is strictly prohibited in the UAE. In connection with this case, the General Directorate for Drug Control (”GDDC”) stated that Mr. Hood was found to have ”quantities of cannabis oil intended for trafficking in return for financial gain.” The GDDC report that Mr. Hood was found to have various storage bottles, cannabis oil, 570 cartridges for vaping and a large amount of cash when he was arrested (see here). The offence of trafficking carries severe penalties under the UAE law and has resulted in a 25 year imprisonment for Mr. Hood. According to news reports the vape oil that was found in Mr. Hood’s car contained MDMB-4en-PINACA. The UN for…

Introducing Baker McKenzie’s Global Cannabis Dashboard: The Regulatory Landscape Across 112 Markets

We are extremely pleased to announce the launch of our Global Medical Cannabis Dashboard, a new interactive tool covering cannabis regulatory regimes in 112 countries (and counting) across the world. We reached out to our global network of healthcare regulatory specialist lawyers across 39 Baker McKenzie offices and 70+ of our correspondent firms and asked them to share their knowledge on this subject. Our resulting dashboard is unique in its scope and stretch and we invite you to explore it yourself. Our dashboard covers the overall feasibility of marketing medical cannabis, permissibility of medical cannabis in its raw form and in pharmaceuticals, clinical trials, export/import, recreational use, hemp definitions, and private sector involvement for each jurisdiction. This tool enables users to see overviews of cannabis regulations globally in the form of interactive heat and geographical maps, with the option to select specific regions, countries, or specific responses, to quickly and easily spot local and global trends. For the purposes of our…

Who’s Afraid of Code Section 280E?

This article referenced in this post was originally published in Volume 99, Issue 11, of CCH’s Taxes—The Tax Magazine (November 2021). In the November 2021 edition of International Tax Watch in TAXES – The Tax Magazine, Tom Firestone, Scott Frewing, Ethan Kroll, Erika Van Horne, Stewart Lipeles, and Julia Skubis Weber explore the U.S. international tax implications of section 280E, concluding that section 280E should not disallow deductions for expenses U.S. persons incur in connection with: maintaining cannabis IP in, and licensing that IP from, the United States;engaging in cannabis R&D in the United States; andassisting with and overseeing from the United States non-U.S. operations that manufacture, market, distribute, dispense, and sell cannabis products outside the United States, where it is legal to do so. They also determine that section 280E should not disallow deductions against tested or subpart F income for expenses CFCs incur in connection with manufacturing, marketing, distributing, dispensing, and selling cannabis products outside the United States, where…

Implementing Thai Regulations on Cannabis and Hemp in Food Products

Towards the end of July 2021, Thailand’s Ministry of Public Health (MOPH) issued a notification under the Food Act regarding food products which contain cannabis or hemp parts as a publication in the country’s Government Gazette. The notification, among other things, sets forth the classification of food products containing cannabis or hemp parts (“Food Products”) and the related requirements with respect to food quality, standards and labeling requirements.The key elements of this notification are as follows: The Food Products shall be classified as specially controlled foods under the Food Act.The Food Products shall adhere to the standards regarding THC content, CBD content, toxins and contaminants as prescribed in the related MOPH notifications and specific regulations applicable to each Food Product.Cannabis or hemp parts to be used in the Food Products must be legally sourced and their manufacturing, use of food additives and packaging must be in accordance with the MOPH notifications.The display of labels, health claims and nutrient content claims shall…

USDA Issues Final Rule for Hemp Production

The U.S. Department of Agriculture (“USDA”) released on January 15, 2021, a final rule package designed to serve as the framework for a U.S. hemp industry that gained federal legal status a little more than two years ago. The 301-page package delivers some changes from an October 2019 interim final rule that provided initial guidelines to implement the 2018 Agriculture Improvement Act (known colloquially as the “2018 Farm Bill”). The 2018 law removed hemp from the Controlled Substances Act and set a legal definition for hemp as 0.3 delta-9-tetrahydrocannabinol (“THC”) on a dry weight basis. The final rule package, which takes effect March 22, 2021, provides steps for the USDA to review and approve plans submitted by state, territorial and tribal governments for regulating hemp production. The rule also lays out how the USDA will regulate farmers in states or tribal lands that have not outlawed hemp but also have not submitted plans. The finished regulations come after 5,900 public comments…

