Xebra Brands Ltd. announce, that further to its press release of December 8, 2022, a District Court judge has ruled in favor of Xebra Mexico. On December 8, 2022, Xebra announced that the Mexican Health Regulatory Agency, had formally notified Xebra's Mexican subsidiary, Desart MX, SA de CV, with a resolution in which it claimed to have complied with the Supreme Court mandate to grant Xebra cannabis authorizations. Xebra however indicated that in its opinion, and in the opinion of its legal advisors, the resolution issued by the COFEPRIS did not fulfill the mandate of the Supreme Court.

A District Court judge has now reviewed the COFEPRIS resolution and ruled in favor of Xebra Mexico, outright rejecting its scope and language as materially insufficient and upholding Xebra's irrefutable legal rights granted by the Supreme Court. Thus, the judge ordered the COFEPRIS to issue the full and proper authorizations within 3 business days. Due to many Mexican government offices closing during the holiday season, Xebra anticipates the process of issuing the authorizations to continue into January 2023.

Furthermore, since these cannabis authorizations are without legal precedent in Mexico, guidance on approximate timing cannot be relied upon, and additional delays can be reasonably expected. Xebra Mexico's authorizations will apply specifically to cannabis with low-levels of THC (under 1%), therefore, in practical terms, to hemp cultivation, processing, and to the manufacture and sale of mainly CBD products, and certain uses of the cannabis flower. Opportunities in the hemp plastics industries have also been identified.