EN

|| EUROPEAN COMMISSION ||

Brussels, 17.9.2013

SWD(2013) 319 final

COMMISSION STAFF WORKING DOCUMENT

IMPACT ASSESSMENT

Accompanying the document

Proposal for a REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL on new psychoactive substances and proposal for a DIRECTIVE OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL amending Council Framework Decision 2004/757/JHA of 25 October 2004 laying down minimum provisions on the constituent elements of criminal acts and penalties in the field of illicit drug trafficking, as regards the definition of drug

{COM(2013) 619 final} {COM(2013) 618 final} {SWD(2013) 320 final}

TABLE OF CONTENTS

1........... Introduction.................................................................................................................... 6

2........... Procedural issues and consultation of interested parties.................................................... 7

3........... Problem definition......................................................................................................... 11

4........... Objectives.................................................................................................................... 40

5........... Policy options and their impacts.................................................................................... 41

6........... Comparison of options and identification of the preferred option.................................... 69

7........... Monitoring and evaluation............................................................................................. 78

Annexes..................................................................................................................................... 80

COMMISSION STAFF WORKING DOCUMENT

IMPACT ASSESSMENT

Accompanying the document

Proposal for a REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL on new psychoactive substances and proposal for a DIRECTIVE OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL amending Council Framework Decision 2004/757/JHA of 25 October 2004 laying down minimum provisions on the constituent elements of criminal acts and penalties in the field of illicit drug trafficking, as regards the definition of drug

This report commits only the Commission's services involved in its preparation and does not prejudge the final form of any decision to be taken by the Commission.

Executive Summary Sheet

Impact assessment on a proposal for a Regulation on new psychoactive substances

A. Need for action

Why? What is the problem being addressed?

New psychoactive substances are increasingly available in the EU internal market and a growing number of individuals, in particular young people, consume such substances, which are also used for various other, legitimate purposes. The potential risks that certain new psychoactive substances pose when consumed by people (for instance they can cause disease, injury, death) have prompted national authorities to submit them to various restriction measures (e.g. market bans, underpinned by either administrative or criminal law). These uncoordinated measures have negative effects on the internal market because they can hamper the legitimate trade and hinder the development of existing and new industrial, commercial and research uses of these substances. The main causes are the divergent national approaches to new psychoactive substances, which can result in displacement of harmful substances between Member States and disruption of legitimate trade, and the ineffectiveness of the current EU instrument on new psychoactive substances.

What is this initiative expected to achieve?

The main objectives of the proposal are: to protect the health and safety of consumers from the risks posed by harmful new psychoactive substances; to reduce obstacles to legitimate trade in new psychoactive substances and prevent the emergence of such obstacles. These general objectives will be achieved by improving the EU's capacity to rapidly identify and assess the risks posed by new psychoactive substances, by reducing the availability on the market of substances that raise immediate concerns to public health and that are proven to pose considerable health, social and safety risks. By harmonising the approach towards substances posing EU-wide risks, it will provide legal clarity to economic operators in the legitimate trade for these substances, facilitating the functioning of the internal market.

What is the value added of action at the EU level?

EU-level action would increase legal certainty and reduce obstacles for economic operators in the market for legitimate uses of new psychoactive substances, helping avoid the loss of business and facilitating the operation of companies across the internal market. It would also improve consumer protection, as harmful substances would be withdrawn from the market rapidly across the EU, thus avoiding their displacement. Member States individually cannot solve the problem, since substances withdrawn from the market in one country can still be sold in neighbouring countries or over the internet, which renders national action ineffective. EU-level action would also have the benefit of alerting Member States to harmful substances that have emerged in other countries, helping them anticipate and address potential health threats.

B. Solutions

What legislative and non-legislative policy options have been considered? Is there a preferred choice or not? Why?

The policy options assessed have been grouped in four thematic clusters to address the main problems identified (the preferred option for each cluster is in bold): (a) Improving knowledge of new psychoactive substances: status quo; facilitating structural cooperation between the EMCDDA, research institutes and forensic laboratories; establishment of an EU-level research infrastructure on new psychoactive substances. (b) Approach to address new psychoactive substances (individually or in groups): individual approach (status quo); approach by group of substances; individual approach supported by information on an 'intelligently clustered' group of substances. (c) Temporary emergency measures: no temporary emergency measures (status quo); EU recommendation to introduce temporary emergency measures; EU decision to introduce temporary emergency measures. (d) Decision on a new psychoactive substance: EU decision to submit substances to restriction measures backed by criminal sanctions or no action (status quo); status quo plus EU recommendation to submit substances to market restriction measures backed by administrative sanctions; status quo plus EU decision to submit substances to market restriction measures backed by administrative sanctions.

Who supports which option?

Each preferred option enjoys the support of a broad majority of stakeholders. Consultation of Member States showed the need for improving the knowledge-base on new psychoactive substances, as well as the speed of reaction and range of options available to act on substances posing risks, including through administrative measures. The proposed measures address these requests. Economic operators in the market for legitimate uses of new psychoactive substances have stressed the need for an approach proportionate to the risks posed by substances, to avoid unjustified restrictions of economic activities. In general, stakeholders' opinions do not indicate different combinations of options. Practitioners and academic experts have also expressed wide support for the preferred options.

1. Introduction

This Impact Assessment covers measures aimed at reducing the availability in the EU internal market of new psychoactive substances that pose health, social and safety risks, while preventing the emergence of obstacles to legitimate trade and increasing legal certainty for economic operators.

What are new psychoactive substances?

New psychoactive substances (also known as "legal highs") are natural or synthetic substances that act on the central nervous system and modify mental functions by inducing a stimulating or depressant effect, causing hallucinations, alterations in motor function, thinking, behaviour, perception, awareness or mood (psychoactive effects). Individuals use them to experience such psychoactive effects. They are sold freely, unless evidence about the risks that they pose when consumed prompts authorities to submit them to restriction measures[1].

Many new psychoactive substances have or could have different other uses ('legitimate uses'), including in the industry, in research, as active substances for medicines. Around a fifth of the substances notified through the EU-level mechanism of exchange of information have some other, legitimate, uses.

New psychoactive substances are not subjected to control measures under the UN Conventions on Drugs[2], unlike other psychoactive substances such as cocaine, cannabis or amphetamines ('illicit drugs'), which were submitted to such measures because of their risks and potential for abuse. They could be considered for restriction measures under the UN Conventions on Drugs, if deemed necessary on the basis of a risk assessment conducted by the World Health Organisation (WHO) at the request of one or more UN Member States.

The current EU instrument tackling new psychoactive substances, the Council Decision 2005/387/JHA on the information exchange, risk assessment and control of new psychoactive substances[3] ("the Council Decision"), does not enable an effective response to the rapid emergence and spread in the internal market of a growing number of such substances.

On the other hand, Member States cannot reduce the problem alone. In addition, divergent national approaches implemented by the Member States can have adverse effects on other Member States, as they can lead to displacement of harmful substances and disruption of trade in legitimate uses of these substances ('legitimate trade').

2. Procedural issues and consultation of interested parties

2.1. Policy context

The rapid emergence and spread of new psychoactive substances in the internal market is one of the most challenging developments in EU drugs policy in recent years. Soon after a borderless internal market was created, and following the emergence and rapid spread of synthetic drugs such as ecstasy and amphetamines, it became clear that the effectiveness of national action on new psychoactive substances was limited and that EU-level action was necessary. Consequently, in 1997 the Council adopted the EU Joint Action on new synthetic drugs[4], which was subsequently replaced with the Council Decision.

The Council Decision established an EU-wide system for tackling new psychoactive substances, which follows six stages (see Annex 1 for details):

(1) A Member State notifies detection by its authorities of a new psychoactive substance and provides information on its manufacture, traffic and use to the Early Warning System (EWS) managed by the European Monitoring Centre for Drugs and Drug Addiction (EMCDDA); this information is shared with the other Member States and Europol.

(2) If the EMCDDA and Europol consider it necessary, they request the Member States and the European Medicines Agency (EMA) to provide additional information on a substance; they prepare a joint report on the substance and submit it to the Council and the Commission.

(3) The Council can request the EMCDDA to conduct a risk assessment on the substance, which is drafted by the EMCDDA's Scientific Committee.

(4) The Scientific Committee conducts the risk assessment, the EMCDDA submits the risk assessment report to the Council and the Commission.

(5) The Commission presents to the Council a proposal to subject the substance to control (restriction) measures and criminal sanctions or a report explaining why it is not necessary to do so.

(6) The Council decides on the submission of the substance to restriction measures and on the obligation for the Member States to subject it to criminal law measures in accordance with their obligations under the UN Conventions on Drugs (which effectively means that the substance becomes an illicit drug).

The Council Decision enables the EU to address new psychoactive substances that raise concern at EU level, without preventing Member States from introducing national measures on substances if they deem it necessary to do so.

When does a new psychoactive substance raise concerns at the EU level?

