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

July 28, 2021

Outlook for Cannabis Liberalization and CBD Market Authorization in Laos

Subscribe to Updates

In recent years, many countries have begun exploring the pharmacological effects of the cannabis plant and the economic benefits of cannabis liberalization. For example, Laos’ neighbor Thailand has cautiously moved forward with legalizing both cannabis and hemp for medical purposes and to boost the Thailand’s economy. The authorities in Laos are likewise looking into the possibility of opening up some of the country’s strict prohibitions on CBD and medical cannabis. However, little has been done so far, and consumption, production, and commercial use of cannabis—including cultivation and commercialization of hemp-related products—remain strictly prohibited. Those who market products related to hemp or CBD in Laos currently risk criminal or civil liabilities.

Legal Landscape and Enforcement Risks

The cannabis plant (Cannabis sativa L.) is known mainly for producing two compounds: tetrahydrocannabinol (THC), which is a psychoactive substance, and cannabidiol (CBD), a nonpsychoactive compound with several beneficial pharmacological effects. A cannabis plant with a relatively high amount of THC exerting psychoactive effects is known as “marijuana” (Cannabis sativa L. subsp. indica), while a cannabis plant with very little THC is considered “hemp” (Cannabis sativa L. subsp. sativa).

Marijuana and hemp have not been defined under Lao law, and the Lao authorities usually take the approach that marijuana is synonymous with the cannabis plant, regardless of the percentage of THC in the plant. The Law on Narcotics No. 10/NA, dated December 25, 2007, prohibits narcotics from being used in Laos. The Decree on the Implementation of the Law on Narcotics No. 076/PM, dated March 20, 2009, declares the “cannabis plant” a narcotic-producing plant, prohibiting its cultivation and possession, and officially places THC on the country’s list of prohibited narcotics. As CBD is extracted from the cannabis plant, products containing the compound are therefore likely to be prohibited as well.

The Penal Code No. 26/NA, dated May 17, 2017, prohibits all activity related to marijuana (here meaning all cannabis) cultivation, trafficking, and possession, setting punishment for violations at three months’ to life imprisonment and fines of LAK 500,000–200 million (approx. USD 52–21,200), depending on the nature of the goods and the activity.

Outlook for Cannabis Liberalization in Laos

In 2019, the Lao government created an ad hoc committee to determine whether the legalization of hemp cultivation in Laos for medicinal use would be feasible, and whether the country might benefit from such a policy. In this vein, the country’s authorities have allowed some local companies to grow hemp in very specific zones under pilot programs, while maintaining the strict overall prohibition on cultivation and commercialization of hemp-related products.

This change in the authorities’ outlook on hemp-related products may evidence their interest in diversifying Laos’ sources of income. The country’s efforts to expand its market potential is not surprising, given that it has developed trusted labels to promote the “made in Laos” brand, and has registered geographical indications (e.g, Bolaven Coffee, Khao Kai Noy rice) to penetrate foreign markets. The market potential of hemp, the future of the CBD market, and the possible impact of these products may encourage the Lao authorities to liberalize cannabis, or at least production, extraction, and commercial use of CBD in Laos—the economic benefits of which could also ease COVID-19’s adverse effects on the Lao economy.

Globally, prospects for cannabis and CBD-related products are bright, with various countries (such as Canada and the U.S.) liberalizing regulations for cannabis and CBD-related products. In Europe, pressured by the EU Court of Justice’s recent decision, and region-wide advocacy for liberalizing restrictions and commercializing CBD products, a more tolerant approach to CBD products may soon be adopted in order not to contravene the principle of the free movement of goods in the European Single Market.

Meanwhile, in Laos, this global trend for recognizing the beneficial effects of cannabis, and specifically CBD, may incentivize the country to encourage development of high-quality products containing CBD and revise its legal framework for cannabis and CBD. Laos’ manufacture of these products could potentially bring further economic growth to the country through direct revenue, investment in research and development, establishment of scientific infrastructure, and the development of local expertise on the subject—all of which could foster sustainable foreign direct investment in the future.

This article was prepared with the assistance of international intern Keoni Williams.

