California assembly bill that would impose regulations on hemp-derived cannabinoids fails to pass state senate

A California Assembly bill (AB 2223) that would limit certain cannabidiol (CBD) products to a maximum of 0.25 milligrams of tetrahydrocannabinol (THC) per serving per package, or 1mg of THC per final product, as well as allow licensed dispensaries to sell hemp products, is being “Held under submission” in the state’s Senate Committee on Appropriates, effectively killing its progress in this legislative session. Industry advocates such as the U.S. Hemp Roundtable are celebrating the bill’s failure. The group thanked its supporters to making their voices heard, and well as “longtime lobbyist in Sacramento, Rand Martin, for his consistently great work on the ground,” and “Members, SunMed, CV Sciences and Cheech and Chong, as well as the HBA and CBA, for providing crucial complementary advocacy efforts.”

However, the group cautioned that more work will be necessary to prevent future efforts and to promote safety and quality across the hemp industry. The U.S. Hemp Roundtable stated in a press release: “The war on hemp continues on Capitol Hill and in state capitals across the country. Moreover, in California, challenges remain. While the vast majority of hemp farmers, product manufacturers and retailers are small and family businesses who play by the rules and hold themselves to the highest standards, bad actors in our industry continue to manufacture products without quality control, label and package them insufficiently, and illegally target children. We also need to do a better job to promote equitable solutions for the entire cannabis industry.”

In a statement released earlier this week, the U.S. Hemp Roundtable’s general counsel, Jonathan Miller, criticized the legislation and urged stakeholders to reach out to representatives to reject the bill. He explained that AB2223 undermined previous efforts for a “balanced, rational and responsible framework to legalize hemp CBD products in California,” namely AB45. That bill was passed into law in October of 2021, and promised to “create a registration process, under the State Department of Public Health, for hemp manufacturers who produce specified products that include industrial hemp or who produce raw hemp extract, as defined, including requirements for testing and labeling on products.”

“Unfortunately, [Assembly member Aguiar-Curry’s] new bill, AB 2223, introduced this year, took a big step backward. The bill included outrageous requirements that would result in the ban of 90-95% of hemp products for retail sale – including most non-intoxicating CBD products that were the explicit focus of passage of AB 45. Hemp advocates were met with continual promises – both privately and during public hearings – that our concerns would be addressed, that the language in AB 2223 was just a starting point of the discussion.The hemp industry provided legislators and the Administration with scientific and economic studies to bolster our arguments,” said Miller in his statement. “Yet just within the past few weeks, the California Department of Cannabis Control dropped a bomb on the discussions. In 41 pages of new ‘technical’ amendments, the agency proposed that all hemp products with any THC in them – again, meaning nearly every hemp product – come under their purview and therefore be banned from retail sale.”

Advocates for cannabis industry cultivators have also opposed the proposed legislation. The Origins Council, a group that claims to represent “800 small and independent cannabis businesses in rural legacy producing counties throughout California,” for example, wrote a letter to Aguiar-Curry in April addressing their concerns and proposing amendments. The letter states: “The majority of our comments focus on AB 2223’s proposal to incorporate hemp into legal cannabis products. If not developed with extreme care, we believe this proposal risks an industry-wide shift towards chemically-converted and synthetic cannabinoids with unclear safety profiles. These loopholes would both significantly undermine small cannabis cultivators, and compromise existing quality control practices in the cannabis supply chain that provide protection to consumers. Additionally, unless and until cannabis and hemp cultivation are regulated at parity, the incorporation of naturally-occurring and concentrated delta-9 THC and comparable cannabinoids from hemp into the cannabis supply chain further threatens to dramatically undermine licensed cannabis cultivators who are currently regulated to a much high degree than hemp cultivators growing the same plant.”

Additionally, retailers of hemp-derived cannabinoid products and patient advocates were critical of the legislation’s stating that the push to have hemp products sold in licensed dispensaries would hurt retailers for whom licensure is financially difficult to obtain as well as customers who rely on non-intoxicating hemp products for their health. Limiting access to hemp-derived cannabinoid products to dispensaries in effect reduces patient and consumer access to said products because there will be fewer retailers to choose from and prices will likely increase.