EU CBD Market: A Patchwork of Regulation

31st December 2019

As the global feeling towards Cannabis continues to become more liberal, big Cannabis companies are keeping a watchful eye on Europe. Despite the almost exclusive prohibition of Cannabis, the EU – and its 512 million potential customers – represents the second-largest CBD market in the world.

A recent study of the European market found that 16% of adults in Europe had used CBD in the past. Though the rates of consumption varied significantly across the continent. For example, Switzerland reported 5x the number of users (33%) as France (7%). Awareness and knowledge of the cannabinoid also varied from country to country.

Despite the continually growing awareness and use of CBD across the European Union, domestic extraction of the cannabinoid remains notably low. In this regard, the EU countries’ regulations on the hemp industry largely impact the potential domestic CBD market.

New Frontier Data observes of the EU CBD market:

“Unfortunately, country-by-country regulations can also hamper uniformity about which parts of the hemp plant may be used.”#

Harvesting Hemp Plants

In the UK, France, and the Netherlands, the harvest of hemp flowers and leaves is prohibited. As these parts of the plant are where cannabidiol (CBD) is found, these countries contribute little to the production line of the CBD industry. France is the largest hemp producer in the European Union, contributing 40% of total EU hemp production.

In spite of being the largest hemp producer, France was found to express the least interest in CBD. According to New Frontier Data’s survey, the country also has the lowest exposure, awareness, and use of CBD.

What’s more, EU hemp cultivation has seen a huge spike in the last few years, contributing almost 25% of global production.

However, higher rates of CBD use in other countries means that customers turn to products sourced from outside the EU. The UK ranked high on New Frontier Data’s list for both interest and use of CBD. But, as it is illegal in the UK to extract CBD from hemp, 100% of CBD, in theory, is imported.

Jersey Hemp is one exception to this rule, having gained the only CBD extraction license in the UK.

Limits on THC Concentration

The European Union guides all member states that hemp should not exceed a THC limit of 0.2%. However, individual countries still have discretion over the actual limits. Some countries, like the UK, France and, and the Netherlands adhere to the EU’s guidance. Others, like Switzerland and Austria, permit a higher limit of 1.0%.

Furthermore, the THC limits on finished CBD products also vary. The UK’s legislation on this matter is particularly confusing, opting for a 1mg of THC per container limit – no matter the size of the container.¬†Other countries may require a 0% THC presence in order for a product to be legal.

Yet another complication lies in the EU classification of CBD as a novel food. This technically means that all CBD products require a license before they can be sold in EU states. The reality is, however, that this rule has hardly been enforced, with only Spain and Italy cracking down on the CBD industry.

According to the European Food Safety Authority, only seven applications have been received. So far, none have been completed.

As public opinion towards Cannabis, and in particular, CBD, continues to become more positive, these inconsistencies may begin to even out. In the meantime, however, the differences across member states will likely impact the market.


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