Overview of Cannabis and Cannabinoid Regulations in Japan

Under the current Cannabis Control Act in Japan, the possession, transfer, acceptance, importation and exportation of cannabis plants and their products are prohibited, except for possession by a person with a licence to cultivate or research cannabis plants. No one is allowed to engage in any medical or recreational use of cannabis plants and their products, or to cultivate cannabis plants except by a person with a cultivation or research licence. As the Japanese government has been very reluctant to issue cultivation licences, there were only 27 licensed cultivators as of 31 December 2022. In other words, the market for cannabis plants and their products is virtually non-existent in Japan.

However, the seeds and mature stems of cannabis plants and their products are exempt from regulations under the Cannabis Control Act. Therefore, there is a market for products of cannabis seeds such as animal feed, essential oil materials, and spices, as well as for products of mature cannabis stems such as textile products and traditional products used in Shinto rituals.

In recent years, CBD products or CBD as a raw material said to be made from mature stems are being imported from foreign countries and distributed in Japan. However, there have been several cases where Delta-9-THC was detected in CBD products being distributed in the Japanese market, and the regulatory authorities have issued warnings to distributors and requested them to conduct voluntary recalls.

It is worth noting that the Japanese government designates many controlled substances as having harmful effects and likely to be abused as narcotics. The possession, use, transfer, acceptance, manufacture, importation and exportation of narcotics are prohibited and penalised under the Narcotics and Psychotropics Control Act. The Cannabis Control Act regulates cannabis and cannabis products, and prohibits, with penalty, the possession, transfer, acceptance, importation and exportation of these substances and products.

The rate of drug use among Japanese citizens is remarkably low compared to that of other countries. According to one study, the lifetime experience rate of cannabis use in Japan is only 1.4% of the population, compared to 20–40% in the United States and Europe. As can be seen from these experience rates of drug use, the Japanese government is generally very strict in its enforcement against drug crimes, including those related to cannabis.

Recent Regulatory Change

In recent years, pharmaceutical products made from cannabis are gradually being approved and marketed in the United States and Europe. In addition, given the recognition of the medical usefulness of pharmaceutical products made from cannabis, the regulatory category of cannabis in the Single Convention on Narcotic Drugs, 1961 was reclassified from Schedule IV (that is, selected drugs from Schedule I that are considered to have particularly dangerous properties and limited or no therapeutic benefit) to Schedule I (that is, drugs the control provisions of which constitute the standard regime under the 1961 Convention), a category that includes substances that may also have medical usage.

In response to these developments, the Japanese government had been considering changes to the cannabis and cannabinoid regulation. Thus, in December 2023, a bill (the “Amending Law”) was passed to amend the regulatory framework on cannabis, including fundamentally amending the Cannabis Control Act as well as revising the Narcotics and Psychotropics Control Act. Although the Amending Law has not yet come into effect and will be implemented in two phases, in 2024 and 2025, it will allow the use of pharmaceutical products manufactured from cannabis and facilitate the distribution of THC-free cannabis-derived products, particularly CBD products.

This chapter of the guide sets out the regulatory landscape as it will appear after the Amending Law comes into effect.

Drastic Regulatory Framework Reform

The Amending Law will drastically change the regulatory framework for cannabis.

Before the Amending Law, the Cannabis Control Act regulated cannabis plants, with the exclusion of mature stems and seeds, and products made from these plants. In other words, the cannabis and cannabinoid regulation focused on certain parts of cannabis plants (eg, leaves, flowers, flower heads, resin and immature stems).

In contrast, the Amending Law changes the approach in regulating THC derived from cannabis by classifying it as a narcotic under the Narcotics and Psychotropics Control Act, based on the understanding that the essential harm of cannabis is caused by THC, the toxic component of cannabis.

As a result, products containing THC will be regulated by the Narcotics and Psychotropics Control Act similar to other narcotics, regardless of whether or not the THC is derived from cannabis. The Cannabis Control Act, on the other hand, will primarily regulate the cultivation of cannabis plants, and has been renamed the Cannabis Plant Cultivation Regulation Act.

Medical Cannabis and Cannabinoid

The Amending Law removes the prohibition under the Cannabis Control Act on the use of pharmaceutical products manufactured from cannabis, thus lifting the ban on the use of those products, such as Epidiolex®, which is one of the main objectives of the regulatory reform.

As a result of the aforementioned revision, pharmaceutical companies can manufacture and sell pharmaceutical products derived from cannabis, subject to approval for the pharmaceutical products themselves under the Pharmaceuticals and Medical Devices Act, and doctors and patients will, therefore, be allowed to use those pharmaceutical products.