Related Professionals

Industries

Consumer Products

Life Sciences

Practices

Regulatory Affairs

Location

RELATED INSIGHTS​ 

July 23, 2025
On June 26, 2025, the National Assembly of Vietnam adopted Resolution No. 216/2025/QH15 to extend the duration of agricultural land use tax exemption through December 31, 2030. This policy extension reaffirms the government’s ongoing efforts to support the agricultural sector, ensure national food security, and promote rural development. Key Takeaways Tax Exemption Period Extended: The new resolution continues the full exemption from agricultural land use tax as stipulated under Resolution No. 55/2010/QH12, as amended in 2016 and 2020. The tax exemption, which was originally set to expire at the end of 2025, will now remain in effect until December 31, 2030. Scope of Exemption: The exemption applies to all types of land currently eligible under the existing legal framework for agricultural land use tax relief. This typically includes land used by households, cooperatives, and non-commercial organizations for agricultural production, aquaculture, salt-making, and reforestation. Effective Date: Resolution 216 will take effect on January 1, 2026. During the interim period, tax exemption remains valid under existing laws and resolutions until the end of 2025. Implementation Guidance to Follow: The government is tasked with issuing detailed guidance to ensure effective implementation of this extended exemption. Businesses, cooperatives, and individuals engaged in agricultural activities should monitor upcoming regulations and instructions from relevant ministries. Outlook Vietnam’s extension of agricultural land use tax exemption demonstrates a strong policy commitment to rural economic stability and environmental sustainability. For land users, the exemption represents meaningful financial relief that can be reinvested into modernizing farming techniques, improving land efficiency, or transitioning to sustainable practices. While the extension itself is automatic, it is recommended that agricultural land users and stakeholders review their land use documentation and tax profiles to ensure alignment with eligibility requirements. Future implementation regulations may also introduce new compliance obligations that should be tracked closely.
Read More
July 15, 2025
On July 1, 2025, Vietnam’s Ministry of Health issued Circular No. 30/2025/TT-BYT providing updated guidance on the application of drug quality standards, testing of drugs and pharmaceutical ingredients, and procedures for the recall and handling of noncompliant drugs (Circular 30). Circular 30 officially came into effect on the same day and replaces Circular No. 11/2018/TT-BYT and its amendments. Key highlights of Circular 30 are presented below. Drug and Pharmaceutical Ingredient Quality Standards Circular 30 maintains consistency with previous regulations regarding the selection of an applicable quality specification. Pharmaceutical businesses and drug preparation establishments may still choose to apply standards from the Vietnamese Pharmacopoeia, reference pharmacopoeias (including the United States Pharmacopoeia, the European Pharmacopoeia, the British Pharmacopoeia, the Japanese Pharmacopoeia, and the International Pharmacopoeia), or an in-house specification. Priority is given to the Vietnamese Pharmacopoeia and reference pharmacopoeias, encompassing quality indicators, quality levels, and testing methods. If alternative pharmacopoeias or in-house specifications are used, they must meet the requirements outlined in the corresponding monographs of the Vietnamese or reference pharmacopoeias. At the time of registration, the quality standards of drugs and pharmaceutical ingredients must comply with either the current version of the pharmacopoeia or a previous version of the pharmacopoeia that is no more than two years older than the current version. The requirement for updating quality specifications in line with the quality under the corresponding pharmacopoeia also applies to products that have already been granted marketing authorization. Testing Drugs and Pharmaceutical Ingredients in Quality Management Similar to the regulations under the previous circular, if pharmaceutical businesses disagree with the sample testing results, they may, within five working days of receiving the test report, request that the state quality inspection authority designate an alternative testing facility. The testing period for establishments listed as foreign drug manufacturers with quality violations remains
Read More
July 14, 2025
Life sciences specialists from Tilleke & Gibbins have updated the firm’s guide to pharmaceutical data exclusivity regulations and practices in Southeast Asia. This guide contains quick-reference information on the availability of data exclusivity protections and limitations in Cambodia, Indonesia, Laos, Malaysia, Myanmar, Thailand, and Vietnam. Developing and launching a new drug on a commercial scale requires an enormous amount of time and investment in research and development (R&D), including pre-clinical testing and clinical trials. When considering the aggregate amount of drug development costs, it is important to recognize that this includes not only the investment in developing new drugs that get approved by a government food and drug regulator and are successfully brought to market, but also the R&D expenditures on a large number of potential pharmaceutical compounds and products that never actually make it to market. In particular, considerable investment is required in order to conduct and produce clinical trial data—to prove safety, efficacy and effectiveness of a new drug—that would warrant marketing approval by the regulatory authority. Such data is proprietary in nature and highly valuable for a research-based pharmaceutical company that develops an original drug. On the other hand, patent law typically confers generic drug manufacturers with the ability to engage in various preparatory activities with a view to obtaining marketing approval for a generic product before the patent for the original drug expires (commonly known as a “Bolar provision”). Since a generic drug maker may submit an application for marketing approval of a generic product before the relevant patent expires, the extent to which the drug originator’s data submitted to the regulatory authority is protected—or in other words, the extent to which the generic company may rely on the drug originator’s previously filed data, which underpins the safety and efficacy of the drug, to support
Read More
July 9, 2025
On June 16, 2025, the National Assembly of Vietnam adopted Law No. 75/2025/QH15 amending and supplementing a number of articles of the 2012 Advertising Law, with an effective date of January 1, 2026. The amended Advertising Law was enacted to further refine the legal framework for advertising activities in the modern era. Online Advertising Under the amended Advertising Law, “online advertising” is defined to encompass not only advertising on electronic newspapers and electronic information pages (as provided under the 2012 Advertising Law) but also advertising on other electronic venues, including social media, online applications, and digital platforms with internet connection. The amended Advertising Law also imposes new requirements for online advertising, including: Identification signs: Advertisements must have clear identifiable signs in numbers, letters, symbols, images, or sounds to distinguish them from non-advertising content. Control features: For advertisements not in fixed areas, there must be easily recognizable features and icons that allow recipients to turn off the advertisement, notify the service provider of violating advertising content, and refuse to view inappropriate advertising content. Linked content: Content in the links embedded in advertisements must comply with the law. Advertising service providers and publishers must have measures to check and monitor the linked content. Advertising on social media: Organizations and enterprises providing social media services must offer users features to distinguish advertising content from other content. Signage for sponsored content: When advertising, users of social media services must use signs to differentiate advertising or sponsored content from other content they provide. In response to the above requirements for online advertising, the amended Advertising Law sets out obligations of advertisers, advertising service providers, advertising publishers, and advertising conveyors in relation to online advertising. Among these, it is notably the responsibility of individuals and organizations engaging in online advertising to prevent and remove violating
Read More