CBD : What do companies need to know now?

The hemp ingredient cannabidiol (CBD) is said to have positive properties, e.g. as an anxiolytic,
analgesic, sleep aid, arthritis or even epilepsy.
According to Dr. Späth & Partner Rechtsanwälte mbB, based in Berlin and Hamburg, more and more
companies in Germany want to position themselves in the growth market CBD, cannabidiol. Hemp
products are “in fashion” and meanwhile socially acceptable, some of them are now even considered
healthy organic products and can be found more and more in drugstores and pharmacies or even in
the food trade.
The Berliner Morgenpost, for example, had reported in a report dated 08.02.2019 entitled
“Wundermittel CBD” that the market was growing rapidly.
In Germany, high growth rates are to be expected in this area and so even a well-known drugstore
had included non-prescription CBD capsules in its range, then removed them again and it was
temporarily uncertain how to proceed …
Interested companies who want to enter the growth market CBD should, however, always check the
legal admissibility in individual cases, because otherwise nasty surprises can also threaten in the CBD
market:
After various raids in Berlin and Bavaria (there are said to have been more than 40 raids here), the
uncertainty is sometimes quite great, which is permissible and which is not, because the public
prosecutor’s office accused some companies of trading in narcotics.
It is therefore always up to the company to check in each individual case whether the CBD product in
question is a food, food supplement, drug or cosmetic, tobacco product, etc. The company is not
allowed to trade in narcotics.
The company in Berlin, against which the public prosecutor’s office became active, was accused of a
violation of the Narcotics Law, among other things the authority refers to a criminal judegment of the
OLG Hamm from the year 2016. In fact, the OLG Hamm had issued a criminal judgment against a
trader with the criminal judgement of 21.06.2016 with the Az. 4 RVs 51/16. In the worst case, not
only the destruction of the goods, but also considerable criminal consequences threaten in the event
of incorrect treatment.
In the opinion of Dr. Späth & Partner Rechtsanwälte mbB, the CBD flowers, which are not considered
marketable in Germany, are particularly problematic. CBD flowers were also involved in some of the
seized products in Berlin.
However, even in the case of CBD food supplements, the legal situation must always be examined on
a case-by-case basis:
The often voiced theory that products with less than 0.2 % THC should be fully marketable cannot be
confirmed by Dr. Späth & Partner.
For example, the BvL, the Federal Office of Consumer Protection and Food Safety, recently
announced that the BvL considered that for products containing CBD, either an application for
approval of a medicinal product or an application for approval of a novel foodstuff had to be
submitted before they could be placed on the market.
The classification of products and the assessment of marketability is the task of the state authorities
responsible for food monitoring, so that it is always necessary to examine which view is decisive in
each individual case.

It must also always be clarified whether the EU Novel Food Catalogue could be relevant, according to
which, according to Art. 6 para. 2 NFV, only approved novel foods listed in the European Union list
may be placed on the market in accordance with the conditions and regulations laid down in the
Union list.
There was a great deal of uncertainty between whether CBD can even be qualified as a “novel food”
and, if so, whether this applies to all CDB products or only to CBD products which contain more CBD
than the plant of origin, the legal situation is in flux.
A Czech company had already submitted an application for a CBD-containing food supplement in
accordance with the EU Novel Food Regulation in 2016, but no decision has yet been taken on this.
Here, too, it must always be checked on a case-by-case basis whether the NFV is to be observed,
because in the event of infringements there is also a threat of sanctions that are “effective,
proportionate and dissuasive”, whatever that means.
Companies wishing to operate in the CBD sector must therefore always ensure that various legal
provisions and the correct “labelling” of the products are observed, and that the highest degree of
caution is also required, e.g. with so-called “health claims”, and that it is always necessary to check in each individual case whether they are permissible.
Interested companies who want to be active in the CBD sector must therefore comply with the legal
requirements in order to be on the safe legal side and not experience any nasty surprises in terms of
administrative offences or even criminal law.

Med. Cannabis / CBD: How can companies secure themselves?

