Man on tractor

It’s not often that the entire country mobilizes and gets excited over a crop. But hemp legalization is altogether different. For the first time in generations, hemp cultivation and sales are federally permitted (as long as you have a hemp license) and this change has made quite the splash. With a pen made of hemp, Senator Mitch McConnell (R-KY) signed the Farm Bill into law, which was quickly followed by President Trump’s signature.

So what does federal hemp legalization mean for farmers, researchers, and consumers? And does it have any impact on the FDA’s stance on CBD? Let’s dive into the new hemp landscape!

RELATED: 2018 Farm Bill Legalizes Hemp Production

2018 Farm Bill

What made the 2018 Farm Bill so historic? In many ways, Farm Bills are a relatively boring piece of legislation. A form of the bill is passed in Congress every five years since 1933 and it’s hardly the most exciting piece of legislation that comes through the Congress. But what made 2018’s Farm Bill so monumental is that it legalized the hemp industry for the first time since the early American years.

The 2018 Farm Bill explicitly legalized hemp and amends the Controlled Substances Act (CSA) to separate hemp from the definition of marijuana, which will remain illegal.

The bill also includes a package of laws that address:

  • Crop subsidies
  • Cultivation regulations
  • Food exports
  • Crop insurance
  • Rural development
  • Research
  • Organic certifications

The Movement to Legalize Hemp

In 1937, the Marihuana Tax Act heavily taxed the possession and transfer of hemp for the first time, widely discouraging production. Before the Marihuana Tax Act came to be, hemp was a required crop for all American farms because of its usefulness and trade value. In the early days of North America, hemp was used to make paper, lamp fuel, ropes, and more.

It wasn’t until the 1970s, at the height of the War on Drugs, that hemp was listed as a Schedule I drug. This placed strict regulations on its production in the United States. Oddly, in 1998, the United States began important hemp seed and oil from other countries, while still outlawing its production in the states.

One of the most major moves for hemp legalization came in 2004, when the Ninth Circuit Court decided to permanently protect the sale of hemp foods and skin care. From there, the movement for hemp legalization took off.

In 2007, the first hemp licenses in five decades were given to two North Dakota farmers. In 2014, President Obama signed a version of the Farm Bill that established the Hemp Pilot Program, allowing certain research institutions to cultivate and study hemp. And in 2018, hemp was officially legalized on the federal level.

What’s Legal and What’s Not?

The 2018 Farm Bill defines hemp as the cannabis L. sativa plant that has less than .3% THC (the compound in cannabis that makes people feel high). Hemp cultivation will be legal for licensed growers only, so you won’t be able to just start growing your own hemp in your backyard. Licensed hemp farmers will have legal access to crop insurance and federal certifications.

Importantly, this change does not legalize CBD, even hemp based CBD with less than .3% THC. The Food & Drug Administration still classifies CBD (even hemp-derived versions) as a drug. It has not been approved as a dietary supplement, food additive, or medicine (except in very limited instances, like the newly FDA-approved CBD for epilepsy).  

The federal legalization of hemp also does not change state laws. Individual states may still prohibit hemp use and cultivation. The 2018 Farm Bill does, however, protect the interstate commerce of hemp, limiting a state from interfering with hemp shipped across state lines.

Legalizing Hemp Will be a Big Jump For The CBD Industry

Even though the 2018 Farm Bill does not legalize CBD, it does create more space for research on the compound. With this new bill, additional research requirements on hemp and its cannabinoids (included CBD) were put into place. This means researchers will have more access to grants to fund this research. With a wider lane opened for hemp research, it is more likely that the FDA will update their stance on CBD as a dietary supplement.

How Will The USDA and States Regulate Industrial Hemp?

The U.S. Department of Agriculture will now treat hemp like any other commodity crop. As a result, the USDA will be in charge of creating federal standards to oversee hemp production. When it comes to licensing, a state can enact their own regulatory scheme for hemp cultivation through the state’s Department of Agriculture. If a state does not enact their own regulations but allows for hemp cultivation, federal hemp licenses will be granted by the U.S. Secretary of Agriculture.

As mentioned, the Farm Bill does not supersede state laws on hemp. A state may still prohibit the cultivation and sale of hemp, but it cannot outlaw the interstate commerce of hemp. As a result, a person in any state will be able to purchase hemp-related products from legal states and have them shipped to them.

The 2018 Farm Bill repeals the Hemp Pilot Program established in 2014 after 12 months. After 12 months, the USDA is required to compile a report on the success of the Hemp Pilot Program.

Can Hemp Companies Now Obtain Federal Trademark Protections?

It is not fully certain that hemp brands and companies will be allowed to seek trademark protections, but we are hopeful. When it comes to hemp-derived CBD, it is highly unlikely trademark protections will be available to any product that is not FDA-approved.

Gleam Law will continually monitor the hemp trademark landscape and work diligently to provide our hemp-related clients top-notch intellectual property help. Give us a call if you’re interested in diving into the legal hemp industry.

Are you interested in a federal hemp cultivation license? Do you already cultivate and sell hemp and are interested in learning more about protecting your brand? Gleam Law is excited to be a hemp and CBD law partner in this new era of hemp legalization.