State, tribe, or federal USDA regulation of hemp production
The 2018 Farm Bill allows1 states and Indian tribes to submit an application to the USDA to self-regulate hemp production within their own jurisdictions.
The application must address, among others, (1) how the state or tribe will maintain information about the land on which hemp is being grown, (2) how the state or tribe will test for THC levels, and (3) other procedures such as inspections verifying compliance and effective disposal of violative plants (that is, psychoactive marijuana). Once a state or tribe submits an application, the USDA must either approve or deny the application within 60 days. If approved, the state or tribe then can license individuals to grow hemp.
In addition, if a state or tribe has not received an approval from the USDA, the legislation authorizes the USDA to license hemp production in such a state or tribe, as long as the state or tribe does not have a law that prohibits hemp production, and as long as the grower can comply with USDA’s federal requirements.2 While it may take some time for the USDA to promulgate the specific federal requirements, the requirements are likely to be similar to the application requirements outlined above for states and tribes.
Finally, the 2018 Farm Bill also facilitates transportation of hemp across the country by making it unlawful for any state or tribe to prohibit shipment of hemp across the state or tribe, as long as the hemp product was produced pursuant to the requirements stated above.
Hemp’s removal from the Controlled Substances Act Schedule
The Controlled Substances Act (CSA) and the Drug Enforcement Agency (DEA) had always been a risk for businesses involved in growing or trading hemp products because hemp was a Schedule I controlled substance under the CSA. See 21 U.S.C. 802(16).
However, the 2018 Farm Bill changes this designation. The legislation’s section 12619 modifies the CSA, and removes hemp and the THC in hemp from the Schedule I controlled substances list. This change means that hemp is simply not a controlled substance and, moreover, even the THC included within hemp is not a controlled substance under the CSA. Companies may therefore be able to market hemp products legally even when they contain minimal amounts of THC. While this may be true, companies marketing FDA-regulated products must be cautious as the FDA’s position on CBD and THC has not changed.
Foods or dietary supplements containing cannabidiol
FDA’s current position is that products that contain THC or CBD may not be sold as dietary supplements and that it is illegal to sell in interstate commerce a food to which THC or CBD has been added.3
The 2018 Farm Bill does not change the FDA’s stance – the Farm Bill states explicitly that it neither affects or modifies the FDCA nor does it impact the agency’s authority to promulgate regulations and guidelines relating to hemp production.4 The FDA’s position is likely to remain unchanged for the foreseeable future, and FDA-regulated companies must take advice before embarking on an endeavor involving hemp.
We will continue to monitor any development in this area, especially on which states request approval from the USDA. If you have any questions, please do not hesitate to contact us.
- See section 297B (page 8 PDF) of the 2018 Farm Bill
- See page 11 section 297C.
- See FAQ 12 and 13. There is one exception to this rule: if the substance was marketed as a dietary supplement or conventional food before this year, then it can be sold lawfully. However, the FDA has concluded that there are no products containing THC or CBD that fit within this exception.
- See page 13, section 297D
Client Alert 2018-249
