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UK Government considers legislative exemption for CBD consumer products

Posted on 23 April 2021

The Government has revealed that it is considering introducing a new exemption for cannabidiol (CBD) consumer products under the Misuse of Drugs Regulations 2001 (MDR 2001). The exemption would apply to any CBD products, which only contain a trace amount of controlled cannabinoids. The proposals are outlined in a letter from the Home Office to the Advisory Council on the Misuse of Drugs (ACMD), in which the Home Office commissions the ACMD to provide impartial scientific advice on the acceptable levels of three constituent cannabinoids in consumer CBD products.

If introduced, the proposed legislative changes have the potential to provide some much needed clarity on the status of consumer retail CBD products in the UK, an industry which is now predicted to be worth £1 billion by 2025.

It should be noted that the new proposals only relate to the regulation of CBD consumer products under the MDA 1971 and MDR 2001. CBD extracts and isolates included in edible products will still need to be approved by the Food Standards Agency and where CBD is used for medicinal purposes a licence will still be required from the Medicines and Healthcare products Regulatory Agency (unless an exemption applies).

Why is the legal framework for CBD consumer products under review?  

The legal status of consumer CBD products in the UK is currently unclear and complex. The Misuse of Drugs Act 1971 (MDA 1971) and the MDR 2001(together the Legislation) govern the control of narcotic substances in the UK. Whilst CBD in its isolate form is not a controlled substance under the Legislation, other cannabinoids with psychoactive properties are, including most notably, tetrahydrocannabinol (THC). However, since the introduction of CBD products onto the UK consumer market, there has been an ongoing debate about the difficulty in extracting CBD in its isolate form, without any trace of THC or other controlled cannabinoids.

Against this backdrop, the Home Office has taken the position that "a CBD containing product would be controlled under the MDA 1971/MDR 2001 as a result of its other cannabinoid content." On this interpretation, any trace of a controlled substance in a CBD product renders the whole product a narcotic for the purpose of the Legislation. Also on this interpretation, the supply, import, production and possession of CBD products without a licence is a criminal offence, which is punishable by up to 14 years in prison and an unlimited fine, if convicted.

Whether the Home Office's legal analysis is correct on this point has to be questionable. The primary purpose of the Legislation is to control the use and distribution of harmful drugs, with the aim of preventing drug misuse. There is no evidence that ingesting traces of controlled cannabinoid would have any harmful effect at all, and of course absolutely no psychotropic effect, making it very difficult for the Home Office to demonstrate that CBD consumer products that have negligible amounts of any controlled cannabinoid would frustrate the purpose of the Legislation. Furthermore, we suggest that the application of the de minimis principle would render the prospects of a successful prosecution most unlikely. 

The fact that the Home Office appreciates these difficulties can be inferred from the lack of enforcement action taken to date. It is our understanding that the Home Office has been aware for some considerable time that there are CBD consumer products on the market with more than just a trace of THC. However, the Home Office has not sought to prosecute these cases or even taken steps to remove these products from the shelves, 

Can retailers rely on the Exempt Product rule?

CBD retailers often seek to rely on an exemption under the MDR 2001, which excludes "Exempt Products" from control. To qualify as an Exempt Product, a product must (i) not be designed for the administration of a controlled drug to a human being or animal (ii) package the controlled drug elements in such a way that they cannot be recovered by readily applicable means or at a level which would constitute a risk to health; and (iii) contain no more than one milligram per component part of a controlled drug. On a literal interpretation, it seems unlikely that any consumer CBD products designed to be ingested would satisfy limb one of these criteria.

However, the applicability of the "Exempt Product" definition to consumer products is also subject to debate. The Home Office has stated that, in their view, the definition of Exempt Product may apply to "drug preparations or products in any form- for example an Active Pharmaceutical Ingredient (API) or a medicinal product in Finished Dose Form" suggesting that its application is limited to scientific or diagnostic purposes.

Despite this, the "Exempt Products" exemption is frequently cited in relation to consumer CBD products and widely relied upon by the industry. A lack of clear guidance on this point means that CBD retailers and investors currently operate under a shadow of regulatory certainty.

What legislative changes are being proposed?

The Home Office has broadly outlined two possible amendments to the MDR 2001. Firstly, it is exploring the possibility of creating a specific exemption, which will permit any CBD products containing no more than a defined trace percentage of controlled cannabinoids.

This U-Turn bolsters the view that the Home Office's current position, which renders products with even a trace of a controlled cannabinoid a narcotic, is untenable. However, the full details of the proposal are yet to be determined. The Home Office has initially proposed a trace level of between 0.01% and 0.0001% by weight per controlled cannabinoid, but the ACMD has been asked to advise further on this as part of its commission.

The new exemption will initially focus on determining a permitted quantity for three specific cannabinoids (THCV, Δ9-THC, CBN and Δ9THCA-A), rather than all cannabinoids that could be permitted. There is currently very little research and evidence on the health implications of regularly consuming traces of controlled cannabinoids, although possible health concerns have been widely reported. Therefore, from a consumer perspective, the initial focus on three commons cannabinoids seems like a sensible approach. If the exemption is introduced, businesses will most likely be required to show comprehensive and independently verifiable information on the full spectrum of cannabinoids in their product.

Secondly, the Home Office is proposing to amend the definition of "Exempt Product" in regulation 2 of MDR 2001. The ACMD has been asked to advise on the specific wording of the amendment, but the Home Office has noted that consumer products and any products intended for human consumption will be unambiguously excluded from the definition.

According to the letter, the purpose of this amendment is to "give effect to the intent surrounding its introduction, being to only exempt products used for scientific or diagnostic purposes which contain an extremely small amount and proportion of controlled drugs." This is the first clear statement from the Home Office that it does not agree with the industry's broad interpretation of "Exempt Product" and signals that CBD retailers will no longer be able to rely on this exemption.

What are the next steps?

As part of ACMD's commission, interested parties were invited to submit written evidence in response to seven prescribed questions. The full list of question can be found here.

In addition to the ACMD's commission, the Home Office has noted that it plans to work with the forensic science sector to determine the method of testing and precise definition of the trace amount. However, there is no indication of a timeline for when this work is expected to be completed or for when the ACMD is due to provide its advice.

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