The DEA is wrong...Again!!

Much is being made of the Drug Enforcement Agency’s (“DEA”) Interim Final Rule (“IFR”) published in the Federal Registry on August 21, 2020 pertaining to the implementation of the Agricultural Improvement Act of 2018 (The “2018 Farm Bill”). More specifically, the concern is over the fact that the DEA is attempting to once again seize control of the Hemp plant and the Hemp industry, despite the fact that Congress has already removed the plant from the Controlled Substances Act and place all oversight in the hands of the United States Department of Agriculture (“USDA”) and the states with respect to farming the plant and to the Food and Drug Administration (“FDA”) with respect to products that end up in the stream of commerce. (This is part 1 of this article. Part 2 may be found here)

In the summary of the text the DEA claims “This interim final rule merely conforms DEA's regulations to the statutory amendments to the CSA that have already taken effect, and it does not add additional requirements to the regulations”. While this may be the case with the rulemaking on the first three of four of the conforming changes to DEA's existing regulations, it is certainly not the case with the fourth. This change states:

It modifies 21 CFR 1308.11(d)(58) by stating that the definition of “Marihuana Extract” is limited to extracts “containing greater than 0.3 percent delta-9-tetrahydrocannabinol on a dry weight basis.”    

It is this statement that has caused a great deal of consternation within the Hemp community because as written, it would suggest that any extract derived from any plant of the genus Marijuana containing greater than 0.3% delta-9-tetrahydrocannabinol on a dry weight basis, other than the separated resin (whether crude or purified) obtained from the plant would fall under the new modified definition of Marijuana and as such would remain a schedule 1 drug. If that were indeed the case, then all crude Hemp oil that is “hot” after the initial extraction process would meet this definition. 

Here is where the subject becomes significantly more technical because in order to understand the fear of illegality one must first understand the process of extraction and must understand the language of both the Farm Bill, the CSA, and the Code of Federal Regulations and how they all relate to one another. It is the totality of these definitions as they relate to one another and the extraction process that leads to the conclusion that all Hemp oil, that which tests below and above 0.3% THC is still legal and that the DEA is incorrect in believing that it has any power to enforce the law otherwise without usurping Congressional power and the plain meaning of the language pertaining to Hemp as currently drafted. 

Technically the plant that the terms “Marijuana” and “Hemp” describe are one in the same; cannabis. So how have they evolved in our lexicon to have such different definitions? Essentially it is an arbitrary distinction, but one that over time has become very important legally. With the passage of the Agricultural Act of 2014, also known as “The 2014 Farm Bill”, Hemp and Marijuana diverged in a meaningful way. The major change that the 2014 Farm Bill ushered in was that Sections 7606 of the 2014 created a framework for the legal cultivation by states of “industrial Hemp” without a permit from the Drug Enforcement Administration. These were called the “Hemp Pilot Programs”. Essentially, what this did was protect Hemp farmers who were registered under a state’s Hemp research pilot program, who were cultivating Marijuana that contained no more than 0.3% of THC, and who conformed with the requirements of their respective state department’s of agriculture.

This was the first time that Congress made any meaningful distinction between “Marijuana”, which remained a schedule 1 drug on the CSA and “Hemp”. Despite the new definition of Hemp Congress fell short of actually legalizing Hemp or removing it from the CSA. This created a conflict between its intent to legalize the plant for industrial purposes and the actual actions needed to do so. If Congress failed to act, intentionally or not, the DEA would still treat Hemp as legally identical to Marijuana, and as such it remained a schedule 1 drug.    

