Do You Need A UK Licence To Produce Or Sell CBD? The Full Story

People around the world often joke about licensing requirements in Britain, where you even need a licence to watch live TV.

That would make it natural to assume that you need a UK licence if you want to sell CBD products. Surprisingly, you don’t, as long as it’s labelled and sold as a “Novel Foods” supplement— and CBD oil and edibles fall into that category. (It’s a different story for companies selling CBD as a medical product, but that’s not applicable right now.)

The products simply have to meet government standards for product safety, composition, and manufacturing standards, and that’s really the responsibility of the producer, not the store stocking their products.

Even more surprisingly, producers don’t need “licences” from the UK government, either. They do need an expensive authorisation from the Food Standards Agency, but the process is complicated and messy.

New CBD products can’t be marketed or sold until they receive that authorisation, and so far, only two have been approved. CBD products currently sold in Britain must have been on the market since February 2020 and their manufacturers must have submitted an application by the end of March 2021. And the four extensive studies required can cost as much as £100,000.

The only licence related to CBD products is issued to hemp farmers, who supply the raw material used to manufacture CBD products. There’s an application, a long list of requirements, and a mandatory inspection required, along with a fee of £580. The licence must also be renewed every three years, at a cost of £326.

That may be more information than you need. If you need even more, though, we’ll get into the details next.

Producing and Selling CBD Products

CBD (cannabidiol) is a natural plant compound, known as a cannabinoid, that’s found in cannabis and hemp plants. Cannabis usually contains very little CBD while hemp contains large amounts, so the cannabidiol used to create gummies, oil, capsules, and other products is extracted from hemp plants.

(Hemp contains very little of the other major cannabinoid, psychoactive THC, so it’s not intoxicating. Cannabis, by comparison, has high THC levels. That’s why it’s the source of marijuana and other products that make users high.)

The plants used by CBD producers to source cannabidiol are grown by hemp farmers. The farmers then sell their crops to manufacturers who extract the cannabidiol and create CBD products with it.

Companies can use several extraction methods to obtain CBD from hemp plants, but most reputable producers use a method called CO₂ extraction. It’s expensive, but it produces the highest-quality cannabidiol. The extracted CBD is known as full-spectrum CBD, because it also contains a full spectrum of other plant compounds including hemp’s small amount of THC.

Producers then can process the CBD even further, removing the THC to create what’s called broad-spectrum cannabidiol, or all of the other plant compounds to create pure CBD known as CBD isolate. The more plant chemicals the extract contains, the more effective it will be; the chemicals contribute to an “entourage effect” that maximizes CBD’s performance.

Extracted CBD is then added to carrier oils like MCT oil or coconut oil to create CBD oil, combined with foods to make CBD edibles, or used to produce CBD products like capsules and vape juice. All of those products are sold directly to customers or distributed to retail vendors to be sold in shops or online.

The Legality of CBD Products

Numerous research studies have shown a wealth of health and medical benefits that CBD appears to provide.

Those results imply that cannabidiol may help to ease numerous mental health issues, chronic pain caused by anti-immune and inflammatory diseases, neurodegenerative conditions like Alzheimer’s and Parkinson’s diseases, insomnia, high blood pressure, acne, some types of cancer, and many other disorders.

The evidence hasn’t been strong enough, however, to convince governments in the UK, the US, and other nations to approve CBD as a prescription treatment for those conditions.

CBD products have been legal for sale and use in those countries for five years or so, but they’re not sold or regulated as medical products. Instead, most regulatory authorities consider them food products, supplements, or “something else” not subject to the same laws as prescription medications. Each nation regulates CBD differently.

In Britain, CBD products are regulated by the government’s Food Standards Agency (FSA) as “Novel Foods.” They must be safe for consumption, have warning labels for any possible risks, not claim unproven medical benefits, and comply with other related laws. The products must also have a green light for sale from the government. We’ll discuss that last matter shortly.

When CBD products were approved for sale in the UK, there was an important caveat as well. The cannabidiol’s THC content must be lower than approximately 0.2%. That’s an even more restrictive limitation than in America or most European nations, where the maximum THC level is 0.3%. As a practical matter, that means CBD products can’t be imported from anywhere else.

With all of that said, British consumers are free to purchase CBD oil and other products with no limitations, as long as they conform to the regulations we’ve described. There aren’t even laws preventing people from giving those products to their children — although there is a law preventing them from giving their CBD to pets.

That all sounds somewhat bizarre and confusing? It is. But the rest of the regulatory picture is even more bizarre and confusing.

The Legality of Manufacturing and Selling CBD Products

We’ll deal with the easy half of the equation first.

Selling CBD Products

Shops and other vendors don’t need licences to sell CBD products in Britain unless the products are being sold as a medical treatment. And sellers claiming to sell CBD medical treatments are defrauding customers. Only the prescription cannabidiol drug Epidiolex has been approved to treat rare types of childhood epilepsy, and it’s only available through the NHS.

Otherwise, sellers are only limited by the requirement that they carry safe, legal, and approved products — and they don’t have to prove that in any way. The burdens all fall to CBD producers.

Manufacturing CBD Products

CBD producers don’t need licences, either. What they do need is a “Novel Food” authorisation from the UK’s Food Standards Agency, and that’s where things get complicated.

In 2019, the Home Office announced that CBD would be classified as a novel food, a term also used by the EU to define food that hadn’t been widely consumed before 1997. Defining cannabidiol as a “food” may seem to be a stretch, but there was really no other category for products like CBD that aren’t classified as controlled substances.

A year later, the government announced that CBD products must be authorised as novel foods before they can be sold. That’s a lengthy and expensive process.

It requires a number of detailed lab studies of toxicology, stability, and other product qualities, and the studies can cost anywhere from £25,000 to £100,000. What’s more, every product that a producer wants to sell requires a separate authorisation.

It gets messier. CBD was first legalised in Britain in the late 2010s, so an enormous number of products were already on the market and would have to be retroactively authorised. The existing situation was essentially unworkable.

The government came up with a stop-gap policy, saying that manufacturers could temporarily keep selling their products. However, any product that had been on the market before February 2020 had to be submitted for Novel Food authorisation by the end of March 2021. If those criteria weren’t met, the products had to be removed from the market by local authorities.

Here’s what happened. Few (if any) products were withdrawn, no enforcement actions were taken, the waiting list for authorisations quickly exceeded 10,000 products (where it still stands today) — and the first approvals for CBD products weren’t announced until May of 2024. As of this writing, a grand total of two CBD products have received Novel Food authorisations.

In short, the CBD products produced and sold today in Britain may, or may not, have been submitted for authorisation. Few people know, and seemingly, even fewer people care. The situation may eventually be sorted, or it may remain a Wild Wild West for some time to come.

That brings us to the only companies in the CBD supply chain that need licences.

Growing Hemp

Companies that grow industrial hemp, from which cannabidiol is sourced, face the only reasonable licensing requirements in Britain. They must first have been registered with Companies House and undergone a DBS (Disclosure and Barring Service) check.

They can then apply for a licence to grow hemp. The application can be submitted online, and it must specify:

• The location of the hemp fields and their total acreage
• The type of hemp seed to be sown and its source, which must be approved by the EU
• The THC level of the hemp to be grown (which must comply with the UK THC maximum)

The fee for a hemp grower’s licence is £580, and it must be renewed every three years at a cost of £326. The growers’ fields are also subject to inspections.

It may seem crazy, but it’s true. The only licences required in the UK’s £800 million CBD industry, which encompasses hundreds of producers, thousands of products, and tens of thousands of sellers — are £580 licences for growing hemp plants.

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