The EMCDDA and Europol apply six criteria for determining if a substance raises EU-level concerns and is to be made subject of a joint report, for which they will request the Member States and the EMA to provide more detailed information: (1) amount of material seized; (2) evidence of international trafficking; (3) evidence of organised crime involvement; (4) toxico-pharmacological properties or analogy with similar, better researched, substances; (5) evidence of the potential for further (rapid) spread; (6) evidence of intoxication or fatalities.

The Commission's assessment report[5] on the functioning of the Council Decision concluded that, while it is a useful instrument for addressing new psychoactive substances at the EU level, it is inadequate, considering the scale and complexity of the problem, and it is therefore necessary to revise it.

The Commission Communication "Towards a stronger European response to drugs"[6] identified the spread of new psychoactive substances as one of the problems requiring a firm response at the EU level and set the ground for revising the Council Decision; it also identified the evolving nature of illicit trafficking in drugs and the interactions between the market for new psychoactive substances and the one for illicit drugs as a challenge that needs to be addressed. It therefore called for the revision of the EU legislative framework on new psychoactive substances and on illicit drug trafficking, to enhance the effectiveness of EU action on drugs. The revision of the Council Decision and that of the Framework Decision are included in the Commission's 2013 Work Programme[7].

In its Conclusions of December 2011[8], the Council requested the Commission to take further action to address new psychoactive substances and invited it to revise the Council Decision. A large number of written questions from the European Parliament to the Commission enquire about new initiatives to address new psychoactive substances.

2.2. Gathering information and consultation

The identification and analysis of the problems, objectives, policy options and assessment of impacts were informed by broad stakeholders' and experts' consultations, as well as a web-based public consultation, which met the Commission's general principles and minimum standards. An external study[9] was commissioned to support the preparation of this Impact Assessment report. This study ran between September 2011 and June 2012.

2.2.1. Consultation of stakeholders

The Commission involved all Member States in the assessment of the functioning of the Council Decision, through written consultation. In the context of the external study, the Commission collected and examined the views of national authorities (responsible for drugs legislation, from ministries of health and justice, health institutes, law enforcement authorities) and EU agencies involved in the implementation of the Council Decision - the EMCDDA, Europol and the EMA. It also gathered and analysed the views of concerned international organisations (e.g. the WHO), civil society organisations, research institutes and academic experts (see Annex 2).

The Commission organised two meetings with experts in the field of new psychoactive substances (on 15 December 2011 and 1 March 2012). Experts stressed that the Council Decision and existing legislation on product safety, consumer protection and drug control are not adequate to deal with the large number of substances whose effects are often unknown and which need to be assessed, and that therefore specific and more adequate legislation on new psychoactive substances is necessary. They pointed out that new legislation should be proportionate to the different levels of risk posed by various new psychoactive substances.

Certain experts expressed concern that too rigorous policy responses (for instance restriction measures on groups of substances or a wide use of restrictions backed by criminal sanctions) could have adverse effects, notably resulting in some substances moving to the illicit drug market, being replaced by more harmful ones or being inaccessible for research.

Economic operators producing or distributing new psychoactive substances for use aimed at inducing a psychoactive response in humans ('recreational use'), as well as those manufacturing such substances for various industrial uses and their trade associations, were consulted as part of the preparatory study. Consultation was conducted through surveys (users, distributors and sellers), as well as through face-to-face and phone interviews (economic operators, distributors and sellers, trade associations). Users of new psychoactive substances were also consulted. However, the rate of response does not allow for the generalisation of the results, which must be triangulated with other sources (see Annex 2).

A survey was conducted among young people (15-24 years' old) in 2011, through the Eurobarometer "Youth attitudes on drugs"[10]. Results show that 34% of respondents were in favour of restricting the availability of all substances that imitate the effects of illicit drugs, 47% were in favour of only restricting the availability of those substances which posed risks to health, 15% believed that sale and consumption should be regulated in a way similar to licit substances like alcohol or tobacco, while 2% thought that nothing needed to be done.

The public consultation on drugs policy that the Commission ran from 28 October 2011 to 3 February 2012 included the question: "What regulatory measures should the EU develop to contain the spread of new psychoactive substances?". The Commission received 205 replies in total and 134 respondents specifically addressed this question. In general, replies stressed the need for quicker action on new psychoactive substances and warned against using criminal sanctions indistinctly, because of their adverse consequences (see Annex 3). Certain stakeholders (NGOs and individuals, in particular) suggested that the market for new psychoactive substances should be regulated in a similar fashion to that of alcohol or tobacco.

The European Economic and Social Committee has urged the Commission, in an opinion[11], to explore options that avoid making the use of such substances a criminal offence.

These contributions have informed the problem definition and form the basis for the formulation of policy options and for their assessment.

2.2.2. Internal consultation

DG JUSTICE, which is responsible for the initiative presented in this report, set up an Inter-Service Steering Group (ISSG) to which the following services were invited: the Secretariat-General, the Legal Service, DGs ENTR, MOVE, RTD, INFSO, MARKT, TAXUD, EAC, SANCO and HOME. The EMCDDA, Europol and the EMA participated as observers. ISSG meetings were held on 8 November 2011, 31 January and 23 March 2012. Services were supportive of the initiative and provided useful feedback during the ISSG meetings and in subsequent communications, which has been taken into account in the drafting of this report.

2.3. Scrutiny of the Impact Assessment Board

2.3.1. First opinion of the Board

The European Commission's Impact Assessment Board (IAB) examined a first version of this report and issued an opinion on 4 May 2012. The revised report took on board the recommendations of the IAB and introduces the following main modifications and clarifications:

(1) Improved problem definition, which better explains why differences in national approaches impede legitimate trade, provides a clearer description of the nature and the scale of the problem with regard to substances that raise cross-border concerns, provides additional information on the functioning and characteristics of the market, differentiating between the market for substances used for recreational purposes and that for legitimate uses, and clarifies the scope and limitations of existing EU and Member States actions. The intervention logic has been clarified, also by adding a graph. The revised problem definition better explains the reliance on internal market competences for action on new psychoactive substances.

(2) The design of the policy options has been strengthened by providing additional details on their content and by adding a new option in cluster 2. Further explanations have been provided to justify why other options have been discarded. A timeline comparing the preferred policy option and the existing Council Decision has been added to clarify how the new instrument will increase speed of reaction.

(3) The assessment of costs and benefits of the policy options, including administrative and compliance costs for the Member States and for economic operators in the market for legitimate uses, has been improved. Proportionality has been assessed in relation to all relevant options, in particular with respect to temporary restriction measures. Stakeholders' opinions have been more extensively referred to throughout the report. The positive and negative impacts of restriction measures have been better highlighted and trade-offs acknowledged.

2.3.2. Second opinion of the Board

The IAB examined this report and issued an opinion on 30 October 2012. The revised report takes on board the recommendations of the IAB and introduces the following main modifications and clarifications:

(1) Improved presentation of the problem, further strengthening the argumentation that divergent national approaches to new psychoactive substances affect legitimate uses of such substances, by making reference to case studies, information and views of industry representatives, and to some research on the matter. The revised report also better explains that data on legitimate uses of new psychoactive substances is not systematically collected or available, and therefore it is not possible to provide additional evidence in this respect. The report also explains more clearly that the proportion of substances notified through the EWS that have known legitimate uses (one fifth) is significant, considering that data on such uses is not systematically collected, and that these are often substances newly synthetized and still not well known or researched.

(2) More detailed explanation of the content of policy options, to clarify the meaning and consequences of administrative and criminal sanctions for the infringement to the restriction measures introduced on a new psychoactive substance that poses health, social and safety risks, and to clarify how temporary (and permanent) restriction measures would work.

(3) Extended assessment of the preferred option, better explaining what would be Member States' possibilities to apply national measures and what consequences would be on the effectiveness of the option in meeting the policy objectives.

3. Problem definition

New psychoactive substances are increasingly available in the EU internal market and a growing number of individuals, in particular young people, consume such substances, which are also increasingly used for various other, legitimate purposes.

The potential risks that new psychoactive substances pose when they are consumed have prompted authorities to submit them to various restriction measures. These measures can hamper the legitimate trade and hinder the development of existing and new legitimate uses.

The main causes of these problems are: divergent national approaches to new psychoactive substances (which can result in displacement of harmful substances between Member States and disruption of legitimate trade) and the ineffectiveness of the current EU instrument on new psychoactive substances.

3.1. The market for new psychoactive substances

3.1.1. Rising number and diversity of substances across the EU

During the past years, Member States have notified an increasing number of new psychoactive substances to the EMCDDA through the EWS. Between 1997 and 2012, they reported around 290 substances - and the pace of notification intensified recently, with more than one new substance notified every week in 2012. The number of notified substances tripled between 2009 and 2012 (from 24 to 73, see figure 1).

Figure 1: Number of notifications and groups of substances notified via the EWS (as of 31 December 2012)

Source: EMCDDA

The number of new psychoactive substances that can emerge on the market may run into the thousands because many variations of existing substances or new, still unexploited, substances can be extracted, manufactured or synthesised at relatively low cost.

