Vicente Sederberg LLP Hemp Update: December 2021
Dec 7, 2021
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Federal Updates
New Bill Introduced that Would Require the FDA to Regulate CBD as a Food & Beverage Ingredient
Last week, a new U.S. House bill was introduced that would require the FDA to regulate CBD as a food and beverage ingredient. The CBD Product Safety and Standardization Act of 2021 would allow the FDA to regulate CBD as it would any other food ingredient and subject these products to enforceable safeguards to ensure accountability. It also charges the agency with issuing rules establishing a maximum serving limit, packaging and labeling requirements and determining in which categories of food CBD is appropriate for use.
This bill focuses on legalizing and regulating CBD in food ingredients, while H.R. 84, the “Hemp and Hemp-Derived CBD Consumer Protection and Market Stabilization Act of 2021” would allow hemp ingredients to be legally manufactured and sold as dietary supplements. The bill was introduced by Rep. Kathleen Rice (D-NY) and Reps. Morgan Griffith (R-VA), Angie Craig (D-IA) and Dan Crenshaw (R-TX).
States Reform Act Has Major Implications for Hemp
A new bill to end cannabis prohibition, the States Reform Act (SRA), introduced by South Carolina Rep. Nancy Mace, aims to regulate cannabis primarily through the Alcohol and Tobacco Tax and Trade Bureau (TTB) while hemp would remain regulated separately by the FDA and the USDA. Notably, the SRA would waive the drug preclusion language in the Federal Food, Drug & Cosmetic Act from applying to cannabis or hemp. VS partner Shawn Hauser weighed in on the issue in this article from Hemp Grower.
Support Grows for Enacting Cannabis Banking Reform Through Defense Legislation
The U.S. House of Representatives voted in September to include the SAFE Banking Act amendment in the FY 2022 National Defense Authorization Act (NDAA). Since then, a coalition of governors, a board member of the National Credit Union Administration, and a bipartisan group of senators have also shown their support. Sens. Hickenlooper and Bennet of Colorado recently sent a letter to Senate committee leaders urging them to adopt the SAFE Banking language into the final NDAA.
Though the Dec. 6 draft of the bill does not include cannabis banking, the head sponsor of the bill has pledged to make the proper moves to add the measure in before things are final. This new version will go through both chambers once more. Read more here.
USDA Improves Crop Insurance for Hemp Producers
The hemp crop insurance policy from the USDA Risk Management Agency provides Actual Production History coverage against loss of yield due to insurable causes of loss for hemp grown for fiber, grain, or CBD oil. In response to feedback from hemp producers, the USDA is improving this policy by adding flexibilities around how producers work with processors as well as improving consistency with the most recent USDA hemp regulation. Read full details here.
General Updates
ASTM Sets New Quality Standards for Sampling Hempseed
ASTM International will soon publish standard D8417, a new standard for sampling hempseed intended for human consumption. The guide will help farmers, supply chain partners, labs and other players in the hemp food supply chain ensure that samples are an unbiased representation for the property to be assessed for regulatory or quality control reasons. The standard includes testing THC levels, moisture, and microbial levels.
Amazon Offers New Flexibility for Dietary Supplement Sellers
Amazon recently announced flexibility for selling partners to demonstrate Good Manufacturing Practices (GMP) for dietary supplements. The new policy requires submission of three demonstrations of quality: 1) a valid GMP certificate; 2) product images that show compliance with 21 CFR 101.36; and either 3a) a finished product Certificate of Analysis; or 3b) evidence of product enrollment or participation in an Amazon approved third-party quality certification program.
State Updates
State-by-State Hemp & Cannabinoid Compliance Guide
VS’s State-by-State Hemp & Cannabinoid Compliance Guide is an affordable, easy-to-use compliance solution to help your business navigate the ever-changing regulatory environment of hemp-derived CBD products. Take the guesswork out of ensuring compliance with all aspects of selling hemp-CBD products in different states — from packaging and labeling, to testing, distribution, and more.
Request a complimentary consultation with an attorney to discuss a customized package that best fits your needs.
Idaho
Idaho, the last state to legalize hemp, recently received USDA approval of its state hemp plan. Applications opened in early November. Click here for more information and helpful videos about the application process.
Louisiana
Louisiana's proposed rules for consumable hemp products have been filed in the Louisiana Register and public comments are being accepted until December 27, 2021. These draft regulations include hemp product registrations, product type restrictions, and labeling restrictions.
New York
New York's cannabinoid hemp regulations were adopted and effective as of November 24, 2021. However, the testing and labeling requirements have a delayed effective date of April 25, 2021.
Oregon
The Oregon Liquor and Cannabis Commission (OLCC) proposed milligram limits on the amount of Delta-9 THC in products, along with a ban on "artificially derived cannabinoids" in hemp products sold at retail. These limits will impact food, beverage, and supplement products containing hemp-derived ingredients and would be limited to 1 mg of total Delta-9 THC per serving and 10 mg per package. Such products will also not be able to exceed a 0.3% total Delta-9 THC concentration.
Artificially derived cannabinoids, defined as “a chemical substance that is created by a chemical reaction that changes the molecular structure of any chemical substance derived from” the cannabis plant, are prohibited from inclusion in hemp products, although the language provides some exclusions. A hearing on the proposed rule is scheduled for Dec. 20, with comments accepted until Dec. 22. If you would like to submit comments, contact Madeline Kane at OLCC.
Texas
In October, the Texas Department of State Health Services (DSHS) updated its website guidance in to confirm the state's position that delta-8 THC is a schedule 1 controlled substance. “Texas Health and Safety Code Chapter 443 (HSC 443), established by House Bill 1325 (86th Legislature), allows Consumable Hemp Products in Texas that do not exceed 0.3% Delta-9 tetrahydrocannabinol (THC). All other forms of THC, including Delta-8 in any concentration and Delta-9 exceeding 0.3%, are considered Schedule I controlled substances.” Soon after, a suit was filed against DSHS arguing that the agency had improperly revised its hemp policy to specifically prohibit products with more than trace amounts of forms of THC other than Delta-9 and did not adequately notify retailers.
On November 8, the 345th Civil District Court granted the plaintiff’s application for a temporary injunction for Delta-8, temporarily blocking DSHS from enforcing its Delta-8 THC product ban. Then, on Nov. 10, the 126th District Court appealed the temporary injunction at the request of the DSHS. In response, the plaintiff submitted an emergency motion to uphold its temporary injunction, which the Third Court of Appeals granted on Nov. 18. The temporary injunction against the state will last through the end of the case.
Status of State and Tribal Hemp Production Plans for USDA Approval
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