OVER half of the European CBD seed market is dominated by illegal varieties exposing farmers to criminal sanctions and costing approved seed operators millions of Euros in lost revenues, it has been claimed.
Responsible companies who can spend in excess of €500,000 validating products are now pressing the European Commission (EC) to crack down on rogue operators.
And, despite creating an EU Seed Fraud Network in 2022, there has been little sign of any EC enforcement action, so far.
With the European market for CBD flowers and extracts expected to exceed €300m this year – equating to around five million seeds – seed company boss Americo Folcarelli says the illegal market is damaging his business and that of others like him.
Play By The Rules
Speaking to Business of Cannabis he said: “It is unfair that we invested time, money and effort to go through the process to do everything legally and then have to compete against breeders who don’t.
“This also hurts our industry because we frequently have to help farmers. The company that sold them the seed left them in the lurch not realising that what they bought was not authorised and was not tested as rigorously as ours by government agencies.
“If we are going to be taken seriously as an industry then we need to play by the rules and ,when someone doesn’t, they need to be accountable.
In 2022, Mr Folcarelli’s companies Jupiter Seed Europe and CBD Seed Europe succeeded in registering two new high-CBD seed varieties on the European Common Catalogue.
This process took over two years of trials and research – and over €500,000 of investment – by the Bulgarian-based company.
However, its high-CBD content seeds which cost up to one Euro each are now in competition with unregistered varieties which are sold to farmers at less than half the price – see below for how the scam works.
Business of Cannabis reached out to the EC for a response to these concerns and was informed that it had launched a Seed Fraud Network in early 2022, although this was news to Jupiter Seeds and others like it.
EU Seed Fraud Network
The EC press office reiterated to Business of Cannabis that only seed varieties registered in Member States and included in the EU Common Catalogue of varieties can be marketed.
It continued: “The Member States have transposed this legislation into their national laws and have been applying it for years, subjecting the producers to controls according to the certification procedure (official or under official supervision) in relation to the production fields and the seed obtained, as well as carrying out post-control tests on the seed once it is placed on the market.
“Only seed of this species that has undergone certification procedures may be marketed, and for the certification of hemp seed it is necessary that the variety is registered. The seed packaging must bear an official label confirming this.
“As the commission is running a Seed Fraud Network together with the Member States, it would appreciate to be informed about any fraudulent activities.”
Simeon Genov, head of the Bulgarian Industrial Hemp Associations, said it had pressed the Bulgarian Seed Agency and the Bulgarian Ministry of Agriculture to tackle the issue.
He said: “Both the seed agency and Ministry of Agriculture in Bulgaria are aware of this situation and are looking at implementing procedures and testing methods to verify that farmers are not using varieties that are not on the EU Authorised Varieties Catalogue for the 2023 growing season.”
As a member of EIHA and as a member of the EIHA working group that includes the Industrial Hemp Associations in the other member states they are working with the other member states Ministries of Agriculture to implement similar measures across the EU including informational programs for local authorities, so they are aware of the regulations and how to identify potential issues of compliance.
“It is important that as an industry that we show those in power at the national and EU level that we want to and can adhere to EU regulations and can be an essential tool in regulating the industrial hemp industry.”
How The Scam Works
The European Union regulations are clear that EU farmers are only allowed to grow varieties that are approved, are on the EU Authorised Varieties Catalogue and come with the blue label on the package.
However, many seed sellers sell to the EU growers varieties that are not authorised banking on the fact growers don’t know or understand the regulations.
The regulations in most EU member states require farmers and growers to declare the variety that they are growing and present the blue label that came with the seed.
So, growers and farmers buy seed from the seed breeder who sells them the non-authorised, high-CBD variety that is planted, but also sells the farmer a cheaper, authorised one, that is declared, but never grown.
They do that banking on the fact that local authorities will not run the more expensive genetics tests, and only the cheaper THC-compliance test.
In almost all cases the unapproved seeds are cheaper as they haven’t had to go through the rigorous EU approval process.
However, in a number of cases those cultivating the high CBD, unapproved seeds have also fallen foul of the EU regulations governing THC content, which currently stands at 0.3% after rising from 0.2% at the start of this year.