Medical Cannabis & Cannabinoid Regulation 2024

Last Updated May 30, 2024

Germany

Law and Practice

Authors



CMS Germany is one of the largest German law firms and forms a part of CMS Legal, a global firm with 77 offices in 43 countries and over 4,800 lawyers. CMS Germany is recognised as having a strong focus on the life sciences and healthcare sectors, with teams in Hamburg, Cologne and Düsseldorf. The life sciences team in the Hamburg office consists of 23 lawyers, with specialists in the areas of regulatory, product liability, drug advertising, co-operation agreements, IP, compliance and reimbursement. The Hamburg team has had a strong focus on cannabis law since the legalisation of medicinal cannabis in 2017. This expertise includes providing advice on regulatory and strategic issues in connection with German/EU market entry as a supplier of medicinal cannabis, and the setting-up of prescription (RX) cannabis businesses in Germany. CMS offers full-coverage advice for cannabis clients, including on structuring and negotiating transactions and on co-operations in the field. The team regularly advises on regulatory issues regarding food, animal feed, smoking/vaping products and cosmetics containing CBD.

Several primary laws and regulations govern practices regarding cannabis in Germany. The main legislation applicable for the different product types is as follows.

General

In 2024, there was a major legal reform in Germany that removed cannabis from the Narcotics Act (Betäubungsmittelgesetz, BtMG) and legalised it for personal use. As part of this reform, two new laws were created: the Medical Cannabis Act (Medizinal-Cannabis Gesetz, MedCanG) and the Consumer Cannabis Act. In addition, numerous regulations in existing laws were amended.

The amendment to the BtMG is a major change as, up until now, the regulations of the BtMG had to be observed in relation to all cannabis products (with the exception of cannabidiol (CBD) without trace tetrahydrocannabinol (THC)).

Medicinal Cannabis

The Medical Cannabis Act

The first legislative reform took place in 2017, when cannabis was moved to the list of narcotics that can be marketed and prescribed in Germany.

With the exclusion of cannabis from the BtMG in the current reform, a new law was created for the handling of medicinal cannabis – the MedCanG. The existing regulations on medicinal cannabis remain essentially unchanged.

Only physicians can prescribe cannabis (see Section 3 MedCanG). In contrast to the previous provisions, a special narcotics prescription is no longer required for this, as now a regular prescription from a doctor is sufficient to obtain medicinal cannabis from a pharmacy. Only the active ingredient nabilone (synthetic cannabinoid) must still be prescribed on a narcotics prescription (see Annex I to Section 1I BtMG).

According to Section 2(1) MedCanG, medicinal cannabis is defined as plants, flowers and other parts of plants belonging to the genus cannabis, which originate from cultivation for medical purposes under state control in accordance with the UN Single Convention on Narcotic Drugs, 1961.

Anyone who cultivates, manufactures, trades, imports, exports, delivers, sells, otherwise places on the market, obtains or acquires medicinal cannabis, or uses it for medical scientific purposes, requires a general licence from the Federal Institute for Drugs and Medical Devices (Bundesinstitut für Arzneimittel und Medizinprodukte – BfArM) according to Section 4(1) MedCanG. Unlike in the past, however, a Europe-wide tender procedure is no longer required for the cultivation of medicinal cannabis in Germany. Holders of a valid licence in accordance with Section 3 BtMG are initially still entitled to handle cannabis products in accordance with the scope of the permit issued in accordance with Section 3 BtMG, even after the entry into force of the MedCanG. A written application must be submitted by post for the transfer of the contents of a valid licence pursuant to Section 3 BtMG to a licence pursuant to Section 4 MedCanG, in which any deletions of items that are no longer required in the future can also be listed.

In the case of an import into Germany according to Section 12 MedCanG, a further permission must be obtained.

Furthermore, companies cultivating medicinal cannabis can now also market and distribute their harvest themselves. They will be subject to monitoring by the BfArM and the relevant state authorities.

The transit of medicinal cannabis or cannabis for medical-scientific purposes through Germany is only permitted under customs supervision (see Section 12 MedCanG).

The Social Security Code

Pursuant to Section 31 paragraph 6 of the German Social Security Code Vol 5 (Sozialgesetzbuch Fünftes Buch, SGB V), patients can receive reimbursement from public health insurers in certain circumstances.

Section 31 paragraph 6 SGB V regulates that patients with a serious illness (eg, chronic pain, multiple sclerosis, epilepsy, nausea and vomiting after chemotherapy, and appetite enhancement for HIV/AIDS patients), who are insured with a public health insurer, have the right to receive cannabis in the form of dried blossoms or extracts, finished medicinal products with cannabis and medicinal products with the active ingredient Dronabinol or Nabilon, if:

  • a generally accepted standard therapy does not exist, or in particular cases does not apply according to the justified assessment of the treating doctor, considering expected side-effects and the disease status of the insured patient; and
  • there is a reasonable possibility that the cannabis will have a positive effect on the disease process or on serious symptoms.

The German Medicinal Products Act

Besides the MedCanG, the most important statute for medicinal cannabis is the German Medicinal Products Act (Arzneimittelgesetz, AMG) which governs the movement of medicinal products in the interest of the proper and safe supply of medicinal products to humans and animals. The AMG covers the manufacturing and trading of medicinal cannabis within Germany and imports from EU countries, as well as third countries, including the requirements of manufacturing practice in accordance with the EU’s “Good Manufacturing Practice” (GMP) rules.

The following licences are relevant for the handling of medicinal cannabis:

  • manufacturing authorisation – every manufacturer of medicinal products needs to apply for such authorisation, pursuant to Section 13 AMG;
  • marketing authorisation – finished medicinal products may only be placed on the German market if they have been authorised by the competent German authority or if they are authorised centrally by the EU, pursuant to Section 21 AMG;
  • wholesale authorisation – any person who engages in the wholesale trading of medicinal products requires an authorisation to do so, pursuant to Section 52a AMG; and
  • import authorisation – where medicinal cannabis will be imported from outside the EU, an import authorisation is required, pursuant to Section 72 AMG.

