You are using an outdated browser and your browsing experience will not be optimal. Please update to the latest version of Microsoft Edge, Google Chrome or Mozilla Firefox. Install Microsoft Edge

August 29, 2023

New Developments in Thailand’s Cannabis Law

Subscribe to Updates

Since the June 9, 2022, delisting of all parts of the cannabis plant according to the Narcotics Code, there has been an explosion of cannabis dispensaries operating in Thailand. The Department of Thai Traditional and Alternative Medicine (DTTAM) has issued more than 12,000 cannabis dispensary licenses to businesses in Thailand. A license allows a dispensary to sell cannabis flowers legally. In addition, the DTTAM requests the cooperation of dispensaries in submitting monthly reports about the sourcing, selling, and inventory of cannabis flowers. The DTTAM may suspend the selling license of dispensaries that fail to submit these reports.

Apart from the enforcement duties and administrative acts of the DTTAM, the enactment of the laws and regulations pertaining to cannabis seemed to be drastically winding down. One of the reasons was that Thailand had delays in the process of forming a new government following the general election of May 14, 2023. These delays dampened Thailand’s thriving cannabis industry.

In particular, the industry has concerns about the uncertainty of the nascent cannabis law. On August 11, 2023, the Narcotics Control Division of the Thai Food and Drug Administration (FDA) posted the Draft Regulation Re: Application for Approval and Approval for Manufacture, Importation, Exportation, Distribution or Possession of Narcotics under Category 5 (Extracts from Cannabis or Hemp Plants Only). This may be the first regulation that the newly formed government implements with regard to cannabis extracts. Unlike the DTTAM’s enforcement activities, the Thai FDA requests that a domestic manufacturer, importer, exporter, or seller of cannabis extracts apply for a license. The Thai FDA, as the authority, will consider granting a license only in the following cases:

  1. For medical benefits;
  2. For commercial or industrial benefits;
  3. For the benefit of medical or scientific analysis or research; and
  4. For use by the government for preventing and suppressing narcotics-related offenses.

Nonetheless, there is currently a restriction period of five years in place, limiting the importation of cannabis extract to cases 3 and 4 in the above list.

There are also some notable limitations for a legal entity applying for a license:

  • The entity must obtain corporate registration under Thai law;
  • The authorized signatories binding the legal entity (authorized directors) must have Thai nationality with an age of at least 20 years old;
  • If the entity is a limited company, it must have Thai shareholders holding at least 51% of the total number of shares; for legal entities in other categories at least two-thirds of the partners must be Thai nationals; and
  • The entity must have a physical office located in Thailand.

These limitations are likely to impact cannabis business operators engaging in the extraction of cannabis and the preparation of CBD/THC for both domestic and exportation purposes. If the regulation is implemented as written, business operators should review the structure of their legal entities carefully.

For more information, please contact Dr. Atthachai Homhuan, director of regulatory affairs, at atthachai.h@tilleke.