However, pharmaceutical products containing THC as an ingredient, including THC derived from cannabis, will fall under the category of narcotic drugs. Therefore, pharmaceutical products derived from cannabis will be controlled under strict distribution regulations under the Narcotics and Psychotropics Control Act, similar to other pharmaceutical products containing narcotics as an ingredient. This means that pharmaceutical companies and distributors involved in manufacturing and distribution of those products will be required to obtain a licence under both the Narcotics and Psychotropics Control Act and the Pharmaceuticals and Medical Devices Act.

Please note that the use of cannabis plants that have not been approved as a pharmaceutical product for medicinal purposes, the so-called medical cannabis, will remain prohibited.

Permitted Products/CBD Products

Products derived from cannabis, other than approved pharmaceutical products, that can be legally distributed include:

• fibre products made from the mature stems of cannabis and products made from the seeds such as animal feed, essential oil materials, and spices; and
• products made from CBD extracted from cannabis.

Under the Amending Law, CBD products made from CBD extracted from cannabis leaves or flower heads will be allowed to be distributed as long as they do not contain the above-mentioned THC, which is a narcotic. Although very small amounts of THC may remain in CBD products, THC residues in products must remain below certain threshold concentrations, which will be set by government ordinance. On 30 May 2024, a draft of the government ordinance was published for public comments. Under the draft, the concentration limits of Δ9-THC are as follows:

• 10 ppm for oil, that is a food or beverage product;
• 0.1 ppm for beverage products excluding oil products; and
• 1 ppm for other products.

The proposed thresholds are those at which the health effects of THC are not likely to occur.

Under the current Cannabis Control Act, CBD products containing even very small amounts of THC are banned from distribution; therefore, many businesses are hesitant to enter the CBD product market because it has been difficult to clearly check the legality of CBD products. The recent revision that ensures the legality of CBD products by controlling the allowable concentration limits of THC residues would be a big step forward in the development of CBD product businesses.

Hemp Regulation

Under the newly renamed Cannabis Plant Cultivation Regulation Act, in order to cultivate cannabis plants, it is necessary to obtain a Class I or a Class II cannabis plant cultivator licence, depending on the purpose of cultivation. Class I cannabis plant cultivators are those who cultivate cannabis plants for the purpose of harvesting mature stems, seeds or raw materials for other permitted products, such as CBD products. Class II cannabis plant cultivators, on the other hand, are those who cultivate cannabis plants for the purpose of harvesting raw materials for pharmaceutical products.

Class I cannabis plant cultivators are permitted to cultivate cannabis plants containing only THC in concentrations below a certain standard, which will be set by government ordinance. On 30 May 2024, a draft of the government ordinance was published for public comments. Under the draft, the weight of Δ9-THC must not exceed 0.3% of the weight of the cannabis plant. Class I cannabis plant cultivators must obtain a licence from the prefectural governor and renew their licence every three years.

Additionally, Class I cannabis plant cultivators are permitted to extract CBD from cultivated cannabis plants if they have separate permission from the Minister of Health, Labour and Welfare. This is expected to facilitate the cultivation of cannabis plants for the purpose of extracting raw materials for CBD products, as it will allow cannabis plant cultivators to engage in various activities such as cultivating cannabis plants, extracting CBD, and selling CBD to businesses that manufacture CBD products.

By contrast, Class II cannabis plant cultivators are permitted to cultivate cannabis plants containing high concentrations of THC. However, a Class II cannabis plant cultivator licence will be granted by the Minister of Health, Labour and Welfare only for the cultivation of cannabis plants for the purpose of extracting raw materials for pharmaceutical products. Class II cannabis plant cultivators are required to have their licence renewed every year.

International Trading of Cannabis Products

Under the Amending Law, licensed narcotic importers can import pharmaceutical products derived from cannabis if they have separate permission to import those pharmaceutical products. They are treated in the same way as importers of other pharmaceutical products with narcotic ingredients.

Provided the THC is below the residue limit concentration, CBD products can be imported without any specific licence. However, when importing a CBD product, the importer is required to obtain an import confirmation from the Regional Bureau of Health and Welfare that the CBD product does not contain THC above the residue concentration limit, by submitting a THC component analysis report. At the time writing this guide, details of the import confirmation procedure have not yet been published.

Future Outlook of Cannabis and Cannabinoid Regulation in Japan

The Amending Law passed in December 2023 will significantly reform the current regulatory environment of cannabis and cannabinoid. The introduction of new cannabis plant cultivator licences, as discussed in “Hemp Regulation” above, is expected to come into effect in 2025, while the other amendments are expected to come into effect in 2024. In particular, the provisions of the Amending Law that will come into effect in 2024 have great significance in encouraging the expansion of businesses of cannabis-derived products, including the lifting of the ban on cannabis-derived pharmaceutical products and the deregulation of CBD products. Important regulatory details on the implementation of the Amending Law in 2024 are expected to be disclosed soon. Thus, interested players must continue to closely monitor legislative and policy developments.