DRAFT
Psychoactive
Substances
Guide to the Licensing
Scheme
16 January 2015
Contents
1.0Background
2.0 Introduction to the legislative framework
2.1 The Psychoactive Substances legislation and guidelines
2.2 Legislation to read in conjunction with the PSR Guidelines
2.3 Requirements to comply with other legislation and standards
2.3.1 Consumer legislation
2.3.2 Hazardous substances and new organisms legislation
3.0 Principles of the Act
4.0 When is an application required?
4.1 Products
4.2 Licences
5.0 Licensing Process
5.1 Receiving and screening for completeness
5.2 Invoicing and payment
5.3 Evaluation of information
5.4 Notification of the outcome
6.0 Types of licences
6.1 Conditions and requirements for licence for sale of unapproved
products
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1.0 Background
The Psychoactive Substances Act 2013 (the Act) came into force on 18 July 2013. The
purpose of the Act is to regulate the availability of psychoactive substances in New
Zealand to protect the health of, and minimise harm to, the individuals who use
these substances. The Act sets up a system of pre-market approval for psychoactive
products by requiring them to demonstrate that they pose no more than a low risk of
harm to the individuals who use them, and by placing restrictions on how and to
whom they can be sold.
The Act establishes the Psychoactive Substances Regulatory Authority (the
Authority) within the Ministry of Health. The Authority is responsible for ensuring
products meet adequate safety requirements before they can be distributed in New
Zealand, and also licenses importers, researchers, manufacturers, wholesalers,
retailers and sellers of unapproved psychoactive substances.
The psychoactive substances regulations (the regulations) further define the full
regulatory requirements for psychoactive substances. There are two tranches of
Regulations; the first took effect on 3 November 2014 and the second will take effect
in 2015. The first tranche of Regulations specify the requirements for product
approvals and licences to sell unapproved psychoactive substances and to import,
research and manufacture psychoactive substances. This set of Regulations also
specifies the fee and levy structure and the penalties for infringements. The second
tranche of Regulations specify the requirements for licences to wholesale and retail.
These guidelines provide detail relating to the implementation of the regulatory
licensing scheme. This includes advice on when and how to prepare applications for
licences to sell unapproved products, manufacture, research, and import, and what
supporting information needs to be provided. In the future these guidelines will be
updated to include requirements for licences to wholesale and retail. These
guidelines give an overview of the application process, the fee structure and the
guidance documents recognised by the Authority for the purpose of supporting an
application. In addition, these guidelines also cover the obligations that successful
applicants must meet, post-approval.
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2.0 Introduction to the legislative
framework
Copies of all relevant legislation can be downloaded for free from
www.legislation.govt.nz.
2.1 The Psychoactive Substances legislation and guidelines
Psychoactive substances are regulated in New Zealand in accordance with the
following:
 The Psychoactive Substances Act 2013 (the Act)
 The Psychoactive Substances Regulations 2014 and 2015 (the regulations)
o The Psychoactive Substances (Fees and Levies) Regulations 2014 (the
fees regulations)
o The Psychoactive Substances (Infringement Fees and Form of Notices)
Regulations 2014 (the infringement regulations)
o The Psychoactive Substances Regulations 2015 for retailers and
wholesalers (these regulations are still under construction and the final
name has yet to be confirmed)
 The Psychoactive Substances Regulatory Guidelines 2014 (the PSR Guidelines).
2.2 Legislation to read in conjunction with the PSR Guidelines
The following is a list of legislation to be read in conjunction with these guidelines.
Areas that are of particular importance or likely to be of particular interest are
further specified but prospective applicants should make themselves familiar with
the complete documents.
 The Psychoactive Substances Act 2013
 The Psychoactive Substances Regulations 2014 and 2015
 The Misuse of Drugs Act 1975
o Schedules 1, 2 and 3 – list controlled drugs
o Schedule 4 – lists precursor substances
 The Medicines Act 1981
o Section 3 – defines a medicine
o Section 2(1) - defines a herbal remedy
 The Medicines Regulations 1984
o Schedule 1 – lists all prescription, restricted and pharmacy-only
medicines
 The Dietary Supplements Regulations 1985
o Regulation 2(a) – defines a dietary supplement
 The Food Act 2014 and its associated Standards
o Section 9 – defines a food
 The Smoke Free Environments Act 1990
o Section 2(1) – defines a tobacco product
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2.3 Requirements to comply with other legislation and standards
2.3.1 Consumer legislation
Manufacturers should be aware that, as psychoactive products are articles of
commerce, they also need to comply with any other relevant consumer legislation
(eg, the Fair Trading Act 1986 and the Consumer Guarantees Act 1993) administered
by the Ministry of Business, Innovation and Employment. In particular, claims of
psychoactivity must only be made for products that actually produce a psychoactive
effect.
