|2020 Market Size
|Key Distribution Channels
Though the country is known for its liberal attitude toward cannabis, the formal markets for cannabis and CBD are in fact both quite restrictive. Though a limited amount of pharmaceutical CBD product is sold through the Dutch medical market, only cosmetics can be fully legally sold in the country in the non-medical realm, and laws regarding cultivation and processing make logistics difficult, as do the thriving black and gray markets. Although growth is expected with the entry of Novel Food-authorized CBD products into the Netherlands in 2021 and beyond, today's market is quite limited in terms of product format, and thus, volume of sales.
CBD occupies a gray area in the Netherlands mainstream, where it’s technically illegal but informally tolerated. This stems from an old piece of legislation, the Opium Act, passed in 1912. The legislation was created in response to opium abuse at the time, drawing from two lists of drugs. List I contained what was considered hard drugs, such as cocaine, and heroin, while List II contained hallucinogenic mushrooms and cannabis.
After the Opium Act was amended in 1999 to legalize hemp produced for the hemp fiber market, hemp plants could be grown in the Netherlands as long as they had THC content of less than 0.2%. However, the processing of CBD remains largely illegal, and hemp that is farmed in the Netherlands may only be legally processed through specialized pharmacies and sold through formal medical channels or for export. CBD is tolerated with a THC content of up to 0.05%, though technically any trace of THC is illegal in the country unless sold through medical channels.
Dutch law provides a loophole, so that - theoretically - hemp can be grown in the Netherlands, processed into CBD abroad, and then legally sold in the country again so long it contains less than 0.05% THC. However, the Netherlands respects and enforces Novel Foods, meaning ingestible products such as tinctures, capsules and foods cannot legally be sold on the formal market prior to authorization (earliest 2021); the country has also banned CBD vapes, and flower with less than 0.05% THC content is virtually non-existent, thus effectively smokables aren't allowed in practice. For these reasons, the strictly legal mainstream CBD market in the Netherlands consists virtually entirely of cosmetics.
The Transvaal pharmacy in The Hague used to be the only place where whole-plant cannabis oil could be legally extracted and purchased by patients. However, in the past few years three other pharmacies have received permission to produce and deliver their own CBD oil, extracting medicinal oil from standardized medicinal cannabis in accordance with GMP guidance.
One of the country’s medical cannabis producers is Bedrocan BV, it is the only company licensed by the Dutch Ministry of Health to produce cannabis flos (the whole, dried flower). They offer 5 different cannabis strains all produced following Good Manufacturing Practice (GMP), for medicinal use on prescription by physicians. The products are not registered as official medicine, but rather delivered to pharmacies as a pharmaceutical raw material, or exported. All medical CBD sales are accounted for in medical market figures.
Despite its own local restrictions on the mainstream sales of CBD, the Netherlands serves as a European headquarters location for various global brands and is home to a number of European CBD leaders. These companies offer a variety of products from tinctures to skin products, soaps, and even suppositories. From their locations in the Netherlands, many ship their products throughout Europe.
Jacob Hooy is one of the best-known drug stores in Amsterdam, and the company’s strong reputation in Europe has set them apart from competitors. Jacob Hooy’s was one of the first CBD brands offered by Holland & Barrett in the UK in early 2018, and today, its dozens of popular product formats are shipped throughout Europe.
Netherlands-based Endoca has been in the market since 2008 and boasts a very strong global and regional presence and reputation. The company indicates it was the first online shop to sell CBD products, and it now offers products in brick-and-mortar shops throughout Europe as well as globally through its website.
Medterra is a US-based CBD company offering oils, capsules and topicals made with THC-free CBD isolate, and emphasizing its quality, affordability and testing transparency. From its European headquarters in the Netherlands, Medterra plans to expand to all of Europe and has been quickly building a reputation as a strong, quality player in the region.
Distribution of CBD is limited in the Netherlands, as GMP-certified pharmacies are the only legal entities permitted to extract CBD oil for patients to purchase, though many pharmacies and dispensing physicians are permitted to sell CBD oil and other products. Because of CBD extracts’ status as a List I drug, Dutch coffee shops – or other non-medical entities - caught selling non-topical products need to pay a high fine and can lose their licenses, but despite this, mainstream CBD sales continue to take place through e-commerce sites and various white and gray market channels throughout the country today.
The Netherlands respects and enforces Novel Foods, meaning ingestible products such as tinctures, capsules and foods cannot legally be sold outside the country's medical market. There has also been a ban on vaping CBD oil, and product with 0.05%+ THC content is not permitted, effectively banning CBD flower as well. Thus the strictly legal non-medical CBD market in the Netherlands consists only of cosmetics, which are popular but still make up a negligible market size given their narrow consumer base.