The DEA position pertaining to the legal status of Hemp and all phytocannabinoids contained therein was made clear soon after the passage of the bill. The DEA continued to take a hardline stance on the Hemp plant and would grant no allowance for its legal production until Congress removed Hemp from the CSA. Their official policy, as described by the the Library of Congresses internal Congressional Research Service (“CRS”) was as follows on page 23:

DEA’s position that “anything that contains ‘any quantity’ of Marijuana or THC” should be regarded as a controlled substance is further supported by reports published by the National Institute on Drug Abuse, which is part of the National Institutes of Health. Although it does not have a formal position about industrial Hemp, its research tends to conflate all Marijuana varieties, including Marijuana and Hemp. For example, it reports: “All forms of Marijuana are mind altering (psychoactive),” and “they all contain THC (delta-9-tetrahydrocannabinol), the main active chemical in marijuana.” DEA further maintains that the CSA does not differentiate between different varieties of Marijuana based on THC content. Regarding interest among growers in some states to cultivate Hemp for industrial use, DEA claims that the courts have supported the agency’s current policy that all Hemp growers—regardless of whether a state permit has been issued and of the THC content—are subject to the CSA and must obtain a federal permit: Under the CSA, anyone who seeks to grow Marijuana for any purpose must first obtain a DEA registration authorizing such activity. However, several persons have claimed that growing marijuana to produce so-called “Hemp” (which purportedly contains a relatively low percentage of THC) is not subject to CSA control and requires no DEA registration. All such claims have thus far failed, as every federal court that has addressed the issue has ruled that any person who seeks to grow any form of Marijuana (no matter the THC content or the purpose for which it is grown) must obtain a DEA registration.  

In the same CRS report, reference was made as to why the DEA made this determination when it released its 2016 Joint “Statement of Principles” on Industrial Hemp: 

In August 2016, DEA issued three major decisions on Marijuana and industrial Hemp. Regarding Marijuana, DEA announced it was rejecting a petition to reschedule Marijuana (affirming its continued status as an illegal Schedule I controlled substance). It also announced certain policy changes regarding authorized Marijuana cultivators for research. Regarding industrial Hemp, DEA issued a joint statement with USDA and FDA on the principles on industrial Hemp. The three federal agencies acknowledged that the 2014 farm bill provision regarding industrial Hemp “left open many questions regarding the continuing application of Federal drug control statutes to the growth, cultivation, manufacture, and distribution of industrial Hemp products, as well as the extent to which growth by private parties and sale of industrial Hemp products are permissible.” The 2014 farm bill also “did not remove industrial Hemp from the controlled substances list.” Federal law continues to restrict Hemp-related activities that were not specifically legalized under the farm bill provision, which did not amend CSA requirements regarding the manufacture and distribution of “drug products” containing controlled substances. The farm bill provision also did not amend the Federal Food, Drug, and Cosmetic Act regarding the approval process for new drug applications.

It was not until President Donald J. Trump signed the Agricultural Improvement Act of 2018 into law on December 20, 2018 that the issues the DEA raised were addressed and Hemp officially returned to being recognized as a federally legal agricultural commodity in the United States. What the 2018 Farm Bill did, that the 2014 Bill did not do is as follows:

The 2018 farm bill went several steps further (than the 2014 farm bill) and legalized the production of Hemp as an agricultural commodity while removing it from the list of controlled substances. The 2018 bill also listed Hemp as a covered commodity under crop insurance and directed the Federal Crop Insurance Corporation board to streamline the process for developing Hemp policies. Given the excitement and uncertainty around the market potential for Hemp, the 2018 bill also requires the secretary of agriculture to conduct a study of the Hemp-related agricultural pilot programs implemented under the 2014 farm bill, along with any other agricultural and academic research on the subject, to determine the economic viability of a domestic Hemp market. Additionally, while the law expands the potential for Hemp production, it does not create a system in which producers can grow it as freely as other crops. The bill outlined actions that would be considered violations of the law, such as producing a plant with higher than 0.3 percent THC content or cultivating Hemp without a license; it even goes into potential punishments and what happens to repeat offenders. The bill also sets up a shared state and federal regulatory authority over the issue, outlining the steps a state must take to develop a plan to regulate Hemp and submit it to the secretary of agriculture for approval. 

