Prohibition Partners are proud to launch The European CBD Report: Health & Wellness. This report will bring you up to speed on current legislation, regulations, the supply chain, consumer behaviour and how to operate a compliant CBD business in Europe.
CBD is now one of the most popular wellness products in Europe, with about 11% of respondents to Prohibition Partners’ new European survey indicating some usage over the past 12 months.
CBD-specific ‘bricks and mortar’ stores are popping up in virtually every country on the continent and the industry is generating hundreds of millions of euro in revenue each year. However, the legislative and regulatory environment that guides this market is extremely changeable and heterogeneous across Europe. Operators need to be acutely aware of these changes as they are driving the business opportunities on the continent.
In November 2020, the European Court of Justice (ECJ) declared that CBD cannot be considered a narcotic substance under the European Union (EU) interpretation of the United Nations Single Convention on Narcotic Drugs (UNODC). The ECJ court case against defendants Kanavape represented the most significant hurdle that the CBD industry has had to overcome in order to become legitimised and normalised consumer packaged goods (CPG).
It demonstrated the formal separation of CBD, in law, from cannabis. The fallout from this court case is being played out across the continent, with the ruling being referenced in court cases in France, Germany, Italy and others where CBD and hemp traders are establishing their right to continue their businesses which have been running, in some cases, for decades.
The next major step for CBD in the EU and the United Kingdom (UK) is the acceptance of CBD products into the Novel Food Catalogue, under each jurisdiction. In 2019, CBD was declared a novel food in the EU and hundreds of operators have since been working hard to register their CBD products through costly and onerous application processes in the EU.
There is now a similar system in the UK. In the EU, products are officially unmarketable while this process is ongoing whereas the UK Food Standards Agency (FSA) allows for product sales during this assessment stage. As of mid-2022, the novel foods assessment process has stalled in the EU, as the European Food Standards Agency (EFSA) has asked the industry to plug gaps in the publicly available data on the safety of CBD for humans. This process will probably take another year or two before the first fully legitimate products are registered.
While regulators consider how to control concentrated CBD products, the supply chain that delivers products to millions of consumers on the continent continues to develop. The supply of CBD into Europe is currently able to meet the market demands, and there is very likely an oversupply in terms of the raw material.
The cultivation of hemp for CBD across Europe is still popular, especially in hubs such as the Baltic nations, Italy, Switzerland and the Netherlands. However, producers have been competing with imports from the United States (US) which massively expanded in 2019. This has driven down raw material and wholesale prices across Europe.
Many companies are now opting to move further down the supply chain where there is less competition and potentially higher margins in terms of manufacturing, direct-to-consumer (D2C) sales and tertiary services like legal and delivery services.
CBD products have now been on European shelves for decades, but the influx of concentrated CBD products like flower and the range of oil products is a relatively recent phenomenon. As such, CBD consumer practices in Europe are changing quite rapidly, and as CBD has no international trading codes, and most companies are operating in a legally ‘grey’ space, there is a dearth of data on consumption patterns.
To fill this gap in knowledge, Prohibition Partners surveyed 5,234 people across Germany, the UK, Spain, Italy, Poland, France and the Netherlands on their knowledge and usage patterns of CBD. The survey represents the most up-to-date survey of this population to be found in any publication in the world, as of mid-2022, and offers unprecedented insights into the key metrics of CBD consumption patterns in Europe. Prohibition Partners examines the financial implications of the current trends in consumption in the CBD market sizing package available alongside this report.
Specific laws and regulations for CBD are lagging far behind the evolution of the market, meaning CBD is now potentially the largest CPG product in Europe which is, in the majority, sold under legally ‘grey’ conditions. This situation is evolving fast, with new laws, regulations and enforcement practices changing at the European and national level on a quarterly basis. This report is designed to bring readers up to speed on: the CBD industry in Europe in terms of legislation, regulations and enforcement; how to operate a compliant CBD business and the current supply chain and consumer behaviour.
Finally, we’d like to take this opportunity to thank our sponsors Brains Bioceutical, Linnea, Bona Voluntate, Atalis, Kannabio and Chillbar for their commitment to further developing the CBD industry in Europe.
To download your free copy of The European CBD Report: Health & Wellness, click here.
For more information on the premium market sizing package available alongside this report, click here.
