In Conversation with Allen & Overy
The “Kanavape Case” at the Court of Justice of the European Union or How to Make the Single Market Real
In anticipation of our event at the European Parliament on December 12 hosted by MEP Marie Arena, I’m sharing our interview with Eveline Van Keymeulen, Counsel at Allen & Overy who is involved in the first referral related to “well-being” cannabis products before the Court of Justice of the European Union.
Register for the EU Parliament event “Cannabis Renaissance” before December https://www.weezevent.com/cannabis-renaissance
Laurène Tran: What are the main points of contention in the interpretation of the law?
Eveline Van Keymeulen: The Court of Appeal of Aix-en-Provence (France) requested that the Court of Justice of the European Union (CJEU) delivers a preliminary ruling on the interpretation of the EU legal framework and fundamental principles, in particular, the free movement of goods, as applied to cannabidiol (CBD) based products.
According to EU regulations, more than 70 varieties of hemp (Cannabis Sativa L) listed in a European register and containing up to 0.2% tetrahydrocannabinol (THC) can legitimately be cultivated in the EU. However, in France, the use of such legitimately cultivated hemp plant is currently restricted to two specific parts of the plant, its fibre and seeds. As these parts of the plant contain very limited active substances (such as CBD), in practice, French regulations in practice prevent the legitimate marketing of CBD-based products that are derived from the (entire) hemp plant. Surprisingly, products that contain synthetic CBD are not covered by the relevant legal prohibition (given the absence of any link to the cannabis plant), and are therefore currently permitted in France.
The question referred to the CJEU seeks to clarify whether EU law requires that the cultivation and marketing of hemp and hemp-derived products be limited to the sole fibre and seeds of the hemp plant (or products derived thereof), and in the absence of such requirement, whether EU law permits such a restriction to the free movement of goods in the European Union. By way of a reminder, any possible restrictions to the free movement of goods in the EU (such as the present French regulations) must be duly justified, for example on the basis of public health grounds, and must be adequate and proportionate with respect to the public interest they seek to protect.
In sum, by referring this question to the CJEU, the French Court seeks to understand whether applicable French law may be incompatible with EU law and should thus not be applied in the underlying French case.
Laurène Tran: What are the most likely scenarios?
Eveline Van Keymeulen: It seems clear that EU law does not require that the use of the legitimately cultivated hemp plant be limited to its sole fiber and seeds. The CJEU will therefore essentially need to respond to the question of whether the French restriction to the free movement of CBD-based products in the EU can be justified on the basis of public health grounds and is proportionate to protect such objective.
The French regulations impose a very severe restriction on free movement, by de facto prohibiting the marketing of all hemp-derived CBD-based products in France. Such strict approach seems not justifiable given that CBD is not a controlled substance, CBD-based products do not have any psychotropic effect and no abuse, serious adverse events, or risk to public health has been reported, as confirmed by international scientific evidence, not in the least by the World Health Organisation (WHO). In addition, possible health concerns were specifically taken into account by EU regulators when the 0.2% THC limit — which may be increased to 0.3% according to the latest discussions — was set for the cultivation of the plant.
If the available international scientific evidence is indeed relied upon by the CJEU, it is difficult to see how the “commercial death” of an entire industry could be considered justifiable and proportionate in light of the absence of reported public health risks to date. The logical conclusion should be that the French regulations which restrict the use of hemp solely to its fibre and seeds constitute a restriction to the free movement of goods which is non-compliant with EU law.
However, it cannot be excluded that, despite the available evidence, the CJEU may take a cautious approach, essentially based on the precautionary principle (which could be invoked when scientific evidence is uncertain). Irrespective of some remaining uncertainties, the scientific evidence available to date seems sufficiently solid not to warrant overly restrictive measures such as the ban of an entire industry, and it seems obvious that more proportionate measures (e.g. regulation of concentrations, information for consumers) would be more appropriate to adequately protect public health. It can only be hoped that the CJEU will take this opportunity to remind France of the fundamental principles and not give it too much leeway in this respect.
Laurène Tran: What could be the consequences for France?
Eveline Van Keymeulen: If the CJEU indeed decides that the applicable French regulations do not comply with EU law, the Court of Appeal of Aix-en-Provence will have to exclude the application of these regulations in its resolution of the pending underlying French case.
In addition, the French Government will have to remedy this non-compliance and bring the French provisions in line with EU law by adopting less restrictive — more proportionate — measures with respect to CBD-based products derived from legally cultivated hemp plants.
However, it should be noted that the CJEU may not itself amend French regulations.
Laurène Tran: Beyond the case of France, what could be the consequences for the legislations and regulations pertaining to hemp-derived products with CBD in other Member States?
Eveline Van Keymeulen: A preliminary ruling constitutes a final determination of EU law, with no scope for appeal. The CJEU’s interpretation of EU law is binding on EU Member States and EU institutions even if they were not directly concerned by the specific preliminary ruling and will serve as a so-called “precedent” in subsequent cases before that are brought before national and/or EU courts. Preliminary rulings are therefore not only binding on the referring national court but also on all other courts in the EU Member States.
If the CJEU indeed rules that the French regulations at issue are not considered proportionate with respect to the public health interest they seek to protect (and are therefore non-compliant with EU law), this may open the door for similar provisions in the other EU Member States to be challenged before national courts. These courts will have to apply the CJEU’s interpretation, or in case of doubt, may refer a similar preliminary reference to the CJEU.
As a consequence, the CJEU’s preliminary ruling in the present case may constitute an important legal precedent with a significant impact on other national laws and regulations related to hemp and hemp-derived products including CBD.
