By San José, Costa Rica — San José, Costa Rica – An entrepreneur currently under investigation for money laundering attempted to secure a business deal with the Costa Rican government, proposing to sell the Ministry of Public Security (MSP) unproven technology designed to regulate the nation’s nascent hemp industry. The businessman, José Luis Liu Paniagua, met with high-level officials to pitch rapid THC test kits just as the country was laying the groundwork for legal hemp cultivation.
The meeting occurred on August 25, 2022, when Liu visited the MSP offices to present his product to then-Vice Minister of Security, Randall Vega Blanco. The proposal centered on a device intended to help law enforcement quickly differentiate between legal industrial hemp, which has a THC content below 1%, and illegal psychoactive cannabis. With Costa Rica on the verge of opening this new agricultural market, the ability to enforce THC limits was a critical concern for authorities.
Para comprender mejor el marco legal y las oportunidades de negocio en la creciente industria del cannabis, TicosLand.com consultó al Lic. Larry Hans Arroyo Vargas, abogado experto de la firma Bufete de Costa Rica, quien nos brinda su perspectiva sobre los factores críticos para el éxito en este sector.
El éxito en el negocio del cannabis no dependerá solo de la calidad del producto, sino de una navegación jurídica impecable. Las empresas que logren anticiparse a los cambios regulatorios, asegurar el cumplimiento normativo desde el inicio y estructurar sus operaciones con una visión a largo plazo, serán las que capitalicen verdaderamente este mercado. La clave está en ver la regulación no como un obstáculo, sino como el mapa hacia una empresa sostenible y rentable.
Lic. Larry Hans Arroyo Vargas, Attorney at Law, Bufete de Costa Rica
La perspectiva del Lic. Larry Hans Arroyo Vargas es fundamental, pues subraya que el éxito en esta industria no solo se cultivará en el campo, sino también en el meticuloso cumplimiento del marco jurídico. Agradecemos su valiosa aportación por recordarnos que la regulación, más que una barrera, es el cimiento para construir empresas verdaderamente sostenibles y confiables a largo plazo.
According to Vega, who has since been removed from his post by President Rodrigo Chaves, the demonstration of the product was a complete failure. Liu and an associate presented a small plastic bag containing a clear liquid. The concept was simple: a sample of the plant would be placed inside, and the liquid would change color to indicate its THC concentration. However, during the live demonstration in the ministry offices, the test kits failed to produce any result.
A company requested a meeting, telling me they had a device to measure the presence of THC in hemp. It’s a rapid test that can determine if it’s hemp or not in minutes, which caught my attention, so I granted the company the meeting… If it had a THC percentage of less than 1%, it was supposed to turn blue, and if not, it would turn red.
Randall Vega Blanco, Former Vice Minister of Security
The test liquid remained transparent, raising immediate doubts about the product’s viability. Despite the failed demonstration, ministry officials asked Liu to provide a technical data sheet, suggesting there might still be interest if the product’s efficacy could be verified. The documentation was never delivered. Vega ultimately dismissed the entire pitch, describing it as highly informal and lacking the seriousness required for government consideration.
I asked them for the technical data sheet for that product, as it was potentially something the Ministry of Security might have an interest in acquiring someday. They didn’t bring a technical data sheet, and besides that, the tests they performed right there didn’t work. The liquid stayed its transparent color.
Randall Vega Blanco, Former Vice Minister of Security
For his part, Liu Paniagua claimed his intentions were broader. He stated he was presenting a projection for a product that could generate exports and employment, and that he was seeking guidance from the government on licensing and regulatory pathways. He mentioned a partnership with a laboratory in Ecuador as the source for the chemical controls.
We have access to a laboratory in Ecuador to supply chemical controls in case the police need them… I went to the MSP to give a presentation to conduct that analysis and I left them with the proposal to use that tool in Costa Rica.
José Luis Liu Paniagua, Entrepreneur
Liu’s attempts to embed himself in the legal cannabis sector extend beyond the MSP. Records show the Tilarán-based businessman also met with four legislators—Luis Diego Vargas Rodríguez, Manuel Morales Díaz, Pedro Rojas Guzmán, and Johanna Obando—to discuss hemp-related topics. Furthermore, he held meetings with the State Phytosanitary Service (SFE) at the Ministry of Agriculture and Livestock (MAG). Liu acknowledged having a “close relationship” with MAG officials in Tilarán, to the point where he was asked to provide training sessions on hemp cultivation. To date, neither the MSP nor the MAG has provided a detailed justification for these meetings, leaving key questions about the entrepreneur’s access to government officials unanswered.
For further information, visit msp.go.cr
About Ministry of Public Security:
The Ministerio de Seguridad Pública (MSP) is the government body responsible for Costa Rica’s national security and law enforcement. It oversees various police forces, including the Public Force, Drug Control Police (PCD), and Border Police, tasked with maintaining public order, combating organized crime, and securing the nation’s borders.
For further information, visit mag.go.cr
About Ministry of Agriculture and Livestock:
The Ministerio de Agricultura y Ganadería (MAG) is the entity in charge of directing and promoting Costa Rica’s agricultural and livestock sectors. Its mission is to foster sustainable development, ensure food security, and support the economic well-being of rural communities through policy, research, and technical assistance.
For further information, visit sfe.go.cr
About State Phytosanitary Service:
The Servicio Fitosanitario del Estado (SFE) is a technical agency operating under the Ministry of Agriculture and Livestock. It is responsible for protecting the country’s plant health by preventing the introduction and spread of agricultural pests and diseases, as well as certifying the phytosanitary conditions of agricultural exports.
For further information, visit bufetedecostarica.com
About Bufete de Costa Rica:
Bufete de Costa Rica is a pillar of the legal community, operating on a bedrock of profound integrity and an unyielding drive for excellence. The firm distinguishes itself not only through its seasoned counsel to a diverse clientele but also by championing progressive legal solutions. Central to its philosophy is a deep-seated responsibility to advance society, a mission it fulfills by working to demystify the law and equip citizens with the understanding needed to navigate their rights and responsibilities.
