BREAKING NEWS: FDA and USDA Start Making Sense on Hemp CBD

According to Hemp Industry Daily reporter Laura Drotleff, it an eventful week for hemp regulation at the National Association of State Department of Agriculture (NASDA) meeting in Arlington, Virginia. Drotleff reported on two major developments at NADSA. These developments came from the Food and Drug Administration (FDA) and the US Department of Agriculture (USDA), respectively, which are the primary regulators of hemp and its derivative products. Both are analyzed below.

FDA Changing Its Tune on Hemp CBD?

FDA Commissioner Stephen Hahn, M.D., said that the agency is working towards regulating hemp-derived CBD (Hemp CBD) products and admitted that the agency’s approach to Hemp CBD is not sustainable:

We’re not going to be able to say you can’t use these products. It’s a fools errand to even approach that[.] We have to be open to the fact that there might be some value to these products and certainly Americans think that’s the case. But we want to get them information to make the right decisions.

Finally! The FDA is finally taking a rational approach to Hemp CBD. This is a major departure from the FDA’s recent messaging on Hemp CBD and it’s coming from the head of the agency.

It was only three months ago, on November 25, 2019, that the FDA sent out a whopping 15 warning letters to companies selling CBD and issued a consumer update stating that CBD was dangerous and could harm people before they even knew the harm occurred. Now, Dr. Hahn is admitting that the agency sees value in Hemp CBD and wants to make sure that consumers get enough information to make the right decision. Good! That’s what the FDA should be doing instead of constantly repeating that most Hemp CBD products are unlawful.

Now I know what you’re thinking: Aren’t you getting a little over-enthusiastic about a single statement on Hemp CBD? It’s not as if the law has changed or the FDA’s actually issued any regulations on Hemp CBD. Plus, hasn’t the FDA made positive statements on Hemp CBD before?

Yes, it’s true that Dr. Hahn has not established a regulatory framework for Hemp CBD with his statements, or convinced Congress to alter the Food, Drug and Cosmetic Act (FDCA) to accommodate Hemp CBD. It’s also true that before leaving his post, former FDA Commissioner Scott Gottleib, M.D., testified to Congress that “[w]e believe [CBD] does have therapeutic value and has been demonstrated[.]” That being said, there is reason to be excited the statements made in Arlington because of who said it and who heard it.

Let’s start with Dr. Hahn. The FDA’s issue with Hemp CBD stems from the FDCA’s “Drug Exclusion Rule” which, simply put, means that an article that has been approved or investigated as a drug cannot be a dietary supplement or be added to food unless the article was marketed as a supplement or food before it was investigated. CBD has been approved as an article in the drug Epidiolex and the FDA does not believe that CBD was marketed as a food or supplement prior to that investigation. But, the FDCA grants the FDA Commissioner can override the Drug Exclusion Rule by issuing “a regulation, after notice and comment, finding that the article would be lawful under [the FDCA].”  As head of the FDA, Dr. Hahn has the ability to regulate Hemp CBD so his statements are important.

Now, let’s talk about the audience which was made up of representatives from state departments of agriculture across the country. We’ve been doing a series on how states treat Hemp CBD and if you’ve been following it you know that states have been struggling to regulate Hemp CBD in light of the FDA’s position. Some states have regulated Hemp CBD despite the FDA’s slow movement, others are locked into the FDA’s policy, banning Hemp CBD in foods and dietary supplements. Many are somewhere in between, trying to figure out how the FDA will act. A positive statement like this from Dr. Hahn, made directly to the NASDA is likely to have ripple effects on enforcement policies across the state. This doesn’t mean that everything will change overnight, but I think it does portend a change in Hemp CBD policy across the US.

USDA Ditches DEA Registration

Drotleff also covered a very promising statement from USDA Undersecretary Greg Ibach, who told the NASDA that the USDA has reached an agreement with the Drug Enforcement Agency (DEA) to remove the requirement that only DEA-registered labs test hemp for THC. The DEA wrinkle was not part of the 2018 Farm Bill but was included in the USDA’s interim hemp rules issued in October.

