April 27, 2023


The war on hemp has come to North Carolina.

Last month, we talked about legislation sweeping the nation, regulating or even banning in some cases, cannabinoids, most of them targeting. What we would consider intoxicating are alternative cannabinoids like Delta eight, Delta ten, HHC, etc..

This month, as anticipated, legislation has been filed in North Carolina. Some of it’s a little more narrow. Some of it’s very, very broad. And all of it is a potential problem if you are in the hemp products industry in North Carolina. So if you’re watching this, imagine there’s huge sirens going off above my head, big flashing letters. Pay attention.

North Carolina SB 366

The first of all, we’re going to talk about that was filed just a couple of days ago is SB 366. Now, at first glance, this bill looks to basically only ban cannabinoids on school property. Doesn’t seem like a big deal. Most of the time, we don’t imagine that any sort of cannabis product tamper otherwise is going to be useful on school property because we think children don’t need to be using products plus anyone under 18 isn’t allowed to have them in North Carolina.

Most people now are preventing anyone purchasing products under the age of 21. That is in one of the bills that we’ve seen proposed. So as a general rule, we don’t anticipate that you’re going to have hemp products on school grounds. However, when you closely read it, this bill goes beyond that. It says no one can use any hemp product on school grounds during school hours or even if you’re just there for a school event.

So that means if you are an adult who has a topical hemp cream that they use because they get arthritis in their hands or they have eczema, any any number of things that you can imagine and they just have a lotion basically that includes had been it. This statute says you can’t do that. You can’t have that product on school grounds.

It’s a lot broader than one would think.

And it does attach potential criminal liability to anyone who violates it. So be aware. The second bill is really a much, much, much bigger problem.

SB 521 – Packaging for CBD, Hemp, Cannabis Products

So this is one of the first bills we’ve seen this year that tries to start regulating the can of the cannabinoid industry as we’ve discussed previously. For many years we’ve all been waiting for the FDA to come out with regulations about packaging, labeling, manufacturing dosage for hemp derived products or cannabis derived products. That still hasn’t happened. And so in the last year, we’ve seen states start to attempt that regulation on their own and some of it’s worked well. Some of it’s been a complete disaster this year so far as we’ve discussed.

Most of it’s been pretty disastrous for the hemp industry, especially anybody operating in the alternative cannabinoid space. SB 521 is no different. The two biggest problems that I see in my initial read of it are one, it removes smokable hemp products from the exception that is carved out for all other hemp products from the North Carolina Controlled Substances Act.

What does this mean? Well, if anybody remembers a couple of years ago when North Carolina first passed it, they then rolled it back a little bit and made smokable hemp illegal. Why? Because smokable hemp and marijuana are not distinguishable by sight or smell. They look and smell the same. And so when hemp first became legal in North Carolina, law enforcement agencies went nuts because they realized that if somebody can legally possess something that looks and smells like marijuana, it threatens their ability to search someone based on the smell or view of marijuana.

So we had a period of time where smokable hemp became illegal, and then that went away. And it is now legal, which is a huge boom for North Carolina farmers who want to produce and sell their own flower. It’s one of the only things that they can grow and then sell without having to sell it wholesale their flower to someone who’s then going to turn it into a downstream product like CBD oil.

This bill removes smokable hemp products from the exception for hemp that exists currently, which means — though it doesn’t say as explicitly – I think that means that smokable hand products, if this were to pass, would once again be illegal. So this is a huge problem.

Changes the North Carolina THC standard

Their second big problem is that it changes the North Carolina THC standard from the federal standard to a what I am deeming a total THC concentration standard plus a any intoxicating cannabinoids kicker.

As you may all know now, the federal standard for what is hemp is something that is grown with a THC concentration, a Delta nine, THC concentration of 0.3% or less. North Carolina adopted the same standard. So something that is hemp has a Delta nine THC standard of 0.3 percent or less.

This changes that standard to a total THC standard, meaning they’re not just going to measure Delta nine concentration. They’re going to look at what the Delta eight, what the THC concentration is. Anything that is a THC tetrahydrocannabinol, any form of it that’s in the product will be taken into consideration and must be within that point 3% standard. So that means there’s going to be a lot less THC in the products roaming around the market.

Total THC and any intoxicating cannabinoid

But then they add a little kicker at the end which says total THC and any intoxicating cannabinoid. Why is that a problem in toxic eating? How do we define that? Well, I know how we define that. If it’s alcohol, you are intoxicated at point eight B, blood alcohol concentration or more. Right. We don’t know how much you have to have in your system to be intoxicated on THC of any kind.

We have roadside tests if you’re operating motor vehicle. But how are you going to look at someone sitting across from you at dinner and say, user are intoxicated? You might have a layman understanding of that, but that’s not a legal standard and we’re certainly not going to roll around testing everyone who’s ingested a THC product as to whether or not they’re intoxicated.

We don’t have the manpower for that and we still don’t have the standard for that. So this add on of any intoxicating cannabinoid is problematic. One for the use of the word intoxicating, but two for the use of the whole phrase. Any intoxicating cannabinoid, if intoxicating, is defined as anything that is quote unquote psychoactive or it interacts with your system and potentially has some psychological effect.
Well, that’s absolutely every cannabinoid you’re going to ingest. Some of the anecdotal evidence that people tout all the time for CBD is the fact that it helps with stress, anxiety, sleep. While none of that’s been approved by the FDA and it’s only anecdotal. That in and of itself is a psychoactive reaction in your body, It is affecting your psychological reaction to the product.

How to define “intoxicating”

Your brain chemistry, your physical chemistry. It interacts with your endocannabinoid system, yada yada, yada. It’s psychoactive. Is it intoxicating? Again, how are we defining that? So this whole definition is very problematic. And what it results in is this overly broad, undefined definition of what is now illegal for THC standard. It’s going to make operating in this space really difficult and basically puts you put any company that’s got hemp products, making it product selling and products in North Carolina in a gray area.

Some of the things in this bill are okay. It does ask for establishment of good manufacturing practices and licensing for manufacturing. We’ve all been wanting that for a while, so that could potentially be a good thing. It doesn’t say what those standards are going to be. It just simply says that it’s going to task the commission with establishing them and it specifically removes hemp as an adult brand.
So as we’ve talked about in previous videos, one of the issues with the FDA not approving hemp or hemp derivatives as a food additive is that they continue to be considered and adulterants in foods, really anything that is for human consumption. This says that hemp in and of itself in a product does not make it adulterated in North Carolina.

So it does take off some of the pressure. If you’re complying with every other part of the statute, your food product or your product for human consumption is is specifically no longer considered adulterated in the state of North Carolina. So that is a good thing that we’ve been looking for for a while. However, the Smokeable product issue and the THC standard issue make this bill not a good one for the hemp industry in North Carolina.

So make sure that you’re watching out for SB 521 and SB 366 as they start to pass through committees in the Senate. And we will be watching for you as well. Take a look next month for an update on where they’re at.

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