Hemp Legal to Ship In USA, says USDA


States Can’t Block Legal Hemp Shipments Within Their Borders, USDA Says 

May 28, 2019

The U.S. Department of Agriculture (USDA) said on Tuesday that hemp can be transported across state lines—even through states that haven’t enacted laws allowing the crop’s production—and that the descheduling of the plant and its derivatives under the 2018 Farm Bill are already in effect because they are self-executing and do not require further action by federal agencies.

In a four-point legal opinion issued by the agency, USDA specified that hemp has been removed from the Controlled Substances Act (CSA), states and Indian tribes may not prohibit the interstate transportation of lawfully marketed hemp products—including those that fall under the more limited research-focused provisions of the previous 2014 Farm Bill—and that restrictions on participation in the hemp industry apply for individuals with felony drug convictions.

The USDA Office of the General Counsel said that while states and Indian tribes can still control the production of hemp in their respective jurisdictions, interstate commerce must be permitted following the implementation of the agency’s hemp regulations.

In the meantime, before any businesses can begin planting, harvesting and processing hemp crops under the new Farm Bill’s provisions, however, the USDA must first enact implementing regulations and then approve state-submitted regulatory plans.

“It is also important to emphasize that the 2018 Farm Bill does not affect or modify the authority of the Secretary of Health and Human Services or Commissioner of Food and Drugs to regulate hemp under applicable U.S. Food and Drug Administration (FDA) laws,” the agency added, perhaps referring to confusion that has surrounded the question of including hemp-derived CBD in food products and dietary supplements. “USDA expects to issue regulations implementing new hemp production authorities in 2019.”

The memo also indicates that people with felony drug convictions—who would otherwise be prohibited from participating in the legal hemp industry for 10 years—are exempted from the ban if their participation began following the passage of the 2014 version of the agriculture legislation but prior to the enactment of the broader 2018 bill.

Another notable aspect of the memo concerns THC derived from hemp.

“Congress has removed hemp from Schedule I and removed it entirely from the CSA,” USDA wrote. “In other words, hemp is no longer a controlled substance. Also, by amending Schedule I to exclude THC in hemp, Congress has likewise removed THC in hemp from the CSA.”

The 2018 Farm Bill definition of hemp stipulates that a cannabis crop must not contain more than 0.3 percent THC to qualify. THC derived from marijuana remains federally prohibited.

The agriculture bill shifted regulatory responsibility for hemp from the Justice Department to USDA. As such, USDA noted in its legal opinion that “this decontrolling of hemp (and THC in hemp) is self-executing.”

“Although the CSA implementing regulations must be updated to reflect the 2018 Farm Bill amendments to the CSA, neither the publication of those updated regulations nor any other action is necessary to execute this removal,” USDA wrote. In other words, the Justice Department doesn’t have to update its guidance on hemp and its derivatives for the policies to be in effect.

These are some of the most concrete updates that the USDA has offered since the 2018 Farm Bill was signed into law in December 2018. Agriculture Secretary Sonny Perdue has indicated that his department wouldn’t be expediting the rulemaking process, but he said that hemp regulations would be implemented ahead of the 2020 planting season.

One of the more consequential takeaways from the legal opinion for industry stakeholders concerns interstate transportation of hemp and its derivatives. USDA explained that a provision of the agriculture legislation “preempts State law to the extent that State law prohibits the interstate transportation or shipment of hemp that has been produced in accordance with” the Farm Bill.

Hemp produced under the 2014 version of the bill also qualifies for the interstate transportation protection, USDA further explained.

A separate memo released on Tuesday clarifies that Indian tribes can continue to engage with states that authorize hemp pilot programs for research purposes but that they, unlike states, cannot themselves authorize hemp research programs.

That second memo doesn’t touch on the 2018 version of the bill, but it states that the “law remains unchanged in that Indian tribes, individuals, and entities located in States that do no permit hemp production are ineligible to participate in the growing or cultivation of hemp under the 2014 Farm Bill program.”