The DEA registration was widely opposed by the agriculture community. Requiring DEA registration on all labs testing hemp creates a huge potential for a bottleneck as all hemp must be tested 15 days before harvest and there are less than 50 DEA-registered labs that could even undertake these tests. Many state departments of agriculture saw this as such a burden that they decided not to even submit a hemp cultivation plan to the USDA, electing to run out the clock with the 2014 Farm Bill, which expires October 31, 2020, rather than operate under the USDA’s interim rules and 2018 Farm Bill. The DEA Registration was a big part of this.

There are still challenges in THC testing, including the need to test for Total THC (delta-9 THC and THCA), which has caused some cultivars of hemp that would have been legal under the 2014 Farm Bill to fail under the 2018 Farm Bill). Still, this is a step in the right direction and quite promising, considering that the USDA will again accept public comments after the 2020 season.

Conclusion

The USDA and FDA are the two federal agencies directing the domestic hemp market. This process is far from over, but the NASDA meeting indicates that policy is moving in the right direction. If nothing else, these agencies are cognizant of how their decisions are perceived by the public and by state regulators. If you’re interested in hemp and Hemp CBD, stay focused on the FDA and USDA and make sure to participate in the public discourse.

Hemp CBD Across Europe: The United Kingdom

The enactment of the 2018 Farm Bill and the legalization of hemp and hemp derivatives, including cannabidiol (“CBD”), has led to a massive CBD craze in the United States. The highly coveted cannabinoid is infused with everything: bath bombs, dog treats and even workout clothes (yes, workout clothes!). According to a recent study by Cowen, the sales of these products are expected to reach $16 billion by 2025.

Thanks to globalization, this sudden boom is not contained within the U.S. borders. Europe has also experienced a huge uptick in the sales of these products, which are expected to reach nearly $1.7 billion by 2023.

In light of this global expansion and the desire of many of our clients to export their hemp and hemp-derived CBD (“Hemp CBD”) products to Europe, we are presenting a mini-series that briefly analyses how certain European countries treat hemp and the sale and marketing of hemp-derived CBD. We begin by analyzing the laws of the United Kingdom (“UK”).

Hemp

Because industrial hemp falls under the definition of genus Cannabis, UK law treats it as a controlled drug in Class B of The Misuse of Drugs Act 1971 (“MDA”) and Schedule 1 of The Misuse of Drugs Regulations 2001 (“Regulations”). Under these Regulations, a license must be issued in order to lawfully cultivate the crop.

As a former European Union member, the UK limits the lawful cultivation of hemp strains to those found in the European Commission’s catalogue, all of which produce no more than 0.2% THC. Generally, UK law also requires that hemp from “third countries”’ be imported under a license.

Although hemp cultivation is lawful, UK farmers are prohibited from processing hemp flowers and leaves, where the highest CBD content can be found. Consequently, the processing of hemp into CBD oil is not permissible, forcing the country to heavily rely on the importation of CBD to sustain the market. In addition, the sale of CBD flowers and buds is strictly prohibited in the country even if the THC concentration is below 0.2% and from EU-approved origin.

Hemp CBD Products

In the UK, Hemp CBD products may be commercially sold so long as they:

  1. contain no more than 1 mg (0.01%) of THC and/or of any other controlled cannabinoid, such as THC-V; and
  2. make no health claims about their therapeutic values.

Other requirements may apply based on the category of products at issue.

Hemp CBD Foods

As we recently discussed, the Food Standard Agency (“FSA”), the agency responsible for protecting public health in relation to food in the UK, recently cleared a path for the sale of Hemp CBD food. Specifically, the FSA is giving the CBD industry until March 31, 2021 to submit valid novel food authorization applications to ensure these products meet specific safety standards. Following the March 31, 2021 deadline, only products for which a valid application has been submitted will be allowed to remain on the market. Therefore, for now, the sale of CBD-infused foods is lawful in the UK so long as these products are:

  1. Properly labeled, including free of health claims;
  2. Safe to consume; and
  3. Only contain low/negligible amounts of THC or other controlled substances (i.e., no more than 1 mg).

Hemp CBD Cosmetics

There are no regulations that pertain to the sale and marketing of Hemp CBD cosmetics in the UK. However, even following its exit from the EU, the country strictly regulates the sale of all cosmetics pursuant to the EU Cosmetics Regulation. For more information on these regulations, you can visit the Cosmetic, Toiletry and Perfumery Association (“CTPA“), the trade group that aims to regulate the cosmetic industry and educates consumers about the safety of these products.

