Mexican President Andrés Manuel López Obrador signed new rules on Tuesday detailing the production and research of medicinal marijuana, essentially legalizing marijuana for medicinal use. The rules will also legalize and oversee the cultivation of marijuana on Mexican soil for medical purposes.

The new regulations primarily target pharmaceutical companies that are intending to sell and prescribe marijuana to patients. It aims to ensure that production, promotion and research will have to adhere to strict supervision. Several lawyers have described the regulations as “extremely demanding,” and companies that hope to partake in such activities must obtain licenses from the Mexican Ministry of Health and the Federal Commission for Protection against Health Risks.

The signing of the rule is seen as a big step in the Mexican government’s recent attempts to establish itself as a major player in the international marijuana market. In late 2018 the Mexican Supreme Court deemed a total ban on marijuana unconstitutional. The Mexican Senate voted overwhelmingly in support of national legalization in November 2020. Talks for legalization for recreational use are also on the table as the Supreme Court has granted an extension to lawmakers after they requested more time to discuss the lengthy and complex legalization bill. López Obrador has stated that the delay is a “matter of form, not substance,” and thinks the bill is likely to pass.

Many have described the reforms as a shift in general collective thought that legalization would presumptively not lead to more drug-related violence. The recent reforms have attracted several foreign marijuana giants such as Canada’s Canopy Growth and California’s Medical Marijuana Inc, seeking subsidiary opportunities in Mexico.