Korea became the first country in East Asia to legalize medical marijuana back in 2018. CBD oil in Korea is big news considering the United States has seen a boom in the cannabis market in the past few years once cannabis was legalized. The CBD market in the states is expected to hit $20 billion by 2024. With the success of CBD in the states, many Korean entrepreneurs are eager to cash in on this industry in South Korea.

What makes this news so shocking is that South Korea has always been against legalizing marijuana for recreational purposes. However, with this step toward legalizing medical marijuana and CBD medical use, it might be possible that marijuana will at some point be legalized in Korea. But first, before marijuana can be legalized, CBD will need to be legalized. This is a much easier process as CBD has been shown to offer many benefits to the human body.

Hemp Seed is Legal, CBD is illegal in South Korea

It is very important to understand that hemp seed oil and CBD oil are different products. While hemp seed oil is legal in South Korea, CBD oil is not (unless for medical purposes). So what is the difference? CBD oil uses the leaves, flowers, and stalks of the hemp plant in its production. Therefore it has a higher concentration of CBD. However, hemp seed oil comes from the seeds of the Cannabis sativa plant. The seeds have ZERO CBD. There are many products in China, South Korea, and all across Asia that promote themselves as CBD products when in reality they are using hemp seed oil. The benefits are completely different. You can go online in South Korea and order hemp seeds with no issues.

There is even a regulation-free zone for hemp in Gyeongbuk (Southeastern Province). This is a special zone set up by the Korean government. It is the only place where licensed farmers can legally plant and grow cannabis for export and medical purposes. Therefore, Gyeongbuk has become the cannabis province of South Korea. A Korean startup called Imagination Garden grows cannabis in the zone for medical use using smart farming technology.

CBD for medical use is legal in Korea

The legalization of recreational marijuana is not coming anytime soon. However, cannabis for medical use is legal. Patients can get access to small amounts of it for certain diseases. They must get approvals from doctors in a very limited number of hospitals. Therefore, the amount of people taking cannabis for medical purposes remains low.

The more interesting case comes with CBD. The use of hemp oil or cannabidiol (CBD) is legal for medical use as well. Since CBD has no hallucinogenic effects it is more commonly used for medical purposes. Therefore, the medical community has tested CBD for its efficacy in neurological and brain diseases. The strongest scientific evidence is for its effectiveness in treating childhood epilepsy syndromes such as LGS (Lennox-Gastaut syndrome). Studies on CBD have shown that CBD is able to lower the number of seizures or in some cases completely stop them.

The Ministry of Food and Drug Safety (MFDS) will create regulations regarding medical cannabis/CBD. This is because there are still some side effects associated with CBD. The FDA does not regulate the safety and purity of CBD in the United States. Therefore the Ministry of Food and Drug Safety needs to test them to make sure the product does not contain harmful elements or has any levels of THC.

The laws in Korea will be strict regarding CBD. Tetrahydrocannabinol (THC) products will be prohibited. Not all cannabis plants are created equal. Hemp, for example, has very little THC but a large amount of CBD. It is a huge craze in the United States due to its relaxing effects. Scientists are still trying to figure out exactly how CBD affects the body. Some initial studies have shown that CBD can help with a number of different medical conditions.

The Potential CBD Market in Southeast Asia

Currently, everything regarding medical marijuana has been controlled by the Korean government. Therefore, the key here is that the cannabis market now has Korea as a target market. With possibly other East Asian countries following in Korea’s footsteps. For example, Thailand has already legalized medical cannabis. In addition, some Asia Pacific countries such as China allow for CBD products to be used for skincare. As South Korea is known for K-beauty, there is a huge potential for CBD in the skincare industry, which is great news for Korea which is the leader when it comes to skincare beauty products.

For Korean startups, this is now the perfect time to plan to start a hemp oil or CBD oil business in Korea. This is because if history has anything to say, CBD products will soon be legalized for the general public in Korea in the near future. Those that plan early can reap the benefits.

This is what happened in America. Now, CBD is in everything from lollipops to lattes. Currently, CBD products are part of what is estimated to be a $5 billion dollar industry in the United States. Therefore, it will only be a matter of time before Korea opens CBD to the masses. Soon, we will be seeing CBD in more and more Korean products. Where will brands go to get their CBD oils and materials? Which Korean company will be the leader in this industry?

The current state of CBD oil in Korea

Under Korean law, CBD oil can pass customs clearance only when the CBD content is less than 0.002%. It is illegal to distribute or sell CBD content that is above 0.002% or more in South Korea. Therefore don’t even think about bringing CBD oil or products into Seoul. There have been close to 80 arrests made in Korea in 2019 for smuggling CBD into Korea. In addition, don’t even think about having them mail it to Korea to help a loved one.

The good news is that now people in Korea can go to a hospital and get medical CBD treatment. Koreans need to get a letter from their doctor explaining their condition and why CBD would be beneficial. Furthermore, the letter then needs to be taken to the Korean Orphan Drug Center for final approval which should not take longer than a week.

If CBD oil were legalized in Korea, more patients would be able to get affordable cannabis-based treatments at a more reasonable cost. Getting CBD oil from the hospital is 10 times more expensive. At the moment, CBD is not a household name in Korea. Many don’t fully realize the therapeutic and health benefits of CBD. Therefore there is not yet a buzz within the Korean population. However as CBD products become popular in the States, it is only a matter of time before the Korean public starts to become knowledgeable about CBD.