New psychoactive substances that emerge in one Member State can spread quickly in the internal market. According to the information gathered through the EWS, a considerable number of the new psychoactive substances reported in 2009-2011 - 81% (71 out of 114) - were notified by more than one EU country, and more substances were present in more than one country in 2011 compared to 2009 (see figure 2).

This percentage is likely to be higher in reality because not all Member States report to the EWS information on all substances that they detected. This is because they are not obliged to do so and may refrain from reporting on a substance detected in very small quantities or that another Member State has already notified.

Figure 2: Geographical diffusion of new psychoactive substances notified in 2009-2011

Source: EMCDDA, European Database on New Drugs

3.1.2. The market for recreational use of new psychoactive substances

Evidence suggests that the levels of use of new psychoactive substances for recreational purposes have increased and that use is predominant among young people. For instance, results of research in Poland show an increase in the use of new psychoactive substances at least once in a lifetime by students aged 18 from 3.5% in 2008 to 11.4% in 2010. Use during the last 12 months was reported by 2.6% of students in 2008 and increased to 7.2% in 2010[12].

Surveys in other Member States show that the level of use of new psychoactive substances is considerable, although no trend surveys are available yet. In the Czech Republic, a survey of internet users in 2011 found that 4.5% of respondents aged 15-34 had tried new psychoactive substances before. In Ireland, a survey conducted in 2010-2011 among 15-64 year olds found that 3.5% had taken new psychoactive substances in the last year – the percentage for 15-34 year olds was 6.7%. In Slovakia a survey carried out in 2011 found that 5% of students from primary and secondary schools used "legal highs". The UK Advisory Council on the Misuse of Drugs has acknowledged that "new psychoactive substances' use appears firmly embedded in the UK drug scene"[13].

According to the EMCDDA[14], the studies available (see Annex 4) indicate that there is a potential for a further rapid rise of use among certain categories, particularly young people. The 2011 Eurobarometer survey "Youth attitudes on drugs" found that 5% of young people (15-24 years' old) in the EU reported having used such substances at least once in their life, with a peak of 16% in Ireland, and close to 10% in Poland, Latvia and the UK.

Figure 1: Experience with legal substances which imitate the effects of illicit drugs

Source: European Commission, Flash Eurobarometer 330, Youth attitudes on drugs, 2011

The number of last-year users can be estimated to be around 2.2 million in the EU (see Annex 5 for details).

Individuals use new psychoactive substances to obtain various effects - pleasure, performance enhancement or relaxation - which are also produced by certain illicit drugs. The use of new psychoactive substances differs strongly from one country to another and may be influenced by the strictness of national illicit drug policies or the availability of certain illicit drugs. Availability, legality and price seem to be the main drivers for the demand of new psychoactive substances for recreational use by individuals.

Availability appeared to be the main factor for the use of mephedrone before it was submitted to restriction measures, while legality seems to be the main reason for the use of synthetic cannabinoids[15]. After they were subjected to restriction measures in certain Member States, between 2008 and 2010, the use of synthetic cannabinoids dropped considerably and some users reverted to using natural cannabis instead. Their price - new psychoactive substances are relatively cheap, particularly when compared to illicit drugs[16] (see Annex 6) - may have contributed to their rapid dissemination.

New psychoactive substances are sometimes launched to attract the users of illicit drugs[17] or to replace substances submitted to restriction measures, to take over their market. Several classes of new psychoactive substances have been modelled on existing illicit drugs[18]. This is principally driven by the fact that there is demand for substances which produce psychoactive effects while remaining legal.

Certain people who would not use illicit drugs, because they do not want to break the law or because they think that illicit drugs are dangerous, could be tempted to use new psychoactive substances, because they are sold freely and are therefore deemed safe, although most of them have never been tested in humans[19]. Chemists can readily identify the substances that are similar to those covered by restriction measures but which are legal, and the production methods are easily accessible from the relevant literature[20].

The main channels through which new psychoactive substances are distributed for recreational use in the EU are the internet and specialised shops selling psychoactive substances ('head shops').

The internet and social networks, which offer new opportunities for businesses and individuals alike, have facilitated the spread of new psychoactive substances across the EU. The role of the internet in selling such substances for recreational use has sharply increased over the past years, illustrating their growing availability and demand for them. However, it is unclear what share of the total distribution and sales takes place over the internet.

The EMCDDA’s internet snapshot survey of January 2012 identified 690 online shops selling new psychoactive substances[21]. This was more than twice the number of shops identified in January 2011 (314) and a four-fold increase since January 2010 (170).

In the past three years, head shops, which had traditionally only existed in a few Member States[22], have opened up in several Member States at a rapid pace. New psychoactive substances are now reported to be sold via head shops in at least 13 Member States[23]. Certain Member States have taken action to close down such shops. As a result, the number of operating shops fell across the EU, although comprehensive data is not available, and a parallel increase in the activity of online shops selling new psychoactive substances was reported. In certain Member States new psychoactive substances are also sometimes sold in petrol stations, kiosks, video rental stores (Germany), sex shops (France, Luxembourg) and tobacconists (Greece).

According to the available information[24], companies that produce new psychoactive substances, mostly as a secondary chemical product, are based outside the EU (China and India mostly). They are responsive to changes in national and EU legislation on new psychoactive substances and are able to rapidly adapt their offer and produce alternative substances to those subjected to restriction. EU companies usually import, re-package and distribute on to private vendors in different Member States. Although complete information is not available, there are indications that EU companies operating in the market for recreational uses of new psychoactive substances (in particular retailers) are mostly small or micro enterprises. The EU can address the production of new psychoactive substances outside the EU through political dialogue with these countries and with other countries concerned by the spread of new psychoactive substances, through cooperation programmes and projects implemented with third countries.

Annual turnover and profit in this market can be significant: for example, one company responding to the survey has an annual turnover of €1 million with a profit margin of 50%. But other companies involved in this trade are likely to have a much smaller turnover. This differs widely depending on the country and on the head shop, as some shops may also sell other, non-psychoactive products (smoking equipment, herbal products, vitamins).

Information from a head shop owners' association in Ireland indicates that annual turnover in the approximately 100 head shops that existed in the country prior to government intervention[25] in 2010 has amounted to between €200.000 and €400.000 per shop on annual basis, resulting in a total, for Ireland, of between €20 and €40 million. These shops, which paid VAT and income tax, employed approximately 500 staff between them. Following drastic measures taken by the government to restrict the availability of new psychoactive substances, only ten head shops operate in Ireland today[26], with an estimated turnover of 5-10% of the original.

It is difficult to provide an estimate of the overall size of the market for recreational use of new psychoactive substances because little information is collected, across the EU, on market operators, sales, products and use of such substances. In addition, the market is volatile, because many substances disappear from the market quickly, either because users do not like them (if they produce unpleasant side-effects) or because they are subjected to restriction measures.

For this Impact Assessment report, estimations of the EU market for recreational use of new psychoactive substances have been made through an analogy with the ecstasy[27] market. Based on those calculations, the turnover in this market is estimated to be approximately €0.5 billion per year[28] (see Annex 5).

3.1.3. The market for legitimate uses of new psychoactive substances

Many new psychoactive substances have or could have various other uses, in addition to being used for recreational purposes. Despite the fact that collection of information on the legitimate uses of new psychoactive substances is sporadic, also because this is not foreseen under the current EU legislative framework, numerous legitimate uses of these substances have been documented so far, mainly in the industry, in research, as active substances in medicines (including in medically assisted drug treatment, to treat drug addiction, as substitutes for illicit drugs), but also for traditional, cultural or religious purposes.

For instance, the substance 4-methylamphetamine, which was subjected to restriction measures in March 2013, was studied in the 1950s as an anorectic medicine by Smith, Kline & French laboratories, under the trade name Aptrol, but its development and marketing was abandoned[29]. Some of the substances notified under the EWS have also been notified or registered in the REACH database in line with the provisions of Regulation 1907/2006 concerning the Registration, Evaluation, Authorisation and Restriction of Chemicals.

However, comprehensive information about legitimate uses of new psychoactive substances is not available across the EU. This is because Member States' authorities are often not aware of these legitimate uses and do not report them to the EWS systematically. The EMCDDA collects data on certain legitimate uses, mostly on human and veterinary medicinal use, only when it produces a joint report on a substance, under the Council Decision. For such a joint report, Member States and the EMA are asked to provide information about legitimate uses. Joint reports have been drawn on only 11 substances since 1997 but the Member States have shared some additional information on legitimate uses through the EWS.

Among the new psychoactive substances notified through the EWS since 1997, the EMCDDA has received information[30] on other uses, often primary uses, for over 45 substances (see Annex 8), or almost a fifth of the substances notified. This is a significant proportion and it may be underestimated, considering that data on legitimate uses is not systematically collected, and that these are often substances newly synthetized that are still not well known or researched. The following types of legitimate uses of new psychoactive substances have been documented:

Substances used as active substances in human or veterinary medicinal products

This group includes human or veterinary medicinal products that have marketing authorisation in the EU, in certain Member States or in EU neighbouring countries, but that are diverted or misused for recreational purposes. At least 12 substances notified since 1997 are part of a range of registered medicines[31] (for instance mCPP, which is an API).