The ingredients used in psychoactive products must comply, not only with the
psychoactive substances legislation, but also with the requirements of the Hazardous
Substances and New Organisms Act 1996 (HSNO), its amendments and its
associated regulations as administered by the Environmental Protection Authority
(EPA).
2.3.2 Hazardous substances and new organisms legislation
Manufacturers are required to ensure that the ingredients contained in the
psychoactive products they manufacture in New Zealand comply with the HSNO
legislation. This may require manufacturers to assess whether the ingredients cross
the HSNO thresholds for hazardous properties. The web site
http://www.hsno.govt.nz is dedicated to the HSNO legislation and its application.
The web site http://www.epa.govt.nz includes information on EPA procedures
together with a searchable register of applications and approvals under the HSNO
Act.
For further information about the HSNO and EPA requirements for obtaining
consent to import and or release products controlled under the HSNO legislation,
contact:
General Manager, Applications and Assessments
Environmental Protection Authority
Level 10, 215 Lambton Quay, 6011
Private Bag 63002, 6140
Wellington
Telephone: (04) 473 8426
Fax: (04) 473 8433
Web site: http://www.epa.govt.nz
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3.0 Principles of the Act
The three key principles in the Act are that:
(i)
(ii)
(iii)
Any psychoactive product that poses no more than a low risk of harm to
individuals who use the product should be approved. (A product that poses
no more than a low risk of harm is expected to have a risk profile similar to
an over-the-counter or general sales medicine
Conversely, any psychoactive product that poses more than a low risk of
harm to individuals who use the product should be prohibited
Animals must not be used for the purposes of assessing whether a psychoactive
product should be approved.
Assessment of the risk of harm posed by a psychoactive substance requires the OPSRA to
consider a range of pharmaceutical, toxicological and chemical factors. In making the
assessment, the Act prohibits the OPSRA from considering any data derived from the use of
the product in animals.
In the opinion of the Psychoactive Substances Expert Advisory Committee
(PSEAC), it is unlikely that a product can be shown to pose no more than a low
risk of harm without the use of animal testing. See Appendix X for the PSEAC
Position Statement on animal testing
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4.0 When is an application required?
4.1 Products
All psychoactive substances intended for human consumption require consent from
the Authority (as established by section 10 of the Act) before they can be sold in New
Zealand. The product approval guidelines set out what is required for product
approval (www.psychoactives.health.govt.nz).
4.2 Licences
Individuals or legal entities must have the Authority’s consent to perform each of the
following activities:






import psychoactive substances
manufacture psychoactive substances
research psychoactive substances
sell psychoactive substances that are not approved products
sell psychoactive substances by retail
sell psychoactive substances by wholesale.
Application forms are available for download from www.psychoactives.health.govt.nz
and should be emailed with all supporting information to
psychoactives@moh.govt.nz.
Under section 16 of the Act, an applicant must be determined to be a fit and proper
person, or if an application is made on behalf of a body corporate, the body corporate
is of good repute. As part of the application process, the OPSRA will require a police
vetting check to determine this.
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5.0 Licencing Process
The key steps in the licencing process are:




receiving and screening for completeness
invoicing and payment
evaluation of initial and additional information
notification of the outcome
o the opportunity to make a further submission if the outcome is negative
o the opportunity to lodge an appeal with the psychoactive substances appeals
committee (PSAC) if the outcome is negative.
o
5.1 Receiving and screening for completeness
Applicants should ensure that applications include all of the required information in
the format required. Applications that are found to be significantly deficient will be
refused and returned and applicants will need to resubmit their application from the
beginning of the process. Please note that this step is only intended to check that
information has been submitted for each of the major requirements and is not a
comprehensive check that the data is appropriate.
5.2 Invoicing and payment
Once an application has been screened for completeness, the OPSRA will issue the
applicant with a tax invoice which will be included with the acknowledgement letter.
It is the OPSRAs intent to complete screening and issue an invoice within 14 working
days of receipt of the application. Payments are to be made on an invoice basis only –
do not send payment with the application.
Payment can be made by Electronic Funds Transfer, or by cheque. Details on how to
make a payment by these methods is listed on our invoice remittance advice.
Credit card payments with Visa or MasterCard can also be made. A 2% transaction
fee on credit cards applies. You should also check with your card issuer for details
about other fees or charges that may apply, as credit card transactions are carried out
in terms of arrangement between you and your bank.
