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The hemp-derived CBD industry in North America is growing at a steady compound annual growth rate (CAGR) of 23.4%. We anticipate the market value to surpass 61.2 billion by the end of 2027. The industry can attribute this rapid growth rate to CBD’s popularity in the wellness sector. Cannabidiol is gaining traction as a go-to non-psychoactive product with therapeutic effects for relieving stress, anxiety, depression, and inflammation.

Both state and federal governments are also at the forefront of enacting favorable legislation that boosts the production and sale of CBD-infused products. It’s worth noting that 2021 is the biggest year for the CBD industry, as many states passed, implemented, or proposed new regulations to guide the sector.

Most of these changes are updates to labeling, testing, packaging, and licensing to limit the types of CBD-infused products making their way to the market.

Although the patchwork on these laws is dynamic, recent changes are worth bringing to your attention. It’s imperative to stay updated with these changes and understand how they impact your business.

Here is a quick breakdown of these new regulations by state.

1. New Jersey

The New Jersey Cannabis Regulatory Commission published new licensing rules on August 19, 2021. Businesses can concurrently hold one New York dispensary license, one delivery service license, and one cannabis manufacturing license. Moreover, individuals can hold cannabis business ownership interest directly or indirectly through a regulated intermediary such as a shell or holding company.

Also, all stakeholders of a cannabis entity, including owners, passive earners, employees, and volunteers, must complete a rigorous background check and be at least 21 years old. The only exception for underage license holders includes heirs taking over ownership interest from a deceased. Even so, the company will hold the ownership interest in a trust until the beneficiary turns 21.

2. Washington

It’s now legal to derive food products from hemp in Washington state. The governor signed Chapter 104 of the Washington 2021 Laws into law in May, giving investors the go-ahead to obtain certifications for processing hemp. The certification demonstrates that the CBD-infused food products processed within the state meet Washington’s inspection and sanitation standards.

This new law also empowered the Washington Department of Agriculture to issue and confirm hemp processor registrations.

3. New York

The state of New York has experienced two legislation changes in hemp laws since the beginning of 2021. The state’s Department of Health assumed authority over CBD hemp and its derivative products in January 2021. Investors can now apply for various licenses from the department’s online portal, including processing, retailing, and distribution.

Five months later (May), the state health department published other hemp law amendments in response to public opinion. This latest amendment expands the types of CBD-infused products retailers can sell within the state. The department also redefined “broad spectrum” and “full spectrum” for more stringent regulation of synthetic cannabinoids.

4. Colorado

The Colorado Department of Public Health and Environment established new testing and labeling regulations for hemp products in April 2021. However, these new regulations became effective three months later, on July 1, 2021. The state’s health department makes it mandatory for hemp processors to test their products against inorganic contaminants, pesticides, heavy metals, and mycotoxins.

All hemp-derived products must also display labels detailing the total CBD content (including THC) in the package in milligrams.

5. South Dakota

South Dakota State made changes to Chapters 38-35 of Industrial Hemp codified laws. These new regulations are now consistent with the U.S. Department of Agriculture (USDA) hemp laws, supporting inter-state transportation of hemp. South Dakota licenses holders can now grow hemp in small locations and enjoy all the crop insurance programs implemented by the state.

Other incentives for hemp growers in South Dakota may include farm loans and conservation programs run by USDA.

6. Virginia

Virginia state amended Chapter 41.1 of the Code of Virginia in March 2021. The governor signed the amendments into law in the same month, excluding federally licensed and processed hemp from the “marijuana” definition.

In addition to that, federally licensed hemp growers are not subject to the state hemp programs. That means you can get your federal hemp licenses and jump straight into production without going through the rigorous state registration requirements.

Stay Updated with the Changing CBD Laws, Regulations, and Policies

Although CBD-infused products are popular across the nation, the hemp industry is still a controversial sector. Expect more changes in policies and regulations in the coming months, if not years.

Moreover, some states, such as Rhode Island, are still gathering public comments and opinions on how to introduce hemp products. The state of New York also recently closed a public commenting period regarding the amendments done in May. If any changes arise from these recent activities, they might affect your business. Always be on the watch out for what is emerging.