Related Professionals

Industries

Life Sciences

Practices

Regulatory Affairs

Location

RELATED INSIGHTS​ 

March 2, 2021
The cannabis plant has fascinated many civilizations, societies, and individuals through the centuries with its unique properties, and many have learned how to benefit from these, finding a variety of therapeutic and industrial uses of the plant that, in turn, enhanced domestic economies worldwide. In Thailand, cannabis plants and their derivatives have been used since ancient times as treatment for many diseases, and the plant forms a key ingredient in many Thai traditional medicinal remedies. However, over the past few decades, cannabis usage was seen to change in a way that became incrementally more abusive, resulting in outright prohibition in almost all countries. Thailand was no exception, and in 1979 the Thai government officially enacted the Narcotics Act forbidding the use of cannabis and listing cannabis plants and their derivatives—most notably marijuana (cannabis with psychoactive properties) and hemp (cannabis with limited or no psychoactive properties)—as category 5 narcotics (i.e., prohibited substances). Despite these restrictions, many Thais continued to use cannabis illegally, and some urged the government to legalize personal and commercial use of cannabis plants and their derivatives. Eventually, some in the Thai government agreed that it was time to consider steps toward legalization, As a result, the government has been taking action to delist cannabis plants from the list of prohibited narcotics since 2018, when a regulation allowed the cultivation of hemp for industrial and non-commercial purposes, such as household cooking and research and development. The next significant step came in February 2019, when the Narcotics Act (No. 7) was amended, legalizing medical marijuana within certain limitations. In national elections the following month, the Bhumjaithai political party, whose election campaign included a pledge to decriminalize and legalize cannabis plants, won substantial support in parts of the country and chose to join the coalition government, with the Bhumjaithai party
Read More
February 23, 2021
As many are already aware, following the change of government in Myanmar on February 1, 2021, a draft Cyber Security Law was proposed which attracted widespread criticism. However, less attention has been paid to significant amendments to two existing laws, some of which have a similar effect to parts of the draft Cyber Security Law. In other words, while the draft Cyber Security Law has not progressed further and is under public scrutiny, significant elements of it have found their way into law in Myanmar by other routes. Because these amendments are already law, it is very important that individuals and businesses in Myanmar understand their implications. Amendments to the Law Protecting the Privacy and Security of Citizens The Law Protecting the Privacy and Security of Citizens (2017), or the “Privacy Law,” was amended on February 13, 2021, less than two weeks after the military government came into power. These amendments chiefly address the power of the government to conduct searches, seizures, and arrests; to extend detention without judicial oversight; and to carry out broad surveillance and investigation activities that could intrude on individual privacy. The amendments accomplish this by suspending various sections of the Privacy Law for as long as the State Administration Council (the military body now governing Myanmar) is in power. The suspended sections include the following: Section 5: Search, seizure, and arrest without civilian observation The relevant part of Section 5 of the Privacy Law states, “The responsible authorities shall … when acting in accordance with existing law, not enter into a person’s residence or a room used as a residence, or a building, compound or building in a compound, for the purpose of search, seizure, or arrest, unless accompanied by minimum of two witnesses who should comprise Ward or Village Tract Administrators…”. The suspension
Read More
February 22, 2021
Following the recent imposition of sanctions on Myanmar individuals and companies by the US, the UK and Canada have now imposed new sanctions. As with the US sanctions, these new measures impact UK and Canadian citizens and companies, and non-UK and non-Canadian companies and citizens with interests in those jurisdictions. The EU has indicated that it is planning to issue similar sanctions in the near future. New UK Sanctions In addition to the 16 individuals already sanctioned by the UK government, on February 18, 2021, the UK government announced that three individuals have been sanctioned for serious human rights violations and are now subject to asset freezes and travel bans. The full list of Myanmar individuals and companies sanctioned by the UK is available on the website of the Office of Financial Sanctions Implementation. Breaches of UK financial sanctions are criminal offences punishable in the UK by up to 7 years imprisonment and heavy fines. New Canadian Sanctions Also on February 18, timed to coincide with the UK sanctions, new Canadian sanctions were imposed on nine individuals. As with the UK, Canada already had a number of individuals in the Myanmar military on its sanctions list, and the new additions bring the total number of individuals sanctioned by Canada to 54. All assets of these individuals in Canada are now frozen, and they are banned from travelling to Canada. Canadian businesses or entities may not do business with any of the 54 individuals. Full details of the impact of the sanctions are available on the Government of Canada’s website, as is a database of the Myanmar individuals and companies subject to them. Breach of Canadian sanctions carries with it up to 5 years’ imprisonment in Canada and/or a large fine. Other Countries The EU is reportedly drawing up sanctions
Read More
February 18, 2021
As you will no doubt know, on February 1, 2021, the Myanmar military declared a state of emergency in Myanmar for a period of one year. State Counsellor Daw Aung Sang Su Kyi was detained, as were the president and various significant political and civil leaders. Min Aung Hlaing, commander-in-chief of the Tatmadaw (Myanmar armed forces) has installed himself as chairman of the State Administration Council, the current administration. New sanctions The reaction of the Biden administration has been swift. On February 10, 2021, President Biden issued Executive Order 14014, which provides bases to impose sanctions on individuals and companies deemed by the US to, among other things: operate in the defense sector of Myanmar; be responsible for policies that undermine democratic processes in Myanmar; have taken actions to undermine democratic processes or institutions, or prohibit, limit, or penalize the exercise of free speech, in Myanmar; or be a spouse or child of the foregoing. On the next day, February 11, the US Office of Foreign Assets Control (OFAC), imposed sanctions under the new executive order on ten individuals—including General Min Aung Hlaing—and three companies, including Cancri Gems & Jewelry Co, Myanmar Imperial Jade Co, and Myanmar Ruby Enterprise.  All such individuals and companies have now been designated on the US list of specially designated nationals (SDNs). Effect of sanctions As a result of such sanctions, the property of these individuals or companies that is located in the US or is under the possession or control of US companies and citizens is frozen, and US companies and citizens are generally prohibited from dealing deal with any such property.  Reportedly, roughly USD 1 billion of funds belonging to the individuals and companies blocked on February 11 are located in the US and thus now frozen. The SDN list As many
Read More