Ecuador Legalizes Low-THC Hemp Cultivation

On June 21st, 2020 the Ecuadorian government implemented 127 changes to the Comprehensive Organic Penal Code (COIP), legalizing the cultivation and harvesting of cannabis in Ecuador.

The legal approach to the matter

What is decriminalized or legalized, in the Article 127 of the Organic Integral Penal Code (COIP) reforms, is the planting, cultivation, production, industrialization, commercialization and export of non-psychoactive cannabis or so-called industrial hemp, whose tetrahydrocannabinol (THC) molecule is less than 1%. The medicinal use of hemp will allow studies in the country on treatments for anxiety, Parkinson’s, Alzheimer’s, among other diseases.

The reform adds a text to the organic law for the integral prevention of the socioeconomic phenomenon of drugs and the regulation and control of the use of catalogued substances subject to control. It indicates that “non-psychoactive cannabis or hemp, understood as the cannabis plant and any part of that plant, whose delta-9 tetrahydrocannabinol (THC) content is less than 1 % in dry weight, is excluded from the catalogued substances subject to taxation, and is regulated by the National Agrarian Authority”.

Over-centralization?

What was approved by the National Assembly marks the beginning of an industry that is yet to be born, and that first requires regulation by the Ministry of Agriculture within 120 days. The Ministry of Agriculture already has a draft 26-page regulation.

The Federation of Cannabis Communities of Ecuador questions the fact that the regulations prohibit hemp planting in border and coastal areas. It considers that there is discrimination in their content and that small producers and peasants are left out. But, most importantly, these regulations refer to differentiated amounts of investment and values for guarantees, licenses and fees for associations, without greater clarity. In addition, the Federation argues that the Ministry of Agriculture is given excessive powers to inspect, sanction and even destroy hemp crops. Likewise, that the regulation lacks environmental considerations, as they believe that the market cannot be expected to regulate the use of agrochemicals.

Two uses, two agricultural approaches

The president of the Ecuadorian Association of Medicinal and Industrial Hemp (EcuaCáñamo), José Antonio Dávalos, also points out that regulation should be simple, and avoid what has happened in other countries due to over-regulation of the industry. The advantage, he says, is that this regulation focuses on a single Ministry and does not extend to more bureaucracy.

He adds that the important thing is to avoid that the regulation is inclined only in the medicinal use of the hemp. Otherwise, the industrial part will be left out, and it is the one that is actually capable of generating revenue and employment.

What differs between the regulation of medicinal hemp and industrial hemp is that when it is a product that will be ingested by humans, the quality of the product is very important, on the one hand to ensure that it does not have high levels of THC (1%), and that it does not have traces of pesticides; for industrial use, however, it is not really so concerned with these details; therefore, if a ban on the use of pesticides is established, the industrial part would be affected.

Corporative approach

Hemp cultivation is becoming attractive for the international market, and more novel because the advantage that Ecuador has. In fact, due to its geographical location and climate characteristics, the territory would allow at least three or four harvests a year, with very little artificial lighting integration being necessary.

Dávalos considers that by establishing permits for hemp cultivation only for legal entities, the Ministry intends to control and determine responsibility for production and marketing, and at the same time provide security when establishing the licenses. The small farmer who wishes to enter this industry will definitely have to form some kind of legal entity either by corporation or limited company or farmers association, he notes.