Setback For German CBD Flower: Federal Court of Justice Rules Against Sales of .2% THC


In a major temporary disaster for the booming German CBD flower market, the Leipzig-based Federal Court of Justice decides a case with interesting repercussions – including the timing of the decision


In a decision that clearly shows how difficult the process can be to fight for a change in the law through the different levels of the German court system, the sale of CBD flower with an acceptable amount of THC has now again been ruled federally verboten.

That this comes as rumblings on the British level about rescheduling cannabis more generally, no matter how unlikely given row backs this week by the Truss government, is certainly interesting timing.

The Leipzig-based court also struck a very German nein in a direct reference to the KanaVape case in that it found that its ruling was not in violation of the same principles.

For this very reason, the case is now bound for the EU.

Legal drama is very sure to follow. Particularly as the ruling German government coalition is literally in the process of drafting recreational cannabis legislation and there is further, movement on the multilateral level within the EU.  Not to mention the fact that at the heart of the matter is the homogenization of German laws with EU ones in some very interesting combinations.

That said, on another level, this is a case with a lot of immediate heat and simultaneously lots of legal eagle blah. There is almost zero way that the now pending increase on the level of CBD flower (rising to .3% next year at the EU level) will be ignored, not knocked out of the way on or for this case.

For this very reason, there is as a result, the possibility that the case will not be accepted for a hearing at the EU level. These are busy girls and guys after all, and they try to only take on cases of significant legal precedent. This case, while it has a lot of immediate flash, may well fail to make that grade.

The German Statutes in Play

The following is the legal pathway, and under which German statutes, the decision has been made, affirming the decision of the lower courts

Annex I to § 1Abs. 1 BtMG

This relates to the sale of non-marketable narcotics, specifically cannabis even if the THC level does not exceed 0.2% and the marketing of the same is for commercial or scientific purposes which preclude abuse.

Article 34 TFEU Exceptions

This is the specific argument that the free movement of goods and services is valid in Germany, using the KanaVape case as a reference.

Article 267 TFEU

The Court of Justice of the European Union shall give preliminary rulings. This means this case is going to be appealed to the Court of Justice at a regional level.

This means it is heading generally in the direction of the Albert Tío case in Spain. That case, involving the establishment of cannabis clubs and cannabis of the high THC variety is a bit different than this one. There is a strong likelihood that the case will be granted cert (allowed to be decided on in the first place) rather than dismissed, given the need to square EU regulations on CBD.

Inevitably, however, the timing on this means that the EU will be implementing rather than deciding on what constitutes legal CBD and bringing German law into conformation with the same right as the German government is crafting recreational legislation.

Does This Legal Eagle Wrangling Really Matter?

To the lawyer(s) in the case, inevitably, as this will be a career-making if not ego-enhancing case to be deliberately if casually dropped at cocktail parties and conferences, that will inevitably win clients if not at least temporary notoriety. Not to mention the defendants who now face a suspended sentence of three years and nine months and ten months for both “illegal trafficking in narcotic drugs” and the aiding and abetting of the same.

That said, on the other hand, what this really does is create even more of an imperative for the German government to move on its own legislation, not to mention include legislation akin to the US wherein President Biden just called for the absolving of federal criminal nonviolent cannabis convictions.

When it comes to such things, the German government is acutely aware of the same.

From this perspective too, it could be that this case will be in fact nullified before it ever gets heard at the EU level. Particularly as the court ruled that this did not violate the German constitutional prohibition of excess.

It also effectively kills much of the CBD flower market, including of the imported kind (and of course including from the US). Unless that is, one has a GMP narcotics distribution license.

For that reason, this is going to further consolidate the grip if not add to the value of having one of these licenses in the first place. The question is, however, how those with such licenses will also be able to sell such stock legally even if they can import it.

Impact on Exporters to Germany

Everyone, from the North and South American markets to those in Africa and even Asia are immediately affected and furthermore, negatively. It is also, in a major blow for every company holding a pharmaceutical license hoping to pick up on the gravy, because they will be unable to sell such products in commercial stores.

While it will certainly not affect the domestic CBD market, as much, particularly those producers who have CBD flower well beneath the 0.2% level, it will certainly drive the levels of what is now commercially available even lower. For right now, this is an educated guess. However, the acceptable risk is hard to judge.

The problem here is that the courts continue to find even small amounts of THC unacceptable for non-narcotic sale on the basis of enhanced THC potency when heated.

The good news of course is that CBD flower sales have not been entirely eliminated. But this is a large if only temporary blow.

There are certainly many strange things that happen on the way to federal if not regional reform.

margueritearnold

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