The European Union Court of Justice has in a landmark ruling announced that cannabidiol (CBD), the cannabis-derived compound, is not a narcotic, on account of it not having “any psychotropic effect or any harmful effect on human health”. This ruling has larger ramifications on the marketability of CBD as a wellness product across the EU and is reflective of a larger paradigmatic shift towards the acknowledgement of cannabis and cannabis-derived products’ place in mainstream healthcare.
The question was taken to the EU decisive powers after French regulatory bodies prohibited KanaVape, a Czech company, from selling electronic cigarette cartridges containing CBD extracted from the whole cannabis plant. The French authority claimed that CBD extracted only from the fibre and seeds of the hemp plant (a variety of the cannabis plant containing less than 0.2% of the psychoactive cannabinoid THC) was permissible for commercial use.
The court clarified that CBD should be not be classified as a narcotic within the remit of the 1961 Single Convention on Narcotic Drugs (UN Treaty) and that prohibiting the marketing of CBD lawfully produced either from the plant in its entirety or solely from its fibre and seeds would create an unnecessary restriction on the free movement of goods. Further, the court ruled that EU states can only ban the marketing of CBD if a risk to public health “appears sufficiently established”.
This ruling has further implications on CBD’s classification as a Novel Food by the European Food Standards Agency. CBD was added to the Novel Food Catalogue in January 2019 requiring that edible CBD products undergo safety assessments before they can be authorised for placing on the market in the interests of safeguarding public health. However, in July of this year, the European Commission suspended applications citing uncertainty as to whether CBD would be better regulated as a narcotic under the UN Treaty. Over 50 companies will now resume the registration process of their products as Novel Foods and it is expected that a number of others will begin the process in light of the clarity provided regarding CBD’s regulatory status.
Changes to cannabis laws and shifting attitudes around the world are generating unprecedented levels of business and investment opportunities. Recent reports place the CBD market as currently worth £300m, with projections to be just short of £1bn in the UK and €14bn across Europe by 2025.
If you would like to discuss any CBD issues that your business might be facing, then please contact Rhea Malhotra at Rhea.Malhotra@ilaw.co.uk.