Since March 2017, physicians have been able to treat their patients with severe illnesses such as
chronic pain, ancillary treatment to cancer therapy, epilepsy, etc., and have been able to provide
them with medical cannabis, which can be prescribed on prescription.
In the area of medical cannabis, high growth rates can be recorded with currently (October 2019)
already approx. 25,000-40,000 patients in Germany, in 1-2 years there could already be approx.
100,000-200,000 patients in Germany, in the longer term the number of patients could rise to
approx. 800,000-1 million patients.
Germany could become one of the largest markets for medical cannabis worldwide, whereby the
good health insurance system also offers advantages.
According to Dr. Späth & Partner Rechtsanwälte mbB, based in Berlin and Hamburg, more and more
companies are trying to enter the lucrative market for medical cannabis or cannabidiol (CBD).
Various venture capitalists, investors and family offices are also increasingly recognising the growth
opportunities in the medical cannabis sector in Germany and, according to Dr. Späth & Partner, are
now becoming more courageous to make an investment in the growth market of medical cannabis.
In a strong growth market they could still benefit from a “first mover” advantage.
In addition to countries such as Canada and the Netherlands, other countries such as Colombia,
Australia, New Zealand, Israel, Macedonia, Portugal or Poland and other countries could also be
available for export to Germany in the future. In some countries there is great interest in exporting
medical cannabis to Germany, and corresponding legislative changes are already in preparation in
some countries.
Countries that want to export medical cannabis to Germany usually have to have a “cannabis agency”
in their country, according to the UN Convention of 1961 only countries that have released cannabis
for medical purposes and not for leisure purposes are allowed to export to Germany.
However, interested companies wishing to import medicinal cannabis should be made aware that
the legal requirements for importing medicinal cannabis must always be taken into account, both in
terms of narcotic law and drug law.
As a rule, for example, the provisions of Section 72-74 of the German Medicines Act (AMG)
concerning the law on medicinal products must be observed alone; in order to apply for an import
licence, a competent person such as a doctor or pharmacist and a suitable warehouse for narcotics
must be proven. In the event of a violation, high fines or, in the worst case, even imprisonment may
be imposed.
Interested companies should also be informed that EU-GMP certification (Good Manufacturing
Practice) is required for the import of medical cannabis in order to ensure export to Germany and to
comply with the high quality requirements.
As a rule, international contracts must also be concluded here with manufacturers from e.g. Canada,
which places high demands on the international drafting of contracts, e.g. with regard to the place of
jurisdiction, because according to the observation of Dr. Späth & Partner, some importers from
Germany had chosen Canada as the place of jurisdiction in the contracts, for example, and in the
meantime have not only had positive experiences with this.
A further hint is also to be given: In various cases, especially if it was produced outdoors, medical
cannabis is treated with radioactive or ionising radiation in order to free it from pests or pesticides,
for example. Importers who import med. cannabis treated in this way should be aware that a special
licence is often required in accordance with the “Ordinance on Radioactive Drugs or Drugs Treated

with Ionising Radiation” (AMRadV). Of the more than 20 importers of medical cannabis in Germany,
Dr. Späth & Partner observes that only a few of them have received this AMRadV licence, although
some of them also import medical cannabis treated in this way. This can also lead to high fines in
some cases, especially since some federal states such as Brandenburg have become more cautious
with the approval according to § 52a AMG.
Companies from Germany and abroad wishing to import medical cannabis or CBD (cannabidiol) into
Germany must therefore comply with numerous civil and criminal regulations and are welcome to
contact Dr. Späth & Partner Attorneys at Law.

Med. Cannabis growing in Germany

In a press release dated July 20, 2018, the Federal Institute for Drugs and Medical Devices announced the requirements for the new tender for the cultivation and purchase of cannabis for exclusively medical purposes in Germany, which is expected to be available from cultivation in Germany from 2020.

According to the tender, a total of 10,400 kg of medical cannabis, spread over four years of 2,600 kg each, will be cultivated.

The new invitation to tender provides for 13 lots with an annual quantity of 200 kg each, and thus 3 lots more than the original invitation to tender, which was limited to a maximum of 10 lots and which had initially been stopped by the Higher Regional Court of Düsseldorf on 28.03.2018 (Ref.: VII-Verg 40/17).

The submission deadline for the offer has now been set for 22.10.2018 at 12.00 noon.

In Dr. Späth & Partner’s opinion, the new tender also brings some advantages especially for German applicants, since, unlike the original tender, cultivation experience with medicinal cannabis is no longer explicitly required and the purely German applicants were massively disadvantaged, as they could not yet have any cultivation experience at all due to the previous ban on cultivation.

Nevertheless, in the opinion of Dr. Späth & Partner, applicants or applicant communities should once again consider whether they can meet the quite high requirements:

A decisive criterion now is the price, because the supplier with the lowest price offer now receives 40 points.

Up to 60 additional points will be awarded for the quality of the technical equipment of the plant, quality of the technical and structural equipment, quality of the concept for cultivation, concept for the selection and training of personnel, as well as for the safety concept to prevent the unauthorized use of cannabis.

Thus, the requirements for a medical cannabis license are quite high.

Companies from Germany and abroad who wish to become active in the field of medical cultivation license or medical cannabis import to Germany can contact Dr. Späth & Partner Rechtsanwälte, we will be pleased to advise you.

We therefore advise you on the following legal issues in the medical cannabis law:

Cannabis cultivation license

Cannabis – Import License

Cannabis pharmacy law

Cannabis-medical and medical law

Cannabis real estate and -Grundstücksrecht (no brokerage)

Cannabis corporate and founding

Cannabis trademark

Cannabis Customs Law

etc.