Thailand has a long and complex relationship with cannabis. Historically, cannabis (ganja) was widely used for medical, culinary, and cultural purposes. For centuries, Thai traditional medicine employed cannabis extracts as remedies for pain relief, appetite stimulation, and treatment of various ailments.

However, under the Narcotics Act B.E. 2522 (1979), cannabis was classified as a Category 5 narcotic, rendering its cultivation, possession, and use strictly illegal. Penalties for violations included imprisonment and heavy fines, and the substance became stigmatized as part of wider international anti-drug campaigns.

The turning point began in the late 2010s, when global shifts toward decriminalization and medical legalization influenced Thailand’s domestic policy. In 2018, Thailand became the first country in Southeast Asia to legalize cannabis for medical and research purposes (Narcotics Act (No. 7) B.E. 2562 (2019)), allowing limited use of cannabis oil, extracts, and research-based cultivation. At that time, operators were required to work closely with public agencies, such as universities or government hospitals, to cultivate and extract cannabis.

In June 2022, cannabis was officially decriminalized through its removal from the Narcotics List under the Ministerial Notification of the Ministry of Public Health (No. 8) B.E. 2565 (2022). This sparked a rapid proliferation of cannabis-related businesses—from dispensaries and cafes to wellness centers and agricultural ventures.

Nevertheless, the swift liberalization also triggered regulatory uncertainty and social debates. The lack of comprehensive oversight, concerns about recreational misuse, and rising public health risks pushed policymakers to reintroduce tighter controls, culminating in the Cannabis and Hemp Control Act (Draft Bill, 2024–2025) and ministerial notifications that now aim to balance economic opportunity with public health and social order. 

2.1 Current Legal Framework

Following decriminalization in June 2022, cannabis entered a “grey zone” of regulation. Businesses mushroomed quickly, taking advantage of unclear restrictions, especially regarding recreational use. However, by mid-2025, the Thai government introduced new legislation and ministerial regulations to formally control cannabis cultivation, distribution, marketing, and consumption.

Key provisions include:

2.2 Impact on Businesses

These rules have reshaped the cannabis landscape. Dispensaries and recreational-style outlets face heightened scrutiny, while medical clinics, licensed manufacturing plants, pharmaceutical companies, and wellness enterprises benefit from clearer compliance pathways.

Notably, businesses engaged in the sale of cannabis flowers or high-THC distillates (>0.2% THC w/w) must operate strictly as medical establishments, employing licensed doctors authorized to prescribe cannabis products. This effectively transforms retail-style models into clinically regulated practices, raising compliance and operational costs.

Foreign investment in cannabis remains restricted under the Foreign Business Act B.E. 2542 (1999), which caps foreign ownership in agricultural and service sectors unless exemptions are granted. While the Board of Investment (BOI) offers privileges for certain high-value industries, cannabis has not yet been included in BOI-promoted activities. In practice, without a permanent Cannabis Act, obtaining BOI promotion for cannabis businesses is unlikely.

Additionally, intellectual property (IP) protections for cannabis strains, cultivation techniques, and extraction processes are increasingly important, as licensing agreements and IP filings help safeguard competitiveness in a regulated market.

3.1 Opportunities and Policy Direction

Despite regulatory tightening, the government continues to view cannabis as a sector with high potential in:

While rumors persist that the government may re-criminalize cannabis, such a move would face strong resistance—including potential class actions from over one million licensed cannabis operators. More realistically, cannabis will remain regulated for medical, industrial, and research purposes, rather than being reclassified as a narcotic.

3.2 Risks in Cannabis Business

3.3 Risk Mitigation Strategies

Conclusion

The cannabis industry in Thailand represents both opportunity and risk. Thailand stands as a pioneer in Southeast Asia, opening pathways for medical, wellness, and industrial cannabis. Yet the regulatory environment remains fluid, and businesses face legal, financial, and reputational challenges.

Of particular importance is the strict requirement that cannabis flowers and all cannabis distillates with more than 0.2% THC w/w can only be sold with a doctor’s prescription. Violations in this area carry serious criminal and civil liabilities and will be a central enforcement priority going forward.

For investors and operators, success depends on rigorous compliance, sound structuring, and proactive legal strategy. By aligning with Thailand’s evolving regulatory framework, businesses can capture opportunities while minimizing risk.

At ILAWASIA CO., LTD., we provide comprehensive legal support for cannabis operators. Our Partner, Tanadee Pantumkomon, is one of the most experienced counsels in Thailand on cannabis cultivation, extraction, and cannabis product manufacturing. Our services cover FDA licensing and permits, corporate structuring, tax planning, dispute resolution, and cross-border advisory—ensuring that our clients’ investments are secure and compliant.