Austrian court deals first blow to proposed tobacco monopoly on hemp flowers

A decision by the Federal Finance Court (BFG) has dealt the Austrian authorities their first blow. who are trying to bring in hemp flowers as part of the tobacco monopoly of the country.

This decision concerns the seizure of hemp-based products sold via vending machines, a business model that has become widespread on the Austrian market for low-THC cannabis products.

At the heart of the matter lies RETO Concept GmbH, a Salzburg-based company owned by the entrepreneur Thomas Reisenhofer, which distributes hemp-based products via vending machines known locally as « Hanfomat ». In March 2025, Austrian customs seized hemp flowers belonging to the company, arguing that the sale violated Austrian tobacco monopoly regulations.

The court has now ruled that the seizure was illegal, effectively rejecting the legal justification put forward by the customs authorities.

Court rejects tobacco monopoly argument

Customs had relied on an earlier decision by the Administrative Court (VwGH) dated autumn 2024 (Ro 2024/16/0006-6), using it as a basis for asserting that dried hemp flowers should fall under the tobacco monopoly rules. But the Federal Finance Court disagreed, finding that the ruling cited did not really establish such a broad interpretation.

According to the’Austrian Cannabis Association (ÖCB), The BFG made it clear that the VwGH's decision «does not rule on the extent to which dried hemp flowers are subject to the tobacco monopoly», and that mere reference to it «is not sufficient» to justify a violation of the monopoly law.

For the ÖCB, this ruling is an important confirmation of what it has been arguing for months: cannabis is not tobacco, Hemp products should not automatically be treated as tobacco products under Austrian law.

«This ruling clearly shows that the authorities» approach had no sound legal basis. The attempt to systematically place hemp-based products under the tobacco monopoly has failed", said ÖCB's President, Klaus Hübner, quoted in a press release issued following the decision.

A broader political battle over legal hemp

This case is part of a wider national debate on how Austria should regulate the hemp and CBD sector. While the BFG's decision addresses the legality of a single seizure, it also highlights the legal uncertainty surrounding enforcement practices.

The ÖCB has repeatedly criticized what it sees as inconsistent decisions by the authorities, arguing that legally operating companies are being subjected to arbitrary measures. Mr. Hübner described the decision as a victory for «legal certainty over arbitrariness».

The association had previously backed up its position with legal analyses, including an expert opinion from the constitutionalist Prof. Heinz Mayer, The tobacco monopoly framework was misapplied when used against hemp flowers.

«This decision confirms this view and strengthens all companies that operate within the law,» said Hübner.

Transitional period until 2028, but the conflict persists

Despite the court ruling, Austria's political orientation seems to be moving towards stricter control. In December, the National Council approved a reform of the tobacco monopoly, which the’Monopoly administration presented as evidence of a clarification of the legal framework.

As part of this reform, a transitional period will remain in force for hemp and CBD stores until the end of the year 2028. After this deadline, low-THC cannabis products would fall under the tobacco monopoly system, meaning that they could only be purchased from authorized wholesalers and sold by licensed tobacconists.

This approach has divided stakeholders. While representatives of tobacconists have welcomed the prospect of exclusive sales rights, the ÖCB continues to oppose it, insisting that legal hemp can be sold outside the tobacco retail network.

The association has also announced its intention to challenge the monopoly restrictions before the French Supreme Court. Constitutional Court and claims that the BFG's decision strengthens its position.

For the time being, this decision is interpreted as a victory for hemp companies operating outside the traditional tobacco retail channels, particularly those experimenting with automated sales via vending machines.

Nevertheless, the conflict remains unresolved. While the BFG ruled against the customs office in this particular case, the evolution of Austrian cannabis policy augurs further legal and political battles to come.

«We now need a clear legal framework that creates legal certainty and strengthens the legal market, rather than hindering it,» said Hübner.