Since 2017, cannabis oils, extracts and herbals have been sold openly in specialised shops as well as health food shops in several EU countries. Cannabis businesses are blooming in the European Union, and the EU is quickly becoming the world’s largest cannabis market.
With an estimated cannabis market worth of €115.7 billion in 2028, cannabis businesses are worth investing in. But you might be wondering, which are the best European countries for cannabis businesses right now?
The Iberian peninsula’s proximity to North Africa has led to the development of various cultural and economic ties over the centuries. The cannabis plant has been part of this exchange. In the late nineteenth and early twentieth century, cannabis was important to the local economy as well as the pharmacopeia of the time. Therefore, some areas of Spain had more knowledge of the intoxicating and medicinal effects of cannabis than other European regions.
Since 2014, governmental, regional and municipal bylaws have been passed to regulate the production and consumption of cannabis in Spain. However, the current legal situation of cannabis in Spain is a complicated one.
At the moment, it’s legal to buy and sell hemp seeds and other hemp products. It’s also legal to cultivate cannabis for personal use and smoke cannabis on private property. As a result, cannabis clubs have sprung up across Spain. That being said, most clubs require a membership and only Spanish citizens are allowed to join.
Cannabis seeds and CBD products that have a THC concentration that is lower than 0.2% can be purchased legally in Spain, as long as you use them in private settings. The Spanish CBD market is active, and large players, such as the Canadian corporation Canopy Growth, are already taking over local businesses.
With that in mind, Spain offers a large and sophisticated market for cannabis businesses. The only reason for it currently being in fifth position is that it’s already a crowded market, especially in large cities such as Barcelona or Granada.
Cannabis consumption is legal in Germany in certain medical contexts, but illegal for recreational use. That being said, the German judicial system will not always prosecute the possession of small amounts of cannabis or cannabis-based products.
However, the German federal law does not define what a small amount of cannabis is, so every state has the right to set different limits. Most states allow the possession of up to 6 grams of cannabis, while some — like North-Rhine Westphalia — won’t bat an eye for anything less than 10 grams. Berlin is even more tolerable, allowing the possession of up to 15 grams of cannabis for personal use.
Recent surveys show that more Germans consume cannabis for recreational purposes than for medical ones. However, Germany is also one of the first EU states to legalise medicinal marijuana. On top of that, Germany is also covering the insurance expenses for medicinal marijuana.
Cannabis products that have a THC concentration that is lower than 0.2% are legal in Germany, and they are commonly found in health food shops or head shops. You can legally buy CBD as a dietary supplement or you can buy cannabis-based products that include CBD in their recipes.
Germany is currently the third-largest CBD market in Europe, after the UK and Austria, but experts believe that it will overtake the top position by 2023, with an estimated worth of $605 million. That’s a significant increase from the nearly $38 million recorded last year.
That being said, some political parties want to bring the full legalisation debate back to the German Parliament, so this could be the right time to invest in a cannabis business in Germany.
3. United Kingdom
With an estimated 3.6 million active cannabis users and a marijuana black market worth somewhere around $6 billion, the United Kingdom is a very big market for cannabis businesses.
Medical marijuana has been legal in the UK since November 2018, and it’s estimated that the potential number of medical cannabis users could be as high as 2.9 million. At the moment, cannabis-based drugs are not covered by health insurance unless the patient exhausted the other treatment options available to them, which often makes it expensive for patients to self-fund.
Recreational use of cannabis is completely illegal in the UK. However, cannabis products containing less than 0.05% of THC are legal, and growing cannabis crops is also legal as long as the process is strictly controlled.
The UK is currently the largest CBD market in Europe, and most experts believe it could be worth almost £1 billion per year by 2025. At the moment, it’s estimated that there are over 1.3 million CBD users in the UK and that they spend over £300 million on CBD products.
A recent survey found that most of the UK consumers purchase CBD products that have high therapeutic doses, so the national trend seems to be heading towards a medically-oriented usage.
With a large user base and an insurance system that covers cannabis-based medicine, the UK could be a fertile ground for smart cannabis businesses.
Cannabis is legal in Austria, as long as it’s used for scientific or medical purposes, but it’s illegal for recreational use. However, the possession of small amounts of cannabis for personal use has been decriminalised since 2016, and the sale of cannabis seeds or cannabis-based products that contain less than 0.2% of THC is legal.
Growing cannabis and even selling cannabis plants in a vegetative phase is legal in Austria. If the cannabis plant is not brought to bloom, you can grow and possess it without any legal repercussions. But when the buds are separated from the plant, cannabis becomes illegal and growing it is prosecutable by law.
The hemp industry in Austria is significant, and parts of the country — such as the village Henfthal — are making efforts to revive the local hemp-growing traditions that have been around for more than 900 years. Recently, multiple Austrian businesses have entered the European CBD market.
With that in mind, the Austrian legal system is perfect for cannabis businesses growing and selling hemp and hemp-based products.
The sale of cannabis products containing up to 1% of THC has been legal in Switzerland since 2011, and the Swiss cannabis industry is growing year by year. According to SonntagsZeitung, a Swiss publication, the tax revenues from legal cannabis businesses have brought in 15.1 million francs (€13.5 million) last year, a drastic increase from 400,000 francs just three years before.
Since 2017, cannabis that has a THC concentration of less than 1% of THC is legally sold at nearly every Swiss tobacco store. The Swiss Federal Administrative Court imposes a special taxation scheme for cannabis businesses, similar to what you’d encounter in tobacco-based businesses in other countries.
Thanks to its clear legal regulations and taxation schemes, its sophisticated market and a large number of users, Switzerland is currently the best European country for cannabis businesses.
Countries that are worth a mention
The following countries are worth a mention because you can start a cannabis business there as long as the final products have a THC concentration that is lower than 0.2% and because these countries have made significant advances towards regulating their cannabis industries.
Poland legalised the use of cannabis for medicinal purposes in November 2017 and has since moved towards decriminalising cannabis, with governmental support for several legislation variants.
Medical use of cannabis-based drugs has been legal in France since 2013. Even though France still has some of the most stringent anti-cannabis regulations in Europe, things are slowly changing, which means the French market is open for new cannabis businesses.
Belgium, the Netherlands and Luxembourg have decriminalised, partially decriminalised or legalised the consumption of cannabis and cannabis-based products for personal use. However, these might not be the best countries for cannabis businesses because the markets are already crowded with reputable companies.
Greece has legalised both the use of medical cannabis and the production of industrial cannabis, creating new business opportunities for cannabis startups.
Until recently, Italy was a thriving opportunity for cannabis businesses. However, a recent ruling of the Court of Cassation states that selling derivatives of cannabis sativa is illegal, spreading concerns among shop owners.
Medical cannabis is now legal in Malta, and the authorities are looking to establish a center of excellence for medical cannabis. This should create some valuable opportunities for cannabis business owners.
Best European countries for cannabis business
Europe will become the world’s largest legal cannabis market in the following years. With more than double the population of the U.S. and Canada combined, and an increasing number of people interested in the beneficial effects of cannabis, the cannabis industry is ripe for investing.
At the moment, cannabis is slowly but surely entering new markets and investors are looking for a chance to find emerging and lucrative markets. For now, the cannabis regulation in the EU is a patchwork of local or national regulations, so you can choose to invest in emerging or mature markets, depending on your skill and experience.