So now, for the first time since 1934, some form of Marijuana had been legalized by Congressional action and in doing so, a split was created between the legal definition of “Marijuana” on one hand and “Hemp” on the other. As part of this Congressional action the definition of Marijuana had to be amended in the CSA. The new definition now read as follows:

(16)(A) Subject to subparagraph (B), the term "Marihuana" means all parts of the plant Cannabis sativa L., whether growing or not; the seeds thereof; the resin extracted from any part of such plant; and every compound, manufacture, salt, derivative, mixture, or preparation of such plant, its seeds or resin.

(B) The term "Marihuana" does not include -

(i) Hemp, as defined in section 1639o of title 7; or

(ii) the mature stalks of such plant, fiber produced from such stalks, oil or cake made from the seeds of such plant, any other compound, manufacture, salt, derivative, mixture, or preparation of such mature stalks (except the resin extracted therefrom), fiber, oil, or cake, or the sterilized seed of such plant which is incapable of germination.

So at this point it is clear that Hemp, as defined in the 2018 Farm Bill had indeed been legalized, so long as it was indeed Hemp as per its new specific definition which reads as follows:

The term ‘Hemp’ means the plant Cannabis sativa L. and any part of that plant, including the seeds thereof and all derivatives, extracts, cannabinoids, isomers, acids, salts, and salts of isomers, whether growing or not, with a delta-9 tetrahydrocannabinol concentration of not more than 0.3 percent on a dry weight basis. 

Now, if a plant met the legal definition of Hemp, the DEA would have not have any regulatory oversight over it because it is NOT, by definition, Marijuana. The oversight of Hemp was now assigned to the USDA, working in conjunction with the individual states that were interested in launching Hemp programs. Despite these new arbitrary distinctions between Hemp and Marijuana, the two plants remained the same genus and species. To the naked eye they look identical. Even a trained professional would be unable to distinguish between the two without the benefit of a certificate of analysis (“COA”) from a qualified cannabis testing facility. Both Hemp and Marijuana have thousands of unique cultivars created by years of selective breeding. This means that different cultivars may present different unique characteristics, especially with regard to cannabinoid, terpene, and flavonoid content, so they may smell, taste, or affect a consumer differently, but ultimately they still remain the same plant.

The differences between Marijuana and Hemp were now specific to the content of THC-Δ9 at the time of harvest and the regulatory agencies that would be assigned to them once the plant material had been analytically tested. So long as a farmer was licensed by the state to grow Hemp legally and their crop came in at below 0.3% THC-Δ9, then that crop was legal and it was relegated to the USDA and the respective States. In any other circumstance, the DEA would continue to exercise dominion and control. If a farmer, under the state regulatory guidelines intends to grow a Hemp crop that it believes will test at below 0.3% THC, but it tests higher, at say 2% THC, then that crop will be considered “hot”, it will now be defined as Marijuana and the DEA would maintain oversight on the crop. Simply put, that crop would never meet the definition of Hemp and as such would not receive the protections contained within the 2018 Farm Bill.

But did the 2018 farm bill actually legalize CBD? Many prospective Hemp farmers were excited about growing the crop so that CBD could be extracted. While harvested Hemp also had many other uses, CBD extraction remained a primary focus for many farmers based on the market value of this chemical compound. But prior to planting a crop, these same farmers needed to be certain that CBD had indeed been legalized. Many academics and Non-Governmental Organizations (“NGO”) tried to make sense of the implications of the farm bill on CBD. The Brookings Institute described the legal question in the following way:

It is true that section 12619 of the Farm Bill removes Hemp-derived products from its Schedule I status under the Controlled Substances Act, but the legislation does not legalize CBD generally. As I have noted elsewhere on this blog CBD generally remains a Schedule I substance under federal law. The Farm Bill—and an unrelated, recent action by the Department of Justice—creates exceptions to this Schedule I status in certain situations. The Farm Bill ensures that any cannabinoid—a set of chemical compounds found in the cannabis plant—that is derived from Hemp will be legal, if and only if that Hemp is produced in a manner consistent with the Farm Bill, associated federal regulations, association state regulations, and by a licensed grower. All other cannabinoids, produced in any other setting, remain a Schedule I substance under federal law and are thus illegal.  