Hemp CBD Vape Products

Similarly to US regulations, vape products may be subject to regulation by various governmental agencies depending on their purpose, how they are being used, and whether they contain nicotine and/or tobacco. As of now, no agency has issued Hemp CBD regulations for the sale and marketing of vaping products. All we know, thanks to the Medicines and Healthcare products Regulatory Agency (“MHRA”), is that Hemp CBD vaping products are “less tightly regulated” and that these products should not contain any health claims.

Hemp CBD Pet Foods and Products

Hemp CBD Pet food and pet products are treated as veterinary medicines and thus would require a license before they can be lawfully sold in the UK. There are currently no Hemp CBD products licensed for veterinary use, which means the sale and marketing of these products is unregulated at best, and unlawfully at worse.

So, unlike in the US, the sale and marketing of Hemp CBD foods is the safest category of products a CBD company may sell right now given the fairly clear regulations implemented by the FSA – assuming their products meet all requirements imposed on these products, including no more than 1 mg THC per product.

Hemp CBD Across State Lines: Oklahoma

The Agriculture Improvement Act of 2018 (2018 Farm Bill) legalized hemp by removing the crop and its derivatives from the definition of marijuana under the Controlled Substances Act (CSA) and by providing a detailed framework for the cultivation of hemp. The 2018 Farm Bill gives the US Department of Agriculture (USDA) regulatory authority over hemp cultivation at the federal level. In turn, states have the option to maintain primary regulatory authority over the crop cultivated within their borders by submitting a plan to the USDA.

This federal and state interplay has resulted in many legislative and regulatory changes at the state level. Indeed, most states have introduced (and adopted) bills that would authorize the commercial production of hemp within their borders. A smaller but growing number of states also regulate the sale of products derived from hemp.

In light of these legislative changes, we are presenting a 50-state series analyzing how each jurisdiction treats hemp-derived cannabidiol (Hemp CBD). Today we turn to Oklahoma.

In April 2018, shortly before the passage of the 2018 Farm Bill, Oklahoma enacted the Oklahoma Agricultural Industrial Hemp Pilot Program (OAIHPP). The Oklahoma Department of Agriculture, Food, and Forestry  (ODAFF) passed temporary rules in May of 2018.

At the time that the OAIHPP was established, the 2014 Farm Bill governed hemp and Oklahoma’s program reflects that. According to ODAFF’s website, “a farmer wishing to grow industrial hemp must establish a relationship with a University or college that belongs to the Oklahoma State System of Higher Education and has a plant science curriculum. Once the farmer has a relationship with a University or College they can apply to the Department to receive a license for each cultivation site.”

In April 2019, Oklahoma passed Senate Bill 868, which directs ODAFF, in consultation with the Governor and Attorney General to submit a hemp cultivation plan to the USDA to bring the state’s hemp program in compliance with the 2018 Farm Bill.  According to the USDA website, Oklahoma is currently drafting a hemp cultivation plan.

When it comes to Hemp CBD there is yet another piece of recent legislation in the mix:  Senate Bill 238 which passed in May 2019.  Products containing Hemp CBD, other than pharmaceuticals approved by the FDA (i.e., Epidiolex), must include the following on the label:

  1. The country of origin of the cannabidiol; and
  2. Whether the cannabidiol is synthetic or natural.

SB 238 also states that, “retail sales of industrial hemp and hemp products may be conducted without a license so long as the products and the hemp used in the products were grown and cultivated legally in this state or another state or jurisdiction and meet the same or substantially the same requirements for processing hemp products or growing hemp.” This appears to indicate that Hemp CBD sales in Oklahoma are OK (apologies, I had to have at least one shameless pun).

SB 238 also states that the addition of hemp derivatives, including Hemp CBD, does not make “cosmetics, personal care products, and products intended for human or animal consumption” adulterated. A license is not required to manufacture Hemp CBD products. However, SB 538 does not “exempt any individual or entity from compliance with food safety and licensure laws, rules and regulations as set forth under the Oklahoma Public Health Code.” That clarification does not explicitly mention the Food, Drug and Cosmetic Act or FDA regulation meaning that Oklahoma has left the door open to Hemp CBD products that the FDA opposes, such as foods and dietary supplements.

Oklahoma is still working on its hemp cultivation plan. It may not have the most robust Hemp CBD regulations but SB 238 at least addresses Hemp CBD, which is more than many other states can say.

