The wave of cannabis reform sweeping across the world has finally reached Mexico, and some American cannabis operators are already seeing gold. Canada, several states in the United States and some European countries have already legalized cannabis in various forms, and for most legal cannabis markets, cannabis has proven to be an insanely lucrative product. Not only are stakeholders reaping big rewards, but local governments are also receiving millions of dollars in tax revenue from the industry.
Last week, the Chamber of Deputies allowed the sale of cannabis products as well as the possession of small amounts of cannabis. Additionally, individuals would be able to consume cannabis in their homes as long as no minors are present. The legislation, which already has the Senate’s stamp of approval, will head back to the Senate where it will more than likely pass and be published, says Raul Elizalde, CEO of HempMeds.
With the legislation in play, now would be a great time for American, Canadian and international companies to invest in Mexico, he says. The Senate initially passed the law with little changes, he says, and it will essentially legalize the cultivation, harvest, processing, transportation, and sale of cannabis and cannabis products. However, it will take some time before retailers can start selling cannabis to the masses, thanks to an April 30 Supreme Court-imposed deadline.
According to Elizalde, the earliest Mexico will see the legislation’s final guidelines will be March 2022. He concedes that it isn’t a perfect law and it could run into plenty of challenges, especially from companies that don’t agree with the legislation and want it changed to suit their agenda. For instance, end-to-end licenses, which were introduced via an amendment in the lower house, may see pushback from some stakeholders. These licenses would allow companies to handle harvesting, processing, distribution and sales, similar to vertically integrated companies in the United States.
The state-legal cannabis industry in the U.S. is still bogged down by plenty of issues despite its relative success, chief among them being the patchwork of cannabis legislation in different states and municipalities. Fortunately for future cannabis companies in Mexico, only one legislation, rather than several different ones, will govern the country’s cannabis industry.
Elizalde’s confidence in the bill is warranted given the support it has received from President Andres Manuel Lopez Obrador’s party. His company, which is a subsidiary of Medical Marijuana Inc., was the first American company \allowed to import hemp supplements into the country. As the legislature works out the details of the cannabis legislation, the company hopes to gain a foothold in Mexico’s cannabis industry as well.
As Mexico works its way through the cannabis legalization process, companies in mature markets in North America are raising the stakes. For instance, XPhyto Therapeutics Corp. (CSE: XPHY) (OTCQB: XPHYF) (FSE: 4XT) has plans to finish the clinical trials for its cannabis-based drug candidates, including an oral strip, to treat spasticity resulting from multiple sclerosis.
NOTE TO INVESTORS: The latest news and updates relating to XPhyto Therapeutics Corp. (CSE: XPHY) (OTCQB: XPHYF) (FSE: 4XT) are available in the company’s newsroom at https://cnw.fm/XPHYF
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