Ionising radiation

In the case of cannabis that has been treated with ionising radiation to reduce germ count, the Ordinance on Radioactive Medicinal Products or Medicinal Products Treated with Ionising Radiation (AMRadV) must also be observed.

Recreational Cannabis

The German Consumer Cannabis Act

The most drastic change of the 2024 reform is the creation of the Consumer Cannabis Act (Konsum-Cannabis Gesetz, KCanG), which contains regulations on private home cultivation, cultivation associations and the handling of industrial hemp. The regulations have been in force since 1 April 2024.

Private consumption

Since then, it is legal for persons who have reached the age of 18 to possess up to 25 grams of cannabis, in the case of flowers, leaves close to the flower or other plant material of the cannabis plant based on the weight after drying, for personal consumption (Section 3(1) KCanG). Adults may grow a total of up to three cannabis plants at a time for personal consumption and may possess a total of 50 grams of dried cannabis for personal consumption at their place of residence (Section 3(2) KCanG). Cannabis from private home cultivation may not be passed on to third parties. For private cultivation, it must be ensured that the plants are protected from access by third parties, especially children and adolescents (Section 10 KCanG).

Cultivation associations

Furthermore, the new legislation allows for so-called cultivation associations (Anbauvereinigungen), also named “Cannabis Social Clubs”, which are registered, non-commercial associations or registered co-operatives whose purpose is the joint, non-commercial cultivation and distribution of cannabis and propagation material (seeds and cuttings of cannabis plants) for personal consumption. They are managed in accordance with the principles of association law.

A cultivation association can start operating in Germany from 1 July 2024. Such cultivation association requires a licence from the competent authority (Section 11 KCanG). Cultivation associations can have up to 500 adult members that are German residents (Section 16 KCanG). Requirements for the community cultivation of cannabis are stipulated in Section 17 KCanG. Members of a cultivation association receive a maximum of 25 grams of cannabis per day and a maximum of 50 grams of cannabis per month for personal use. For adolescent members (ie, persons who have reached the age of 18 but not yet the age of 21), the maximum monthly amount of cannabis to be distributed is 30 grams and may not exceed a THC content of 10% (Section 19(3) KCanG).

Advertising and any form of sponsorship for cannabis and for cultivation associations are prohibited (Section 6 KCanG). The provision will be in force from 1 July 2024 onwards.

Industrial hemp

Industrial hemp falls under the definition of cannabis in Section 1(8) KCanG, but is legally privileged as it does not pose any health risks. The cultivation of industrial hemp is regulated in Sections 31 et seq of the KCanG. For the distinction between cannabis within the meaning of Section 1(8) KCanG and industrial hemp within the meaning of Section 1(9) KCanG, the factual feature of the exclusion of “abuse for intoxication purposes” is still relevant. This distinction requirement was previously included in the BtMG. Accordingly, a plant is not subject to the regulations of the KCanG if the handling of it (apart from cultivation) serves exclusively commercial or scientific purposes that exclude abuse for intoxication purposes, and provided the other requirements for industrial hemp are met – namely, as follows:

  • the industrial hemp originates from cultivation in member states of the EU with certified seed of hemp varieties, which are listed in the common catalogue of varieties of agricultural plant species on March 15th of the year of cultivation and which are certified in accordance with Article 17 of Council Directive 2002/53/EC of 13 June 2002 in the common catalogue of varieties of agricultural plant species (OJ L 193, 20 July 2002, p 1) as amended by Regulation (EC) No 1829/2003 (OJ L 268, 18 October 2003, p 1), in its current version, published by the European Commission in the Official Journal of the European Union, C series; or
  • its THC content does not exceed 0.3%.

Furthermore, hemp falls within the classification of industrial hemp in the case of the following.

  • If it is grown by agricultural undertakings which:
    1. meet the requirements of Section 1(4) of the Act on Old-Age Insurance for Farmers, with the exception of enterprises in forestry, horticulture and viticulture, fish-farming, pond-farming, beekeeping, inland fishing and transhumance; or
    2. are eligible for a direct payment in accordance with the provisions on direct payments under the Common Agricultural Policy of the European Union.
  • Additionally, if the cultivation is carried out exclusively from certified seed of hemp varieties which are listed in the common catalogue of varieties of agricultural plant species on March 15th of the year of cultivation, and which are published by the European Commission in the C series of the Official Journal of the European Union in accordance with Article 17 of Directive 2002/53/EC, as amended.

Lifestyle Products

Besides the general rules of the MedCanG and KCanG, for so-called lifestyle products (often containing CBD), a distinction must be made between different categories, such as:

  • food and animal feed;
  • cosmetics; and
  • smoking/vaping products (not containing THC).

Food, animal feed and cosmetics law is largely harmonised EU law, and therefore applies in all EU countries as a matter of priority. The most relevant legislation in this field includes:

  • the German Food and Feed Code (Lebensmittel-, Bedarfsgegenstände- und Futtermittelgesetzbuch, LFGB);
  • the General Food Law Regulation (EC) 178/2002;
  • the Novel Food Regulation (EC) 2015/2283;
  • Regulation (EC) 767/2009 on marketing feed;
  • Regulation (EC) 1831/2003 on feed additives for use in animal nutrition;
  • the Catalogue of Feed Materials (EU) 68/2013 and (EU) 2017/2017; and
  • the EU Cosmetics Regulation (EC) 1223/2009.

CBD smoking/vaping products that do not contain tobacco or nicotine are considered “herbal products for smoking” and fall within the “tobacco-related products” regulated within the German Tobacco Products Act (Tabakerzeugnisgesetz, TabakerzG).