Taking Steps to Set up a CBD Business in South Korea

There are many challenges when setting up a CBD business in South Korea. There are many challenges because of the legal landscape in Korea regarding CBD. The first thing a Korean startup needs to do is find a partner in the U.S. This partner has to produce CBD that has zero THC. This will be difficult as most hemp contains at least some levels of THC.

Finding a partner that produces CBD with no THC should be your first step. If you import CBD only for the Ministry of Food and Drug Safety to find traces of THC in the CBD materials, your business will be over before it starts. Therefore, the early stage is simple. Make the partnerships needed to launch your business right when CBD becomes legal. Sign MOUs with potential customers in different industries from cosmetics to F&B. Those that have the buyers and the sellers in place will only need to wait until CBD becomes legal in South Korea.

Keep up to date with CBD regulations

Then you need to keep up to date with the CBD regulations in Korea. Understanding your legal obligations and playing it safe will be crucial when setting up your business. The issue is that many of the staff at the Ministry of Food and Drug Safety are not giving interviews and very little information is given to the public.

You might be asking how hospitals in Korea get CBD for their patients. There is only one type of pharmacy company that imports and sells CBD and it is called CBD LAB ASIA. It is a global Singaporean pharmaceutical company that sells CBD all across Asia.

Many will see CBD oil being sold online on Korean e-commerce platforms. This is not CBD oil. It is actually hemp oil being branded as CBD.

When producing CBD oil, stalks, leaves, and flowers of the hemp plant contain a higher concentration of CBD.

Hemp oil comes from the hemp seed which are small seeds of the Cannabis Sativa plant. These seeds do not contain the same levels of compounds as the plant. However, hemp seeds do offer a lot of benefits for the human body such as inflammation.

Pre-Planning Stage

Therefore during this time, it would be wise to set up a marketing campaign around the benefits of CBD. As the Korean public understands the benefits of CBD, the demand will come. This will also attract Korean investors to get the capital they need to start your CBD business in Korea. In addition, keep up to date on new developments as the Korean government moves forward with new regulations regarding CBD.

The moment CBD is legalized for the general public, it is important to start offline initially. It will be difficult to sell CBD products on major Korean online eCommerce platforms like Coupang and G-Market. Also, it will be difficult to advertise using social media. CBD promotion on Facebook, Twitter, and Instagram can potentially get you banned. Therefore focus on creating your own eCommerce site for your CBD oils as well as having a CBD brick-and-mortar store.

Building a website and having an offline store could take months so it is important to get started early before the laws are set. Yes, this is a risk but those that take risks reap the benefits.

The three main industries that will be looking for CBD to incorporate into their existing products will be:

• Korean Food and Beverage Industry – Baked Goods, Candies, Drinks, and Snacks in Korea that incorporate CBD will be able to find a niche audience in the beginning.
• Pet Industry in Korea – CBD oil for dogs and cats could be a major industry in Korea. There are no definitive scientific data on how CBD can benefit dogs and cats but there is some anecdotal evidence from pet owners online that say CBD is great for treating pain and controlling seizures.
• Vaping Industry in Korea – This will be a smaller market but with all the Vape stores popping up in Seoul, CBD oils will be one of the top sellers here.
• K-Beauty Industry – This industry will have the biggest potential. K-Beauty products such as gels, creams, and sprays with CBD will be able to be applied directly to the skin. There are many global skincare companies finding great success with their CBD beauty products. K-Beauty which is the leader in the global skincare industry will be eager to incorporate CBD into its future lines.

Why CBD is perfect for Startups in Korea

While it might seem like big companies like Kolmar Pharma will dominate the CBD space in Korea, that is not necessarily the case. The cannabis industry is a very fast-growing industry and CBD is just one of the quickest growing sectors in that industry. Many companies in Korea that want to incorporate CBD into their products will not find it easy to work with big companies like Kolmar Pharma.

The competition will arise and with a fast-paced industry like CBD, a startup is primed to become the leader in the industry. Startups in Korea are able to move quickly and adapt while at the same time being able to innovate. A combination of creativity and due diligence will set your startup for great success in the CBD industry in Korea.

Frequently Asked Questions Regarding Medical Cannabis in Korea

What kind of cannabis-based drugs will be allowed in Korea for medical purposes?

Those suffering from epilepsy will be prescribed Epidolex. Those suffering from multiple sclerosis will be prescribed Sativex. Those having issues with nausea and vomiting because of cancer treatments of the AID virus will be prescribed Cesamet and Marinol.

Can companies produce medical cannabis in Korea?

No. Korean companies are not allowed to manufacture cannabis-based drugs. Until you are in the regulation-free zone and granted permission by the Korean government.

Can Companies in Korea import CBD Oil?

No. However, they can import CBD materials extracted from hemp seeds, stems, and roots that do not contain any THC.

Why do I see CBD being sold online in Korea? 

These are hemp seed oil products branded as CBD. Hemp Seed Oil can be sold but actual CBD oil can’t be sold to the general public.

How do I qualify for medical cannabis in Korea?

Step 1: Get a medical diagnosis from a doctor for cannabis-based drugs.

Step 2: Fill out an application for medical cannabis. In addition, the application will ask for the diagnosis from the doctor, a letter from the doctor, and full medical records.

Step 3: Send the application to the Ministry of Food and Drug Safety via fax, mail, or online.

Step 4: If approved the Korean Orphan Drug Center will import the requested drug into South Korea.

Could more cannabis drugs be added to the list of 4?

Yes, a representative from the Ministry of Food and Drug Safety stated that there is room for expansion. Therefore, there is no final list.

Which Hospital in Korea offers medical cannabis?

The only way to get cannabis medicine is to pick it up personally at the Orphan Drug Center in Seoul. They will not mail it to you.