VANCOUVER, BC, Dec. 2, 2021 /PRNewswire/ - Xebra Brands
Ltd. ("Xebra") (XBRA: CSE) (XBRAF: OTC) (9YC: FSE), a cannabis
company, announces that its wholly owned Mexican subsidiary, Desart
MX, SA de CV ("Xebra Mexico"), has been granted an
injunction by the Mexican Supreme Court, that has positioned it
with an outright first-mover-advantage in the Mexican CBD and CBG
market. All five Supreme Court justices voted unanimously in
favor of the injunction to Xebra Mexico.
The Supreme Court decision is irrevocable and cannot be
appealed. Next the Supreme Court will mandate the Federal
Circuit Court that previously heard the case, to enforce the
Supreme Court's final decision and direct the Mexican Health
Regulatory Agency (COFEPRIS) to grant Xebra all
authorizations. Xebra expects this process to be completed as
soon as practicable.
As a result of the granting of the injunction and Mexican Law,
Xebra Mexico is the only company in Mexico that will be authorized to legally
carry-out the following activities: import cannabis seeds,
cultivate cannabis, process cannabis, extract cannabinoids, and
manufacture cannabis products. Xebra Mexico could also sell
cannabis products within Mexico
and for export. Xebra believes its first-mover-advantage in
the Mexican CBD and CBG market could last 1 to 3 years.
Commercialization of high-THC cannabis remains prohibited in
Mexico; however, Mexican Congress
is in the process of debating a bill to fully legalize.
Earlier this year, possession of small amounts of cannabis was
decriminalized.
Xebra Mexico's injunction applies specifically to the industrial
cannabis sector, and explicitly to cannabis with low-levels of THC
(under 1%), therefore, in practical terms, to hemp cultivation and
processing, and to the manufacture and sale of mainly CBD and CBG
products, such as tinctures, oils, topicals, edibles, beverages,
concentrates, distillates, emulsions, and biomass etc., and certain
uses of the cannabis flower.
There is a significant amount of misinformation circulating
about the legal status of cannabis in Mexico. While personal
possession of small amounts of cannabis has been decriminalized,
and legalization is underway, the fact is that until today's
Supreme Court decision in favor of Xebra Mexico, commercial
cannabis activities have been very limited and presently fall into
3 categories:
- INDUSTRIAL USE - Only Xebra Mexico will be
authorized to legally cultivate and process hemp, and manufacture
CBD and CBG products such as tinctures, oils, topicals, edibles,
beverages, concentrates, distillates, emulsions, and biomass, and
can commercialize the cannabis flower. To the best of Xebra's
knowledge, perhaps only two other companies in Mexico presently legally have limited
offerings of CBD products on shelves, which they import into
Mexico for distribution and
sale. The companies obtained those rights through a legal
process; however, they cannot cultivate or manufacture, and their
right was not granted by the Supreme Court and can therefore be
revoked by authorities at anytime. No company in Mexico can do anything with THC at this time
under the industrial category.
- MEDICINAL USE - This regulation under the General
Health Law (Law of 2017) was enacted in January 2021. This
category applies ONLY to the pharma industry and includes THC and
all other cannabinoids such as CBD and CBG. Cultivation and
processing only for the manufacture of cannabis pharmaceutical
drugs is allowed, however in practice, to approve a cannabis drug
under this category, lengthy many-year human pharma-trials are
required, so in essence it is not expected that any company will
cultivate or commercialize under this category in the foreseeable
future. This category also includes research licenses granted
to labs, universities, big pharma etc.
- ADULT USE - No legal framework exists for the
commercialization of adult use cannabis however, Congress is
debating a bill, and federal legalization may occur in 2022.
If a legal framework is approved, it could be up to 3 years before
any company can commence operations, due to the fact that a lengthy
application and approval/inspection process would likely be
necessary.
Xebra believes Mexico has the
potential to be one of the largest near-term country cannabis
consumer markets in the world. Mexico is also within the North American free
trade zone (USMCA), giving it considerable cultivation and product
manufacturing cost advantages over Canada and the
United States. Xebra is of the opinion that there is
sufficient precedent with many agricultural crops and manufactured
products, to suggest that there is a possibility that ultimately
the majority of North American industrial scale cannabis production
activity will occur in Mexico.
More information will be provided on Xebra's Mexican plans in
due-course.