Payments are in New Zealand dollars. If payment is made using a credit card issued
outside New Zealand, any currency conversion will be done according to the terms
and conditions of the card.
From the invoice remittance advice you will require the customer number, invoice
number, and invoice total to complete the payment transaction. Payments received
up to 2230hrs New Zealand time will be applied the next business day.
The schedule of fees and levies payable can be found below.
Fees incl. GST
Application for licence to import psychoactive substances
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$2,500
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Application for licence to manufacture psychoactive substances
$19,000
Application for licence to research psychoactive substances
$2,000
Application for licence to sell psychoactive substances that are not approved
$2,000
products
Future Licences
Application for licence to sell approved products by retail
Application for licence to sell approved products by wholesale
$12,000
$7,000
Levies incl. GST
Holder of licence to import psychoactive substances
Holder of licence to manufacture psychoactive substances
Holder of licence to research psychoactive substances
Holder of licence to sell psychoactive substances that are not approved
products
Future Licences
Holder of licence to sell approved products by retail
Holder of licence to sell approved products by wholesale
5.3 Evaluation of information
7,500
42,000
3,000
2,000
7,000
6,000
It is the intent of the OPSRA to complete the evaluation of all information provided
with the application within 60 working days of receiving payment.
5.4 Notification of the outcome
If the outcome is positive, the applicant will receive the licence approval certificate
and an outcome letter. Applicants should carefully read both the outcome letter and
the certificate as these documents will describe the approved details, requirements
and conditions that must be complied with. Any incorrect details should be notified
to the OPSRA immediately.
If the outcome is negative, the applicant will receive an outcome letter which clearly
explains the grounds for the proposed refusal. The letter will also advise the
applicant of their right, under section 21(1)(b) of the Act, to make a written
submission to the OPSRA to object to the Authority’s proposal to refuse product
approval.
If the applicant chooses not to make a written submission within the required
timeframe the Authority will refuse the licence application.
If the applicant chooses to make a written submission and it is received within the
required timeframe the Authority will reconsider the proposal to refuse the licence
based on the written submission. It is the OPSRAs intent to complete this process
within 28 working days of receiving the written submission.
If the outcome is positive, the applicant will receive the licence certificate and an
outcome letter. Applicants should carefully read both the outcome letter and the
licence certificate as explained above.
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If the outcome is negative, the applicant will receive notification that the licence
application has been refused, and the grounds for this refusal. Applicants will also be
advised of their right, under section 45 of the Act, to lodge an appeal with the PSAC.
Specific conditions imposed on licences can be contested by the applicant with the
OPSRA. If the applicant is not content with the outcome received from the OPSRA,
they can appeal to the PSAC about the Authority’s decision to impose specific
conditions on a licence.
5.5 Lodging an appeal with the PSAC
The PSAC is a committee made up of three members, at least one of which must be a
lawyer with at least seven years’ experience. The function of the committee is to
independently review any decision made by the Authority:
 to refuse to grant the person a licence:
 to impose a condition on the person's licence:
 to suspend or cancel the person's licence
The committee cannot review any decision or part of a decision that is not appealed
against. On hearing the appeal, the committee may:
 confirm, reverse or modify the decision appealed against
 make any other decision that the Authority could have made
 refer appeals back to the Authority to reconsider.

Appeals against an Authority decision should be accompanied by a detailed letter
stating the decision to be appealed and the grounds on which it is to be appealed.
Appeals should be sent to:
The Psychoactive Substances Appeals Committee
c/o the secretariat
No. 1 The Terrace
Po Box 5013
Wellington 6145
New Zealand
Appeals must be received no later than 60 days after the decision appealed against is
given unless the committee allows a longer period. The decision being appealed
remains in force throughout the appeal unless the committee orders otherwise. The
committee will meet as and when required.
For further information on the appeals process, please direct queries to
psychoactiveappeals@moh.govt.nz.
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The flow chart below provides an overview of the product approval process and expected timeframes
Application received
Screen application
for completeness
Application
incomplete
Applicant notified of
refusal within 14
working days of
receipt. Application
returned or
destroyed.
Application
complete
Applicant invoiced
within 14 working
days of receipt
Payment not
received within 7
working days
Applicant notified of
refusal within 21
working days of
invoicing.
Application filed.
Payment received
within 7 working
days
Refer to police
within 14 working
days of payment
receipt
Vetting check
required
No relevant
criminal
conviction
Refer to districts for
further information
Clock starts.