Essentially, the prevailing legal belief was that as long as the CBD was produced in Hemp, as per the specific definition of Hemp in the Farm Bill, then that CBD would be legal and would be allowed to be added to a host of retail products. This interpretation, if accurate, would represent not just the first time that the cannabis plant had been legalized in specific circumstances, but that the compounds contained therein, including a phytocannabinoid, had been legalized since the 1930’s, in any capacity.   

But a larger question still remained: Did the 2018 Farm Bill legalize all phytocannabinoids contained within the Hemp plant so long as the plant itself, when harvested and dried, contained 0.3% THC by dry weight? Again, the prevailing academic interpretation was that indeed it did. The Brookings Institute concluded: 

The Farm Bill ensures that any cannabinoid—a set of chemical compounds found in the cannabis plant—that is derived from Hemp will be legal, if and only if that Hemp is produced in a manner consistent with the Farm Bill, associated federal regulations, association state regulations, and by a licensed grower.  

While certainly persuasive in its interpretation, a respected NGO is certainly not qualified to be the legal arbiter of Congressional intent, nor would its interpretation be dispositive of the question. Certainly the intent of the Farm Bill was to legalize Hemp. There was little argument about whether or not non-psychoactive CBD, derived from regulated and compliant Hemp, had also been legalized in the process. But what about the other phytocannabinoids? Was THC really legalized as well? While NGOs and legal scholars could make the argument, the government had yet to opine. That changed on May 28, 2019 when Stephen Alexander Vaden, General Counsel to the USDA drafted a legal opinion addressed to Sonny Perdue, the Secretary of Agriculture (“Sec of Ag”). In this opinion, Vaden wrote:

By amending the definition of Marijuana to exclude Hemp as defined in AMA §297A, Congress has removed Hemp from Schedule 1 and removed it entirely from the CSA. In other words, Hemp is no longer a controlled substance. Also, by amending Schedule 1 to exclude THC in Hemp, Congress has likewise removed THC in Hemp from the CSA.

It is important to note 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.    

With the passage of the 2018 Farm Bill, the concerns the DEA raised in 2016 saying that “the 2014 farm bill also did not remove industrial Hemp from the controlled substances list” and “that Federal law continues to restrict Hemp-related activities that were not specifically legalized under the farm bill provision, which did not amend CSA requirements regarding the manufacture and distribution of “drug products” containing controlled substances” had now officially been addressed. Now Congress had expressly removed industrial Hemp from the controlled substances list. Hemp was now officially legal, so long as farmers adhered to both the Federal requirement that the cannabis plant being grown does not contain greater than 0.3% THC by dry weight and any requirements created under section 10113 of the Farm Bill, whereby state departments of agriculture must consult with the state’s governor and chief law enforcement officer to devise a plan that must be submitted to the Secretary of USDA. If a farmer is in strict compliance with both state and federal rules then Congress has legalized THC, as well as all other phytocannabinoids produced in legally cultivated industrial Hemp. as alluded to by the Dept of Ag’s General Counsel Vaden in his legal opinion to the Sec of Ag.  

Further bolstering the claim that all phytocannabinoids derived from Hemp had been legalized is the fact that on January 13th, 2017 the DEA issued the drug code 7350 (“7350”), a new drug code for Marijuana extract that went into effect immediately. 7350 allows DEA and DEA-registered entities to track quantities of Marijuana extract separately from the quantities of Marijuana. There was a great deal of uncertainty around 7350, and so the DEA was asked to clarify its position on the meaning of the code. Soon after, prior to the passage of the 2018 Farm Bill, the DEA did so by publishing its Clarification of the New Drug Code (7350) for Marijuana Extract.

