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Mexico Senate suspension over COVID-19 puts cannabis legalization deadline in doubt

The Mexican Senate struck an agreement to postpone most legislative activity as part of the second phase of contingency measures to fight the coronavirus pandemic.

The decision casts serious doubt on the feasibility of complying with the April 30 deadline the Supreme Court set for the legalization of cannabis.

Senate commissions approved a legalization bill earlier this month, but the document still needs to go through the Senate plenary, the Chamber of Deputies (the lower house) and signed into law by the president.

It could still see modifications or setbacks along the way.

The lower chamber of the Mexican Legislature on March 20 suspended most activities.

There is no specific date in the announcement for when Senate work will be renewed, meaning the postponement is effectively indefinite.

In the document announcing the postponement of most activities, the Senate said it asked several government authorities – including the judicial power – to extend or suspend any deadlines prescribed to the Legislature.

But the Supreme Court is unlikely to reply to the request any time soon because it also suspended most of its activities – effective until at least April 19.

It remains possible that Mexican lawmakers will approve the cannabis bill before the end of April, but the chances are slim.

The Supreme Court originally set an October 2019 deadline, but after the Senate failed to reach a consensus, the chamber received an extension to the end of April 2020.

Even if the bill is approved by the April 30 deadline, a functional medical cannabis market in Mexico remains years away.

After the law is approved by the Legislature and signed by the president, a government cannabis regulatory institute must be created.

The new agency would then need to draft subsequent regulations before it could begin accepting licenses and permits applications.

The proposed bill has seen many modifications thus far. Its latest version would, among other things:

  • Limit foreign investment in a cannabis business licensee to 49%.
  • Block vertical integration by allowing a business to possess only one type of license – chosen from cultivation, transformation, commercialization and import and export.
  • Limit horizontal integration, for instance, by restricting the allowable number of retail points of sale, or limiting the area that a cultivation license holder would be able to grow.

“Vulnerable” domestic agrarian communities that have been affected by prohibition could be exempted from some of these restrictions, according to the draft law.

In addition to recreational marijuana, the bill would legalize cannabis for medical uses and industrial hemp.

Alfredo Pascual can be reached at [email protected]

For more of Marijuana Business Daily’s ongoing coverage of the coronavirus pandemic and its effects on the cannabis industry, click here.

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