In January last year, the European Commission (EC) ruled products containing cannabinoids would be treated as novel foods, which applies to foods or ingredients that were not widely consumed before 1997.

Since then, countries such as Germany and Belgium have put in place legislation aligning their national domestic laws with the EC's ruling, which means products containing CBD must receive government authorisation before they can be legally sold.

Late last year, the UK's Food Standards Agency (FSA) also indicated it would follow suit and enforce the novel food ruling for CBD products. 

Despite confirming in a letter to the Cannabis Trades Association (CTA) earlier this year that the agency has "no current plans to immediately withdraw CBD products from shelves", the FSA said it "retains the right to change this stance if new evidence is produced that concludes CBD is not safe, or for any other relevant reason". 

Furthermore, in a report to the agency's board, the FSA's chief executive said "it is important that industry puts these products through the authorisation process, as the process is there to establish more information about the products and their safety [and] to confirm that the products are what they say they are, and therefore to protect consumers. The industry must bring these products into compliance with the law".

So will Europe's legislation stifle the projected growth of this category in the region? Or is it merely a bump in the road this nascent food sector can easily overcome?

Food industry experts say at the moment it's difficult to accurately establish how big the market for CBD products in Europe is – and therefore how big it could potentially become – because there has been a 'green rush' of companies launching products containing CBD in recent years. 

"In the UK alone, sales of CBD products have increased by 99% in 2019, with Brits rushing to invest in the ingredient that is now used in copious health and beauty products," says Kamila Sitwell, co-founder of nutrition-enhanced drinks brand Kolibri Drinks. 

The sector is in similarly rude health across Europe. But then in January last year the novel food ruling came in, which according to Lorenza Romanese, managing director of the European Industrial Hemp Association (EIHA), has had "a negative consequence for the entire sector because of the lack of clarity" surrounding the ruling. 

Romanese says part of the problem is that the EC's ruling isn't legally binding, while it is also being applied on a country-by-country basis, which only adds to the confusion. 

So far "there has been a lack of harmonisation" across EU countries, explains Romanese. "There is no certainty of law, the sector is nervous and investment has gone down. So there has been a huge negative impact after the change. 

“If there are clear rules, the market will develop, but if Europe does not develop quite a positive hemp legislation soon, the market will only survive [rather than thrive]. By changing the regulation, we need the political will and at the moment there isn't a clear political will."

Thomas Mumcuoglu, founder of hemp food company Themptation, which manufactures a range of different CBD food items, including hummus and chocolate spread, also thinks a different legislative approach makes more sense.

"We fully support some level of regulation for CBD in the UK, but would prefer to have a full traceability scheme like organic and even a national testing facility/programme," he says.

"For instance, when you see the Soil Association logo on a product, it's a guarantee of traceability and quality. Something along those lines would be best to protect consumers from cowboy products and sellers."

Mumcuoglu thinks in the longer term the EC's ruling won't dampen the appetite for CBD products. Rupert Leigh, founder of Jackpot Peanut Butter, which offers a CBD variant, holds a similar view. 

Leigh even believes there could be some potential upsides to the novel food ruling for manufacturers of CBD food products. 

"Whilst there are no known effects of cannabis and therefore to some degree CBD, that it's classified as a novel food is no bad thing - where clinical trials across a range of categories and therefore products must be conducted - as there are some brands that are appropriating their product without any sort of back-up," Leigh says. 

"They cannot state any benefits until clinical trials have been conducted, therefore the consumer in our view is buying products that are price inflated due to the use of CBD on the label."

Christian Hendriksen, VP of international expansion at CBD extractor Mile High Labs, also believes in the longer term the introduction of legislation will be a "net positive" for the sector.

"I think there might be a short term bump in the road in terms of growth," says Hendriksen."It's costly and takes a lot of resources to put a novel food application together and get that filed so it will likely mean it won't be viable for a lot of small scale extractors. 

“From an industry perspective that means some companies might go out of business, but as a whole it means the products that persist are the ones where you can really demonstrate product safety."

He adds that if the extractor sector undergoes a period of rationalisation, food brands will have access to a smaller number of CBD suppliers who have the necessary compliance and quality assurance standards, and as a result over time he thinks the "larger FMCG companies and larger retailers will be more comfortable with this category".

This process has already begun to a certain extent. Mumcuoglu says he has been approached by some of the big manufacturers to produce for them and he thinks “it is inevitable the big players will move into the CBD market over time".

The same trend is also occurring in the drinks sector, according to Kolibri Drinks' Sitwell, who says drinks manufacturers see CBD as both a threat and an opportunity.

"Alcohol consumption is declining globally and US data demonstrates that 9% of those who choose to abstain/moderate alcohol switch to CBD drinks," she explains. "Although alarmed by its initial popularity, beverage marketers today have started to see cannabis as an opportunity more than a threat. 

"At the moment, some of the most popular names in the beverage industry such as Corona and Modelo maker Constellation Brands, Molson Coors or Heineken are making the transition into the cannabis beverage space, indicating that the potential is now in the emerging sector."

The potential Sitwell's refers to is, on paper, tremendous. Some food industry experts believe the CBD food product category could be the biggest 'next big thing' to come along since the recession.

So despite the new regulatory landscape that manufacturers of CBD food products are having to start operating within, it appears that growth of the category is set to continue unabated. As a result, we can expect to see all manner of CBD related items hitting the shelves of the larger grocery retailers across Europe sooner rather than later.