Advisor to check
application
Applicant notified of
refusal and right of
appeal
Relevant
criminal
conviction
Vetting check
not required
Applicant chooses
not to make a
written
submission within
14 working days
Police report
provided to the
OPSR within 20
working days of
request
Process application
within 30 working
days of receipt of
payment (including
sign off)
Provide report to
the OPSR ASAP
Outcome
positive
Update file and
compliance strategy
based on this
information
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Assign licence
number, update
website and issue
applicant with
licence and invoice
for annual levy
within 14 working
days of decision
Outcome
negative
Applicant notified of
proposal to refuse
within 14 working
days of decision
Applicant
chooses to make
a written
submission within
14 working days
Outcome
positive
OPSRA to consider
submission within
28 working days
(including sign off)
Applicant notified of
refusal and right of
appeal
Outcome
negative
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6.0 Types of licences
There are six different licences within the Psychoactive Substances Act. These are
manufacture, wholesale, retail, import, research, and sale of unapproved products. All of the
licences have their own conditions and requirements associated with them, although there
are conditions and requirements that are common to all licences. The terms for the licences
covered by the first tranche of regulations (import, research, sale of unapproved products,
and manufacture) are outlined below.
6.1 Conditions and requirements for licence to import
A licence to import allows the holder of the licence to import psychoactive products.
The licence holder must inform the OPSRA before importing a substance, the date
they intend to import the substance, the quantity of the substance, and the identity of
the substance. A person who holds a licence to import must also hold either a
manufacturing, wholesale, sale of non-approved products, or research licence. The
applications for these licences must be submitted at the same time as the application
to import psychoactive substances.
Conditions
 Before each import of a psychoactive substance, you must advise the Office of
the Psychoactive Substances Regulatory Authority of the name and quantity of
the psychoactive substance to be imported, and the intended date of
importation.
 You must provide all relevant documentation requested by the OPSRA within
10 days of receiving the request
 You must not unreasonably withhold permission for an enforcement officer or
representative of the OPSRA to enter the premises during normal business
hours
Requirements
 You may sell or distribute psychoactive substances only to persons that hold a
licence under the Psychoactive Substances Act 2013.
6.2 Conditions and requirements for licence to research
A research licence allows the holder of the licence to carry out research into the
production of novel psychoactive substances. The OPSRA expects anyone
undertaking research with psychoactive substances to hold a research licence.
Conditions
 The licence holder must inform the OPSRA of all intended research, the
timeframe for the research and the outcome.
 You must not unreasonably withhold permission for an enforcement officer or
representative of the OPSRA to enter the premises during normal business
hours
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Requirements
 The licence holder may obtain psychoactive substances for the purpose of
research only from a manufacturer, wholesaler, seller of unapproved products
or importer licenced under the Psychoactive Substances Act 2013.
6.3 Conditions and requirements for licence to manufacture
A manufacturing licence allows the holder of the licence to manufacture approved
psychoactive products for sale. An application for a manufacturing licence must
come complete with overview of company structure, and nomination of responsible
persons who will also need to go through the vetting process.
The conditions and requirements for a licence to manufacture, aside from those
mentioned in 6.1, are set out in full detail in the code of manufacturing practice,
(www.psychoactives.heath.govt.nz) which must be complied with at all times.
6.4 Conditions and requirements for licence for sale of unapproved
products
A licence to sell non-approved products allows the holder of the licence to sell
psychoactive substances that are not approved products to holders of manufacturing
or research licences. A person who holds a licence for sale of unapproved products
must also hold a licence to import, or to manufacture. The applications for these
licences must be submitted at the same time as the application for sale of
unapproved psychoactive substances.
Conditions
 You must only sell psychoactive substances to a person who holds a
licence to manufacture psychoactive substances or a licence to research
psychoactive substances.
Requirements
 You must provide to the Office of the Psychoactive Substances Regulatory
Authority, by the 20th day in each month, information on the volume of
psychoactive substances sold by you for the previous month.
6.5 Conditions and requirements common to all licences
Conditions
 Psychoactive substances and products must only be stored at location(s) that
have been notified to the Authority in the manner prescribed by the Authority.
 You must securely hold all records as specified by the regulations for 7 years
after the date of the last entry in the record.
 You must notify the Authority of the details of any intended export of a
psychoactive substance in the manner required by the Authority before the
substance is exported.
 The licence should be permanently exhibited in some conspicuous place where
it can be readily seen by all persons having access to the premises to which the
licence relates.
 The address given must not be a residential address or a PO BOX
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Requirements
 You must notify the Psychoactive Substances Regulatory Authority if you
become aware of any adverse reaction arising from the use of a psychoactive
substance or an approved psychoactive product (whether in New Zealand or
overseas) as soon as is reasonably practicable.
 An application to renew the licence (including the application fee) should be
submitted at least two months but less than three months before the expiry
date on your current licence.
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