Hemp CBD Q&A – A Few Extra Questions and Solutions

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Hemp CBD Q&A – A Few More Questions and Answers

September 17th Itogether with my colleagues, Attacks Thorne and Vince Sliwoskiheld a webinar entitled "Hemp CBD Q&A", a recording of which available on our blog.

During the webinar, we received more questions than we could answer. So today we're going through some of these remaining questions.

  1. Does a state have a model law that regulates the licensing of state hemp processors?
    Many states, including Oregon and Colorado, specifically regulate the processing of raw hemp. However, there is no uniform licensing program across national borders. However, most states that allow processing require processors to obtain a license from their state Department of Agriculture and comply with a variety of regulations, including but not limited to testing and recording requirements.
  2. If the THC percentage changes over time in storage, is there a legal risk for the warehouse for violations or for the producer / owner? In light of the Drug Enforcement Administration's recently published Final Provisional Rule (the “Rule”) anyone handling hemp containing more than 0.3% THC on a dry weight basis is at risk of criminal liability. The rule partially stipulates that "any such (cannabis) material that contains more than 0.3% D9-THC on a dry weight basis remains controlled in Appendix I." stored so that the risk of THC fluctuations is reduced.
  3. Do I need a specific license in the states I sell if I'm a wholesaler interested in selling hemp FDA compliant items in the US?
    It depends on the condition. You would need to review the applicable state laws and regulations and determine if any state and / or local licenses, permits, or registrations apply to wholesalers.
  4. What are the developments in payment processors accepting CBD? Most banks still seem on the sidelines, and the fees for CBD retailers are DOUBLE
    This problem remains unsolved and unregulated. Payment processors apply subjective guidelines on whether to partner with hemp CBD companies and whether to process payments for finished hemp CBD products. This is partly due to the gray legality of hemp CBD products. At the federal level, the FDA is having problems selling and marketing CBD foods made from hemp because the agency approved CBD as a drug ingredient before those products were marketed as food and dietary supplements. Still, states have chosen their own legal approaches to regulating hemp CBD products that are not necessarily in line with the current position of the FDA and / or that violate that position altogether. Accordingly, due to this conflicting legal framework, hemp CBD companies are placed in the high risk category, making securing merchant accounts more difficult and expensive. Since CBD accounts are often closed, hemp CBD companies are advised to open multiple accounts as a backup plan. It is also recommended to work with brokers who specifically support hemp CBD companies and who know exactly which payment processors work best with the industry.
  5. We are a large commercial (public) cold store group. We were asked to store industrial hemp in our buildings. Our concerns relate to insurance coverage, risk management, and storage of legal products. Ask:
    (1) How can we check whether industrial hemp is produced by a certified (legal) producer? You should obtain the grower's license number and contact the state Department of Agriculture where they work to verify that their license has not expired, suspended, and revoked.
    (2) How can we check whether the Delta 9-THC% is at or below the legal limit of 0.3%? You should request a certification of analysis (“COA”) from the grower for pre- and post-harvest testing from an accredited laboratory to ensure the hemp meets the 0 THC limit set by the laws of the state where the hemp is located , 3% never exceeds cultivated. In addition, you should ask the grower whether they use packaging and storage methods and precautions to reduce the risk of THC fluctuations after harvest.
    (3) Are there FDA or USDA guidelines in support of these two questions? No, the FDA only regulates certain categories of finished hemp products, including food, beverages, pharmaceuticals, cosmetics, and tobacco products. Therefore, the agency would not regulate raw hemp. Additionally, the FDA has not yet regulated the manufacture, sale, and marketing of finished hemp products. When it comes to the USDA, which oversees the production of hemp, it has rules in place, some of which govern the storage of harvested hemp before the harvest is delivered for further processing. USDA regulations mandate that these storage locations must be listed on the producer's license, especially if the hemp is being tested so that the agency or state that oversees hemp production can have access to that hemp to conduct inspections.
  6. Are there any updates on a timeline for FDA approval?
    I am assuming you are referring to the FDA approval for the sale and marketing of hemp CBD foods, beverages, nutritional supplements, and other finished products as pharmaceuticals. In May, the FDA submitted a proposal to the White House Office of Administration and Housekeeping ("OMB") entitled "Cannabis and Cannabis-Derived Compounds: Quality Considerations for Clinical Research," which OMB reviewed in July. The plan has yet to be released, but according to a statement by an FDA spokesman, the plan could affect the agency's approach to developing regulations for finished hemp CBD products. The FDA is also asking the public for input into regulating these products, but remains unhappy with the studies presented to support the safety and effectiveness of CBD.Hemp. Stakeholders and Congress continue to put pressure on the agency to regulate these products as dietary supplements. Unfortunately, it is unclear when the agency will issue regulation proposals.

Thanks to everyone who participated. We are planning more webinars by the end of the year. So keep an eye out for upcoming announcements.