This group also includes medicinal products that have received marketing authorisation in certain countries outside the EU, but which have no marketing authorisation at EU level or in the Member States[32], and which are advertised as 'legal highs'.

It also includes new psychoactive substances that are used recreationally in certain Member States, and are therefore submitted to restriction measures in these Member States, but that are used as medicines in other Member States. This is the case for certain synthetic cannabinoids, for instance, which have emerged on the market in recent years. For example nabilone, which has been subjected to restriction measures in several Member States, is used in the UK in the treatment of nausea and vomiting caused by chemotherapeutical agents used to treat cancer.

Substances with potential legitimate uses, some of which are modifications of known medicinal or veterinary medicinal products

This group includes substances that are still subject to research and clinical trials by the pharmaceutical industry, and substances that are used, for instance, as food dietary supplements. Data on such research is often not available as it may involve confidential business information. Some substances may even be patented[33].

Plants and herbs

This group covers plants and herbs that grow free in nature, and whose flower core, leaves or roots have psychoactive potential (sometimes when extracted). They have been and may still be traditionally used in Africa, Asia or the Americas. Examples include Kratom ("traditional medicinal" leaf used in Southeast Asia), Salvia Divinorum ("healing medicine" traditionally used in Mexico), kava (common herbal product used in the South Pacific Islands, where the roots of the plant are brewed into a tea and taken by the indigenous population for relaxation), Ibogaine (hallucinogenic substance extracted from plants and used for traditional and ritual purposes in Africa, and which is marketed in France as a medical drug for dieting).

Substances that have been researched for medicinal purposes but not marketed

This group includes substances that have been subject to pharmaceutical research, but that were finally not approved or marketed as medicinal products, possibly because of adverse side-effects or toxicity (for example 4-MTA and 4-methylamphetamine).

Substances with other (potential) chemical and industrial uses

This involves substances that have various uses in the industry, for instance as radioisotopes for medical examinations. It also includes precursors for the manufacture of industrial products (e.g. glue, reagents), such as gamma-butyrolactone (GBL), or precursors for a medicinal product like CPCPP[34], which also have psychoactive effect when consumed for recreational purposes.

It is not possible to provide an overall estimate of the size of the market for legitimate uses of new psychoactive substances, because this depends on each specific substance and because information is not collected systematically on such uses, on market operators, distribution, sales and products. But it is reasonable to assume that the size of this market is considerable.

This assumption is based on the following elements: the number of new psychoactive substances present on the market; the potential number of substances with psychoactive effects that may yet be launched, which runs into the thousands; the likelihood that they will be launched, considering the demand for them; the potential for 'dual use' - substances consumed for recreational purposes and also used in the industry, for instance as active substances in medicine (as shown before, a considerable number of substances notified to the EWS have been researched for medicinal or other commercial purposes before being launched on the market for recreational use – see Annex 5 for more details).

It is expected that a large number of new psychoactive substances could have uses in the industry, in particular as active ingredients for human or veterinary medicinal products. This is because their psychoactive properties can be valuable for medical treatment. But the appropriate conditions need to be provided for companies to conduct research in order to develop such uses, without disproportionate administrative burden and red tape - and certain restriction measures, aimed at limiting the availability of substances for recreational use, can create such burden.

The box below presents three case-studies of dual-use substances, which are used recreationally while having wide uses in the industry:

GBL is an industrial chemical that, according to the industry, offers excellent solvent qualities with low toxicity and diminished environmental concerns and is used in a wide range of legitimate end uses, for example as an aroma compound, stain remover, superglue remover, paint stripper. It is used in the manufacture of products including hospital supplies, beverage filtration and purification aids. It is also used for various applications, including circuit board cleaning in the electronics and high-tech industries, the production of herbicides and as a processing aid in the production of vitamins and pharmaceuticals. It is also one of the precursors for the manufacture of the illicit psychoactive substance GHB. When consumed by humans it is converted into GHB inside the body and it is therefore used for inducing psychoactive effects for recreational purposes with effects similar to those of alcohol.

The industrial use of GBL is considerable. According to data provided by the industry[35] there is one producer of GBL in the EU, with a production capacity of 30.000t (±25% of world production capacity).

1,4-BDO (1,4-butanediol) is an industrial chemical that serves predominantly as an intermediate ingredient in common industrial and commercial products. 1,4-BDO is reacted to make items such as engineering plastics, polyurethane systems (e.g. golf balls, skateboard wheels, car bumpers) and as a carrier solvent in printing inks and cleaning agents. Like GBL, it is also one of the precursors for the manufacture of the illicit psychoactive substance GHB. And as with GBL, when consumed by humans 1,4-BDO is converted inside the body into GHB and it is therefore used for inducing psychoactive effects for recreational purposes with effects similar to those of alcohol.

According to data provided by the industry[36] there are three producers of 1,4-BDO in the EU, with a combined production of app. 500.000t (±36% of world capacity).

Both GBL and 1,4-BDO are voluntarily monitored by economic operators under the EU's drug precursor control system[37].

mCPP - a mild stimulant - was subject of a joint report under the Council Decision in 2006. Because it was a metabolite of the psychoactive compound Trazodone, which was used as an active ingredient in medicinal products in Belgium and France, it was not submitted to risk assessment and no action was undertaken on it at the EU level.

Several Member States have subjected these three substances to various restriction measures under different types of legislation, with different constraints on economic operators in the market for legitimate uses (see section 3.3.).

3.2. Problem 1: Risks posed by the recreational use of new psychoactive substances to individuals and society

The rising number of new psychoactive substances available in the EU internal market, their growing diversity, both in type and risk level, the speed with which they emerge and the growing number of individuals who consume them challenge the capacity of public authorities to provide effective responses to protect public health and safety without hampering legitimate trade.

The recreational use of certain new psychoactive substance can cause harms[38] to individuals' health and safety, and can pose risks to and burdens on society. These risks are amplified by the fact that many such substances are sold to consumers without appropriate labelling and instructions of use and are sometimes mislabelled to evade rules on consumer products.

There is a wide variety of new psychoactive substances on the market, which pose different levels of health, social and safety risks. For instance, the level of risk posed by mephedrone is higher than that of certain "magic mushrooms", in particular those containing the hallucinogen active components psilocine and psilocybine[39]; at the same time, the risk-level of mephedrone is lower than that of an illicit drug such as crack cocaine (see figure 9 in Annex 5). The restrictions applied to new psychoactive substances, at national and at the EU level, often do not take into account the different risk-levels of these substances and fail, therefore, to provide proportionate responses. Disproportionate responses can undermine the effectiveness of restriction measures and can have severe adverse effects (see section 3.4.2.).

It is difficult to provide a complete picture of the risks associated with the use of new psychoactive substances soon after they appear on the market, because of scarce research on and information about their toxicity, long-term effects, historic trends and future projections of use[40]. There are two broad categories of harms that new psychoactive substances may cause to individuals and to society:

(a) Health harms

The consumption of new psychoactive substances may cause physical or psychological harms, including (see Annex 7 for details):

· Acute harm and toxicity (significant agitation, psychosis, delirium, tachycardia, hypertension, chest pain and seizures, including potential risk of overdose[41]).

· Spread of blood borne infections, such as HIV or hepatitis C, among users that inject new psychoactive substances[42].

· Severe psychiatric problems, in particular in the case of synthetic cannabinoids, which may have a greater potential to cause harm than natural cannabis[43].

· Fatalities were reported in relation to several new psychoactive substances recently[44].

· Dependence: some evidence[45] suggests that amphetamine type psycho-stimulants have an increased risk of dependence[46].

The risk of physical and psychological harm is higher when several new psychoactive substances are consumed together or with alcohol[47]. The use of such substances may, in fact, lead to higher consumption of alcohol or of illicit drugs[48], which increases the risk of harm[49].

Lack of information about the correct administration of these substances and misleading labelling can further increase the risks to health and safety. This is because even substances that would cause limited harm under certain conditions of use can be risky if used in combination with other substances, illicit drugs, certain medicines or alcohol.

Research in several Member States has shown that new psychoactive substances are often sold without information regarding their chemical composition, pharmacology or toxicology, without safety assessments (side-effects, contra-indications, interaction with other substances) and without instructions as to how they should be administered[50]. Certain Irish[51] and UK[52] studies have revealed that information that is crucial for consumers is often not presented on labels and that most packages containing these substances either do not list ingredients or incorrectly claim to contain various natural extracts.

Studies have also shown that certain new psychoactive substances that were sold as alternatives to substances subjected to restriction measures (e.g. to mephedrone) actually contained the substances that they claimed they replaced[53], posing serious risks to users’ health. In other cases, new psychoactive substances were sold by dealers as illicit drugs (for instance, 4-methylamphetamine was sold as amphetamine). On the other hand, certain products marketed as new psychoactive substances only contained caffeine[54], but sometimes in toxic doses.

Substances are sometimes intentionally mislabelled in order to circumvent rules on the marketing of specific products. For example, mephedrone was variously advertised and labelled as "research chemical", "bath salts" or "plant food" often with a note saying "not for human consumption" to evade product safety and food safety legislation. However, the intended use was clearly human consumption.