For previous coverage in this series, check out the links below:

The Sale of CBD Foods Is Legal in the UK (For Now)

Last week, the Food Standard Agency (“FSA”), the agency responsible for protecting public health in relation to food in England, Wales and Northern Ireland (collectively, the “UK”), cleared a path for the sale of CBD-infused food for the next 12 months.

Specifically, the FSA is giving the CBD industry until March 31, 2021 to submit valid novel food authorization applications to ensure these products meet specific safety standards. Following the March 31, 2021 deadline, only products for which a valid application has been submitted will be allowed to remain on the market.

Although the UK recently severed its ties with the European Union, the FSA has opted to align its policy with that of the European Food Safety Authority (“EFSA”). The EFSA guidance on cannabinoids strongly echoes the U.S. Food and Drug Administration (“FDA”)’s in that it mandates that all food products infused with hemp or its derivatives should receive a pre-market approval under the European Union “novel food” regulation because these products were not significantly used as a food or food ingredient before May 15, 1997.

According to the reporting of Hemp Industry Daily, CBD companies wishing to sell into the UK market will send approval plans to the EFSA through the end of 2020, at which point all applications will be transferred to the FSA.

So for now, the sale of CBD-infused foods is lawful in the UK so long as these products are:

  1. Properly labeled, including free of health claims;
  2. Safe to consume; and
  3. Do not contain THC or other controlled substances.

Despite the fact that the FSA gave the green light on the sale of CBD-infused foods, the agency also warned consumers about its potential side effects.

Based on a scientific report issued by the country’s Committee on Toxicity of Chemicals in Food, Consumer Products and the Environment (“COT”), the FSA guidelines warn pregnant and nursing women “not to consume CBD products” and recommends that healthy adults limit their daily dosage to no more than 70 milligrams, which is the equivalent of 28 drops of 5% CBD oil.

After reviewed scientific data of Epidiolex previously used by European and foreign health authorities, including the FDA, for the approval of the drug, the COT concluded that because the data was intended for pharmaceutical and not over-the-counter use, the “trade-off between risks and benefits that does not apply to food.”

Therefore, in drafting this new policy, the FSA opted for a pragmatic approach that balances the consumer demand for CBD-infused food products with the protection of public health and provides much needed clarification about the legality of selling and marketing CBD-infused foods. Nevertheless, the guidelines also create some serious challenges for the industry. Indeed, the novel food application process is a demanding and onerous process. Unless a blanket authorization will cover each end-form of CBD (this issue has yet to be clarified by the FSA), this would mean that only a handful of CBD companies could afford applying. This, in turn, would consolidate these products and offer a monopoly to the companies that manage to secure an approval.

Nevertheless, the FSA guidelines are a step in the right direction, as they  encourage the Hemp-CBD industry to work together, educate and advise, which, hopefully, will inspire the FDA in forging a clear path for the sale and marketing of these products within U.S. borders, too.

Hemp CBD Across State Lines: Ohio

The Agriculture Improvement Act of 2018 (“2018 Farm Bill”) legalized hemp by removing the crop and its derivatives from the definition of marijuana under the Controlled Substances Act (“CSA”) and by providing a detailed framework for the cultivation of hemp. The 2018 Farm Bill gives the US Department of Agriculture (“USDA”) regulatory authority over hemp cultivation at the federal level. In turn, states have the option to maintain primary regulatory authority over the crop cultivated within their borders by submitting a plan to the USDA.

This federal and state interplay has resulted in many legislative and regulatory changes at the state level. Indeed, most states have introduced (and adopted) bills that would authorize the commercial production of hemp within their borders. A smaller but growing number of states also regulate the sale of products derived from hemp.

In light of these legislative changes, we are presenting a 50-state series analyzing how each jurisdiction treats hemp-derived cannabidiol (“Hemp CBD”). Today we turn to Ohio.

Hemp cultivation in Ohio is regulated by the Ohio Department of Agriculture (“ODA”). Notably, Ohio was among the first states that got a 2018 Farm Bill hemp production plan approved by the USDA. Way to go, Buckeyes! People who want to grow hemp in Ohio will need to obtain licenses from the ODA and hemp cultivated there is subject to testing requirements established by the USDA’s interim hemp rules.

