Media Release

18 July 2006

New licensing rules for industrial hemp

Commercial cultivation of hemp may become more common with a relaxing of the rules around its production from August 1.

The Ministry's medicine regulatory agency Medsafe will be implementing a new but less onerous regulatory regime for the cultivation, processing and distribution of industrial hemp as an agricultural crop. Those who wish to grow, trade in or process hemp will need to be licensed.

Spokesman Derek Fitzgerald said individuals and organisations would be allowed to grow hemp for industrial purposes and research under certain conditions.

“The new regulations --- the Misuse of Drugs (Industrial Hemp) Regulations 2006 and the Misuse of Drugs Amendment Regulations 2006 --- take into account the low drug content of hemp, which was previously subjected to the same strict controls as those placed on illicit cannabis,”Mr Fitzgerald, Medsafe’s Team Leader for Compliance,explained.

“They seek to balance growers’ appeal for practical and reasonable requirements against the need to maintain adequate controls on hemp seed and plants,” he added.

The new licensing system covers only industrial hemp, which refers to varieties of Cannabis sativa with low tetrahydrocannabinol (THC) - the psychoactive substance found in illicit marijuana crops –and primarily cultivated for their fibre or seed.

Other varieties of cannabis will continue to be regulated by the Misuse of Drugs Act 1975 and the Misuse of Drugs Regulations 1977.

Hemp fibre is used in the manufacture of ropes, textiles, paper and plastics. Hemp seed oil is used in food, cosmetics and other bodycare products. Hemp derivatives are also used as replacement for petrochemical products or as a renewable energy source.

As a drug, cannabis usually comes in the form of dried leaves (marijuana), resin (hashish), or various extracts collectively referred to as hash oil.

“The new regulations still classify industrial hemp as a controlled drug and consider it an offence to advertise hemp for psychoactive purposes or to supply it to unauthorised persons,” Mr Fitzgerald said.

A general licence costs $500 including GST and allows the cultivation, processing and dealing of cannabis varieties approved by the Director-General of Health. A research and breeding licence, on the other hand, costs an additional $150 and permits the cultivation and processing of non-approved varieties.

Under the new regulatory framework, only one general licence is required for multiple activities involving hemp on a single site.

Cultivation licences are granted initially for a year, and may be extended, on application, to three years. Licences solely for processing and distribution of hemp are granted for up to three years.

Mr Fitzgerald said licensees for any industrial hemp crops with THC levels higher than 0.5 per cent may be required to immediately harvest or destroy these crops.

Bare hemp stalks and processed hemp products are exempt from prohibitions in the Misuse of Drugs Act 1975 and the licensing requirements of the Misuse of Drugs (Industrial Hemp) Regulations 2006.

Licences for the import and export of industrial hemp will continue to be issued under the Misuse of Drugs Regulations 1977.

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To read the Misuse of Drugs (Industrial Hemp) Regulations 2006 and the Misuse of Drugs Amendment Regulations 2006 online, check the following websites after the new regulations come into force on August 1:

www.lexisnexis.co.nz

www.legislation.govt.nz

Questions and Answers:

1. Which varieties of Cannabis sativa are covered by the new regulatory regime?

The new licensing system covers only industrial hemp, which refers to varieties of Cannabis with a THC content generally below 0.35 per cent and not higher than 0.5 per cent.

In varieties grown for use as a drug, THC levels can reach as high as 20 to 30 per cent; these varieties will continue to be regulated under the Misuse of Drugs Act 1975 and the Misuse of Drugs Regulations 1977.

The Director-General of Health will decide on the varieties of hemp permitted to be grown in New Zealand. Growers may make an application for other varieties to be considered for cultivation.

2. Why were new licensing rules for industrial hemp developed?

In the mid-1990s, a review of security issues surrounding cannabis cultivation was conducted and resulted in a proposal for the trial cultivation and processing of industrial hemp.

In 2001, then Minister of Health Annette King approved a two-year trial cultivation of industrial hemp to determine its potential as a commercial crop and the level of control that would be appropriate for such cultivation. That scheme was extended to allow the continued cultivation of hemp while the new regulations were being developed.

In 2003, Cabinet approved the recommendation to develop a regulatory scheme to control activities relating to industrial hemp. In 2004, it approved the issue of drafting instructions for the regulations to govern this.

Government regulators including Medsafe believe that controls should recognise the low drug content of hemp, which was previously subjected to the same strict controls as those placed on illicit cannabis.

3. Will the new regulations – namely the Misuse of Drugs (Industrial Hemp) Regulations 2006 and the Misuse of Drugs Amendment Regulations 2006 – supersede the Misuse of Drugs Act 1975 and the Misuse of Drugs Regulations 1977?

The new regulations cover only industrial hemp. Other varieties of Cannabis sativa will continue to be regulated by the Misuse of Drugs Act 1975 and the Misuse of Drugs Regulations 1977.

The Misuse of Drugs Amendment Regulations 2006 amend the Misuse of Drugs Regulations 1977 and licences for the import and export of industrial hemp will continue to be issued under the latter regulation.

4. The psychoactive chemical tetrahydrocannabinol (THC) is present in all cannabis plant varieties. How will Medsafe ensure that industrial hemp is not used for illegal purposes, and that other forms of cannabis are not cultivated and distributed under the guise of industrial hemp?

The new regulations provide safeguards from possible abuse. Firstly, the Director-General of Health will determine which varieties of cannabis can be cultivated. Applicants for cultivation licences must meet certain conditions with respect to background and suitability.

Licensees may also be required to have their crops tested for THC levels. Results of such tests must be provided to the Director-General of Health. If a test result showed that a crop has a THC level higher than 0.35 per cent or 0.5 per cent, the regulations prescribe different courses of action which may include further testing of, harvest of, or an order to destroy the crop altogether.

The regulations specify possible offences and prescribe penalties, including fines, suspension and/or revocation of licences, for these.

It must also be noted that the THC levels in hemp are generally below 0.35 per cent and not above 0.5 per cent.

5. The new regulations promise a less onerous regime for licensees than the Misuse of Drugs Regulations 1977. How will Medsafe balance the new regime against the interests of the wider community and ensure that hemp seed and plants are adequately controlled?

The new regime still classifies industrial hemp as a controlled drug, and provides adequate controls for the cultivation, processing and distribution of hemp.

First, a licence will apply only to a particular location and specify the activities and varieties licensed to be grown. The location for licensed activities must be safe and suitable for the relevant activity, and at least five kilometres from residential areas unless special permission is given.

Licence holders are also required to keep the hemp secure, maintain records, report on licensed activities to the Director-General of Health, and alert the police and the Director-General of unauthorised activities.

Applicants – either individuals or organisations – must meet certain conditions with respect to background and suitability before they are granted a licence. An applicant or a director or responsible person nominated by an organisation will be subjected to a background check by the New Zealand Police.

ENDS

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