• The new drug code (7350) established in the Final Rule does not include materials or products that are excluded from the definition of Marijuana set forth in the Controlled Substances Act (CSA).
• The new drug code includes only those extracts that fall within the CSA definition of Marijuana.
• If a product consisted solely of parts of the cannabis plant excluded from the CSA definition of Marijuana, such product would not be included in the new drug code (7350) or in the drug code for Marijuana (7360).

At the time this clarification was published, the Farm Bill had not yet been passed and Hemp was still considered to be synonymous with all other forms of federally illicit Marijuana. However, as illustrated above, once the Farm Bill was signed into law, Hemp was no longer part of the CSA definition of Marijuana and as such 7350 did not apply to Hemp nor did it include materials or products that are excluded from the definition of Marijuana, such as those contained in Hemp.

This belief was further supported by the testimony of Amy Abernethy, MD, PHD, Principal Deputy Commissioner FDA in her testimony to the US Senate's Commission on Agriculture, Nutrition, and Forestry on July 25, 2019. In her prepared statement Abernethy said:   

In December of 2018, the 2018 Farm Bill was signed into law. It removed Hemp, defined as cannabis (Cannabis sativa L.) and derivatives of cannabis with extremely low concentrations of the psychoactive compound delta-9-tetrahydrocannabinol (THC) (no more than 0.3 percent THC on a dry weight basis), from the definition of Marijuana in the Controlled Substances Act (CSA)...It has only been seven months since the 2018 Farm Bill removed Hemp, which includes low THC derivatives of cannabis, such as CBD products, from the definition of Marijuana in the CSA. I cannot overstate how significant of a policy sea change this has been. Prior to the enactment of the 2018 Farm Bill, the CSA did not differentiate between Marijuana and Hemp, and all cannabis (with certain exceptions, e.g. sterilized seeds and mature stalks of the plant) was a Schedule I substance and therefore controlled by the Drug Enforcement Administration (DEA). 

Essentially what Abernethy was affirming is that 7350 no longer applies to Hemp derived extracts as the DEA has no control over Hemp anymore as legally grown Hemp no longer meets the DEA definition of Marijuana and because Hemp had been removed from the Controlled Substances Act. Taken in concert with one another, Congress's intent was made clear; Hemp that tested at 0.3% THC or below, grown by a state sanctioned farmer was now legal and the DEA no longer had regulatory control over Hemp. The growing and harvesting of Hemp would now be regulated by the USDA and the states and the resulting consumer products, including foods and dietary supplements, made from Hemp extracts would now be regulated by the FDA.  

Lastly, the former Commissioner of the FDA, Scott Gottlieb, M.D., weighed in on this issue the very day the 2018 Farm Bill was signed into law. In doing so he reaffirmed that the DEA had no authority over Hemp and that the FDA was only concerned with safety and efficacy of Hemp derived products that were entering interstate commerce. He wrote:

Today, the Agriculture Improvement Act of 2018 was signed into law. Among other things, this new law changes certain federal authorities relating to the production and marketing of Hemp, defined as cannabis (Cannabis sativa L.), and derivatives of cannabis with extremely low (less than 0.3 percent on a dry weight basis) concentrations of the psychoactive compound delta-9-tetrahydrocannabinol (THC). These changes include removing Hemp from the Controlled Substances Act, which means that it will no longer be an illegal substance under federal law. Just as important for the FDA and our commitment to protect and promote the public health is what the law didn’t change: Congress explicitly preserved the agency’s current authority to regulate products containing cannabis or cannabis-derived compounds under the Federal Food, Drug, and Cosmetic Act (“FD&C Act”) and section 351 of the Public Health Service Act. In doing so, Congress recognized the agency’s important public health role with respect to all the products it regulates. This allows the FDA to continue enforcing the law to protect patients and the public while also providing potential regulatory pathways for products containing cannabis and cannabis-derived compounds...Additionally, it’s unlawful under the FD&C Act to introduce food containing added CBD or THC into interstate commerce, or to market CBD or THC products as, or in, dietary supplements, regardless of whether the substances are Hemp-derived. This is because both CBD and THC are active ingredients in FDA-approved drugs and were the subject of substantial clinical investigations before they were marketed as foods or dietary supplements.  

