The next few years will continue to be busy for hemp industries, and we expect there to be dramatic changes across the board, both good and bad.
2019 was, to put it lightly, an intense year for the hemp and hemp-derived cannabidiol (“Hemp CBD”) industries in the United States. We saw the implementation of the 2018 Farm Bill, strongly worded statements by the Food and Drug Administration (“FDA”) that Hemp CBD was unlawful in many products followed (amazingly) by almost zero enforcement, the issuance of interim hemp production regulations by the United States Department of Agriculture (“USDA”), and the development of hemp cultivation and Hemp CBD bans, regulations, and/or gray areas in nearly every state in the union (see the Canna Law Blog’s ongoing 50-state survey series that we post every Sunday).
Though 2019 was indeed busy, the U.S. hemp and Hemp CBD industries are far from normalized. The next few years will continue to be equally busy and we expect there to be dramatic changes across the board, both good and bad. Here are our top four predictions for 2020.
1. State Hemp Production Rollouts
For anyone who isn’t deeply familiar with the 2018 Farm Bill by now, it set up a system where states and tribes were required to come up with hemp production plans for approval by the USDA. Some states submitted plans to the USDA immediately, but it only began its substantive review after issuing its interim regulations.
As of today, numerous states and tribes have submitted or are in the process of submitting plans (you can see the actively updated list here), but only a small handful have actually been approved. In 2020, we expect that the USDA will approve most of the plans, or force states or tribes to change their plans up to comply with the USDA’s rules. Either way, state-level production is expected to kick into full gear under the 2018 Farm Bill.
2. FDA Enforcement
To date, the FDA hasn’t really done much about Hemp CBD products it claims are unlawful. Until late November 2019, all the FDA did (sometimes in concert with the FTC) was issue a small handful of warning letters to companies it claimed made unlawful products or advertised products in an unlawful way. But on November 29, it sent 15 warning letters simultaneously.
While, to date, the FDA has not initiated any kind of public enforcement proceeding or litigation, the fact that it went from just a small handful of letters over 11 months to 15 in one day signals that the FDA is shifting into enforcement mode. 2020 may be the year where we see actual enforcement or litigation.
3. Hemp CBD Importation
Over the last few months, our hemp attorneys have fielded numerous questions about importing raw hemp or Hemp CBD products, mostly from South America and Europe, but even from Asia or Africa. Importation can trigger the jurisdiction of a number of agencies, including Customs and Border Protection, the FDA, and/or the USDA. I say “and/or” because importing products usually involve multiple agencies.
For example, in this ruling, CBP noted that some Hemp CBD products were also subject to federal laws that are administered by the FDA. To boot, importation also involves the consideration of laws in the country from which products are being imported and, in some cases, international treaties. Notwithstanding the extreme legal complexity of importing hemp and Hemp CBD, we expect to see a huge uptick in 2020.
4. FDA Regulation of Hemp CBD
2020 may be the year that the FDA picks up the pace and does something clear with Hemp CBD. After all, Congress has been admonishing the FDA to speed things up for months now, and just recently an appropriations bill was signed that apparently directs $2 million to the FDA to finish its Hemp CBD regulations. Still though, at this point, FDA regulations on Hemp CBD are more of a hope or wish than an expectation. If they do come out in 2020, things we expect to see are testing requirements, packaging and labeling rules, advertising restrictions, Hemp CBD concentration limitations, etc. Hopefully, we will have more clarity in the next few months.