CBD is one of the fastest growing markets in the United States and is expected to be a $20 billion dollar industry within the next few years. Despite the size and growth of this industry, until recently the manufacturing of hemp and the sale of CBD (a hemp extract) were largely unregulated in Florida.
In 2019, however, Florida’s Governor signed into law Senate Bill 1020. This law, codified at Section 581.217, Florida Statutes, sets forth the general guidelines for Hemp Cultivation and the Distribution and Sale of Hemp Extracts (“CBD”). Importantly, these guidelines empower Florida’s Department of Agriculture to implement rules in these areas. These new rules, located at 5K-4.034, Florida Administrative Code, took effect January 1, 2020.
The biggest change is that anyone who cultivates hemp or manufactures or sells CBD for human or animal consumption must be licensed. Guidance from the Department of Agriculture state that this licensing requirement applies to everyone in the distribution and retail chain – including manufactures, middlemen, and the individual stores that sell CBD products.
Further, the statute requires that CBD may only be sold in Florida if it has a certificate of analysis prepared by an independent testing laboratory proving:
- The hemp extract is the product of a batch tested by the independent testing laboratory;
- The batch contained a total delta-9-tetrahydrocannabinol concentration that did not exceed 0.3 percent on a dry-weight basis pursuant to the testing of a random sample of the batch; and
- The batch does not contain contaminants unsafe for human consumption.
Fla. Stat. § 581.217(7)(a).
The statute also mandates labeling requirements that include:
- A scannable barcode or quick response code linked to the certificate of analysis of the hemp extract by an independent testing laboratory;
- The batch number;
- The Internet address of a website where batch information may be obtained;
- The expiration date;
- The number of milligrams of hemp extract; and
- A statement that the product contains a total delta-9-tetrahydrocannabinol concentration that does not exceed 0.3 percent on a dry-weight basis.
Fla. Stat. § 581.217(7)(a).
The Florida Department of Agriculture has already started sending out enforcement teams to inspect cultivation and retail establishments for compliance with these new laws and regulations.
While the rules related to penalties (Rule 5K-4.035, Florida Administrative Code) have not yet been adopted, it appears that, once they are, penalties for violations can range from orders prohibiting the sale of CBD to fines up to $10,000.00 (or both).
If you have been cited by the Department of Agriculture or if you are concerned as to how these new statues and rules may affect your Hemp or CBD business, you should contact an attorney at Smith & Associates to help evaluate your rights.