When it comes to Hemp-CBD, the state has not dialed in its regulatory regime. The ODA is in the process of reviewing public testimony before adopting rules affecting the processing of Hemp CBD products. In late 2019, there was a public hearing concerning proposed processing rules that would govern many different types of Hemp-CBD products (as of today, those regulations haven’t been officially adopted). It’s important to note that these rules would not let anyone go and start processing. Instead, licenses would be required and it looks like the state’s requirements will be pretty comprehensive.

The products that the rules would govern include “hemp buds, flowers, cigarettes, cigars, shredded hemp, cosmetics, personal care products, dietary supplements or food intended for animal or human consumption, cloth, cordage, fiber, fuel, paint, paper, particleboard, and any other product.” So basically, anything under the sun. Notably, the rules anticipate the production of Hemp-CBD products (e.g., cosmetics and food) but also anticipate the use of hemp in all kinds of other products that will not be marketed for Hemp-CBD content (e.g., paint and fuel). These rules are therefore extremely comprehensive.

These rules would also impose some strict requirements on manufacture, including pretty standard things that our hemp attorneys see in other states. This includes testing and labeling, to start.

In sum, while Ohio probably isn’t anywhere near the top of the list when people think about states that allow hemp, it’s actually more friendly than a lot of other large states (looking at you California). While states like California are still in prohibitionist mode for all kinds of Hemp-CBD products, states like Ohio are taking the wheel. For more updates on Ohio’s Hemp-CBD laws, stay tuned to the Canna Law Blog.

For previous coverage in this series, check out the links below:

The Four Basic Labeling Requirements for CBD Products

Last week, I attended Portland’s Hemp CBD Connex, an annual event that highlights the vast potential of hemp and CBD.

Of interest to me–because my practice focuses on the regulatory framework of CBD products–was a panel entitled “Weeding Through the CBD Jungle: How to Grow, Run and Be Successful.” This panel was led by two experienced industry leaders: Stuart Bennett, VP of Contract Manufacturing for Canopy Growth, and Alex Rullo, Executive VP of Strength of Hope. Both panelists discussed the dos and don’ts of selling and distributing CBD products in interstate commerce and stressed the importance of complying with the CBD laws of each state in which a product is sold. This was music to my ears!

As you already know if you follow our blog, the Food and Drug Administration (“FDA”) has taken the position that CBD-infused foods and dietary supplements cannot be lawfully sold or marketed in the United States. Yet, states have adopted their own approaches to regulating CBD products that are not necessarily consistent with the FDA’s current position.

Some states, including Colorado and Oregon, allow the manufacture and sale of all CBD products, including food, dietary supplements, smokable products, and cosmetic products. Other states, like Idaho, strictly prohibit the production and/or sale of any such products. A handful of other states, including California, have banned certain categories of CBD products (usually food and dietary supplements) but seem to take no issue with the sale of other products, such as CBD cosmetics.

In addition, some states that have legalized the sale of Hemp CBD products impose their own regulations, including but not limited to labeling and testing requirements.

As we previously discussed, CBD manufacturers and distributors selling their products in interstate commerce should familiarize themselves with labeling and marketing laws in each state where they plan on placing their products. As a rule of thumb, companies should adopt the most stringent rules, such as those imposed by Indiana, Texas and Utah, to ensure compliance across state lines.

While it’s impossible to cover all state labeling and marketing laws in one blog post, I thought I would provide a brief overview of the label components that have become standard in the industry:

The FDA’s General Labeling Requirements

Every state that authorizes the sale of CBD products also mandates, in one way or another, that the labels of CBD products sold within their borders be labeled in accordance with the Food, Drug and Cosmetic Act (“FDCA”). Under the FDCA, the labels of any product sold in the United States must contain four basic elements:

(1) An identity statement, which indicates what the product is;
(2) A net weight statement;
(3) A list of all ingredients, which in states like New Mexico and Colorado, must clearly identify hemp and CBD. This requirement makes it difficult for companies that are steering clear from using the term “CBD” in an attempt to mitigate the risk of enforcement action. For more information on this issue, please read here; and
(4) The name and address of the manufacturer, packer or distributor along with their street address.

