Cannabis in Chile:
History, Laws & Business Opportunities
From dense jungles to the tops of the Andes Mountains, Chile has something to offer everyone. Until the end of the 20th century, Chilean dictator Augusto Pinochet had strict laws against cannabis and other drugs. But much has changed since the fall of Pinochet.
Chile has since reformed its draconian cannabis laws and grown a cannabis economy. Now, with legalized medical and homegrown cannabis and decriminalized adult-use cannabis, Chile is on the cusp of immense economic opportunities. Here’s what to know about cannabis in Chile.
The History of Cannabis in Chile:
Before the 20th Century
Chile has a long and rich history with cannabis, dating back to the 16th and 17th centuries. Cannabis was introduced to South America by Spanish colonists in the form of hemp that was used to create fiber and textiles.
The first recorded cannabis plantation in all of Latin America was established in Chile in 1550 C.E. Over the ensuing hundreds of years, cannabis was also used for personal and ceremonial purposes, along with other psychotropics like ayahuasca.
In the 20th century, the acceptance of cannabis in Chile took a dramatic downturn. Like many other Latin American countries, Chile was a direct target of the U.S. government’s War on Drugs and was compelled by the U.S. to enact draconian drug laws that criminalized many who had been using cannabis and similar psychotropics for centuries.
After President Salvador Allende was elected president of Chile in 1970, U.S. President Richard Nixon authorized the CIA to overthrow the Allende government through a coup d’état in 1973. The U.S. didn’t like that Allende had ties to the Cuban Castro regime, thereby keeping Chile outside of its sphere of influence.
However, Allende was replaced with the now-infamous General Augusto Pinochet, who brutally suppressed political opponents, dissolved the Chilean congress and constitution, censored the press, and tortured and killed over 28,000 people during his reign of terror.
But the U.S. believed the new Pinochet government would fall in line with U.S. interests — one such interest was stamping out narcotics from Latin America. Ironically, it’s now known that Pinochet, while seeming to crush the Narcos trade from Chile at the behest of the U.S., actually authorized the Chilean army and secret police to flood America and Europe with cocaine.
Over 12 tons of cocaine was shipped from Chile between 1986 and 1987 alone! Though it’s now universally accepted that the War on Drugs was an abject failure — even after Pinochet was deposed, arrested, and prosecuted in 2000 — Chile continued many of the same prohibitionist policies.
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The History of Cannabis in Chile: After the 20th Century
In the ensuing two decades following the downfall of Pinochet, Chile has become substantially more liberalized and democratic. One landmark change in Chilean law came in 2015, when the country first legalized medical cannabis, authorized homegrown cannabis for personal use, and decriminalized adult-use cannabis.
Chile’s trend away from cannabis prohibition has continued since it first legalized medical cannabis. In May 2023, Chile democratically elected a new constitutional government that seeks to rewrite many Chilean laws in the post-Pinochet dictatorship era.
There has been a sizable push from within Chile for the new constitution to include a “right to consume cannabis” provision. The inclusion of a right to consume cannabis in Chile within the new constitution is based on the notions of personal sovereignty and autonomy, including the right to “search for wellbeing, pleasure and integral health.”
Though these proposed provisions were ultimately rejected by the reviewing commission and excluded from the final draft for the new constitution, the notions of personal autonomy and sovereignty to use cannabis remain.
Does Chile Have a Cannabis Economy?
It’s clear that Chileans are accepting of cannabis in society and that Chile intends to create a functioning and healthy cannabis economy. Interestingly, even though adult-use cannabis is merely decriminalized and medical cannabis is often obtained through home grows, Chile has a growing cannabis economy.
Chile and Uruguay are reported to have the highest levels of cannabis use of all Latin American countries, and those numbers continue to rise. It’s projected that the Chilean cannabis market will grow at a rate of 17.76% between 2023 and 2027, from $174.7 million to $337.9 million.
In 2016, the Chilean government opened the largest medical cannabis cultivation farm in Latin America. This massive farm allowed harvests of up to 1.65 tons of cannabis within the first few months of operation between March and May of 2016!
Chile is also home to the Expoweed Fair and the International Cannabis Film Festival (FICC) is held in Santiago on 4/20. It has even begun to capitalize on cannabis tourism by allowing visitors from around the world to experience its beauty — and enjoy medical cannabis while doing so.
In addition to homegrown cannabis in Chile, Tilray, one of the biggest names in cannabis cultivation and distribution, has been provided special authorization by the Chilean government to supply the country with cannabis-based products. After it acquired Alef Biotechnology, SpA, Tilray used the acquisition to create a hub in Chile to distribute cannabis products throughout Latin America.