Various regulatory authorities are involved in the cannabis sector. The main authorities responsible for enforcing the laws and regulations for medicinal cannabis and general cannabis (industrial hemp, CBD, etc) are as follows.

Medicinal Cannabis

The German Federal Institute for Drugs and Medical Devices (BfArM)

The BfArM is an independent federal higher authority within the portfolio of the Federal Ministry of Health, and is responsible for medicinal products and devices. As cannabis has been removed from the scope of application of the BtMG, it is now regulated in the MedCanG. The competent authority for the application of the MedCanG is the BfArM. The BfArM is not responsible for any tasks in connection with the KCanG.

Following the BtMG’s reform in 2017, and in line with the UN Single Convention on Narcotic Drugs, the BfArM created a Cannabis Agency (Cannabisagentur) that is responsible for issuing licences for the cultivation of cannabis for medical purposes and for medical-scientific purposes in Germany. The requirements for the pharmaceutical quality of herbal medicinal products must be met for permission to cultivate for medicinal purposes. This primarily concerns the quality-determining process steps of cultivation, harvesting, trimming, drying and storage.

State authorities responsible for medicinal products

The sale of medicinal cannabis by doctors and in pharmacies is subject to supervision by the respective state authorities.

Also, the individual state authorities are responsible for the general enforcement of the German Medicinal Products Act (Arzneimittelgesetz, AMG). This concerns, in particular, the granting of wholesale and import licences.

Recreational Cannabis

The competent authority for the supervision of cultivation associations is determined by the relevant states.

Lifestyle Products

The German Federal Office of Consumer Protection and Food Safety (BVL) and respective state authorities

The BVL is involved in the co-ordination of monitoring official food, animal feed, cosmetics and smoking products between the federal states.

The state authorities enforce the respective law within their own states.

The German Federal Office for Agriculture and Food (BLE)

The BLE is responsible for the import regulations regarding third countries, the cultivation notification for industrial hemp and the implementation of THC controls in hemp cultivation.

Decisions by the German authorities can be reviewed by administrative courts upon application.

Several German and European industry associations cover cannabis-related topics – for example:

  • the German Hemp Association (DHV);
  • the Branch Association Cannabis Economy (BvCW);
  • the Working Group on Cannabis as a Medicinal Product e.V. (ACM);
  • the Federal Association of Pharmaceutical Cannabinoid Companies (BpC);
  • the International Association for Cannabinoid Medicines (IACM);
  • Medicinal Cannabis Europe;
  • the Federal Association of the Pharmaceutical Industry (BpI); and
  • the European Industrial Hemp Association (EIHA).

These industry associations are directed at different companies and interest groups, and pursue different objectives, such as the legalisation of recreational cannabis or setting standards for cannabis quality.

In relation to the founding of cultivation associations (“Cannabis Social Clubs”), Cannabis Cultivation Associations Germany (CAD) was founded to represent the interests and concerns of cannabis cultivation associations and to promote the sustainable, responsible development of legal cannabis cultivation and consumption for recreational purposes in Germany. In addition, numerous Cannabis Social Clubs have already been founded in the 16 federal states, and will be allowed to operate from 1 July 2024.

There are several challenges that market participants in the cannabis sector face and must consider when establishing their business models. The key challenges may be summarised as follows.

Lengthy and Complex Approval Processes

Licences for the cultivation of medicinal cannabis are only issued via a lengthy process.

The timeline of the approval process for licences at state level can differ in every German state. Certifying manufacturing sites under the EU GMP rules, particularly in third countries, is a very lengthy process.

The regulations for the distribution of CBD products are quite unclear, and violations of the law are prosecuted with varying degrees of severity in the different German states.

The Changing Legal Environment and Lack of Experience

Since 2017, the cannabis sector has undergone a huge transformation and has taken on enormous importance in the market. The further reform in 2024 with the legalisation of cannabis for private consumption (including the establishment of Cannabis Social Clubs) has brought further change in the legal landscape. The second pillar of the legislative reform, which envisages the testing of distribution by professional providers as part of regional pilot projects with commercial supply chains, has not yet been implemented but is on the government’s agenda.

The regulations for certain product categories (cosmetics, food, feed, etc) remain unclear, or simply missing, making it difficult for the authorities to issue clear recommendations and thus to create legal certainty for market participants.

Due to the still relatively new subject matter, many of the involved authorities at the state level have not yet fully established a reliable administrative practice, and are often hesitant to issue statements or make clear decisions.

Many planning uncertainties persist for the industry – owing to the current uncertainties on how the full legislative plans will proceed – particularly for the medical cannabis sector. For example, newcomers to the business are faced with the question of how much they must comply with the strict safety requirements that currently apply, when the measures – which are often cost-intensive – may be overdue in just a few months/years and violations that have occurred by then may be granted amnesty.

Enforcement Differs From State to State

The interpretation and enforcement of cannabis-related legislation and regulations may differ widely from state to state, depending on experience and political priorities. For example, medicinal cannabis is classified differently in various German states – either as a medicinal product or an active ingredient. It is therefore essential to choose the right location for a cannabis business.

High Requirements for Cultivation in Germany

Companies wishing to cultivate cannabis in Germany face different challenges, making it hard for German cultivators to compete with foreign cultivators. Three of the key challenges are listed below.

  • If a company wishes to cultivate medicinal cannabis, it requires a licence from the BfArM, Section 4I MedCanG, which can take time. (Note: prior to the 2024 reform, only companies authorised by the German Cannabis Agency were allowed to cultivate cannabis in Germany. In April and May 2019, the Cannabis Agency awarded the contract for the cultivation, harvesting and processing of cannabis for medical purposes for a total of 10,400 kg for four years.)
  • The cultivation premises must be highly secured so that unauthorised access can be excluded.
  • Due to the unfavourable weather conditions in the country, the indoor cultivation of cannabis requires a lot of energy, which makes production costly.

