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25 Aug 2020
BY Lloyd Christie AND Sabelo Ngubeni

Bioprospecting in South Africa: unique opportunities in the cannabis sector and the biodiversity economy

In August 2020, the draft Cannabis for Private Purposes Bill was published in South Africa, providing for the regulation of cannabis for home use and cultivation. While there is still no commercial framework for cannabis in the country, South Africa has a bioprospecting regulatory framework that supports commercialisation of the entire cannabis value chain. As cannabis is a plant in which South Africa is well endowed, unlocking this industry will greatly benefit the bioprospecting economy.

Bioprospecting in South Africa

Bioprospecting refers to the search for plants and animal species from which medicinal drugs and other commercially valuable compounds can be obtained. Bioprospecting of plant species, such as aloe ferox and rooibos, contributes immensely to the South African economy. In 2007, the production of 14 000 tonnes of rooibos generated ZAR500-million in revenue and created 5 000 jobs. Similarly, the cannabis plant has the potential to contribute immensely to the broader bioprospecting economy.

To counter the radical exploitation of nature, realise economic returns and to diminish biopiracy in the process of bioprospecting, the Convention of Biological Diversity (“CBD”) which was the first international legal instrument to regulate nature, set guidelines for bioprospecting and for the first time, acknowledged the sovereign rights of countries over the sustainable natural resources. South Africa became signatory to the CBD in 1995 and passed bioprospecting specific legislation in the form of the National Environmental Management Biodiversity Act, 2004 (“NEMBA”) and the regulations thereunder.

South Africa is recognised as the third largest centre of biodiversity in the world, boasting over 20 000 indigenous plant species, apart from animal, marine and microbial diversity.

Interestingly, South Africa has taken a lead towards realising the economic and transformative benefits associated with the bioprospecting economy. The advent of NEMBA and the regulations thereunder has enabled South Africa to put an end to an era of unconstrained access to South African bio resources, wherein plants would be harvested, sometimes in destructively excessive quantities and exported abroad for research, development, value addition and off-shore financial benefit. For instance, records from 27 years ago reveal that the Dutch flower industry earned almost ZAR300-million annually from the sale of the freesias plant alone. Although the genus freesia plant is near endemic to South Africa, the proceeds of its sales would remain abroad resulting in no associated revenue returns to South Africa.

South Africa’s legislation of cannabis

The legalisation of cannabis has enjoyed vocal support from Finance Minister Tito Mboweni, who has said he is eager to unlock the economic potential of cannabis cultivation and believes it could contribute as much as ZAR4-billion to the economy.

Cannabis for recreational use was decriminalised in the 2018 Constitutional Court judgment of Minister of Justice and Constitutional Development v Prince (Prince judgment) to the effect that personal and private cultivation, possession, use and consumption of cannabis by adults are no longer criminal offences.

However, laws prohibiting public consumption and trading in cannabis are still in force.

Medicinal use

In South Africa, cannabis for medical use is regulated by the Medicines and Related Substances Act, 1965 (“Medicines Act”). The Medicines Act mandates the South African Health Products Regulatory Authority (“SAHPRA”) to regulate the availability of quality medicines, which are safe and efficacious for their intended use and to apply standards for the manufacturing, distribution, selling and marketing of medicines, medical devices and scheduled substances, including cannabis.

The cultivation, manufacturing and use of medicinal cannabis may occur once a potential cannabis grower or producer has obtained a licence issued by SAHPRA and a permit issued by the Department of Health. Medical practitioners may apply to SAHPRA for permission to access and prescribe unregistered medicines including cannabis when intended to treat their patients. It is important to note that SAHPRA will grant access to cannabis for medical purposes only in exceptional circumstances, to specific patients under proper medical supervision.

There have been significant developments around the laws regulating cannabis for medical use in South Africa which include: the reassignment of cannabidiol, which is a component of the cannabis plant, from Schedule 7 of the Medicines Act (highly regulated substance) to Schedule 4 (substance to be sold with a prescription), down-schedules THC to a Schedule 6 substance and completely deschedules THC when:

  • contained in raw plant material and processed products manufactured from such material, where intended for industrial purposes and not for human or animal ingestion and containing 0.2% or less of THC;
  • contained in processed products made from cannabis containing at most 0.001% THC; or raw plant material; or
  • raw plant material is cultivated, processed and consumed by an adult in private for personal consumption.

The transformative benefit of unlocking the bioprospecting value chain relating to cannabis presents South Africa with a unique opportunity. Through benefit sharing, the bioprospecting of cannabis will ensure that traditional knowledge holding healers and communities benefit equitably from the commercial and other gains derived from local commercialisation. Moreover, illegal cannabis growers and traffickers, particularly in the KwaZulu-Natal and the Eastern Cape provinces can be incorporated into a legal value chain ranging from cultivation, production of cannabis oils and edible products, cannabis tourism as well as logistics and international export.

Lloyd Christie

Natural Resources and Environment | Executive

lchristie@ENSafrica.com

+27 82 210 2159

Sabelo Ngubeni

Natural Resources and Environment | Candidate Attorney

sngubeni@ENSafrica.com

+27 79 774 1694