Here again, it was the position of the FDA that the DEA no longer had control over Hemp and that the FDA was principally concerned with product safety and efficacy, as it relates to the FD&C Act and interstate commerce. The FDA expressed no concern related to products that contained Hemp derived cannabinoids until they were introduced into interstate commerce. Until that point, the USDA and the respective states would oversee all Hemp related activity. In doing so a completely new and legal industry emerged; Hemp extraction. 

The process that one extracts Hemp is identical to the process one would employ to extract any other cannabis plant. The primary differentiating quality of Hemp extraction again relates to the content of THC within the Hemp plant. As a general rule, if one is processing a Marijuana plant to extract the THC, the desired starting material, or biomass, should contain high levels of THC. By contrast, if one is processing Hemp for CBD, then the desired starting material, or biomass, should contain high levels of CBD. Specific cultivars of both high THC Marijuana and high CBD Hemp have been bred for many years to achieve the desired processing results. Additionally, most cultivars of Marijuana that are high in THC are also correspondingly low in CBD and most cultivars of Hemp that express high levels of CBD are also correspondingly low in THC. This allows one to maximize the amount of the chemical compound, by volume, that they are attempting to extract. By way of analogy, a copper mine will still yield a small amount of extractable gold, but its primary product remains copper. But in the extraction process, the mine will remove both.

The major difference between the extraction of Hemp and that of Marijuana is the sheer amount of material that is ordinarily processed for commercial applications. With Marijuana, users only use a very small amount of THC to get them “high” or to alleviate problems associated with specific medical indications. By contrast, a user of CBD will consume far larger quantities of the chemical compound. This means that far more biomass needs to be processed to extract enough of the usable material to satisfy the market demand. 

Since the passage of the 2018 Farm Bill, the CBD industry has exploded. With the increased demand for CBD, there has been a corresponding need for processing facilities that specialize in Hemp extraction. These are the facilities that process large quantities of industrial Hemp into CBD crude oil, distillate, and isolate. Ultimately these processors either sell these products to manufacturers of CBD consumer products, or they make these consumer products themselves. Much like Marijuana processors, Hemp processors have very specialized equipment to complete the extraction process, but again, the major difference is the average commercial Hemp processor must have the ability to process significantly more plant material in order to create the volume of finished product that the market requires.

The process to make each extracted Hemp product is very different and some processing facilities specialize in only one portion of the process. Some will process the biomass to crude oil and then ship it to the next laboratory for further processing. Others specialize in distillation, while others are only concerned with remediation. When Hemp is harvested for extraction, it initially needs to be bucked, shucked, and dried prior to being extracted. After the biomass has dried, the farmer will send a sample to an analytical testing facility to ensure that the plant material does not exhibit greater than 0.3% THC on a dry weight basis. Once the plant material is shown to be compliant, it may now be shipped anywhere in the United States to be extracted.

The initial extraction will likely be either performed utilizing ethanol or supercritical CO2 as a solvent, as those are the two methods that allow for the greatest volume of material to be processed. This initial extraction strips the resin glands from the plant material and deposits the oil in a catch basin prior to recovering the bulk of the solvent. The next step is to “winterize” the oil by removing waxes, lipids, and fats from the oil. Doing so creates a much cleaner and more pure oil than what is initially extracted. 

Once winterized, the remaining ethanol will be removed with the use of a rotary evaporator (“rotovap”). The final step is to decarboxylate the oil in order to activate all the cannabinoids by converting them from their acidic version to their usable form. This will convert all THCA to THC Δ9 and all CBDA to CBD. Once all of these steps; extraction, recovery, winterization, and decarboxylation have taken place, then the manufacturer will have what is commonly referred to as “Full-Spectrum Winterized Decarboxylated CBD Crude Oil” and it will be marketable for sale to other businesses who will further refine the oil for the specific products they desire to make, or in order to refine it to sell it to a products manufacturer.