Difficulties in Establishing Brand Recognition for Medicinal Cannabis and Recreational Cannabis

In Germany, except for very few authorised finished medicinal products, medicinal cannabis is mainly dispensed by pharmacies as a so-called magistral formulation – ie, the flowers and extracts must be “prepared” for the patient in the pharmacy in accordance with the presented prescription and be made available to the patient in the correct dosage form.

As a result, the product packaging originally branded by the manufacturer does not reach the end consumer, which poses challenges to building recognition in the market. However, some participants in the market have – so far successfully – experimented with collaborations with pharmacies, whereby cannabis flowers or extracts have been dispensed to pharmacy customers as magistral formulations in branded packaging as part of this collaboration.

With respect to recreational cannabis, advertising and any form of sponsorship for cannabis and for cultivation associations are prohibited (Section 6 KCanG), which makes it very difficult for companies operating in that area to achieve brand recognition.

Due to the cannabis industry still being relatively new in Germany, there are several legal risks that need to be considered by companies wishing to engage in the cannabis business, including the following.

Lack of Legal Certainty

The legal landscape, both in Germany and at the EU level, is constantly changing, so a current major legal risk is a lack of long-term certainty. It may very well be that an assessment of a certain product’s legality changes during only a few months. This is of particular relevance to “newer” product categories that do not fall within the clearly defined traditional product categories – for example, do CBD chew pouches fall within food law? Also, the classification of a product (eg, as a cosmetic, general commodity or food) is essential for the marketability of such a product.

Criminal and Administrative Liability

Cannabis and non-synthetic THC are no longer legally classified as narcotics within the meaning of the BtMG; as such, criminal liability is no longer the focus. However, violations of official licensing requirements and record-keeping obligations, unauthorised advertising or sponsorship constitute administrative offences and are punishable by a fine. Permission for the cultivation association may also be revoked.

Particularly in the CBD sector, companies too often run the risk that their product will not be classified under the exemption of KCanG for industrial hemp, as authorities/courts rule that misuse for intoxication purposes cannot be ruled out for many products. Based on that determination, such product will fall within the scope of the KCanG and cannot be marketed, and the involved persons would face criminal charges for illegal trade with cannabis (see Section 34 et seq KCanG). Even though some German and EU case law on the subject now exists, there is still a degree of legal uncertainty when abuse for intoxication purposes is affirmed.

When marketing medicinal cannabis, a risk exists under criminal law when the provisions of the MedCanG are not adhered to – eg, when medicinal cannabis is not marketed with the respective licence (see Section 25 et seq MedCanG). Furthermore, the prohibition of lay advertising under the German Drug Advertising Act (Heilmittelwerbegesetz, HWG) has to be observed.

Seizure of Revenues

Where authorities consider that a criminal offence has been committed in connection with the cannabis business of a company, it is possible that revenues from such cannabis business will be seized – in some cases, this may include the turnover of the company.

Regarding the enforcement of legislation, it is important to distinguish between criminal and administrative offences, as well as violations of unfair competition law.

Prosecution Authorities and Regulatory Authorities

Currently, several criminal law and administrative law regulations apply in connection with cannabis, such as the following.

KCanG

As mentioned previously, cannabis is no longer a prohibited substance under the BtMG. The criminal provisions of the BtMG are therefore no longer applicable to cannabis. Instead, the KCanG itself regulates criminal offences in Section 34; such offences are based on the previous regulations. Anyone who possesses, cultivates, produces, traffics in, imports, exports, sells, dispenses, otherwise puts into circulation, acquires or otherwise obtains cannabis contrary to the exemption provisions in the KCanG can be punished with imprisonment of up to three years or with a monetary penalty. In particularly serious cases, the penalty is a prison sentence of three months to five years. According to Section 36(5) KCanG, the advertising/sponsoring of cannabis, directly or indirectly, constitutes an administrative offence which is subject to a fine of up to EUR30,000.

The Food Law

Pursuant to Section 1a(1) NLV, in conjunction with Section 59(3) No 2 of the German Food, Commodities and Feed Act (Lebensmittel-, Bedarfsgegenstände- und Futtermittelgesetzbuch, LFGB), anyone who, contrary to the Novel Food Regulation (EU) 2015/2283 places a novel food on the market without having the corresponding authorisation can be punished with imprisonment of up to one year or with a monetary penalty.

The Medicinal Products Act

According to Section 95, paragraph 1, No 4 and Section 45, paragraph 1, sentence 2 AMG, it is forbidden to trade with prescription medicinal products outside pharmacies. This can particularly apply where CBD lifestyle products are advertised as medicinal products.

The competent authorities for enforcement of criminal offences are the public prosecutors.

The competent local authorities verify whether cannabis products are in compliance with regulatory legal requirements. If not, the authorities can order a sales stop. They can also order administrative penalties in many cases.

Competitors and Consumer Associations

In Germany, complaints about products that are not compliant with the legal requirements or about unfair advertising claims are often brought by competitors and consumer associations. It is common for competitors or consumer associations to apply for a court injunction, which includes a cease-and-desist obligation. This means, for example, that products can no longer be marketed and may even have to be recalled.

There is no fully harmonised legal landscape within the EU in relation to medicinal cannabis, which leads to different rules across EU member states and can also lead to various cross-jurisdictional issues. In Germany, this is particularly noticeable in connection with the importation of medicinal cannabis from third countries outside the EU – the biggest challenge for manufacturers in third countries is obtaining EU GMP certification to make importation to the EU possible.

Some countries have concluded mutual recognition agreements (MRAs) with the EU. Upon successful completion of the equivalence assessment or preparatory phase provided for in some MRAs, during which the parties evaluate each other’s GMP inspection systems, inspections are considered mutually recognised. Even if an MRA is in place, it needs to be carefully evaluated for each country regarding whether the MRA also includes cannabis, as the scopes of agreements vary.

