Upcoming FSA Deadline Highlights the Dangers of Investing in CBD

One of the consequences of the Brexit process has been the need for the UK government to take over certain regulatory capacities that were once handled by the EU. Among those regulatory duties is the control of the legalization of CBD products, particularly CBD edibles and health supplements, which used to go through the EU’s Novel Foods application process.

The UK’s Food Standards Agency (FSA) has already stated that they’ll take over the Novel Foods application process. They also set a March 31st for all CBD manufacturers in the UK to go through the application process, as only FSA approved products will be allowed to be sold in the UK after that deadline.

Up to now, CBD manufacturers had to deal with a lot of uncertainty surrounding the standards that would be enforced by the FSA. That’s something the institution helped rectify in late September when they put out a document outlining what they call “business guidance on CBD as a novel food”. That document led the Association for the Cannabinoid Industry to announce they were putting together a landmark safety study in order to gather the data necessary to comply with FSA deadlines.

At the time of writing, it appears unlikely that CBD foods and supplements will be outright banned in the UK. But the uncertainty of the substance’s regulatory situation could lead up to a situation where manufacturers are unable to sell their products for several months due to regulatory uncertainty and a lack of available data.

This circumstance encapsulates well all the reasons why investing in CBD is a risky move in 2020. Here are some of the concerns CBD businesses have to contend with.

1 – Research on the dangers of CBD is still ongoing

The CBD market was practically non-existent five years ago, so it’s no surprise that there was very little research being conducted on the substance back then. Because of that, today we have little data available on the long-term effects that CBD use has on the body. Especially when it comes to people using high doses of the substance in isolation. 

Although there is yet no indication that CBD use causes any type of damage, new research showing that CBD is dangerous could surface overnight. And even if that study turns out to be wrong, the bad press surrounding it would cause massive damage to the CBD market.

2 – The legal status of CBD is uncertain

The FSA isn’t the only governmental body showing great interest in the CBD market. Both in the UK and around the world, institutions and legislative bodies are taking great interest in the recent CBD craze. This means that those invested in the CBD market often find their investments being affected by external factors that have nothing to do with customer demand or the quality of their product.

3 – The market is in constant flux

Relative to other areas of investment, the CBD market is still in its infancy. New products, regulations, and changing customer demands can lead to massive fluctuations in the market. This means that those who invest in CBD need to be ready to adapt and make quick decisions, even more than other investors and entrepreneurs.

If you’d like to learn more about CBD and its benefits, this Cibdol guide can help.

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