You may have heard some buzz around Law 340. It’s a very long document. Here is a summary.

In May 2015, then Governor Alejandro Garcia Padilla issued an Executive Order legalizing medicinal marijuana in the commonwealth of Puerto Rico. In early 2016, the Puerto Rican Health Department adopted Regulation 155, which recognized the change in policy and gave bureaucratic sanction to the legal cultivation, manufacturing and distribution of medical-grade cannabis products on the island.

Despite the earnest efforts of the Puerto Rican government to make medicinal marijuana available as quickly as possible, the original Executive Order was lacking in specifics, and the Health Department edict needed further technical and administrative support.

On June 25^th, 2017, almost six months after the sale of medical marijuana products officially became legal, the Puerto Rican House and Senate each passed the final version of Law 340, which establishes the parameters, rules and standards that will govern the operation of the medical marijuana industry in Puerto Rico.

Each bureaucratic institution involved in the implementation of the new system will have its own rules and regulations to enforce. But this groundbreaking legislative initiative is designed to create an integrated and workable super-structure that regulates every aspect of the medical marijuana industry, to protect the safety and welfare of patients who obtain recommendations from their physicians for medical-grade cannabis products.

Law 340: A Basic Outline

As explained by the committee responsible for its drafting, Law 340 was necessary to accomplish the following:

1. Reaffirm the prohibition of marijuana for recreational use.
2. Create a legal framework that covers the entire medicinal marijuana industry.
3. Establish standards to determine legitimate medical uses for cannabis products and authorize further scientific research into the effectiveness of cannabis as a medication.
4. Form a vigorous control structure that brings transparency and assures accountability for all actors involved in the medicinal marijuana trade.
5. Set appropriate levels of punishment for physicians who don’t comply with the requirements of the law when recommending medicinal marijuana for patients.
6. Amend existing laws on impaired driving to make it illegal for anyone to operate a motor vehicle while “under the influence” of medicinal marijuana products.

To monitor and manage the medicinal marijuana industry in all its phases (cultivation, research, manufacturing, transportation and sales), the creators of Law 340 have passed responsibility on to a supervisory committee called the Board of Cannabis (Junta Reglamentadora del Cannabis).

The six permanent members of this nine-person Board will include the Puerto Rican Secretaries of Health, Economic Development and Trade, Agriculture, Treasury and Consumer Affairs, along with the Superintendent of Police. Three revolving members must be appointed by the Governor and will include people with expertise in medicine, economic development and scientific investigation.

Impact of the New Regulations of Law 340 on the Medicinal Marijuana Industry in Puerto Rico

While medicinal marijuana is now legal in Puerto Rico, recreational marijuana is still illegal and listed as a Schedule 1 substance (meaning it has a high risk for abuse and addiction) by the U.S. federal government.

In recognition of this status, Puerto Rico’s marijuana control standards will be strict, rigorous and designed to create barriers that prevent illegal distributors from exploiting the medicinal marijuana trade for illicit ends.

The security measures adopted to prevent abuse of the system include:

• Stringent licensing requirements for growers, manufacturers and distributers, allowing for careful tracking of all cannabis products sold to medical patients. All licenses must be renewed on an annual basis.
• Approval of a limited list of medical conditions that make patients eligible to purchase cannabis products, and fines of up to $100,000 for physicians who recommend them for non-approved medical conditions.
• Strong accounting and record-keeping procedures to reduce the likelihood of money laundering (the hiding and movement of funds obtained through the sale of illicit narcotics). Only financial institutions approved by the government can be used to deposit funds acquired through the legal sale of medicinal-grade cannabis.
• Creation of a central database recording the names and purchase history of medical marijuana customers. At no time will anyone be allowed to buy more than a one month supply of cannabis medicines during a visit to a dispensary.

After receiving a recommendation for cannabis from a physician, all patients (or their guardians if under 21 or companions if disabled) must obtain medical marijuana IDs before being eligible to enter dispensaries to purchase products. Medical marijuana IDs must be renewed annually, and those carrying medical marijuana products must have their IDs on their person at all times.

Tourists or travelers from other parts of the United States can purchase cannabis medicines while in Puerto Rico, but they must have medical marijuana IDs issued in their own states to do so. Even with a medical marijuana ID, however, they will still have to obtain a recommendation from a physician in Puerto Rico before buying medical-grade cannabis.

A Guarantee of Efficiency or a Recipe for Chaos?

As revealed by the composition of the Board of Cannabis, the new medical marijuana statute in Puerto Rico, also known as Law 340, will incorporate virtually every institution of government into the monitoring and regulatory fold. This is intended to reduce the chances of abuse within the system, mainly from illegal medical marijuana growers, dealers and consumers who might seek to expand or whitewash their activities by using legal marijuana sales as a cover.

This broad-ranging attempt to bring order and structure to the medical marijuana business may achieve its goals: to protect consumers while giving producers, manufacturers and retailers the market stability and legal certainty they need to operate profitably and efficiently. But because the system involves so many actors, there could be ambiguities and conflicts over authority that create waste, confusion and disorder.

At the very least, a system with so many moving parts and such ambitious goals is bound to need tweaking or modification on occasion. The current laws will undoubtedly change (possibly significantly) over time, and Encanna will do its best to keep our customers and suppliers up-to-date on the evolving legal status of the fledgling medical marijuana industry.