In all other cases, third-country inspections must be carried out by an authority authorised in Europe. In Germany, the third-country inspection is a quite lengthy process, as the GMP inspectors must travel to the relevant manufacturing sites. Third-country inspections were significantly stalled due to the ongoing COVID-19 pandemic.

However, the strict EU GMP rules are not applicable where the cannabis product is classified as an active pharmaceutical ingredient (API) instead of as a medicinal product. This classification needs to be confirmed by the authority of the country of origin (with a written confirmation), and the German authority must also have the same classification for the product to be imported. As the import licence falls within the competence of the individual states, such classification also differs across Germany. Some state authorities allow for cannabis flowers to be imported as an API (ie, no EU GMP certification is necessary), while others classify cannabis as a medicinal product and prohibit importation until the manufacturing site has been EU GMP-certified.

So far, German authorities have allowed imports of cannabis from numerous jurisdictions, including Australia, Denmark, Israel, Jamaica, Canada, Columbia, Lesotho, Malta, New Zealand, the Netherlands, North Macedonia, Austria, Poland, Portugal, Spain, Uganda and Uruguay.

Several legal elements that affect access to medical cannabis must be considered.

Untrained Physicians

Only a physician can prescribe cannabis or finished medicinal products with cannabis (see Article 3 MedCanG). However, many physicians are still reluctant to prescribe cannabis. This is, inter alia, caused by the persistent stigma of cannabis as a recreational substance. Furthermore, physicians often have a lack of knowledge about prescribable cannabis products and possible effects.

Few Medical Studies

Apart from authorised finished medicinal products containing cannabis (such as Sativex), there are few medical studies regarding the effects of cannabis products on serious diseases.

However, where a therapy with medicinal cannabis has been approved by the statutory health insurers (see 1.1 Primary Laws & Regulations), participation in an accompanying survey conducted by the BfArM was obligatory. This survey was completed by 31 March 2022 and the results were released on 6 July 2022. Although the survey has been partly criticised in professional circles (especially as the data sets were insufficient), it did provide information on the scope of application of medicinal cannabis, the average user and the average effectiveness of the treatment as perceived by patients – which, for example, in the case of cannabis flowers was rated as positive by over 90% of those treated.

Reimbursement Depends on the Health Insurer

As outlined in 1.1 Primary Laws & Regulations, patients with a serious illness can, under certain circumstances, be reimbursed by their public health insurer. However, when medicinal cannabis is prescribed for the first time, the patient must ask for the public health insurer’s approval. Although this approval can only be refused in justified exceptional cases, it is still a bureaucratic burden that often leads to a delay for patients.

To reduce this bureaucratic burden, a health insurance company has – for the first time – already signed a contract with the German Society for Pain Medicine (DGS) to facilitate the provision of medicinal cannabis, especially in pain therapy. Rebate contracts between pharmaceutical wholesalers of medicinal cannabis and public health insurers are also in place.

Foods containing cannabinoids have been trending in recent years and are still of interest, with the topic being much discussed. However, foods containing cannabinoids are currently not marketable in Germany for the following reasons.

Food Containing Cannabinoids Is Considered “Novel Food”

In Germany, food and food supplements with cannabinoids are currently classified as “novel foods” and therefore are not marketable without a corresponding authorisation.

Pursuant to the Novel Food Catalogue of the European Commission, extracts of Cannabis sativa L and derived products containing cannabinoids are considered novel foods, as a history of consumption (before 1997) has not been demonstrated. This applies to both the extracts themselves and to any products to which they are added as an ingredient (such as hemp seed oil). It further applies to extracts of other plants containing cannabinoids and synthetically obtained cannabinoids.

German case law and authorities have often confirmed the classification of food and food supplements that contain the cannabinoid cannabidiol (CBD) as novel food, as briefly summarised below.

  • Several administrative court decisions considered CBD-based food as novel food.
  • The Federal Government of Germany and the Federal Office of Consumer Protection and Food Safety (BVL) have both stated that they are currently not aware of any cases in which CBD products would be marketable as food. From the BVL’s point of view, either an application for authorisation of a medicinal product or an application for authorisation of a novel food must be submitted for ingestible products containing CBD before they are placed on the market. Within the framework of these procedures, the safety of the product must be proven by the applicant.
  • Novel foods are only marketable after prior authorisation by the European Commission and as an addition to the so-called Union List, in accordance with Article 10 ff Novel Food Regulation. To date, the European Commission has not authorised any food or food supplements containing CBD. Foodstuffs containing CBD are therefore not yet marketable in light of the requirements of the novel food regime.
  • Many local authorities have acted forcefully against companies selling food and food additives containing CBD. In some cases, products have had to be taken off shelves and administrative proceedings started. However, as previously discussed, enforcement priorities often differ from state to state.
  • Some consumer or trading organisations have successfully brought claims for “cease and desist” against CBD food businesses in civil courts.

Currently, the European Food Safety Authority (EFSA) has 19 applications for approving CBD as a novel food. In June 2022, EFSA indicated in a statement that the assessments on CBD will be suspended until new data on safety is available. So far, there have been no new developments in this regard.

Food Containing Cannabinoids Can Fall Under the KCanG

Food and food supplements are not marketable in Germany if they fall outside the definition of industrial hemp (see 1.1 Primary Laws & Regulations).

Many products containing CBD include CBD extracts that derive from the whole cannabis plant, and may therefore contain THC residues. As such, the following needs to be observed.

Low THC content

The THC content of the food product may not exceed 0.3%.

No misuse for intoxication purposes

Another hurdle was and still is the question of misuse of the CBD product for intoxication purposes. This requirement was previously included in the BtMG and is now included in the definition of industrial hemp in the KCanG. This means that if industrial hemp is concerned the provisions in the KCanG (except regarding cultivation) do not apply.

