Federal, State, & Local Regulations Explained

Most people would now agree that CBD is legal. However, exactly how legal is CBD? Is the CBD industry regulated, and are you allowed to sell any type of CBD product any way you like in any part of the country?

For CBD producers who want to remain competitive and stay in business for many years to come, keeping abreast of recent hemp industry regulations is a must. Learn more about the current status of CBD regulation in the United States, and find out the best ways to ensure your products remain compliant.

Are there federal regulations for CBD?

The 2014 Farm Bill created a legal loophole that allowed the nation’s first CBD companies to set up shop. Then, the 2018 Farm Bill addressed the rapid growth of the semi-legal hemp industry by legalizing the cultivation of Cannabis sativa strains containing less than 0.3% THC.

What the 2018 Farm Bill failed to do, however, was establish provisions for the manufacture and sale of products containing CBD derived from these legalized hemp plants. This responsibility was left to executive branch agencies such as the United States Department of Agriculture (USDA) and the US Food and Drug Administration (FDA).

While the USDA has taken measures to streamline the production of CBD-rich hemp, the FDA has not yet released meaningful guidance regarding the regulation of consumer CBD products. After conducting multiple studies, this federal agency has indicated that it views CBD favorably, and DC sources indicate that the FDA might move to regulate CBD as a supplement sometime in 2021.

At present, however, CBD is not federally regulated in any meaningful way. The 2018 Farm Bill removed CBD from a legal gray area and placed it into a regulatory gray area, legitimizing the US CBD industry to a significant degree. But, for the moment, American CBD producers are not required to comply with any FDA regulations.

States where CBD is legal or regulated

The 2018 Farm Bill made it considerably easier for individual states to legalize CBD commerce. Some states, such as Indiana, preempted the 2018 Farm Bill by legalizing CBD in 2017. Most states in which CBD is now legal, however, passed CBD legislation after January 1st, 2018.

Each state has its own CBD laws. Some states allow CBD to be present in tinctures, vapes, capsules, and topicals but not in food or drinks. Others have not passed any CBD-specific laws whatsoever.

What’s important to know is that no states have passed laws that directly countermand the 2018 Farm Bill’s assertion that CBD products containing less than 0.3% THC are not marijuana. While certain states have passed relatively restrictive laws regarding how CBD can be sold, no states hold the position that CBD is an illegal drug.

Consult each state’s individual CBD laws to verify your position as a CBD producer, but understand that state-specific CBD laws generally conform with the federal position on this non-intoxicating cannabinoid. If a state does not have any CBD-specific laws, CBD regulation in that state reverts to the federal position.

Local CBD regulations

Some counties and municipalities have established their own CBD regulations independently of state and federal positions. These regulations only apply within the borders of the particular county or municipality, and they usually restrict the types of businesses that are allowed to sell CBD.

Before establishing a CBD business, check your local regulations by calling or visiting your chamber of commerce. In most cases, county or municipal CBD laws will not conflict with state or federal positions.

What it all means for producers

In the early days of the CBD industry, the largely unregulated status of cannabidiol instilled a sense of both allure and foreboding in enterprising hemp entrepreneurs. While this “Wild West” atmosphere allowed CBD brands to operate with practically zero regulatory oversight, there was a feeling that the rug could get pulled out from underneath you at any moment, crushing your dreams in the blink of an eye.

Ever so slowly, the CBD industry has creeped toward the mainstream of consumer culture. It’s entirely possible that CBD could be meaningfully regulated by the end of 2021, taking the industry to a state of legitimacy that early hemp entrepreneurs could never have imagined.

Long gone are the days when you could make any type of CBD product you liked, throw it at the wall, and hope it would stick. CBD is no longer a back-alley product sold with furtive glances and fearful ferocity. It is, on the contrary, on the cusp of becoming a mainstream substance, and it’s now time for CBD producers to behave with the utmost professionalism and take upcoming regulatory efforts very seriously.

How to make sure your CBD is compliant

There are a few steps you’ll need to take to ensure that your CBD is compliant with existing local, state, and federal regulations. You can also take preemptive steps now that will prepare you for upcoming changes to CBD regulations at the federal level.

1. Consult with your city or county government

Your county or municipal government may have put regulations in place regarding the manufacturing or sale of CBD products. Consult with local authorities to ensure your compliance.

2. Make sure you’re in compliance with your state’s CBD laws

Each state has different laws regarding the production and sale of CBD. These laws are posted online, and a reliable cannabis and hemp lawyer can help you make sure your business is compliant.

3. Ensure that your CBD contains less than 0.3% THC

To comply with existing federal CBD regulations, it’s essential to ensure that your CBD products contain less than 0.3% THC.

4. Conform with CGMP manufacturing standards

At present, there are no federal standards regarding CBD production processes. It is, however, a good idea to make sure that your manufacturing facilities follow basic CGMP standards in preparation for potential upcoming CBD regulation from the FDA.

5. Regularly test your CBD products at a reliable lab

The only current federal requirement for CBD products is that they must contain less than 0.3% THC. In the future, however, it’s likely that the FDA will stipulate that CBD products must contain less than a certain threshold of heavy metals, mycotoxins, and other potential contaminants. To stay compliant with existing regulations and prepare for the future of the CBD industry, it’s essential to regularly submit product samples for testing at reputable, independent labs.

Comprehensively test every batch of CBD products you produce

The CBD industry is changing rapidly, and keeping a close eye on the quality and compliance of your products is the only way to ensure your ability to compete as relevant rules and regulations continue to shift. Every time you produce a new batch of products, have them tested using the most comprehensive and cutting-edge techniques available to stand out as a truly exemplary CBD producer.

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