The Future Of Drug Decriminalization After Oregon

This article was originally published by Law360 on December 16, 2020. On Nov. 3, Oregon passed Measure 110, a novel law[1] that reclassifies personal or noncommercial possession of controlled substances such as heroin, cocaine and methamphetamines, from a Class A misdemeanor to a Class E violation, punishable only by a $100 fine.[2] It also establishes a drug addiction treatment and recovery program funded in part by the state’s marijuana tax revenue and state prison savings.[3] In 1973, Oregon was the first state to decriminalize possession of small amounts of marijuana. Could Measure 110 be the first step to legalization of cocaine and heroin throughout the U.S.? Similarities to Marijuana Reform The broader drug decriminalization movement grows out of, and shares many similarities with, the marijuana reform movement. Like marijuana reform, it is driven by sophisticated, organized, long-term policy advocacy. For example, according to Ballotpedia, the largest contributor to the Measure 110 campaign was the Drug Policy Alliance, or DPA, which contributed over…

This article may also be found at https://www.law360.com/articles/1333792/2020-election-may-mark-a-turning-point-for-marijuana-law.

2020 Election May Mark A Turning Point For Marijuana Law

This article was originally published by Law360 on December 2, 2020. “You have a row of dominoes set up, you knock over the first one, and what will happen to the last one is the certainty that it will go over very quickly.” —Dwight D. Eisenhower What did this election do for the marijuana industry? A lot. Four states — three traditionally red — voted to legalize recreational marijuana while a fifth, one of the reddest, voted to legalize medicinal marijuana. These reforms will likely create a domino effect, leading other states to reform their laws and will likely also force change at the federal level. In short, the elections could mark a turning point for marijuana law and policy throughout the United States. What the States Did Three traditionally red states, Arizona, Montana and South Dakota — plus New Jersey — voted to legalize recreational marijuana, while Mississippi voted to legalize medical marijuana. In Arizona, marijuana reform received approximately 300,000…

Draft Kratom Act Approved by the Thai Cabinet

On October 12, 2020, the Thai Cabinet approved in principle the draft “Kratom Act.” By way of background, kratom is an herbal extract that comes from a tropical tree that has stimulant qualities if used in high doses. It was previously controlled under the Thai Narcotics Act because of its addictive effects. However, following recent developments in the liberalization of cannabis and hemp in Thailand, the Thai government has also been considering liberalization of the rules regarding kratom. On March 10, 2020, the Cabinet approved in principle a draft amendment to the Narcotics Act, which was proposed by the Office of the Narcotics Control Board (ONCB) and which would remove kratom (Mitragyna speciosa (Korth.) Havil.) from the list of category V narcotics under the Narcotics Act. However, due to its properties and addictive effects, the Council of State (a government organization which performs consultative functions including drafting laws, by-laws, rules and regulations) is of the view that there should be a…

What You Need to Know Before Importing/Exporting Legal Cannabis Products

As the market for hemp derived CBD has exploded, there is increasing interest in international trade in these products and the materials used to make them, including in the United States. For example, a US-based manufacturer of hemp-derived CBD edibles might import the active ingredient for manufacturing and then export the finished product overseas. US-based companies could also be interested in importing or exporting raw materials such as industrial hemp, hemp seeds, or other hemp-derived products. Below we summarize some of the key US trade compliance considerations for companies seeking to import or export these products. Because every export from the United States by definition involves an import into another country, there will always be at least one other jurisdiction’s import laws to consider.[1] What should you know about US export controls and economic sanctions? The first step in determining whether a particular export is permissible under US export controls laws is determining whether the product is described in an…