With respect to “misuse for intoxication purposes” under the old provisions, the BGH has, in a recent decision, confirmed that an abuse of the food product derived from the cannabis plant for intoxication purposes must be excluded for all possible uses of the product. Therefore, the BGH confirmed the previous decision of the regional court according to which hemp tea with a THC content under 0.2% could be a classified as a narcotic if the dried plant parts could also be used for baking cannabis cookies. According to the expert opinions issued in the court proceedings, with a skilful baking process it is possible to make the THC usable for intoxication purposes.

It remains to be seen how the very strict interpretation will develop in the new legislative landscape.

Two-Pillar Legalisation

As planned by the German government (elected in September 2021), the legalisation of cannabis was to take place in a two-pillar model. The first pillar, which envisaged provisions for the controlled distribution of cannabis to adults for recreational purposes, has now been implemented (see 1.1 Primary Laws & Regulations). Therefore, recreational use of cannabis is no longer prohibited in Germany.

The second pillar of the draft legislation related to the controlled distribution of cannabis in licensed stores. It provides for the trialling of distribution by professional providers as part of regional pilot projects with commercial supply chains. However, this second pillar has not yet been implemented. The aim is to give companies the opportunity to produce and distribute cannabis for recreational use and to sell it to adults in specialised shops within a licensed and state-controlled framework. The trial is to be locally limited, and comprehensively monitored and analysed.

However, Germany must co-ordinate the implementation of the second pillar with the European Commission. The government has until autumn 2025 to implement it during the current legislative period.

The Effect of the Legalisation on Past Convictions

As stated previously, Cannabis is no longer a prohibited substance under the BtMG. The criminal provisions of the BtMG are therefore no longer applicable to cannabis; instead, the KCanG itself regulates criminal offences in Section 34, and these are based on the previous regulations.

Previous convictions can be erased from the Federal Central Criminal Register upon application, if the conduct at the time is no longer punishable under the new law – in particular, for possession of up to 30 grams or personal cultivation of up to three plants (Section 40 et seq KCanG). When the legislation comes into force, investigations and criminal proceedings that no longer have a basis under the new law will be discontinued.

Furthermore, an amnesty provision has been introduced (which was a controversial aspect of the legislative process). According to this provision, sentences imposed before 1 April 2024 for offences that are no longer punishable under the new law and that are no longer subject to fines will be remitted when the new law comes into force.

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CMS Germany is one of the largest German law firms and forms a part of CMS Legal, a global firm with 77 offices in 43 countries and over 4,800 lawyers. CMS Germany is recognised as having a strong focus on the life sciences and healthcare sectors, with teams in Hamburg, Cologne and Düsseldorf. The life sciences team in the Hamburg office consists of 23 lawyers, with specialists in the areas of regulatory, product liability, drug advertising, co-operation agreements, IP, compliance and reimbursement. The Hamburg team has had a strong focus on cannabis law since the legalisation of medicinal cannabis in 2017. This expertise includes providing advice on regulatory and strategic issues in connection with German/EU market entry as a supplier of medicinal cannabis, and the setting-up of prescription (RX) cannabis businesses in Germany. CMS offers full-coverage advice for cannabis clients, including on structuring and negotiating transactions and on co-operations in the field. The team regularly advises on regulatory issues regarding food, animal feed, smoking/vaping products and cosmetics containing CBD.

From Prohibition to Permission: Germany’s Journey Towards Cannabis Legalisation

The further legalisation of cannabis – which has been planned for some time – took another major step this year. Since 1 April 2024, the first steps towards legalisation of cannabis for private consumption have been implemented. Cannabis for medical use had already been legalised in 2017.

A first (short) overview

The first step towards legalising cannabis was taken in 2017 by amending the Narcotics Act and accordingly the German Social Code, Book V, thereby legalising cannabis for medical use. These amendments to the law enabled (for the first time) seriously ill patients to obtain dried cannabis flowers and cannabis extracts on a doctor’s prescription with a so-called narcotics prescription. While this legal reform has, to a large degree, been a success both for patients and for the cannabis industry, increasingly more companies have been jumping on the bandwagon of dispensing medicinal cannabis in Germany, while the market of purchasers has been growing steadily. Thus, over time, a stable set of rules and good practice for dispensing medicinal cannabis has been established.

However, the legalisation of medicinal cannabis has not silenced calls for further reforms. The socio-political discussion has also increasingly focused on the legalisation of cannabis for recreational purposes. This debate has now come to a preliminary conclusion with the Cannabis Act (Cannabisgesetz, CanG). As of April 2024, Cannabis is no longer qualified as a narcotic and no longer falls within the scope of the Narcotics Act (Betäubungsmittelgesetz, BtMG).

Furthermore, two new laws were enacted by the German Parliament on 27 March 2024: the Medicinal Cannabis Act (Medizinal-Cannabis Gesetz, MedCanG) and the Consumer Cannabis Act (Konsum-Cannabis Gesetz, KCanG). At the same time, several other laws have also been amended.

This is the result of a lengthy political initiative that is not yet completed.

A decisive driving force behind the legalisation-reform efforts in Germany was and still is the ambitious approach of the current German federal government, consisting of the Social Democratic Party (SPD), the Free Democratic Party (FDP) and Alliance 90/the Greens (Bündnis 90/Die Grünen) elected in Germany in 2021. In their election manifestos, all three parties had already announced their support for the legalisation of cannabis for recreational purposes, and aimed towards such legalisation within their legislative period.

These endeavours were then laid down in a first White Paper of the federal government for a comprehensive draft of a cannabis law in October 2022. After further consultation, this was developed in a second White Paper published in April 2023, leading to the first submission of a draft bill on the controlled use of cannabis and the amendment of other regulations (the Cannabis Act) by the responsible German Ministry of Health.

For medicinal cannabis, the MedCanG came into force on 1 April 2024, bundling the regulations on medical cannabis into one law.