(b) Social harms

The recreational use of new psychoactive substances can pose risks to society. Because they may affect mental health and social functioning, the frequent use of such substances, like that of any psychoactive substance, can have a negative impact on society, adversely affecting personal development, family life, communities and the social fabric in general.

The use of new psychoactive substances can impair the ability to drive a car, with serious consequences for road safety. The degree of impairment depends on the type of substance, on its effects and on whether it is used together with alcohol or other psychoactive substances. Current road safety testing equipment still lacks accuracy and reliability for the most prevalent illicit drugs, and may not even detect these new psychoactive substances. And testing equipment cannot keep pace with the increase in the number and variety of such substances on the market.

The use of new psychoactive substances can place a significant burden on public authorities, especially in the health policy and law enforcement areas. Emergency services must cope with an increasing number of cases of people intoxicated following their use. For instance, a new Club Drug Clinic has been set up at the Chelsea and Westminster Hospital in London to deal with special cases related to the misuse of recreational drugs[55]. In its first year, the clinic reported that most patients use new psychoactive substances alongside illicit drugs.

Media reports suggest that use of some new psychoactive substances may lead to violent behaviour and crime. The risk assessment of mephedrone[56] reported geographically restricted (Guernsey) episodes of crime among users who injected the drug, including burglary and theft. In addition, since certain products marketed and sold as new psychoactive substances actually contain illicit drugs, consumers commit an offence when they possess and use them, without necessarily being aware of it (the use or possession for personal use of illicit drugs is a criminal offence in several Member States[57]). Therefore, new psychoactive substances also put a burden on the criminal justice system.

Violence may increase proportionally to the involvement of organised crime in the market for recreational use of new psychoactive substances. Available information shows that there is a limited involvement of organised crime, which is sometimes active in the distribution and sale of new psychoactive substances on the black market, in combination with illicit drugs[58].

Stakeholders from ten Member States[59] reported that criminal groups are involved in the market to some extent, e.g. in repackaging or tableting, while five Member States consider the involvement of organised crime to be minimal or non-existent[60]. This information is confirmed by the joint report[61] and the risk assessment report on mephedrone, which pointed to a limited involvement of organised crime groups, mostly in tableting. The risk assessment on BZP[62] provided no clear indication of the involvement of organised crime.

The cultivation, manufacture or extraction of new psychoactive substances can cause environmental harms. For instance, the manufacture of synthetic substances in residential areas, where potentially hazardous substances are combined in chemical processes in clandestine laboratories, without proper safeguards, may result in explosions, fire or the release of toxic substances[63]. The dumping of chemical residues and packaging after the manufacture has been completed can cause further harms to the environment.

(c) Costs

The harms caused by the recreational use of new psychoactive substances to individuals and to society can have considerable costs. These include tangible costs, mainly in the public health and law enforcement area, and in the economic sector, and intangible costs, such as pain, suffering, reduction of quality of life and death.

The tangible economic costs are borne by the economy as a whole but also by consumers. They revolve around loss of productivity for paid workdays and incapacity benefits for individuals who are affected in the long-term, including expenses to cover medical care, and lost wages and productivity. Long periods of sickness absences may cause loss of earnings. The harms caused to individuals' health can have negative consequences on their ability to work, resulting in lower incomes.

The health-related harms of new psychoactive substances are estimated to cost around €211 million per year and the cost of criminal law enforcement is estimated at between €117 million and €144 million per year (for an estimation of other costs, for instance, cost of sanitary inspections, loss of tax revenues, see Annex 5).

3.3. Problem 2: Obstacles to legitimate trade in the EU internal market

The risks posed by the recreational use of new psychoactive substances have led public authorities to introduce various restriction measures on these substances, which impede legitimate trade. Such restriction measures make it more difficult for economic operators in the market for legitimate uses to get access to the restricted substances and can, therefore, cause the loss of business. They can make research more cumbersome, since various authorisations may be required before substances can be obtained, and can, therefore, hinder the development of new uses for these substances.

Restriction measures vary depending on the Member State and on the specific substance, leading to obstacles to trade, fragmentation and an uneven level playing field for economic operators, and making it difficult for companies to operate across the EU internal market. As the market for new psychoactive substances is likely to grow, so will the obstacles to future legitimate trade in the internal market.

Certain Member States have introduced wide-ranging restriction measures, covering entire chemical groups of new psychoactive substances ('blanket bans'), sometimes without assessing the risks posed by the consumption of these substances or the benefits of their uses for other purposes. Such approaches can severely impede the development of legitimate uses of these substances, for instance uses that companies registered through the REACH mechanism, especially since substances subjected to restrictions are unlikely to be 'rescheduled' (restriction measures are not lifted), even if more information becomes available on their risks and benefits.

The potential benefits and risks of new psychoactive substances, for instance as active substances for human or veterinary medicinal products, can only be determined through research. Restriction measures can make it more difficult for companies to conduct research on new psychoactive substances, in particular when the measures are backed by criminal law. This is because companies need to prove that the intended use of the substance is legitimate, sometimes following cumbersome authorisation procedures.

The advocacy group "Youth Rise for Reform", has warned that an overall ban on certain categories of new psychoactive substances may seriously affect research and availability of such substances for therapeutic purposes. In particular, such bans could hamper the research and use of new psychoactive substances in substitution treatment for illicit drugs, to treat drug addiction[64]. For instance, one substance that has been notified to the EWS is vanorexine, which is being researched by pharmaceutical companies for use in the treatment of cocaine dependence. The advocacy group argues that other substances could be used for drug substitution treatment, but that restriction measures make research difficult.

Table 1.4 provides an overview of the restriction measures applied across the EU on the three substances presented before as case studies - GBL, 1,4 BDO and mCPP:

Table 2: Restriction regimes in Member States

Substance type || Not-restricted/ controlled || Drug control legislation[65] or drug precursor legislation[66] || Other

GBL || BE, CY, DK, EL, ES, LV, LT, LU, MT, NL, PL, PT, SI || AT, BG, CZ, EE, HU[67], IE, IT, RO, SK, UK[68] || Medicines: DE, FI Restricted sale: FR[69], SE[70]

1,4-BDO || BE, CY, DK, EL, LV, LT, LU, MT, PL, PT, SI || CZ, EE, IE[71],UK[72] || FR[73], SE

mCPP || FR, IE, IT, LU, PL, PT, SI, SE, UK || BE, BG, CY, CZ, DK, EE, FI, DE, EL, HU, LV, LT, MT, RO, SK || NL, ES (Medicines Act)

Depending on the type of legislation under which a substance is subjected to restriction measures, only certain uses are allowed at national level, and lack of compliance is sanctioned by either administrative or criminal law (see section 3.4.1. for an overview of national legislation applied to new psychoactive substances). Within a specific restriction regime there may be exceptions and differences between countries.

To be able to research, develop and commercialise a substance after the introduction of restrictions, economic operators must undergo through various procedures, which can be very cumbersome. They entail, in certain cases, a system of licensing and registration as applied to UN-controlled substances, to avoid that they are diverted for illicit uses (for instance, under the UN Conventions, morphine can be traded only under very strict controls, because it is derived from opium and the illicit drug heroin can be manufactured from it). These procedures are different from a Member State to another and the types of uses of substances that are allowed at national level also differ according to the type of legislation applied.

Except for certain uses, for example the use of a veterinary medicinal product for which EU-wide marketing authorisations are available, no mutual recognition of licenses or of nationally authorised uses exists. The result is that operators trading across the borders need to obtain different types of authorisations in different Member States, which creates obstacles to trade in the internal market. This causes additional costs to economic operators that can negatively affect the production, distribution and trade in these substances for legitimate uses.

For instance, certain Member States' regulations require industry and trade operators to register and to apply for individual licences for regular trade in new psychoactive substances. According to a representative of the European Chemical Industry Council (CEFIC), such requirements are a concern for the industry. This is because they hamper legal trade and the free movement of goods within the EU, effectively weakening the functioning of the internal market, by introducing trade restrictions at Member State level.

In relation to GBL and 1,4-BDO, which are chemicals used for legitimate purposes while also being consumed as new psychoactive substances for recreational purposes, as well as to certain pre-precursors[74], CEFIC points out that these are widely used industrial chemicals, serving as critical ingredients in many different products and applications. These substances have an important role in the business activities of certain companies and it would be difficult to find equivalent substances presenting as favourable characteristics in terms of environmental impact and occupational health[75].

Moreover, restriction measures have a chain-reaction impact on economic operators, because these substances are often used in the production of other substances which are used for manufacturing various goods. For instance, the majority of the GBL produced in the EU is used by industrial companies as an intermediate in the manufacturing of other chemicals[76].

According to CEFIC, control measures on these substances, including requirements for a pre-export notification and an export authorization, have serious implications for the industrial use of these chemicals and affect the competitiveness of the EU industry. Depending on the Member State, it may take up to four weeks for a company to obtain an export authorization. Thus, just-in-time deliveries to third country customers would be impossible, according to the industry. As a consequence, third country customers will either have to increase their stocks in these substances (which may increase the risk of diversion of the substance in those countries, facilitating trafficking and abuse of the substance for recreational purposes) or alternatively will have to turn to a supplier outside the EU, which is able to supply the required quantity immediately.