ON BEHALF OF THE BOARD:
Rodrigo Gallardo
President
Certain information contained in this press release
constitutes forward-looking statements under applicable securities
laws. Any statements that are not statements of historical fact may
be deemed to be forward-looking statements, these include, without
limitation, statements regarding Xebra Brands Ltd.'s (the
"Company") expectations in respect of: the Mexican Federal Circuit
Court enforcing the Mexican Supreme Court's final decision granting
the Company's wholly owned subsidiary an injunction (the
"Injunction"), receipt of all authorizations relating to the
Injunction, the Company obtaining a first mover advantage in
connection with the Injunction, other companies cultivating
or commercializing cannabis in Mexico, the possibility that the majority of
North American industrial scale cannabis production activity
occurring in Mexico, or
expectations related to Xebra's operations; the legalization of
cannabis and its derivatives in Mexico; the potential for increased industry
wide cannabis production in Mexico
and the timing thereof; exportation of cannabis products from
Mexico; its ability to
successfully execute its business plan or business model; its
ability to provide economic, environmental, social, or any benefits
of any type, in the communities it operates in or may operate it in
the future; its ability to be a first mover in a country, or to
obtain or retain government licenses, permits or authorizations in
general, or specifically in Mexico, Colombia, Canada, the
Netherlands, or elsewhere; its ability to successfully apply
for and obtain trademarks and other intellectual property in any
jurisdiction; its ability to be cost competitive; its ability to
cultivate, grow, or process hemp or cannabis in Mexico, Colombia, Canada, the
Netherlands, or elsewhere and related plans; financial,
operational, or any other term relating to the Company's
participation in the Dutch trial medicinal cannabis cultivation;
its ability to manufacture cannabis beverages, wellness products,
or other products; its ability to commercialize or sell cannabis
beverages, wellness products, or other products, in Mexico, Colombia, Canada, the
Netherlands, or elsewhere; its ability to commercialize or
to sell Vicious Citrus Lemonade in 2022 or at any time, in any
jurisdiction; its ability to commercialize or to sell Elements
wellness products in any jurisdiction at any time; its ability to
create wellness products that have a therapeutic effect or benefit;
plans for future growth and the direction of the business;
financial projections including expected revenues, gross profits,
and EBITDA (which is a non-GAAP financial measure); plans to
increase product volumes, the capacity of existing facilities,
supplies from third party growers and contractors; expected growth
of the cannabis industry generally; management's expectations,
beliefs and assumptions; events or developments that Xebra expects
to take place in the future; general economic conditions; and other
risk factors described in the prospectus of the Company dated
September 30, 2021. All statements,
other than statements of historical facts, are forward-looking
information and statements. The words "aim", "believe", "expect",
"anticipate", "contemplate", "target", "intends", "continue",
"plans", "budget", "estimate", "may", "will", and similar
expressions identify forward-looking information and statements.
Forward-looking statements are necessarily based upon a number of
estimates and assumptions that, while considered reasonable by
Xebra as of the dates of such statements, are inherently subject to
significant business, economic and competitive uncertainties and
contingencies. Known and unknown factors could cause actual results
to differ materially from those projected in the forward-looking
statements. Such factors include, but are not limited to, the
inability of Xebra to generate sufficient revenues or to raise
sufficient funds to carry out its business plan; changes in
government legislation, taxation, controls, regulations and
political or economic developments in various countries; risks
associated with agriculture and cultivation activities generally,
including inclement weather, access to supply of seeds, poor crop
yields, and spoilage; compliance with import and export laws of
various countries; significant fluctuations in cannabis prices and
transportation costs; the risk of obtaining necessary licenses and
permits; inability to identify, negotiate and complete a potential
acquisition for any reason; the ability to retain key employees;
dependence on third parties for services and supplies;
non-performance by contractual counter-parties; general economic
conditions; the continued growth in global demand for cannabis
products and the continued increase in jurisdictions legalizing
cannabis; and the timely receipt of regulatory approval for license
applications. The foregoing list is not exhaustive and Xebra
undertakes no obligation to update or revise any of the foregoing
except as required by law. Many of these uncertainties and
contingencies could affect Xebra's actual performance and cause its
actual performance to differ materially from what has been
expressed or implied in any forward-looking statements made by, or
on behalf of, Xebra. Readers are cautioned that forward-looking
statements are not guarantees of future performance and readers
should not place undue reliance on such forward-looking statements.
There can be no assurance that such statements will prove to be
accurate and actual results and future events could differ
materially from those set out in such statements.
View original content to download
multimedia:https://www.prnewswire.com/news-releases/xebra-is-an-absolute-cannabis-first-mover-in-mexico-with-supreme-court-decision-granting-it-an-injunction-301436381.html
SOURCE Xebra Brands Ltd.