On the same day, the KCanG also came into effect as regards cannabis for recreational purposes. According to the KCanG, non-commercial, private consumption and cultivation of cannabis has been decriminalised. The regulations on self-cultivation in cultivation associations will enter into force on 1 July 2024. In addition, further legalisation on a commercial supply chain for recreational cannabis is planned (the so-called second pillar of the reform). Germany will co-ordinate the implementation of the second pillar with the European Commission – the government has until autumn 2025 if it still wishes to implement this within the current legislative period.

Medicinal Cannabis as the Starting Point for Legalisation

The “Cannabis as Medicine” provisions (Law on the Amendment of Narcotics Law and Other Provisions) entered into force on 10 March 2017 and changed patient care in Germany, particularly in the areas of pain and palliative treatment. From that point onwards, the prescription of medicinal cannabis is subject to the condition that, in the assessment of the attending physician, the drug may noticeably improve or influence the course of the disease or its symptoms.

In this context, the amendment to the German Social Code, Book V was also ground-breaking, as it allowed for an extended coverage of costs by the statutory health insurance, not only for finished cannabis-based medicinal products but also for dried cannabis flowers, provided these were necessary for therapeutic purposes.

As a further novelty, a dedicated Cannabis Agency was formed as part of the Federal Institute for Drugs and Medical Devices (Bundesinstitut für Arzneimittel und Medizinprodukte, BfArM) to steer and control the cultivation of cannabis for medicinal purposes in Germany. First licences for the cultivation of medicinal cannabis in Germany were granted to three companies: the Canadian companies Aphria (now Tilray Medical) and Aurora, as well as the German company Demecan. Furthermore, import licences for medicinal cannabis have been granted to many companies from numerous countries, including Australia, Denmark, Israel, Jamaica, Canada, Columbia, Lesotho, Malta, New Zealand, the Netherlands, North Macedonia, Austria, Poland, Portugal, Spain, Uganda and Colombia.

With the new MedCanG coming into force on 1 April 2024, the existing regulations on medicinal cannabis are bundled into one law. The major change is that cannabis is no longer classified as a narcotic, and thus the strict requirements regarding the prescription of narcotics are not relevant anymore (except for the active ingredient nabilone, a synthetic cannabinoid). If a company wishes to cultivate medicinal cannabis, it requires a licence from the BfArM. Unlike previously, however, a Europe-wide tender procedure is no longer required.

Legalisation for Recreational Purposes

The starting point

The positive developments regarding medicinal cannabis have contributed to the increasing popularity of cannabis as an active ingredient, and have attracted more interest and attention in society as well as in various industries and sectors. Accordingly, this success has not gone unnoticed at the political level either.

As the subject of cannabis for recreational purposes already received considerable attention in the coalition negotiations of the current German federal government, the steps towards further expansion of legalisation hardly came as a surprise after the federal election in 2021.

Initially, a consensus was reached within the federal government to introduce controlled dispensing of cannabis to adults for consumption purposes in licensed shops. In this regard, the Federal Minister of Health, Prof Dr Karl Lauterbach, stated that the primary objective of the legislative process must be to ensure the best possible health protection for consumers, as well as the protection of children and adolescents. According to the federal government, the advantages of legalising recreational cannabis outweigh the potential disadvantages. The existing risks were mainly seen in the large black market for cannabis, which lacked quality standards and controls, and which led to contaminated cannabis products entering the illegal market.

The legalisation of cannabis was also based on the intention to encourage consumers to use cannabis responsibly. Controlled dispensing to adults, combined with comprehensive health risk education, was intended to reduce the potential health risks of cannabis and to encourage regulated and responsible use, aiming (along with appropriate education) at the reduction of drug abuse, especially among young adults.

Due to legal concerns regarding compatibility of a nationwide licensed-shop model with international and European law, the initial plans were amended and the legalisation transformed into a so-called two-pillar model.

While the first pillar concerns the private, collective and non-profit self-cultivation of cannabis, the second pillar envisages the testing of distribution by professional providers as part of regional pilot projects with commercial supply chains.

First pillar: legalisation of private, collective and non-profit self-cultivation of cannabis

The first pillar was implemented with the Consumer Cannabis Act (KCanG), passed on 27 March 2024. Numerous parts of the law have already been in force since 1 April 2024.

The main provisions of the new KCanG are as follows.

  • Persons who have reached the age of 18 are allowed to possess and carry up to 25 grams of cannabis.
  • Persons who have reached the age of 18 and who have been permanently or ordinarily resident in Germany for at least six months may grow up to three cannabis plants at the same time for the purpose of personal consumption at their place of residence or habitual abode. The number of three cannabis plants applies per adult person in a household.
  • Cannabis may only be cultivated and possessed for personal use. Distribution between private individuals is generally prohibited. Distribution to minors is a criminal offence and is punishable by a custodial sentence.
  • Storage and consumption are restricted by various regulations – for example, cannabis may not be consumed in the vicinity of playgrounds and sports facilities or in the immediate presence of minors.

Further provisions of the KCanG will come into force from 1 June 2024. In particular, regulations are planned concerning the communal, non-profit cultivation of cannabis and the controlled distribution of cannabis and propagation material in cultivation associations for personal consumption (Anbauvereinigungen), also called “Cannabis Social Clubs”.

The following provisions (among others) will apply regarding these associations.

