Cannabis Licenses in Colombia, Get to Know the New Regulation

July 30, 2021

The Colombian government has taken a big step to promote the cannabis industry for medical and scientific purposes in Colombia. On July 23, 2021, the Decree 811 of 2021 signed by the President of the Republic of Colombia, regulates several important and necessary aspects for the evolution of the cannabis industry in the country.

Evolution of the Regulation of Medicinal Cannabis in Colombia

From the legal point of view, the medical cannabis industry in Colombia has been asking to export the dried flower of cannabis for medicinal purposes, to the extent required by the global market and the commercial customs of this sector. That's why the Colombian government, listening to these requirements, decided to issue this new Decree 811 of 2021, which opens the door to export the dried flower of cannabis, which is a fundamental raw material for the pharmaceutical, cosmetic, and food industry globally, as well. as it is also used to a great extent for scientific research.

Clearly, this new regulation favors entrepreneurs in this sector in Colombia and encourages foreign investment in this sector, as the Decree 613 of 2017 is modified, introducing significant changes that create a range of industrial and commercial possibilities for the cannabis industry for medicinal and scientific purposes.

Among the changes highlighted is the authorization of the use of dried cannabis flower for exportation under medicinal and scientific purposes, something that was previously forbidden. Importantly, the cannabis industry in Colombia has a structured legal framework under strict control, prevention, entrepreneurship, equality and, anti-corruption, aimed at scientific and medicinal use, but not for recreational use.

In addition to approving the exportation of dried cannabis flower and expansion of due dates of the licenses cannabis, other relevant aspects were modified for this industry, therefore we invite you to read this entire article. If you don't have enough time to read it, and you are a foreign or national investor who wants to venture into this cannabis industry. Contact our cannabis licensing attorneys at the link below. If you don't have enough time to read this article and you are a foreign or national investor who wants to venture into this industry in Colombia. Contact our Cannabis Licensing Attorneys at the next Contact Form.

What's New About the Decree 811 of 2021

We allow ourselves to briefly explain the main changes brought by the Decree 811 of 2021, with emphasis on those that our ways of seeing are striking for entrepreneurs, investors and, entrepreneurs in the industry of legal cannabis for medicinal and scientific purposes.

1. One of the main things about the Decree 811 of 2021, is that the Information Mechanism for Cannabis Control (MICC) is maintained and strengthened, which allows the application of cannabis licenses digitally, making this service faster than was previously carried out in person.

In our opinion, while it's true that the MICC has been an important advance in the medical cannabis licensing process in Colombia, Decree 811 of 2021 should have been stricter in the time it takes to process a cannabis license than according to our experience, continues to be extended even when the previous and current regulations speak of a maximum time of thirty (30) days for the granting of licenses that have met all legal and technical requirements.

2. Another important modification is the time that is granted to start the activities of the cannabis license, for example, in the case of the non-psychoactive cannabis cultivation license, it is established that the cultivation activities must be started within the nine (9) months following the granting of the licenses. Time in our opinion is short given that once the licenses are granted, the time it takes to implement all the infrastructure necessary for cultivation, as well as the time it takes to hire personnel and start-up schemes, must be kept in mind. crop safety.

3. In addition, this Decree 811 of 2021 creates a new category for licenses for the manufacture of non-psychoactive cannabis derivatives that will only allow the transformation of non-psychoactive cannabis and non-psychoactive cannabis plant components. This is a substantial difference insofar as the previous regulation only spoke of derivatives licensing regardless of whether they were psychoactive or non-psychoactive.

4. This new decree also addresses an issue that was very outstanding addressed by the national government, which refers to the validity of licenses. In the previous regulation granting licenses are given for five (5) years, but now with the Decree 811 of 2021, current licensees may request an advance of three (3) previous months maturity, expansion of the term for five (5) more years and the granting of the new licenses will be for a period of ten (10) years.

Decree 811 of 2021 expressly includes a list of very specific obligations and prohibitions, with special emphasis on the fact that failure to comply with any of these will lead to their cancellation. Although many of these prohibitions and obligations could be easily extracted from the previous regulation, the creation of a list of obligations and prohibitions for licensees makes the rules of the game and the responsibilities of companies dedicated to cannabis in Colombia much clearer. If you are interested in obtaining a cannabis seeds license and want specialized legal advice, we invite you to contact us through our contact form or write us in our next WhatsApp number: (310) 5706331.

5. At the same time, the Decree 811 of 2021 establishes under what circumstances the suspension of cannabis licenses and their cancellation will operate, highlighting that the company or natural person from whom the licenses are canceled will not be able to request them again for the term of two (2) years, a prohibition that also extends to shareholders with a stake equal to or greater than 20% in the company and their legal representatives.

6. Another great advance corresponds to the possibility of outsourcing the different activities of the licenses, as well as the decree 811 of 2021 planet the possibility for the licensees of any license of the cannabis industry in Colombia to outsource the activities of cultivation, harvest, and postharvest; transformation of grain, storage of seeds, grain vegetable component, vegetable component, plants and derivatives, manufacture of derivatives.

