Eve Mbasabye

Eve Mbasabye

Is Govt Being Unfair To Local Companies Intending To Deal In Marijuana?

The growing of marijuana for medicinal use has attained legal status in many countries across the world including Africa where global pharmaceutical companies regard as the new frontier for growing the herb.  

In Uganda, local and international companies have expressed interest in growing the herb on a commercial scale to meet the demand in Europe, North America and part of Asia where scientists continue to find medicinal value in the herb.

Uganda, according to government authorities, specifically the ministry of health, is bogged by the lack of legal regimes to regulate the growing of marijuana and for that matter has refused to license close to 100 companies desiring to farm the hemp.

Since last year when there was heightened demand for licenses to legally plant and grow marijuana for medicinal purposes the ministry of health commenced a process to revisit the laws and regulations on the matter but hasn’t come up with a promising position.

But what is most frustrating to some of the companies that despite applying for license many months to no avail is that some companies are illegally farming and exporting the herb to Europe. They say this is unfair, illegal and a bad gesture for a country like Uganda to hobnob with foreign firms at the detriment of local ones.

Recently, Uganda exported hundreds of kilos of marijuana to Israel. Daily Monitor newspaper recently reported that the Ugandan government cleared shipment of 250 kilogrammes of marijuana to Tel Aviv after Israeli Prime Minister Benjamin Netanyahu’s government agreed to pay for dry cannabis flowers.

According to the newspaper report, Kasese-based Industrial Hemp (U) Ltd, a company with Israel links, last year signed a delivery order with Israel’s ministry of health that requires Uganda to supply dry cannabis flowers at a gate price of $1,500 per kilo. The company is expected to export additional 600kgs later this month.

And this month, Industrial Hemp, using Turkish Airlines delivered their first cannabis exports to Israel. The company, one of the few licensed, is primarily engaged in the growing and development of medical cannabis (Medical Marijuana) and cannabis products alongside sativa for industrial purposes in Uganda.

The newspaper also revealed that under the new deal, Uganda is required to supply 2.5 tonnes of medical cannabis to Israel’s pharmaceutical industry. The Israelis are looking for cannabidiol (CBD) and tetrahydrocannabinol (THC) - the two important natural drug manufacturing compounds found in plants of the cannabis genus.

But while Industrial Hemp is cracking deals, many local companies with similar or better capabilities are wallowing in inactivity after ministry of health refused to offer them licenses to deal in marijuana.

There are more than 100 bids from companies and individuals seeking to secure government clearance to grow and export marijuana for medical purposes. Among the requirements to earn the license, these companies will have to present evidence of marijuana buyers.

The government is also under pressure from the various marijuana dealers to explain why they allowed Industrial Hemp (U) Ltd, a private company working with another Israeli-based cannabis firm to grow marijuana in Kasese and "frustrated" others through "delaying tactics".

The minister of health Dr Jane Ruth Aceng last year in a letter to companies that have applied for operational licenses said the government is still in early stages of carrying out wide consultations on this nascent area to understand the economic benefits of cannabis, its medical value based on scientifically proven evidence including the challenges of regulation so that we can formulate a way forward.

She said: "In line with the above, we have not yet progressed to the stage of granting operational permits for entities to grow and process cannabis for medical export in Uganda. However, we welcome more information and input on the subject matter."

Global medical reviews have indicated that using marijuana medically may help to treat epilepsy, chronic pain and cancer symptoms, help people who are addicted to alcohol, as well as treat symptoms of mental illness, like relieving depression and post-traumatic stress disorder symptoms, among others.

The World Health Organization, however, warns against non-medical marijuana use, linking it to the high rate of mental disorders, cancer and respiratory diseases, among others.

According to the Narcotic Drugs and Psychotropic Substance Act 2015, anyone involved in the manufacture, production, sale or distribution of a narcotic drug substance commits an offence and is liable to a fine not exceeding sh2.4m or imprisonment not exceeding five years or both.

The law prohibits the cultivation of any plant from which narcotic drugs and psychotropic substances may be extracted without permission from the health minister.

According to a Daily Monitor repot in January this year, individuals and companies seeking to grow or export marijuana for medical purposes will be required to present minimum capital of $5m (Shs18.3b) and a bank guarantee of Shs4b.

Investors will also be required to present a tax clearance certificate from the Uganda Revenue Authority, lists of employees and their job descriptions, a valid trading licence, evidence of value addition to cannabis and audited accounts.

The marijuana farms/sites must not be located near schools, hospitals and residential areas and in case of any associates/business partners, the details must be disclosed to government, including site designs, a robust security system with access control systems and intrusion systems in place.



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The world is turning to cannabis not only for its medical values but also its trade benefits and Uganda cannot afford to miss out, Rajiv Ruparelia, the managing director of Premier Hemp, one of the local companies eying growing the medicinal herb told local radio in an exclusive interview.

 “It will bring in foreign currency, the global cannabis phenomena is taking off. Uganda has one of the best environments, it has cheap labour force, availability of land. So, there is no reason why we shouldn’t be doing this,” Rajiv said.

“Like I said we need to be forward-thinking not following every other nation. So, I am very proud of our cabinet, I am very proud of our MPs because they have taken this initiative to drive it faster than our neighbours and this is going to create hundreds of thousands of jobs in Uganda.”

“If cabinet can sit down and pass this bill because it is going to be a game-changer for Uganda, it will inspire new industries to evolve and the speed at which they have driven this is phenomenal.”

Premier Hemp as part of Rupelia group of Companies plans to leverage its vast agriculture expertise - they own Rosebud Limited and Premier Roses who together control about 40% of Uganda’s flower export business – to grow Medical Marijuana on a commercial scale.

The company is one of over 20 companies that have applied for a production license that is pending cabinet clearance of policy guidelines on the production and processing for export of medical marijuana.

In January, according to Daily Monitor, the government sets strict rules for marijuana growing. Now individuals and companies seeking to grow or export marijuana for medical purposes will be required to present minimum capital of $5m (Shs18.3b) and a bank guarantee of Shs4b.

Investors will also be required to present a tax clearance certificate from the Uganda Revenue Authority, lists of employees and their job descriptions, a valid trading licence, evidence of value addition to cannabis and audited accounts.

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