  • The number of members should be limited to a maximum of 500 persons.
  • The association must be established as a registered association or co-operative, and must be registered with the competent court. There must be at least seven members at the time of formation.
  • The established association can only apply for a cultivation licence if it fulfils all local and personal requirements. The licence is limited to seven years, and can be reapplied for after five years. The competent authority still has to be determined by ordinance in the individual federal states.
  • The persons authorised to represent the association must be reliable. The associations must also appoint a prevention officer, and must draw up a health protection and youth protection concept.
  • The facilities of the association must be at least 200 metres away from the sites of schools, kindergartens, youth facilities and sports fields. The cultivation area must not be visible to the public and must be secured against unauthorised access. Furthermore, the cultivation area must not be located in a private flat or house.
  • Only members may cultivate. They may only be employed and paid for cultivation as part of marginal employment (currently EUR538 per month). Employees may be hired without wage limits for activities outside cultivation, such as cleaning, security, accounting or laboratory services.
  • Membership should require a minimum age of 18 years and residence in Germany.
  • Members of a cultivation association receive a maximum of 25 grams of cannabis per day and a maximum of 50 grams of cannabis per month for personal use. For adolescent members (ie, persons who have reached the age of 18 but not yet the age of 21), the maximum monthly amount of cannabis to be distributed is 30 grams and may not exceed a THC content of 10%.
  • The transfer should take place at the location of the club. Consumption on the site is prohibited.
  • Dispensing should only take place in pure form (flowers or resin). Information on the product, dosage, application and risks of consumption, as well as on counselling centres, must be included. The packaging must be neutral in design.
  • The costs for the acquisition of cannabis should be covered by membership fees. There is no upper limit for membership fees.

The approach of this first pillar and its legal implementation are to be evaluated after four years.

Second pillar: legalisation of commercial supply chains

Perhaps the most significant deviation from the originally planned approach of legalising cannabis for recreational purposes is the fact that no licensed specialist shops are to be installed. Instead, scientifically monitored model projects in the form of commercial supply chains are intended to be implemented in districts and cities of several federal states. This is to implement the planned dispensing in specialised shops, albeit in a different manner than originally envisaged.

These projects aim to enable companies to produce, distribute and sell to residents of the model regions in specialised shops. The project duration is limited to five years as of the establishment of the supply chain. At the end of this period, the project shall be evaluated regarding health and youth protection as well as the effects on the black market.

However, the German federal government already stated in the White Paper that no time perspective can currently be given for this second pillar. This pillar of the legalisation project is still subject to notification, meaning that a final decision can only be expected after consultation with the European Commission.

Further Updating of Cannabis Legislation

In addition to the legal changes already mentioned, other laws were amended as part of the legalisation efforts, including the following:

  • the Medicinal Products Act (Arzneimittelgesetz, AMG);
  • the Federal Non-Smoker Protection Act (Bundesnichtraucherschutzgesetzes, BNichtrSchG);
  • the Workplace Ordinance (Arbeitsstättenverordnung, ArbStättV);
  • the Road Traffic Act (Straßenverkehrsgesetz, StVG);
  • the Criminal Code and the Code for the Federal Register of Criminal Offences (Strafgesetzbuch, StGB and Bundeszentralregistergesetz, BZRG); and
  • cannabis and non-synthetic THC are no longer legally classified as narcotics under the Narcotics Act (BtMG).

Outlook

The present German federal government still has until the end of the term in 2025 to finalise its plans for cannabis legalisation, and to implement them according to the political agenda. To date, the legislation shows the relevance and willingness with which the issue of cannabis is being addressed on a political level.

With the recently implemented law, a first step has been taken. Even if there might be some disappointment for the industry and consumers regarding the divergence from the initial far-reaching approach, the quick implementation of the first pillar shows that the federal government has treated cannabis legalisation as a priority. It remains to be seen to what extent the second pillar will be implemented, and within what timeframe. Ultimately, the decision for this lies first and foremost with the European Commission, on whose approval the project partly depends.

However, the current fast-moving developments show that Germany is trying to set an example and to take a measured approach on the matter of cannabis legalisation. Only time will tell where the developments lead in the coming weeks and months, not only for Germany but for all of Europe.

CMS Germany

Stadthausbrücke 1-3
20355 Hamburg
Germany

+49 40 376 30 339

+49 40 376 30 40 574

joern.witt@cms-hs.com www.cms.law
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Law and Practice

Authors



CMS Germany is one of the largest German law firms and forms a part of CMS Legal, a global firm with 77 offices in 43 countries and over 4,800 lawyers. CMS Germany is recognised as having a strong focus on the life sciences and healthcare sectors, with teams in Hamburg, Cologne and Düsseldorf. The life sciences team in the Hamburg office consists of 23 lawyers, with specialists in the areas of regulatory, product liability, drug advertising, co-operation agreements, IP, compliance and reimbursement. The Hamburg team has had a strong focus on cannabis law since the legalisation of medicinal cannabis in 2017. This expertise includes providing advice on regulatory and strategic issues in connection with German/EU market entry as a supplier of medicinal cannabis, and the setting-up of prescription (RX) cannabis businesses in Germany. CMS offers full-coverage advice for cannabis clients, including on structuring and negotiating transactions and on co-operations in the field. The team regularly advises on regulatory issues regarding food, animal feed, smoking/vaping products and cosmetics containing CBD.

Trends and Developments

Authors



CMS Germany is one of the largest German law firms and forms a part of CMS Legal, a global firm with 77 offices in 43 countries and over 4,800 lawyers. CMS Germany is recognised as having a strong focus on the life sciences and healthcare sectors, with teams in Hamburg, Cologne and Düsseldorf. The life sciences team in the Hamburg office consists of 23 lawyers, with specialists in the areas of regulatory, product liability, drug advertising, co-operation agreements, IP, compliance and reimbursement. The Hamburg team has had a strong focus on cannabis law since the legalisation of medicinal cannabis in 2017. This expertise includes providing advice on regulatory and strategic issues in connection with German/EU market entry as a supplier of medicinal cannabis, and the setting-up of prescription (RX) cannabis businesses in Germany. CMS offers full-coverage advice for cannabis clients, including on structuring and negotiating transactions and on co-operations in the field. The team regularly advises on regulatory issues regarding food, animal feed, smoking/vaping products and cosmetics containing CBD.

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