The industry therefore points out that such requirements put EU suppliers at a competitive disadvantage and warns about the risk of loss of export business[77]. Intra-company shipments in a globally active company are equally affected by such requirements and control measures, the industry adds.

In addition, the current lack of clarity about how drug control legislation, at national level, and the Council Decision, at the EU level, connect to the internal market and relate to specific internal market legislation, in so far as dual-use substances are concerned, further impedes legitimate trade and affects the functioning of the internal market.

This is because gaps exist between drug legislation, on one hand, and medicines legislation and other relevant legislation (for instance the EU chemicals legislation REACH). The result of such gaps is twofold: the recreational use of certain new psychoactive substances cannot be addressed, because they fall between two regulatory regimes (for instance mCPP, which was neither tackled under the Council Decision, because it is an active substance for a medicine, nor under the EU's pharmacovigilance system, which primarily targets the misuse of authorised medicinal products); and, the legitimate use of certain other substances is impeded by restriction measures introduced to address their recreational use (for instance the use of GBL in industry in the Member States that have subjected it to drug control legislation).

In conclusion, the consequences of the various restrictions applied across the EU are obstacles to trade, legal uncertainty, market fragmentation, uneven level playing field for economic operators and, more broadly, difficulties for companies operating across the internal market or globally. Finally, the lack of predictability of the type of legislation likely to be applied, which can vary depending on the substance and the Member State, and of restrictions that this entails, further increases legal uncertainty for economic operators, which may struggle to adapt their businesses to new requirements or to find alternatives to restricted substances.

Since the number of new psychoactive substances on the market is expected to grow and the variety of restrictions aimed at reducing their availability for recreational use is likely to increase (see section 3.4.1.) the obstacles to legitimate trade that have been identified in this section are expected to be amplified. This is likely to seriously affect the functioning of the internal market.

3.4. Main causes of the problems

The two main causes of the problems identified are:

(1) Divergent national approaches to new psychoactive substances.

(2) Ineffectiveness of the EU instrument on new psychoactive substances.

3.4.1. Cause 1: Divergent national approaches

The Member States have wide discretion in addressing new psychoactive substances and they use different types of legislation to tackle them. Most Member States have their own identification, risk assessment and restriction measures in place, which vary in terms of the level of scrutiny, duration, the stakeholders involved and outcomes.

Overview of legislation used to address new psychoactive substances at national level

Drug control legislation (criminal law-based) is the most common type of regulation applied in all Member States to address new psychoactive substances. Based on the UN Conventions on Drugs (see Annex 9), this provides the legal framework under which the use of psychoactive substances that have been scheduled under the UN Conventions is allowed for specifically authorised purposes, and defines the offences and level of sanctions for illicit trafficking in the scheduled substances. In certain Member States, the use or possession for personal use of scheduled substances is also criminalised.

The UN Conventions provide a control regime and specific schedules for psychoactive substances that have been analysed on the basis of their risk potential and liability for abuse, likelihood to cause harm to health and society, set off against their therapeutic usefulness. Some other uses are allowed, e.g. for traditional (coca leaf chewing) or industrial (hemp) purpose, but under strict conditions and requirements, backed by criminal law.

The second most commonly used instrument to restrict the availability of new psychoactive substances at national level is medicines legislation[78]. The use of medicines law does not imply that the new psychoactive substance is considered a medicinal product.

This legislation enables measures on new psychoactive substances to be adopted quicker than under drug control legislation, which, because it involves criminal law, has longer procedures. Medicines legislation does not criminalise the use or possession for personal use of new psychoactive substances subjected to restrictions. In certain Member States only new psychoactive substances presented in the form of a capsule can be addressed under medicines legislation, but not those marketed and sold as a white powder without packaging. At least 11 Member States have used medicines legislation to restrict new psychoactive substances[79].

Certain Member States also use general consumer protection legislation[80] - product safety[81] or food safety legislation[82] - and legislation relating to dangerous chemicals[83] to address new psychoactive substances. For instance the Netherlands, the UK and Italy have applied food and product safety legislation to regulate the market for certain, mostly natural, new psychoactive substances.

In the UK, since mephedrone was labelled as "plant food" or "bath salts" but the authorities confirmed that it had no such uses, in 2010 the Home Secretary asked local authorities to seize mephedrone under the 2008 Consumer Protection from Unfair Trading Regulations. In addition, the UK has imposed importation bans on certain substances.

In Italy, in 2010 the Executive Board for Prevention and Health Promotion forbade the sale of the product referred to as "n-Joy" and its analogous product "Spice", for violation of the Consumer Code, because it was sold without Italian-language indications. In Poland and Romania economic operators are required to obtain a market authorisation before commercialising products containing new psychoactive substances, but in practice substances that have psychoactive effects are unlikely to obtain such authorisation.

Twelve EU Member States[84] have modified their legislation or have adopted specific legislation in the past years to respond to the increasing availability of new psychoactive substances. The new laws follow different approaches on certain issues such as risk assessment of substances[85], fast-track or temporary emergency procedures (see Annexes 10, 11 and 12), increasing the risk that the responses given to new psychoactive substances will further diverge.

In the majority of Member States the risks posed by the recreational use of each substance are assessed individually. Five Member States implement the "generic risk assessment" approach (assessment of a group of chemically related substances), three use the "analogue" approach (assessing the similarity between the effects of a new psychoactive substance and those of an illicit psychoactive substance), while five Member States do not perform any risk assessment at national level and rely on the system set up by the Council Decision.

These different approaches to risk assessment can lead the Member States to take different decisions on the same substance or to introduce restriction measures on different substances. For instance, certain Member States have recently introduced restriction measures on a host of new psychoactive substances[86] (Bulgaria has adopted restriction measures on 45 substances, the Czech Republic on 33, Latvia on 27, Romania on 44[87]). These measures are backed by either criminal sanctions (particularly if drug control legislation is applied) or by administrative sanctions (if consumer protection, medicine or food legislation is applied), depending on the substance and on the country.

Member States can introduce national restriction measures on new psychoactive substances even before the risk assessment of substances has been completed at the EU level (for example 16 Member States adopted restriction measures on mephedrone before it was submitted to such measures at the EU level).

The substantial differences between the Member States' laws and administrative provisions on new psychoactive substances have adverse effects on consumers using such substances recreationally. This is because uncoordinated decisions by the Member States can lead economic operators in the market for recreational use to relocate from Member States that introduced restriction measures to those with less strict legislation on new psychoactive substances, or with weaker capacities to detect, seize or identify such substances. Consumers in countries with weaker capacities to act on new psychoactive substances are, therefore, exposed to the risks of these substances.

The distributors and retailers of new psychoactive substances for recreational use interviewed in preparation of this impact assessment indicated that they do not intend to break any laws by importing (or exporting) a substance to a Member State where it has been restricted. At the same time, they make use of the opportunity to divert trade to other Member States where there may be demand for the substance and where it has not been restricted. Such displacement of potentially harmful substances between countries can diminish the level of consumer protection across the EU and can lead to ambiguity about the risks of substances.

Geographical displacement

Following the Polish authorities' decision to close around 1,300 shops selling new psychoactive substances in Poland in December 2010[88], Polish companies opened more than 30 shops in bordering countries, including in the Czech Republic, which had not witnessed such shops before. A similar dynamic has been observed between Sweden and Norway, with substances submitted to restrictions in Sweden moving to the market in Norway.

The substantial differences between the Member States' laws and administrative provisions on new psychoactive substances also have significant adverse effects on economic operators in the market for legitimate uses, as section 3.3 has shown. As the case studies on GBL, 1,4-BDO and mCPP have shown, and as the information from the chemical industry representatives and some research have demonstrated, different national approaches make it more difficult for companies to operate across the internal market because they cause obstacles to trade, market fragmentation, and an uneven level playing field for economic operators. They also create legal uncertainty, due to the lack of predictability of the type of legislation that may apply in each Member State.

The industry representatives consulted during the preparation of this impact assessment indicated that the national measures on substances that are used for legitimate purposes while also being consumed recreationally can hamper the free circulation of the good for legitimate uses, create administrative burden - because of the necessity to comply with different national procedures - and ultimately affect the competitiveness of the EU industry.

3.4.2. Cause 2: Ineffectiveness of the EU instrument

The Council Decision, which is a former third pillar instrument, enables the EU to address new psychoactive substances that raise concern at EU level (see page 5 for criteria for substances causing concern at the EU level), without preventing Member States from introducing national measures on substances.

Since 1997, the risks of 13 substances were assessed under the Council Decision and its predecessor, the Joint Action 97/396/JHA. Nine of these substances[89] were submitted to restriction measures and criminal sanctions across the EU. The latest substances submitted to such measures at the EU level were BZP in 2008, mephedrone in 2010 and 4-methylamphetamine in 2013[90]; to implement these measures, Member States usually include the substance within the scope of the national legislation on drugs, which have to comply with the provisions of the Framework Decision 2004/757/2004 on drug trafficking[91].

