On December 21, 2023, the Verkhovna Rada of Ukraine adopted Law No. 3528-IX, which fundamentally changes the legal regulation of the market for the cultivation and processing of (parts thereof) for industrial purposes.
The law enters into force on August 16, 2024.
The key provisions that are changed by Law No. 3528-IX regarding the economic activities on the cultivation and processing of hemp or its parts for industrial purposes are as follows:
- economic activity, which is carried out by a legal entity, is now not subject to licensing;
- the economic entity must not obtain a permit for the use of objects and premises used in this kind of economic activity;
- the provisions of the Law “On narcotic drugs, psychotropic substances and precursors” now do not apply to the regulation of the production and circulation of raw materials and hemp processing products (including their parts) for industrial purposes, except certain cases*;
- a subject of economic activity that intends to carry out growing and processing hemp or its parts for industrial purposes, according to the declarative principle, notifies the Ministry of Agrarian Policy and this is sufficient to start work;
- the maximum content of tetrahydrocannabinol in dried straw of hemp for industrial purposes should not exceed 0.2% before February 16, 2027, and 0.3% – after February 16, 2027;
- before the introduction of Law No. 3528-IX into effect, the Cabinet of Ministers of Ukraine must develop and adopt a number of legal documents that should regulate the procedures and mechanisms in the field of industrial cultivation and processing of hemp more specifically.
When and how the provisions of the Law of Ukraine "On narcotic drugs, psychotropic substances and precursors" can be applied to regulate economic relations in the cultivation and processing of industrial hemp:
I. The law contains definitions that must be followed by economic entities working in the field of cultivation and processing of hemp for industrial purposes
Hemp for industrial purposes – plants of the hemp genus (Cannabis), grown from appropriate and certified seeds of no lower than the second generation, belonging to the group of agricultural crops used for industrial purposes, where the concentration content of tetrahydrocannabinol in the dried straw does not exceed 0.3 percent “
(According to the transitional provisions – temporarily, within three years from the date of entry into force of this Law, i.e. until February 16, 2027, the maximum permissible concentration of tetrahydrocannabinol in dried hemp straw for industrial purposes does not exceed 0.2 percent).
Hemp processing products for industrial purposes (parts thereof) – products formed as a result of processing activities for industrial purposes hemp (parts thereof), excluding tetrahydrocannabinol (the following isomers and their stereochemical variants)”.
Hemp raw materials for industrial purposes – whole hemp plants for industrial purposes or any of their parts, regardless of the degree of separation (shredding), used in raw or heat-treated form for further use in industry, regardless of the type of activity (except production of medicinal products or production of narcotic drugs or psychotropic substances).
Narcotic drugs, psychotropic substances and precursors do not include goods produced (manufactured) from hemp for industrial purposes, and hemp processing products for industrial purposes, provided the content of tetrahydrocannabinol in them does not exceed the limit.
2. The law establishes the conditions for cultivating and processing hemp for industrial purposes
The Ministry of Agrarian Policy maintains the Register of legal entities engaged in sowing, growing and processing hemp for industrial purposes.
The register is formed according to the declarative principle and is maintained in accordance with the procedure approved by the Ministry of Agrarian Policy.
Legal entities that carry out the activities of sowing, growing and processing hemp for industrial purposes are obliged to submit the relevant information to the Ministry of Agrarian Policy for its entry into the Register.
The Ministry of Agrarian Policy provides real-time access of the National Police of Ukraine to the information contained in the Register.
3. Control measures for enterprises that grow hemp for industrial purposes are stipulated in the Law.
The law contains general regulations of the procedure for controlling the content of tetrahydrocannabinol in hemp for industrial purposes.
Thus, the determination of the concentration of tetrahydrocannabinol in dried hemp straw for industrial purposes is carried out by conducting laboratory tests (research) of samples of the hemp plant (Cannabis) by enterprises, institutions and organizations managed by State Service of Ukraine on Medicines and Drugs Control, or state specialized expert institutions that are authorized for this in accordance with the Law of Ukraine “On forensic expertise”.
Harvesting is prohibited until the results of the laboratory test (research) are obtained.
The sampling of the hemp plant (Cannabis) for laboratory tests (research) is carried out based on the application of the business entity that is engaged in the cultivation and processing of hemp for industrial purposes, submitted in the prescribed manner, within 10 calendar days from the date of application. The term of conducting laboratory tests (research) of samples of the hemp plant (Cannabis) cannot exceed 5 working days according to procedure “A” and 10 working days according to procedure “B”.
General rules of verification procedures are defined. In particular, the sampling is carried out with the participation of the National police of Ukraine:
- procedure “A” – during the flowering period of the hemp plant in order to determine the quantitative percentage content of narcotic drugs or psychotropic substances;
- procedure “B” – within 10 days after the end of the hemp plant flowering for the purpose of conducting an additional laboratory study in case the maximum permissible concentration of narcotic or psychotropic substances in plants was exceeded.
According to the law the procedure for submitting an application for laboratory tests (research), sampling, determination of the laboratory test (research) subject, sending samples for laboratory tests (research), conducting such laboratory tests (research) and the appeal of the laboratory test (research) results is established by the Cabinet of Ministers of Ukraine.
If the concentration of tetrahydrocannabinol in the dried straw of hemp grown for industrial purposes exceeds the level established by this Law, which is confirmed by the results of laboratory tests (research), the entire grown crop of such hemp for industrial purposes is subject to destruction in the prescribed manner.
Conclusions:
Full-fledged economic activity on the cultivation and processing of hemp for industrial purposes under the new simplified rules will be possible no earlier than the next agricultural year 2025
The adopted Law contains regulations that make it possible to build a general picture. These regulations indicate a simplification of state control and movement in the direction of deregulation of legal relations in the cultivation and processing of hemp for industrial purposes.
In order to fully launch the market for the cultivation and processing of hemp for industrial purposes, by-laws for regulating the functioning of the Register of entities that grow and process hemp for industrial purposes, the Procedure for controlling tetrahydrocannabinol concentration etc. must be adopted.