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17 July 2020

Is France moving towards a more flexible regulation in respect of CBD products: the CJEU’s Advocate General considers that the French restrictive position is contrary to European Law.

Stehlin & Associés and the Cannabis Law Team at Mackrell Solicitors look at the recent opinion delivered by the CJEU’s Advocate General on 14 May 2020 in case C663/18 (Kanavape) centering on the distribution in France of electronic cigarette cartridges which contained CBD.

In an earlier article dated 30 April 2020  Stehlin & Associés looked at French rules governing the use of CBD in France.  You can find a copy of their article “CBD: A Short reminder of the French rules governing the use of “legal cannabis”” at the following link.

In this specific case, CBD oil, used in an electronic cigarette liquid marketed in France by SAS Catlab, was imported from the Czech Republic, where the hemp plant was grown and where the CBD was extracted legally from all parts of the hemp plant.   However current French regulation prohibits the marketing of CBD products which derived from the whole hemp plant and  only allows the use of fibres and seeds of the hemp plant to create CBD based goods. These restrictions are laid down by French law (Order of 22 August 1990) and as a consequence the directors of Catlab were convicted by the Criminal Court of Marseille in 2017 for drug trafficking and violations of the legislation on medicines.  They appealed to the Aix-en-Provence Court of Appeal, which noted that, by contrast, synthetic CBD (with identical characteristics and effects) is legal in France, and that other Members States had more permissive legislations with regards to CBD.  The Court of Appeal therefore raised the preliminary question to the CJEU on the compliance of French regulations with European Union law.

The Advocate General of the CJEU considered that the prohibition of imports of CBD oil between Member States when it is extracted from the whole hemp plant is contrary to the principle of free movement of goods under EU law.  Contrary to what the French government claimed, the French prohibition is seen as neither appropriate nor proportionate to protect public health by the Advocate General. He came to this conclusion by referring to the fact that in the current state of scientific knowledge, it has not been established that CBD oil has harmful and in particular psychotropic effects. Still, according to his opinion, the French government having failed to demonstrate the seriousness of the potential negative effects on health, it was deprived from relying on the “precautionary principle” to justify the restrictions.

The Advocate General leaves it to the national court (in this instance France) to satisfy itself that no risk associated with non-psychotropic effects of CBD has been identified to date. In the event the Court  were to identify that such a risk existed (through a comprehensive scientific assessment) it would need to make sure that no alternative and less restrictive on the free movement of goods measure could be adopted, such as the establishment of a maximum CBD content.

While in procedural terms the opinion of the Advocate General is not binding on the Court, in practice the CJEU usually follows his opinion. The judgment to be delivered by the CJEU in a few months’ time will only refer to CBD oil in this specific case but will nonetheless constitute binding case law with a European scope.  If the CJEU confirms that the French regulation is contrary to European law, the Court of Appeal of Aix-en-Provence will have to exclude the application of the relevant French law and is likely to overturn the decision of the Criminal Court of Marseille in the coming months.

A CJEU decision having the force of res judicata is not only binding on the national court that referred the question, but also on all national courts of other Member States, whom would be faced with the same or a similar dilemma.

Should the CJEU follow the Advocate General’s conclusions, there is no doubt that this decision would have an impact on the CBD market, not only in France, but also in Europe, which suffers from a fragmented legal framework. France would thus be required to remedy its non-compliance and to amend its legislation by allowing the marketing of CBD extracted from the hemp plant in its entirety and taking more proportionate measures (such as maximum CBD concentration). As this decision would set a binding precedent within the European Union, it  could also push other Member States to reconsider possible existing restrictions related to CBD based products. These conclusions should therefore be seen as a major step towards the harmonization of regulations on CBD and a significant legal breakthrough for the players in this growing market.

The opinion of the Advocate General is available in English here and in French here and the CJEU decision is expected by the end of 2020.

There is definitely a sentiment both in France and in the United Kingdom, as well as Europe, that the true applicability, and clarification of, the laws governing CBD and cannabis will require a test case. There is simply too much grey area and vagueness surrounding the phytocannabinoid and its uses. To go further, some legislation has not been rationally put together. What has happened in France may need to take place in the UK or other EU Member States to really put the pressure on legislating for a more commercially beneficial industry, that carries with it not only potential for health and wellness, but also for a medicinal cannabis market.

Stehlin & Associés is a French independent law firm based in Paris. The commercial team helps French and foreign clients with all regulatory and commercial issues with an industry approach of many sectors, including agribusiness, agrochemicals and chemicals, luxury goods, financial services, online retail.

The CBD team at Stehlin & Associés (Paris) and the Cannabis Law Team at Mackrell Solicitors (London & Birmingham) work together to provide a comprehensive range of Legal and Business services to every part of the growing Cannabis and CBD industry. As members of the Global Lawyers Network – Mackrell International, we  provide  our clients with legal solutions in 60 countries from 170 offices.