27 November 2020

European Court of Justice: is CBD extract a ‘drug’?

Category: Cannabis law

Cannabis component CBD subject of French lawsuit

France has a total ban on the import and export of, among other things:

  1. cannabis;
  2. the cannabis plant and resin;
  3. products containing cannabis;
  4. products obtained from cannabis, the cannabis plant or resin; and;
  5. THC, the main psychoactive substance in cannabis.

The fact that the French authorities also included CBD in the scope of the prohibition on drugs meant that an E cigarette containing refills containing CBD was compromised. The trader in question was convicted of offences against the legislation on toxic substances. His defence raised the question whether national legislation prohibiting trade in CBD contravened various provisions of European law designed to protect the internal market. The Court of Justice of the European Union recently gave an interesting answer. 

Judgment of the Court of Justice on interpretation of the Convention on Narcotic Drugs

CBD is extracted from the entire cannabis plant and not just from the seed and leaves of the plant. Since, under the Single Convention on Narcotic Drugs, the terms ‘cannabis’ and ‘cannabis plant’ refer to that method of extraction, that category is classified as a ‘narcotic drug’. Consequently, the Court of Justice states, first, that ‘a literal interpretation of the provisions of the Single Convention could lead to a finding that CBD, in so far as it is extracted from a plant of the genus cannabis and that plant is used in its entirety, including its flowering or fruit-bearing tops, is a cannabis extract’.

At the same time, the Court of Justice confirms that, on the basis of the scientific evidence available, it cannot be established that CBD has ‘psychotropic and harmful effects’ on health. The Court of Justice adds that the same view is upheld by the World Health Organisation and that CBD itself is not included in the Single Convention on Narcotic Drugs. In the light of those facts, the Court holds that ‘in the current state of scientific knowledge, the CBD does not contain a psychoactive substance, so that it would be contrary to the aim and general scheme of the Single Convention if the CBD, as a cannabis extract, fell within the definition of ‘narcotic drugs’ within the meaning of that convention’. A legal heart for the CBD industry. 

CBD is a ‘normal’ product that may not be restricted in trade

In summary, the Court holds that the CBD, as present in the entire cannabis plant, cannot be regarded as an agricultural product and is therefore not covered by the European agricultural regulations. At the same time, the finding that the CBD cannot be classified as a ‘narcotic drug’ leads to the conclusion that it is an ‘ordinary’ good; the free movement of goods in the European market (and hence the prohibition of restrictions on imports) applies.

A general ban on CBD extracts, as we have seen in France and many other Member States, is therefore a major restriction on the free movement of goods. Such a restriction is permitted only if it can be justified by the Member State on grounds of the public interest. It is required that it can be sufficiently demonstrated, on the basis of scientific evidence, that trade in CBD poses a real risk to public health and that the measure taken to protect it does not go beyond what is necessary to achieve that objective. 

Consequences for the Dutch CBD market

In the Netherlands, it is prohibited – inter alia – to bring hemp and hashish into or out of the territory of the Netherlands, to cultivate, prepare, process, sell, deliver, supply, transport, have or produce them. In short: ‘drugs’ are prohibited, for which reference is made to the lists annexed to the Opium Act. These lists refer to ‘hemp oil’. Because ‘hemp oil’ is defined as the ‘concentrate of plants of the genus Cannabis (hemp) obtained by extraction of hemp or hashish, whether or not mixed with oil’ – which is quite similar to ‘cannabis extract’ – one can, after the ruling of the Court of Justice, wonder whether CBD extracts may still be prohibited in the Netherlands. The Dutch Court has not made any decisions on the issie of CBD. It may however assess that the scientific data available and produced before it in order to make sure that the real risk to public health alleged does not appear to be based on purely hypothetical considerations. The Dutch Court may therefor prevent the authorities from actions which prevent trade of CBB products based on unjustified allegations of health risks. 

THC in products

In the case of cannabis products, however, the presence of THC, the psychoactive substance, is still prohibited at all times. The difference from the situation after the Court of Justice’s judgment is that in the past, even if a product did not contain detectable amounts of THC, the starting point was that – depending on the product – it could still be ‘hemp oil’ because it was a cannabis extract. Now that the Court has held that CBD, as a cannabis extract, cannot fall within the definition of ‘narcotics’ within the meaning of the Single Convention, on the basis of which the Opium Law was co-written, it is quite justifiable that cannabis extract is therefore no longer a prohibited substance within the meaning of the Opium Law. 

Advice on CBD in products in the Netherlands

In response to the above, do you have any questions about the regulations that apply to products containing CBD or do you need advice? If so, please contact one of Blenheim’s administrative law attorneys.