Many of the almost 280 substances that were not addressed at the EU level, because they did not meet the criteria described above, were tackled by the Member States, individually, and were subjected to various restriction measures, which may differ according to the substance and to the Member State (see section 3.4.1. for an overview of types of national legislation applied to new psychoactive substances). But certain substances were not addressed at national level either, or only in a few Member States, either because public authorities did not have sufficient information about these substances to adopt measures or because the substances disappeared from the market quickly.

The Commission's assessment report[92], which was based on an extensive consultation of Member State stakeholders, concluded that the Council Decision is a useful instrument for tackling new substances at the EU level, but that it has several major shortcomings, including:

(1) It is slow and reactive, and it is therefore not able to address effectively the increase in the number of new psychoactive substances.

(2) Insufficient evidence is available to take appropriate and sustainable decisions under this instrument.

(3) It lacks options for restriction measures.

(1) Slow and reactive instrument

The speed at which new substances emerge on the market and spread across the EU challenges the capacity of the instrument to respond: 17 Member States believe that the decision-making procedure under the Council Decision is too slow[93]. The Council took the decisions on BZP and on mephedrone 15 months and 12 months respectively after the launch of the procedure, with a joint report, and during this time these substances caused serious concern across the EU. In addition, from the moment when the Council decides to submit a substance to control and criminal sanctions, Member States have a year to adopt national legislation to that effect.

There are two reasons why the decision-making process under the Council Decision is slow:

(a) The decision whether to introduce restriction measures on a substance can be taken only after the completion of a risk assessment. Risk assessments are essential for making the appropriate decision on a substance. But a risk assessment needs time to be completed because limited information is readily available to the EMCDDA Scientific Committee (see point (2) in this section), and because a thorough review of this evidence is needed to identify the risks that a substance poses. However, public authorities are sometimes under pressure to act quickly, in particular when a substance causes immediate concern, for instance because fatalities were reported in connection to the substance.

To address this, more than half of the Member States use various fast procedures, urgency procedures or temporary emergency measures. Nine Member States have fast-track procedures for adopting restriction measures on new psychoactive substances. Some also have the possibility to introduce temporary measures – for example, in Germany a substance can be taken off the market for a period of at most one year.

The Council Decision does not provide for this possibility at the EU level. The Commission's assessment report showed that 18 Member States would favour temporary emergency market restrictions at the EU level for substances causing concern of an immediate nature, pending their risk assessment. One Member State suggested that substances submitted to risk assessment at the EU level should always be subjected to temporary restrictions across the EU, until the risk assessment is completed.

(b) The decision-making procedure to introduce restriction measures is lengthy. The Council Decision foresees that, after completion of a risk assessment, the Commission can table a legislative proposal for restriction measures backed by criminal sanctions, which the Council shall adopt by qualified majority, following which Member States need to adopt national legislation to submit the substance to such restriction measures.

Because of the length of this process, many Member States, which were under pressure to act quicker because of public concerns relating to possible risks of substances, have pre-empted EU-level decisions (see section 3.4.1.).

In addition, certain Member States consider that the Council Decision is reactive and unable to anticipate or to slow down developments in the market for new psychoactive substances, because as soon as a substance is submitted to control measures, new ones are often developed to replace it, possibly because the Council Decision does not foresee the possibility to address groups of substances. The consequence of this is that public authorities lag behind market developments.

(2) Insufficient evidence to take decisions

The lack of knowledge about the emergence of new psychoactive substances, their effects, risks, modalities and prevalence of use undermines the effectiveness of the Council Decision and the capacity of decision-makers to provide swift and proportionate responses. Unless a substance has been used or studied for various purposes, for instance as a potential active substance for a medicinal product, there is scarce information on its properties, toxicology, pharmacology and long-term effects.

Member States' authorities point out that major gaps exist in the evidence base underpinning decisions taken on new psychoactive substances at EU level, ranked as follows[94]:

- Lack of evidence on the effects of these substances on human health (59%).

- Lack of capacity to monitor the emergence of new psychoactive substances (36%).

- Lack of evidence on the involvement of criminal groups (36%).

First, the EU decisions on restriction measures on substances are often taken on the basis of limited and sometimes insufficient evidence. The risk assessment reports on BZP and on mephedrone acknowledged that insufficient evidence was available on the harms caused by the substances. The main reasons for this are that Member States do not have sufficient information and that limited research is conducted on new psychoactive substances. At the same time, the Council Decision does not envisage support for research, analysis and testing of new psychoactive substances causing concern at the EU level, which are essential in order to determine the risks of a substance. Furthermore, there is very limited information available on the prevalence of use of a substance, and on the type and frequency of use, which would help ascertain the potential risks to public health and to society.

Restriction measures underpinned by criminal sanctions that are not based on substantial and reliable evidence about the risks of the substance in question can unduly hurt economic operators. They can also undermine the credibility of the mechanism and the effectiveness of the measure: if consumers have the impression that the decision to restrict the availability of a substance was not backed by convincing evidence about its harms, they are more likely to continue using it, potentially also buying it from the black market.

Secondly, limited information is available about the overwhelming majority of substances, those which have not been submitted to risk assessment at EU or national level. Since 2005, around 2% of the substances notified by the Member States through the EWS have been assessed by the Scientific Committee of the EMCDDA (five out of around 230[95]). Information is collected on the other notified substances when available, but there is no possibility to conduct analysis and research on the chemical properties, risks and prevalence of the different groups of substances or on their interaction following – for example – combined use.

The Council Decision does not require Member States[96] to monitor substances which they notify through the EWS or those that were subjected to a joint report, risk assessment or to restriction measures at the EU level. Furthermore, existing drug surveys do not cover new psychoactive substances that have been recently submitted to restriction measures. On the other hand, the EMCDDA does not currently have the mandate or the capacity to monitor all substances notified by the Member States.

In addition, very few Member States (the UK, Ireland, Luxembourg) proactively monitor the market for new psychoactive substances, for instance via controlled test purchases, in order to spot emerging trends early, before harmful substances are disseminated across borders.

The fact that there is no systematic monitoring of substances with a heightened risk profile notified through the EWS (e.g. to obtain information about their availability, use and effects), weakens the capacity to analyse, at EU or national level, this rapidly evolving market, to anticipate developments, the emergence of new substances, to react quickly and provide the appropriate response. Basing decisions to restrict or not substances on weak evidence about their risks is a major shortcoming, in particular since the Council Decision does not foresee the possibility to review the status of a substance submitted to restriction measures, when more information becomes available.

Member States consulted by the Commission for the preparation of the assessment report[97] pointed out that additional resources should be made available in order to produce information at EU level on new psychoactive substances, notably toxicology, forensic and pharmacological information. Most Member States indicate that substances that are not submitted to risk assessment following a joint report should be actively monitored.

(3) Lack of options for restriction measures

Under the Council Decision, once the risk assessment of a substance is completed, only two options are available for decision-makers: the Commission either presents a proposal to have the substance subjected to restriction measures backed by criminal sanctions across the EU[98], or it presents a report to the Council justifying why it deems it not necessary to do so[99]. If the Council adopts the Commission's proposal to subject the substance to control, Member States will have to include it under the scope of application of their national legislation on illicit drugs, implementing the UN Conventions, broadening the scope of this legislation; since this national legislation on illicit drug trafficking has to comply with the Framework Decision 2004/757/JHA on drug trafficking, the rules on the definition of offences and levels of sanctions defined in that EU instrument will consequently apply to the new psychoactive substance.

However, new psychoactive substances have a varying potential to pose risks and the decisions on them should be proportionate to those risks. A more graduated choice of measures would therefore be appropriate, in order to ensure that restriction measures underpinned by criminal sanctions are applied as an instrument of last resort to punish and deter behaviours that involve substances posing severe health, social and safety risks.

Decision-makers may be more likely to introduce restriction measures backed by criminal sanctions, when the only alternative would be to take no action on the substance at all, even if they have inconclusive evidence about its risks. This is because they would apply the precautionary principle.

Restriction measures backed by criminal sanctions can be effective in reducing both the availability of substances that pose severe risks to individuals and to society, and the demand for such substances, because of their deterrent effect. They can be effective in particular if they are introduced in the early stages of a substance's 'use curve', when it emerges on the market[100], especially if they are accompanied by prevention measures. Criminal sanctions are more likely than administrative sanctions to be effective in the case of substances available on the black market. Therefore, a targeted use of criminal sanctions can be effective.

At the same time, criminal sanctions may sometimes have adverse consequences. One such consequence is that the trade in a substance can move from the licit to the illicit market, boosting the involvement of organised crime in this market and its revenues[101]. This is likely to happen in particular when users of the substance submitted to restriction measures are not convinced that the substance is harmful, because the measures were not based on a robust assessment of its risks. In this case, they are more likely to continue buying the substance, on the illicit market.