Scannable Bar Code or QR Code

A growing number of states are mandating the use or a scannable bar code, QR code link or web address linked to a document containing information, pertaining to:

  • the batch identification number;
  • the product name;
  • the batch date;
  • the expiration date, which in some states like Indiana, must be not more than two (2) years from the date of manufacture;
  • the batch size;
  • the total quantity produced;
  • the ingredients used; and
  •  certificate of analysis.
FDA Warning Statement

States like Colorado require that the following statement appear on CBD product labels: “FDA has not evaluated this product for safety or efficacy.”

No Medical or Health Claims

As we have discussed at length, the FDA has limited its enforcement actions against CBD companies that make outrageous and unfounded health claims about the therapeutic values of their products. Nevertheless, many states demand that the labels of CBD products sold within their borders be free of any health claims. It’s important to understand that drug claims don’t need to be explicit. If a company implies that its product can be used to treat a disease, the FDA and local authorities may conclude that the product is a drug.  Consequently, if a CBD company makes any medical, disease, or bodily structure or functional claims or implications about its products, the FDA will likely conclude that the company is marketing unapproved drugs in violation of the FDCA.

Ensuring compliance with the labeling and marketing laws (and policies) of each state in which a CBD product is sold can be challenging, yet it is a crucial step in mitigating the risks of enforcement action by federal and state agencies.

Oregon Cannabis 2020: Legislative Forecast and Report

Last week, Oregon kicked off the 2020 legislative session. Because we are in an even-numbered year, this will be a 35-day session. In short sessions, we tend to see fewer pieces of introduced legislation. The prospects for a productive session may also be lower than usual in 2020, given that House and Senate Republicans are threatening to flee the Capitol again (just like in 2019, to stop a carbon cap-and-trade bill). With respect to cannabis in particular, there may be some general fatigue in Salem on both sides of the aisle.

Still, there are a handful of cannabis bills in the hopper and we expect to see at least one omnibus bill wend its way through between now and March 8. Below, I’ve summarized each bill that is or appears to be substantially related to cannabis on the Oregon legislature’s website. I’ve also conferred a bit with our generous contacts in the legislature, informing some of this commentary.

Senate Bills

Senate Bill 1566.  This bill authorizes the Oregon Liquor Control Commission (OLCC) to create data and analysis “regarding commercial sales and commercial industries.” By and through something called the OLCC Information Technology Infrastructure Fund, the agency presumably would extrapolate and package data on both the liquor and cannabis sides. Sales of this data would be made to industry, or governmental bodies may be interested. The challenge here would be adopting standards to establish exemptions from disclosure of public records, along with the tricky interplay between “proprietary” data and public records law.

Senate Bill 1559.  This bill would prohibit “distributing, selling or allowing to be sold flavored inhalant delivery system products.” It’s a vape ban bill. If passed, SB 1559 would take effect “91 days following adjournment sine die”, which by my calculation is June 7, 2020. This bill will be met with opposition by both the tobacco and cannabis industry, who successfully have litigated (at least, so far) an attempted executive ban on sales of both tobacco and cannabis flavored vaping products.

Senate Bill 1577.  This bill is virtually identical to SB 1559 and also would take effect on or around June 7, 2020. Unlike 1559, it was filed pre-session. But both bills have been assigned to the Senate Committee on Health Care and it’s likely that just one would make it out alive. Should be fun to watch.

Senate Bill 1561. This bill requires the Oregon Department of Agriculture (ODA) to develop an Oregon hemp plan for commercial production and sale. It’s an omnibus bill sponsored in part by Floyd Prozansky, known for crafting much of Oregon’s cannabis legislation over the past several years. SB 1561 also:

  • Directs an “Oregon Cannabis Commission” to determine a framework for future governance of the Oregon Medical Marijuana Program
  • Directs the OLCC to adopt rules for registration of medical marijuana grow sites (an attempt to deal with diversion) and establishes plant production limits (same)
  • Specifies health care providers who may recommend medical marijuana use
  • Merges determinations of guilt for certain offenses related to marijuana into a single conviction, and allows the possession of certain items (this looks like clean-up related to 2017’s sprawling SB 302)

This bill is currently in the Senate Judiciary Committee and will see action this week. If there is one bill that I could single out as most likely to go somewhere, it would be SB 1561, and probably in some gut-and-stuff form. Of all its current ornaments, the hemp plan is likely to remain. And if that happens, Oregon will likely have something to submit to the US Department of Agriculture for certification this year.

