Mio & Partners Insights - Uae Regulates Industrial Hemp

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UAE Issues Federal Decree-Law Regulating Industrial and Medical Uses of Industrial Hemp

The UAE has issued Federal Decree-Law No. 24 of 2025 on the Regulation of the Industrial and Medical Uses of Industrial Cannabis, introducing a comprehensive federal framework governing the cultivation, manufacture, import, export, and trade of industrial hemp and hemp-derived products.

This marks a significant regulatory development, establishing a new, tightly controlled economic sector while maintaining the UAE’s longstanding prohibition on personal or recreational cannabis use. The Decree-Law is intended to align industrial and medical hemp activities with international best practices, while ensuring robust oversight, traceability, and enforcement.

The Decree-Law is scheduled to enter into force on 1 January 2026, following publication in the Official Gazette.

Below is our overview of the new regime and its strategic implications for businesses and investors.

Scope of the New Regulatory Framework
The Decree-Law applies to all industrial hemp-related activities conducted within the UAE, including ...
... free zones, subject to the right of each Emirate to impose additional restrictions or prohibitions within its jurisdiction.
Industrial hemp is defined as cannabis varieties with a total tetrahydrocannabinol (THC) concentration not exceeding 0.3% on a dry-weight basis. Any hemp exceeding this threshold remains subject to the UAE’s narcotics legislation.

Regulated activities include:

• Import and export of industrial hemp seeds;

• Cultivation in designated and secured areas;

• Transport and disposal of seeds and seedlings;

• Manufacture, import, export, and trade of authorised hemp-derived products;

• Use of industrial hemp in legally authorised medical products.

Permitted Uses and Prohibited Activities
While the Decree-Law introduces a regulated pathway for industrial and medical use, it draws clear boundaries around prohibited activities.
Personal or recreational use remains strictly prohibited, including the manufacture, import, or use of hemp-related:

• Food products;

• Dietary supplements;

• Veterinary products;

• Smoking products;

• Any other products designated by Cabinet decision.

Cosmetic products containing industrial hemp are also prohibited, except in narrowlydefined cases involving oils extracted from hemp seeds or stalks, provided they are entirely free from THC and any compounds capable of producing a narcotic or psychoactive effect.

Notably, the import and export of hemp seedlings is expressly prohibited.

Licensing and Compliance Requirements

The Decree-Law establishes a licence-based regulatory model, with oversight shared between federal and local authorities depending on the activity.

Key compliance features include:

• Mandatory licensing for cultivation, manufacturing, trading, and import/export activities;

• Security clearance requirements, particularly for cultivation and storage personnel;

• Cultivation limited to fenced, monitored, and isolated zones designated by local authorities;

• Periodic testing throughout the production cycle to ensure THC levels remain below 0.3%;

• Restrictions on transport, disposal, and subcontracting;

• Detailed record-keeping obligations for a minimum period of five years.In addition, the Decree-Law mandates the creation of a national tracking system for industrial hemp seeds, seedlings, and products, alongside a unified electronic registry accessible to relevant federal and local authorities.

Medical products containing hemp compounds or raw materials remain subject to Federal Decree-Law No. 38 of 2024 on Medical Products, the Profession of Pharmacy and Pharmaceutical Establishments, meaning that pharmaceutical-grade compliance standards continue to apply.

Enforcement and Penalties

The enforcement framework reflects the regulatory sensitivity of the sector.

Administrative penalties include:

• Warnings;

• Fines ranging from AED 10,000 up to AED 1,000,000 (and up to AED 2,000,000 in cases of repeat violations);

• Suspension or revocation of licences and permits.

Criminal penalties may include:

• Imprisonment of no less than three months;

• Fines of no less than AED 100,000;

• Mandatory seizure of industrial hemp seeds, seedlings, or products involved in violations.

Offences include conducting unlicensed activities, misuse outside authorised purposes, exceeding THC thresholds, unauthorised transport or disposal, and providing false or misleading information to regulators.

Strategic Considerations for Businesses

The Decree-Law introduces clear opportunities for industrial, agricultural, and medical stakeholders, particularly in sectors such as textiles, construction materials, paper and packaging, and pharmaceuticals. However, these opportunities are tightly conditioned on compliance with a multi-layered regulatory framework.

Businesses considering entry into this sector should note that:

• Licensing is activity-specific and subject to both federal and local approvals;

• Compliance failures may trigger both administrative and criminal liability;

• Further clarity is expected through implementing regulations and Cabinet decisions, which will define permitted products, technical standards, and procedural requirements in greater detail.

Until the full regulatory framework is operational, a cautious and structured approach is advisable.

Final Notes

Federal Decree-Law No. 24 of 2025 represents a controlled but deliberate step toward economic diversification within a highly regulated environment. While the law enables industrial and medical use of hemp, it does so under stringent oversight, leaving limited tolerance for regulatory error.

Businesses seeking to operate in this space should ensure early engagement with legal and regulatory advisors to assess feasibility, licensing requirements, and compliance exposure under both federal and emirate-level regulations.

MIO & Partners provides specialist legal support on regulatory structuring, licensing, and compliance across emerging sectors in the UAE. Should you require assistance, please contact Obaid Basit, member of our corporate team, to arrange an initial discussion.