The term “full-spectrum” refers to the fact that in the extraction process, the oil will retain the full range of cannabinoids, terpenoids, and flavonoids that existed naturally in the plant. When they are extracted, the same range of compounds still exist, just at a much higher concentration. For example, if the dried Hemp biomass tested at 7% CBD, it may now test at 70% CBD in this crude state. The same is true of all other retained compounds. The entire process is predicated on retaining the compounds one wants to keep and removing the compounds, including the vast majority of plant material, it does not.  

It should be noted that at this point in the extraction process, due to the concentrating of retained compounds, the winterized CBD oil will now most certainly test at a level that exceeds the federal government's mandated maximum of 0.3% THC, but it does so in a product that was derived from compliant Hemp and will be used to manufacture compliant finished products. Every state with a Hemp program is aware that at this step in the process the Hemp oil will be “hot” as it is impossible for it not to be. Even with compliant starting material, the extraction process will concentrate all cannabinoids in an oil that by the very nature of the extraction process will elevate the THC content to above 0.3%.

Due to this issue of Hemp oil going “hot” in the initial extraction, many states have created regulations pertaining to the sale of winterized CBD crude. Some, such as Vermont, have published specific guidelines to follow that say that so long as the crude does not test at above 1% total THC, then it will remain compliant, contingent upon it being sold to another business within the processing or manufacturing supply chain. Other states do not have specific language pertaining to this issue, but have provided guidance that show intent as to how winterized CBD crude should be treated within the confines of the state's borders. In the same manner that the states took a more expansive view of federal law with respect to medical or adult use of Marijuana, they did so again with respect to Hemp extracts. As long as the “hot” product does not leave the state, or get marketed to consumers in this form, then the oil will remain compliant. The regulatory agencies within the respective states are provided a great deal of regulatory deference by the USDA to create and enforce the rules as they see fit, so long as consumer products emanating from those states are compliant prior to entering interstate commerce. 

In Colorado the regulatory agency assigned to oversee the state’s Hemp program is the Industrial Hemp Committee under the Colorado Department of Agriculture (“CDA”). While the CDA is very specific about strict compliance to the 0.3% THC rule for harvested biomass, it has made the determination to remain silent with respect to the rules and regulations pertaining to processing Hemp. The CDA’s official policy, as displayed on its internal website is as follows: 

The CDA does not regulate the processing and/or extraction or end-use products. Our program staff is not able to answer any questions about regulations or requirements for processing and/or extraction, sales, products, product testing, etc. since it is not within the scope of our program.

What the CDA does say on page 3 of its Industrial Hemp Frequently Requested Information page skips right over the extraction and purification process and lands on consumer products. Here the CDA suggests that its concern is that when a final product is sold to a consumer that it is again compliant with the 0.3% requirement. It position reads as follows:

What tests are legally required for Hemp products?

The language under HB18-1295 states that all finished Hemp products must conform to a THC concentration of 0.3% or below to enter the consumer market. Therefore, it is the responsibility of the licensee to ensure their products contain 0.3% THC or less.

No required testing other than potency exists at this time, but Colorado Hemp cannabinoid-based product manufacturers, extractors and/or processors are encouraged to test for heavy metals, residual solvents, pesticides, microbial and shelf stability.

Taken together, it is clear the official position of the CDA is that cultivated Hemp must not be more than 0.3% THC by dry weight. Once the Hemp has been cleared as compliant, then the CDA takes a hands off approach until the time that a consumer product enters the stream of commerce, at which point in time the consumer product must again be tested at less than 0.3% THC, but what happens between the harvest of complaint Hemp and when a compliant consumer product is manufactured, the CDA has little concern or desire to regulate. 

Part 2 of this article may be found here.