House Bills

House Bill 4034. This one mirrors a small component of SB 1561: it directs the OLCC to adopt rules for registration of medical marijuana grow sites and it establishes plant production limits. This bill seems likely to die in the Senate, if it ever gets there.

House Bill 4035. This bill directs OLCC, ODA, the Oregon Health Authority (OHA) and the Governor’s office to “develop a plan to address issues related to regulatory authority over marijuana.” The bill would take effect immediately and sunset in 2021. Like HB 4034, this one is probably going nowhere.

House Bill 4051. This lengthy submission establishes an Oregon Hemp Commission, similar to other commodities commissions around the state. The Commission would be responsible for developing, maintaining and expanding state, national and international markets for Oregon hemp. This bill is a wild card. Maybe it passes on its own, maybe it dies, or maybe it gets rolled into an omnibus bill. But it seems like a great idea.

House Bill 4072. This industry-supported bill is somewhat similar to HB 4051, although it amends existing statutes rather than cutting from whole cloth. HB 4072 directs ODA to administer an Oregon Hemp State Program for “studying growth, cultivation and marketing of hemp.” It also requires ODA to “conduct criminal records checks of applications for licensure related to hemp.” It’s possible that some of this leaches into HB 4051, but it would be surprising if the bills both went the distance, especially given that each creates a “fiscal impact” which triggers budget review.

HB 4078. This bill is similar to SB 1559. It prohibits “remote sales of inhalant delivery systems” which the bill also defines carefully at Section 1(5)(a). This bill was requested pre-session by Governor Brown herself and has been moving along briskly, already receiving a third reading and “do pass” recommendation. This bill contains an emergency clause and would take effect immediately.

HB 4088 – This bill directs OLCC to establish a Cannabis Social Equity Program to provide discounted licensure fees and other support to program participants. This bill seems to be moving a bit with a work session scheduled today, February 12. Beyond that it is hard to know what will happen, but a serious discussion around this issue at the statewide level is a long time coming.

HB 4156. This skeletal bill directs ODA to advance the design of a cannabis business certification program. The idea is to promote market-based approaches to incentivize low-carbon cultivation techniques that use water and energy efficiently. Seems like a good idea! A grant of $300,000 would come from the OLCC’s Marijuana Control and Regulation Fund and the bill would take effect July 1, 2020.

HB 4158.  In some respects similar to bills covered above, this one directs ODA to develop an Oregon Hemp Plan for commercial production and sale. It also requires OLCC to track commercial cannabis shipments (of all types) through an electronic tracking system and make that information readily available to law enforcement. This is an omnibus bill at present and includes clean-up of criminal offenses sprinkled throughout SB 302. HB 4158 is currently in the House Committee on Agriculture and Land Use. It saw some early action, but nothing appears to be scheduled going forward.


All in all, the next month should be eventful. Interested parties can reasonably expect Salem to produce one or two impactful pieces of legislation related to Oregon cannabis, chiefly on the hemp side. We will check back in after March 8. And if there are any major developments between now and then, we will cover those too.

Hemp CBD Across State Lines: North Dakota

The Agriculture Improvement Act of 2018 (“2018 Farm Bill”) legalized hemp by removing the crop and its derivatives from the definition of marijuana under the Controlled Substances Act (“CSA”) and by providing a detailed framework for the cultivation of hemp. The 2018 Farm Bill gives the US Department of Agriculture (“USDA”) regulatory authority over hemp cultivation at the federal level. In turn, states have the option to maintain primary regulatory authority over the crop cultivated within their borders by submitting a plan to the USDA.

This federal and state interplay has resulted in many legislative and regulatory changes at the state level. Indeed, most states have introduced (and adopted) bills that would authorize the commercial production of hemp within their borders. A smaller but growing number of states also regulate the sale of products derived from hemp.

In light of these legislative changes, we are presenting a 50-state series analyzing how each jurisdiction treats hemp-derived cannabidiol (“Hemp CBD”). Today we turn to North Dakota.

In 2019, North Dakota legalized the cultivation of hemp under the 2014 Farm Bill. However, the new law (HB 1349) does not address the regulation of Hemp-CBD products.

According to guidelines released by the Attorney General (AG), the state seems to defer to FDA guidance when regulating Hemp-CBD products. In addition, even following the enactment of HB 1349, which excludes the term “hemp” from marijuana, law enforcement remained hostile to Hemp-CBD making the sale of these products in the state risky.

