Setting Covid aside for a moment, our ‘legal doctor’ Robert Botkai discusses regulation changes for the fast-growing CBD sector

FT - Robert Botkai partner Winckworth Sherwood

Robert Botkai - partner Winckworth Sherwood

CBD is a non-psychoactive ingredient derived from cannabis plants. CBD has extremely low levels of the psychoactive element tetrahydrocannabinol (THC) and so has been considered safe for human consumption.

The rate at which the CBD market has expanded in the past few years, meaning that consumers can purchase anything from CBD gum to cereal bars, ultimately paved the way for the Food Standard Agency’s (FSA) intervention in February 2020. The goal of this intervention was to protect both the consumer and stockists from potentially being mis-sold a perfectly safe product compared to something far more concerning – an illegal product containing high doses of THC. THC is a controlled substance under the Misuse of Drugs Act 1971 and, accordingly, it is a criminal offence to supply, possess, or sell it in the UK. Any CBD sold in the UK should contain nil or trace levels of THC (ie less than 0.01%). In effect, a more regulatory framework would ensure a standardised level of safety and security.

Novel Food Authorisation

In January 2019, the EU categorised CBD food products as novel foods for the purposes of the EU Novel Food Catalogue. Novel foods are classified as foods which have not been widely consumed by people in the EU prior to May 1997. The Catalogue is a way of recording the European Commission’s decisions on novel food status.

The FSA accepted this reclassification which meant that its pre-market safety assessment on any food product containing CBD in the UK was imposed.

The result of this was that businesses wishing to sell their products in Britain had to submit a novel food application via the new regulated products system, which is jointly operated by the Food Standards Agency and Food Standards Scotland.

FSA Intervention

On February 13, 2020 the FSA made a dramatic intervention in the UK CBD market with a statement requesting businesses to submit, and have fully validated, novel food applications by March 31, 2021. After this date, only products with a validated FSA application could remain on the shelves.

Local authorities were advised that relevant businesses could still sell their existing products but only if these were not incorrectly labelled, unsafe and did not contain any substances that fell under drugs legislation. Importantly, too, no new CBD extracts or isolates could be sold until they had the relevant authorisation required.

Applications submitted to the FSA are subject to an eight-day administration check. Following that, it can then take up to 30 days for an application to be validated. Validated applications then continue along the authorisation process which ascertains the safety-worthiness of a product and determines whether it should be allowed to be sold.

What has changed?

It was previously the case that only products which were on sale at the time of the FSA’s February 2020 announcement, and which were connected to an application which had been validated by March 31, were allowed to remain on sale from April 1, 2021.

However, the FSA has since recognised that, in order to maximise the opportunity to pass the validation criteria, and thus, in turn, promote the regulation and safety of CBD products, it had to widen this strict criterion. A list of products with validated novel food applications which was published in April this year only contained the names of three different brands.

The position now is that, in order to remain on the market, a product has to have been on sale on February 13, 2020 and linked to an application submitted before March 31, 2021, that is subsequently validated.

This dramatic shift in the original criterion is largely as a result of the volume of applications received by the FSA so close to the March 31 deadline. The FSA has, quite fairly, assessed that in order to properly process these applications the sale criteria had to be adapted.

The road to achieving novel food status is a long and complicated one, which is why the FSA has taken a proportionate approach to its management of the authorisation process.

Looking Ahead

So, what does the future of CBD products in the UK look like? Has the FSA’s intervention quashed the notion of CBD becoming the next avocado toast? In fact, the very opposite could be said as a result of the recent FSA relaxation of the authorisation criteria. It could, indeed, help to unlock the growth potential of the sector as both consumers and stockists can take comfort from the tight standards imposed. Regulation of the market, in this instance, could be the key to the CBD market’s future success and this has undoubtedly been facilitated by novel food approval helping to break the stigma of CBD in the UK.

I would very much welcome feedback and suggestions on these issues or any areas you would like me to cover in future articles.