CBD and hemp remain a hot topic in Minnesota and nationwide. We have received a lot of questions about CBD and the sale of CBD in C-stores. What is CBD? Cannabidiol (CBD) is a non-intoxicating compound found in both hemp plants and marijuana plants. Hemp and marijuana come from the same species of cannabis, but hemp contains no more than 0.3% of THC (the primary psychoactive compound found in marijuana).

The legality of CBD depends upon the intended use of the product and how it is labeled and marketed. The 2018 Farm Bill signed into law on December 20, 2018 removed hemp and any derivatives and extracts thereof from being classified as a controlled substance under federal law. However, the 2018 Farm Bill explicitly preserved the FDA’s authority to regulate hemp-derived products. While hemp is no longer a controlled substance, the FDA has clearly stated that CBD derived from hemp cannot be sold as either a drug, a dietary supplement, or for human or animal consumption.

A drug is a substance (other than food) intended to affect the structure of any function of the body and for use in the diagnosis, cure, mitigation, treatment, or prevention of disease. A dietary supplement is a product taken by mouth that contains a dietary ingredient including vitamins, minerals, amino acids, and herbs or botanicals, as well as other substances that can be used to supplement the diet. The FDA has issued numerous warning letters to companies making unsubstantiated claims about CBD products. It is illegal for a C-Store or retailer to sell any CBD products that are marketed as having any therapeutic or medical use, that are intended as a dietary supplement, or that are intended to be consumed.

The Minnesota State Legislature recently passed a number of CBD and hemp-related laws that you should know about, especially if you consider acting as a manufacturer or retailer of CBD/hemp products. These regulations became effective January 1, 2020.

Under the new Minnesota law, any hemp-derived CBD product must conform to certain testing and labeling requirements. As a retailer, you may believe that this doesn’t matter to you, as you are only selling someone else’s product – you aren’t the manufacturer, wholesaler or distributor. However, there is an enforcement provision of the new law and certain penalties in the event the product does not adhere to the labeling requirements.

In such an event, you may receive a cease and desist order, your non-compliant CBD products may be embargoed, and you may be sued in district court. Additionally, any person violating a provision of the Pharmacy Practice Act is guilty of a crime.

So, what should you do? You need to ensure you are compliant with the FDA, the parameters of the 2018 Federal Farm Act, and Minnesota law. This area of the law is changing daily. CBD is a fast growing industry, and one that many people have the potential to profit from. If you choose to sell CBD/hemp products, we strongly recommend you consult with an attorney right away. We would be happy to advise you on these issues and any others that affect you and your business. Please contact us here.