Effects of the introduction of restriction measures

1) Mephedrone in the UK

An annual online survey[102] among heavy users ("clubbers") showed that the submission of mephedrone to criminal law in the UK was successful in reducing the availability of the substance in the market, as last-month prevalence of use among "clubbers" decreased from 33.6% in 2010 to 25% in 2011. However, the supply of the substance shifted towards the black market: sale via drug dealers more than doubled (58%); price increased from €14.6 in 2010 to €24 in 2012, while perceived quality decreased (in 2010, quality was perceived to be excellent by 60% and good by 30%; in 2011 these percentages were respectively 7% and 32%, with 80% of users thinking that mephedrone had been mixed with other drugs; in 2012, 46% of respondents thought that quality worsened).

2) BZP in New Zealand

BZP was widely available and used in New Zealand before being subjected to drug control measures in 2008. Its availability dropped considerably following the introduction of these measures, but the substance is now reported to be available, again, on the black market. A study among frequent users showed that those who considered the availability of BZP to be 'very easy' decreased from 98% in 2007 to 15% in 2008, and then increased again to 44% in 2009[103].

The lack of options to restrict the availability of substances, besides restriction measures backed by criminal sanctions (or doing nothing) has as a result that the decisions taken at the EU level are not always proportionate to the risks posed by substances, and may therefore not be effective. In addition, the lack of proportionate and more graduated responses to the risks posed by substances makes it difficult to address substances that have wide legitimate use but that are harmful when used for recreational purposes. For instance, no action has been taken on GBL (see section 3.3.) under the Council Decision because this instrument does not enable a targeted restriction that does not impede the substance's industrial uses.

Member States consulted by the Commission for the preparation of the assessment of the Council Decision[104] pointed out that restrictions underpinned by criminal law should continue to be part of the answer to new psychoactive substances, but most of them argued that such measures are not always the most effective answer and therefore they should not be the only option. A majority of Member States indicated that the current lack of alternatives to criminal control measures, under the Council Decision, is inadequate and that a wider range of options (in particular market restriction measures underpinned by administrative sanctions) should be considered. Fourteen Member States would favour permanent market restrictions backed by administrative sanctions for substances found to pose moderate risks.

In addition, a large number of civil society and citizen stakeholders that took part to the public consultation, as well as respondents to the Eurobarometer survey (see section 2.2.1.), stressed that it is important to diversify away from a criminal justice focus on new psychoactive substances and to make a broader use of consumer protection approaches.

3.5. Who is affected by the problems and how?

Consumers are affected by the presence on the market of harmful new psychoactive substances. They can incur serious risks to their health, because of the harms caused by the recreational use of certain new psychoactive substances. These risks are heightened by the fact that these substances are often sold without sufficient or correct information about administration, dosage, intended effects, potential adverse side effects and interaction with other licit or illicit substances, including alcohol. Moreover, since some of the products presented as being new psychoactive substances – in particular those bought from street dealers – can also contain illicit drugs, users may face additional health and social risks, and may unintentionally break the law when possessing or using such substances.

Society at large is also affected, considering the fact that the frequent consumption of new psychoactive substances can affect social and family life, communities and the social fabric in the society. As with other licit and illicit psychoactive substances, their use can affect road safety and can play a role in violent behaviour and crime.

Economic operators in the market for legitimate uses of new psychoactive substances are affected by the problem, because different restriction measures and requirements imposed by national authorities on specific substances lead to legal uncertainty, impede legitimate trade and may, therefore, disrupt business activities.

Public health institutions, and in particular emergency services, are affected because of the potential adverse health consequences that the consumption of certain new psychoactive substances may provoke, particularly considering the lack of information on their effects and lack of knowledge about effective treatments. Such services may not be equipped to deal with increasing numbers of users suffering from adverse health effects and are often unable to provide appropriate treatments.

Law enforcement authorities and the criminal justice system are also affected. The increasing availability of new psychoactive substances, and the submission to restriction measures backed by criminal law of large numbers of such substances, may be accompanied by some increase in organised criminal activity and may generate public nuisance. In addition, the difference in the legal status of substances that are a problem at the EU level can jeopardise cross-border cooperation (for instance, when a substance is submitted to restriction measures in the requesting state, but not in the requested one).

3.6. How would the problems evolve in the baseline scenario?

Assuming that the current framework will remain unchanged, the problems identified are likely to get worse.

The market for recreational use of new psychoactive substances is likely to grow. Although many factors determine the availability of new psychoactive substances (e.g. consumers' preferences and perceptions, price and channels of distribution), the rapid spread of substances in the EU internal market recorded in the past years is expected to continue for the mid-term future. Considering that the number of new psychoactive substances notified by the Member States tripled from 2009 to 2012 and that thousands of substances can potentially be manufactured at relatively low cost, the market will possibly double by 2020. The health and social costs associated with a growing availability and use of harmful new psychoactive substances would increase proportionally.

The market for legitimate uses of new psychoactive substances is also expected to grow, proportionally to the availability of such substances. Without a more effective EU instrument, replacing the Council Decision, that would enable faster and more proportionate responses to address an increasing number of new psychoactive substances, the problem will become worse. If no action is taken at the EU level, the adverse effects of individual national responses on legitimate trade and on consumer protection will continue and possibly intensify.

Member States will continue to follow their own approaches and certain may revise their national legislation on new psychoactive substances in the coming years to address this challenge. This will result in growing discrepancies between national regulatory frameworks, which may cause further displacement of harmful new psychoactive substances between the Member States, and may further hinder legitimate trade.

Furthermore, in the absence of proportionate measures to address new psychoactive substances at the EU level, a growing number of substances would be subject to criminal law measures, which are not always the most effective way to restrict the availability of substances and could have adverse effects. An additional undesirable side-effect would be the incrimination of many young people in respect of relatively minor offences, for possessing such substances. This would also place a larger burden on the criminal justice system, to investigate, prosecute and trial large numbers of such offences.

Finally, since the involvement of organised crime in the market for recreational use of new psychoactive substances may increase proportionally to the number of substances subjected to criminal law provisions, a further increase in the revenues of criminal networks and in violence associated with rivalling crime groups is expected, causing additional harms to society.

3.7. Right to act and subsidiarity

3.7.1. Legal basis

The EU's competence to act in the area of new psychoactive substances stems from four different provisions of the Treaty on the Functioning of the European Union (TFEU).

Article 114(1) TFEU empowers the European Parliament and the Council to adopt measures for the approximation of the provisions laid down by law, regulation or administrative action in Member States which have as their object the establishment and functioning of the internal market. Article 114(3) TFEU, stipulates that the Commission should aim at ensuring a high level of health, safety and consumer protection in its proposals envisaged in paragraph 1 of Article 114 TFEU.

EU action on new psychoactive substances falls within the scope of action to improve the functioning of the internal market, because:

- It addresses obstacles to trade in the market for legitimate uses of new psychoactive substances, while enabling certain measures to be introduced to restrict the availability on the consumer market of those substances posing risks.

- It provides for a scientific assessment of the risks of substances, which is crucial for enabling a proportionate response, depending on the harms caused by each substance, thus mitigating the impact of restriction measures on legitimate trade.

- It addresses the lack of legal certainty for economic operators in this market, by reducing divergences between national approaches and harmonising the response given to substances causing concern at the EU level.

- It connects the market for legitimate uses in new psychoactive substances to the wider internal market, by tackling potential gaps between legislation on medicines, drug control, precursors, chemicals.

The EU also has the obligation to ensure a high level of human health protection in the definition and implementation of all EU policies (Article 168(1) TFEU) and to protect the health, safety and economic interests of consumers (Article 169(1) TFEU).

The aim of the envisaged proposals is to make use of the tools provided by the Lisbon Treaty to act rapidly to ensure that the legitimate trade in new psychoactive substances is not hindered and that the functioning of this market is improved while the health and safety of individuals are protected from potentially harmful new psychoactive substances, which cause concern at the EU level.

For this purpose, the EU should ensure that effective and proportionate measures are in place to reduce the availability and stop the dissemination of potentially harmful substances across the EU, and to submit those proven to cause harm to restriction measures, while avoiding that legitimate trade in such substances is impeded.

To tackle those new psychoactive substances that pose particularly high health, social and safety risks, the EU is empowered to bring such substances within the scope of criminal law provisions, subjecting them to the minimum rules on the definition of criminal offences and sanctions in the field of illicit drug trafficking. This stems from Article 83(1) TFEU.

3.7.2. Subsidiarity: Why the EU is better placed to take action

The EU is better placed than the Member States to take action to restrict the availability in the internal market of harmful new psychoactive substances for recreational use, while simultaneously ensuring that legitimate trade is not impeded.

This is because individually Member States cannot address effectively and sustainably the rapid emergence and spread of these substances. Uncoordinated national action produces knock-on effects on other Member States (displacement of harmful substances) and hinders the operation of the internal market as far as legitimate trade in such substances is concerned. Moreover, the proliferation of diverse national regulatory regimes tackling these substances is likely to increase, further hampering legitimate trade. For these reasons, EU action would ensure higher efficiency.

(i) Necessity test

There is a clear need for EU action on new