7. Regarding the pharmaceutical and medicinal domestic industry, it opens the possibility of manufacturing finished products based on cannabis in Colombia, (such as drugs, herbal medicines, homeopathic and master formulations).

8. About the foreign trade regime, this new regulation establishes the regime for the importation of merchandise into free trade zones by the different actors of the medical and scientific cannabis industry in Colombia, allowing different licensees to carry out various industrial processes in the free trade zone at all times, and when the uses and purposes of the imported goods are authorized by the cannabis regulation in Colombia.

9. Clearly, another important advance of the Decree 811 of 2021 corresponds to the export regime, which allows the exportation of seeds, grain, plant components, plants, cannabis, cannabis derivatives, products obtained from cannabis derivatives, and vegetable components. Specifying that these foreign trade operations within the cannabis industry can be done in the following ways:
• From the Colombian customs territory to the rest of the world
• From free trade zones of Colombia to the rest of the world
• From the national customs territory of Colombia to other free trade zones.

This new foreign trade regime, especially what has to do with exports within the legal cannabis industry in Colombia, is undoubtedly a regulatory evolution that makes Colombia one of the countries with the greatest potential for a global market of medical and scientific cannabis. Opening the possibility for entrepreneurs to establish themselves in free zones in the national territory where production or conditioning processes can be carried out with a vocation for export or import.

We think that although the Decree 811 of 2021 generates an advance in terms of export, import, and foreign trade in general, for the legal cannabis industry in Colombia for medical and scientific purposes, the national government, through its Ministries, still needs to issue the specific regulation that determines the requirements, procedures, and steps that must be carried out to carry out the export and import procedures.

Small and Medium Cannabis Growers in Colombia

In relation to the protection of small and medium-sized growers, producers, and marketers of cannabis in Colombia, although in a study or previous concept of advocacy of the competition of the Superintendency of Industry, and Commerce, it was recommended to eliminate the minimum percentage of 10% that must be acquired from these market players.

The national government decided to preserve this protection for small and medium growers, producers, and marketers. The reason why licensees continue with the obligation to acquire at least 10% of psychoactive or non-psychoactive cannabis of each quota from a small or medium grower.

Summary of the Benefits of Decree 811 of 2021

We can highlight the main benefits of the modifications made by the Decree 811 of 2021, as follows:

• The economic reactivation of Colombia, through the generation of employment, to carry out these cannabis activities.
• Colombia can be a world leader in innovation in the pharmaceutical sector, in the production and export of cannabis for medicinal and scientific purposes, guaranteeing safe and effective cannabis-based medicines for patients.
• Colombia will allow extraordinary authorizations at the higher education level, for the acceleration of scientific research on cannabis.
• The Information Mechanism for the Control of Cannabis (MICC) is strengthened and maintained for the license application process.
• There is an extension of the due dates of cannabis licenses, from 5 to 10 years.
• Sanctions are established in cases of suspension of cannabis licenses.
• The outsourcing of cultivation, harvest, and postharvest of cannabis is allowed; transformation of grain, storage of seeds, grain vegetable component, vegetable component, plants and derivatives, manufacture of derivatives.
• The entry of the cannabis-dried flower in free trade zones is authorized. So that industrial and pharmaceutical companies with their respective licenses, can carry out their transformation, packaging, and repackaging processes, taking advantage of the tax benefits of these areas.

At AGT Attorneys We Offer Specific Services For The Cannabis Industry

Thanks to our professionals in Cannabis law in Colombia, we offer a variety of legal services regarding cannabis for medicinal and scientific use in Colombia, among which are:

• M&A of cannabis companies.
• Patent of cannabis plant varieties.
• Foreign trade procedures or customs law for export or import for the cannabis industry for medicinal or scientific purposes.
• Cannabis Licensing
• License for the cultivation of psychoactive cannabis.
• Non-psychoactive cannabis cultivation license.
• License for the use of seeds for cultivation.
• License for the manufacture and manufacture of cannabis derivatives.
• Legal defense litigation against Cannabis regulatory entities.
• Cannabis Compliance Outsourcing.
• Lands for Cannabis Cultivation in Colombia.

Do you need Cannabis Legal Services Lawyers in Colombia?

If you are a foreign or national investor and have a good investment to establish your business in the medical or scientific cannabis industry, contact our cannabis lawyers. We have all the legal experience to help you from the incorporation of your company to the repatriation of capital, whether in cases of the national business or if your company is located outside of Colombia.

Read our Cannabis articles:

• License for the Manufacture of Cannabis Derivatives.
• License for the use of Cannabis Seeds for Planting and Crops.
• License for the Cultivation of Psychoactive Cannabis Plants.

You can do it either by writting us at (310) 5706331 or by filling out the next Contact Form. We'll be glad to assist you!