Following the election of a constitutional convention in May 2023, Chile now appears poised to define itself as a cannabis leader in Latin America. With the increasing degree of social acceptance and an eye toward growing a cannabis economy, Chile could be an ideal location for aspiring cannabis entrepreneurs.
Recreational Cannabis
Laws in Chile
Chile’s cannabis laws are a little inconsistent. On one hand, possession of small amounts of adult-use cannabis was merely decriminalized in 2015 by reclassifying cannabis as a soft drug — the same category of classification as alcohol.
On the other hand, it remains illegal to buy, sell, or transport adult-use cannabis. However, homegrown, self-cultivated cannabis
is allowed, so long as it’s only for personal use.
On May 15 and 16, 2023, Chile elected a constitutional convention to revise and draft new laws. Some of the motivations behind authorizing the new constitution were concerns about addressing social inequity and the status of cannabis in Chile’s laws.
The notion of “personal sovereignty” that motivated some convention candidates to vote in favor of reform would imply that personal cannabis use is a legally protected activity recognized under a right to privacy and personal autonomy.
Medical Cannabis
Laws in Chile
Medical cannabis in Chile was fully legalized in 2015. Since its inception, Chilean society has warmed up substantially toward medical cannabis. It’s legal to grow, sell, and import medical cannabis in Chile, but only with special authorization.
The Chilean Agricultural and Livestock Service (Servicio Agrícola y Ganadero [SAG]) is the state agency charged with providing authorization to those who wish to cultivate medical cannabis.
Meanwhile, the Public Health Institute of Chile (ISP) is the state agency charged with licensing and conditioning the personal use of medical cannabis by Chilean patients. To be prescribed medical cannabis in Chile, you must have one of the qualifying medical conditions.
Despite these developments, Chile still imposes tough penalties to those who break the medical cannabis laws. If a doctor is found to have prescribed medical cannabis to a patient who doesn’t qualify under the guidelines, he or she can face five to 15 years in prison and/or a fine of $2,800 to $28,000.
These same steep sentences apply to suppliers if they wrongfully provide medical cannabis to an unauthorized individual. Chilean law harshly punishes those who break cannabis laws, and it doesn’t delineate between users and traffickers.
Contact Us to discuss cannabis
Licenses in Chile
If you are looking to attain a license for hemp or cannabis in Chile, Higher Yields Cannabis Consulting can help. Our team of cannabis licensing consultants and technical writers has had great success helping newcomers and experienced operators attain licenses all over the world.
How to Start a Chilean Cannabusiness
Chile is in a state of flux right now. As previously mentioned, huge reforms are coming to Chile’s medical cannabis sector that will undoubtedly open the doors even wider to aspiring cannabis entrepreneurs. So, the industry’s current regulations are likely to evolve in the near term.
The Chilean Agricultural and Livestock Service is the entity charged with granting cultivation permits for large-scale cannabis grows. But Chile’s cannabis market lacks much of the legal framework most other countries that have legalized medical cannabis possess.
Only authorized companies are permitted to conduct medical cannabis activities, and access to that permission has been fairly limited due to a lack of a clear legislative framework for cannabis in Chile.
The existing legal framework for obtaining special authorization to conduct cannabis cultivation activities has been described as “opaque and time-consuming,” thereby limiting the number of existing authorizations to a handful of companies.
In the near future, it’s certain that Chile’s medical cannabis laws and the ISP’s legislative frameworks will undergo substantial changes.
The new developments will likely lead to a system where there’s a clear path for aspiring cannabis entrepreneurs to enter the Chilean cannabis industry. To understand Chile’s nuanced cannabis laws, it’s critical to consult a cannabis professional like the experts at Higher Yields Consulting.
The Future of Cannabis in Chile
Cannabis in Chile is incredibly popular. With the highest percentage of cannabis users per capita in Latin America, and the fifth-highest in the world, Chile has huge market potential. Chile is in a state of immense change at the moment, with the adoption of a new constitutional convention in May 2023.
With its high degree of social acceptance and the push to include cannabis use protections in the new constitution, Chile appears to be on the cusp of great economic opportunity with cannabis.
If you’re interested in starting your own Chilean cannabis company, now is the time to start preparing! The experts at Higher Yields Consulting can help you navigate Chile’s choppy regulatory ocean.
Contact us today to start turning your green dreams into your reality!
Last updated: June 2023