Given that the state has decided not to submit a plan under the 2018 Farm Bill and instead continues operating under the 2014 Farm Bill until it expires on October 30, 2020, it seems unlikely that North Dakota will change its position on the sale of these products. So for the time being, CBD companies should refrain from selling their products in this not-so-hemp-friendly state.

For previous coverage in this series, check out the links below:

February 14th in Las Vegas: Harris Bricken Presents at the USA CBD Expo

Harris Bricken cananbis attorneys Nathalie Bougenies and Griffen Thorne will present at the “Nation’s Largest CBD Event” in Las Vegas on February 14th. This Main Stage panel begins at 12pm, and will examine the complex and ever-evolving regulatory framework of hemp CBD.

Nathalie, who has written extensively on market regulations and trends, will address ongoing marketing and labeling requirements. Griffen, who regularly writes about the California CBD industry, will speak to standard legal practices, as well as pitfalls our CBD attorneys often encounter in that state and elsewhere. Rounding out the panel will be Jesse Bader and Jason Drangel from the law firm of Epstein Drangel, and Julian Garcia with USC Gould School of Law,

If you are joining the hundreds of industry professionals descending on Las Vegas next weekend for the USA CBD Expo, this panel will be a great chance to hear from some of the most prominent legal voices in the market.

For more information:

  • The Las Vegas USA CBD Expo is running from February 13th through February 15th. The full schedule can be found here.
  • Industry Buyer and Professional tickets are still available for purchase here.

What To Consider Before Entering the European CBD Market

This past year, the cannabidiol (“CBD”) craze has taken the world by surprise, showing remarkable prospect for economic growth.

According to BDS Analytics and Arcview Market Research, the CBD market is expected to surpass $20 billion by 2024 in the United States alone. Europe has also witnessed a huge demand for the most coveted cannabinoid, whose market, Brightfiled Group predicts, will grow by 400% by 2023.

Unlike the U.S. CBD market, the European CBD market is just beginning to take hold with both product availability and consumer awareness being quite limited. Consequently, Europe offers great opportunity for U.S. CBD brands to enter and expand their existing business in a less competitive atmosphere. Nevertheless, entering the European market is not as easy as it may seem.

European markets are complex, particularly when it comes to hemp-derived CBD (“Hemp CBD”). Indeed, the Old Continent is composed of 44 countries, 28 of which are member states, that have adopted 24 different languages and apply their own sets of laws and regulations. With this in mind, we now turn to the three main challenges international Hemp CBD players should consider before venturing into the European Hemp CBD market.

  1. Novel Food Regulations 

The main challenge in selling Hemp CBD products in Europe is that the European Foods Safety Authority (“EFSA”) has classified the most coveted cannabinoid as a “novel food” ingredient. “Novel food” is “food that was not used for human consumption to a significant degree within the Union before 15 May 1997, irrespective of the dates of accession of the Member States to the Union.” Pursuant to EU regulations, anyone who wishes to sell food containing a “novel food” ingredient must first secure a license from the EFSA.

Although the European Industrial Hemp Association and the Cannabis Trades Association have challenged this guidance, a handful of European countries such as Spain, Italy, and Austria have already taken enforcement actions against Hemp CBD products on the basis of being “novel foods.” Therefore, much uncertainty remains regarding the legality and regulation of these products.

  1. Different Laws and Regulations

Another challenge associated with entering the European market is the fact that each country is implementing its own set of rules and regulations pertaining to importation, manufacturing, testing requirements and distribution. Of particular relevance to the Hemp CBD industry is the lack of clarity or consistent guidance regarding the acceptable levels of THC in Hemp CBD products. For instance, the United Kingdom authorizes the sale of products with a THC concentration of less than 0.1% whereas the Netherlands and Switzerland allow products that contain less than 1% THC.

  1. Different Languages

Foreign Hemp-CBD manufacturers and distributors will also need to ensure that their product labels comply with varying labeling and marketing laws. Take for example Belgium. Although the country is only composed of roughly 11 million inhabitants, it has adopted three official languages: French, Flemish (a Dutch dialect) and German. Consequently, any label of products imported to Belgium must be written in all three languages.

To shed additional light on these considerations, our firm will soon present a blog post series of some of Europe’s Hemp CBD laws. Stay tuned!