CBD is a molecule that is contained within all plants of the genus cannabis (which includes marijuana and hemp). It is a “cannabinoid” but, crucially, not a “cannabinol”. It does not have the strong psychoactive effects of cannabinols such as the notorious tetrahydrocannabinol (“THC”), but it has been shown to have relaxing and stress reducing effects. CBD itself is not a controlled substance in the UK, so it is legal to possess and (theoretically) supply. CBD products are front and centre both on retailer websites and in the windows of pharmacies and high street health supplement shops. This fast-growing market has attracted both new start-ups and larger businesses.

Criminal Law – Plenty of myths to bust

Perhaps thanks to this rapid growth, UK regulators have struggled to manage this market so far. There are many regulatory and legal aspects to the sale of CBD products, not least the criminal laws relating to controlled substances. Much has been made of the issue of THC content and, although it is true that THC is in itself a controlled drug under the Misuse of Drugs Act 1971 (as it is one of the main psychoactive substances derived from the plant), there are many other derivatives of the cannabis plant which are equally illicit to possess, supply or import. The market is also rife with conflicting and sometimes inaccurate advice, not just from non-professional websites but also from lawyers. The best example of this is the common myth that “0.2% THC” is a legal limit. Recently, reliance on this has led to products being sold on the market that allegedly have illegal levels of THC.[2]

UK Food Regulation – Novelty wearing off

Aside from staying on the right side of controlled drugs law, the single biggest issue in the case of ingestible supplements or oils is food regulation. Under the Novel Food Regulations 2018 (“the UK regulations”) and Regulation (EU) 2015/2283, any food that was “not used for human consumption to a significant degree within the Union before 15 May 1997” is classed as “novel”. There are several caveats to this, but the regulations leave it to the national food agency (Article 4, EU 2015/2283) – in the UK this is the Food Standards Agency (“FSA”) – to decide whether a food is novel, although the European Food Standards Agency (“EFSA”) provides guidance. This guidance takes the form of the EU Novel Foods Catalogue.[3]

According to this catalogue, the EU views cannabinoids such as CBD as novel. It also designates the hemp plant (or cannabis Satvia L.) a novel food, save for a number of exceptions all relating to the seeds and products thereof. The FSA agrees with this designation and has made that position clear for some time.[4] Novel foods cannot be marketed within the EU (and currently the UK) without authorisation by the EFSA.

Applications for authorisation can be very expensive and require the support of comprehensive research into the various health implications of the ingredient. A company submitting an application that has any chance of success may be set back by hundreds of thousands of pounds. They also take a number of years to be processed and may eventually be rejected. If they are authorised, they are then placed on the “Union List” of authorised novel foods (Article 6, EU 2015/2283). The ingredient can then be sold in food products if it complies with the conditions set out in the list (e.g. maximum dosage, warnings etc.).

Legally speaking, CBD containing, ingestible products should therefore be removed from the market in the UK at the present time. The UK regulations task local trading standards to enforce these regulations. Breaches are punishable with a fine, but there are also civil avenues for enforcement, by way of compliance notices and stop notices (Reg 3 & 4 & Sch. 3, Novel Food Regulations 2018).

Enforcement – A patchy approach

Local authorities have shown reluctance to enforce against retailers that are breaching these regulations, however. This may be down to a lack of information or knowledge within their trading standards departments, but years of austerity and cuts have damaged the capacity of councils to enforce in this regard. This has created an awful lot of uncertainty for businesses operating in the CBD market, with a handful of councils bringing prosecutions but most largely ignoring it.

In response to this situation, the FSA released an announcement on 13 February 2020 giving the industry a deadline to submit “valid” applications for authorisation by 31 March 2021 or their products would be taken off the shelves.[5] This has inevitably generated significant disquiet in the industry, particularly amongst the smaller businesses. It also created as many questions as it answered, if not more. What does the FSA mean by “valid”? Does every business have to submit an application for their particular CBD product (the law set out above and the EU’s own guidance suggests not)?[6] What happens if the EU rejects an application?

At time of writing, there is one application pending for “cannabidiol derived from chemical synthesis” submitted by a Swiss company.[7] CBD supplements in the UK usually contain “hemp paste” (in other words the mashed down hemp plant, which carries its own, separate legal issues) and/or CBD that has been extracted from the rest of the plant by chemical means. It may be that British businesses selling chemically synthesised CBD products are covered by this Swiss application under the FSA’s new declaration, but again this is not clear until the FSA gives guidance on the questions above.

Conclusion

Against this background, it is difficult to advise lay clients on how to sell their products compliantly. Providing the client with the risks and their relative significance and making it clear that ultimately it is their decision whether to accept those risks is the only sensible way forward. Notwithstanding this, lay clients should always be advised in clear terms against breaking the law. Over-confident or incautious advice is to be avoided when it comes to CBD businesses, bearing in mind the consequences for the client if they make the wrong decision.

One major positive that has come out of the FSA’s recent announcement is their instruction to local authorities not to bring enforcement action against existing CBD products in breach of novel foods regulation until 31 March 2021. This, at least, provides a slightly clearer regulatory picture for the near future. Beyond then, everything is far from clear.

As ever with the legal cannabinoids market, it’s a case of watch this space.

Article by Alfred Underwood.

Alfred is currently completing a secondment at Mackrell Solicitors, where he is advising on CBD and cannabis law in the UK

References:

[1] https://www.thecmcuk.org/policyreports – CBD in the UK – Executive Summary – June 2019

[2] https://www.dailymail.co.uk/news/article-7956513/Illegal-cannabis-oil-sale-Holland-Barrett.html – Mail on Sunday (last updated 6 February 2020)

[3] https://ec.europa.eu/food/safety/novel_food/catalogue_en – EU Novel Food Catalogue (accessed 17 February 2020)

[4] https://www.food.gov.uk/business-guidance/cannabidiol-cbd – FSA page on CBD (accessed 17 February 2020)

[5] https://www.food.gov.uk/news-alerts/news/food-standards-agency-sets-deadline-for-the-cbd-industry-and-provides-safety-advice-to-consumers – FSA announcement on Novel Food status of CBD – 13 February 2020

[6] https://ec.europa.eu/food/safety/novel_food/authorisations_en (accessed 17 February 2020)

[7] https://ec.europa.eu/food/safety/novel_food/authorisations/summary-applications-and-notifications_en – Cibdol AG application for authorisation (accessed 17 February 2020)