Hemp industry insiders have been awaiting the recent passage of the U.S. Department of Agriculture’s (USDA) interim final rules regarding the Domestic Hemp Production Program. The rules, which went into effect on October 31, 2019, are wide ranging and potentially impact all aspects of the hemp industry from cultivators to retail shops.

As a quick recap, the USDA was tasked with implementing agency rules for hemp production following passage of the Agricultural Improvement Act of 2018 (commonly referred to as “the 2018 Farm Bill”). The rules were promised in advance of the 2020 growing season and the recently released rules will be in place through November 1, 2021. The rules are multi-faceted and may impact your particular business in different ways (or not at all) so careful review and consultation with an attorney if you have questions is recommended. As a general bulleted summary, the USDA interim rules:

Outline provisions for the USDA to review and approve hemp plans submitted by states, territories, and American Indian tribes for the domestic production of hemp and establishes a plan for jurisdictions that do not have their own.
Clarifies that acceptable THC levels must be total delta-9 THC concentration of not more than 0.3% on a dry weight basis.
Includes provisions for maintaining information about the land where hemp is produced, testing levels of delta-9 THC, disposing of plants not meeting the necessary requirements, licensing requirements, and ensuring compliance.
Allows for interstate transportation and shipment of hemp. No state or Indian tribe may prohibit the transportation or shipment of hemp.
Requires samples from flower material to be taken within 15 days prior to the anticipated harvest of hemp plants by a federal state, local, or tribal law-enforcement agency or designated person for delta-9 THC testing.
Requires that laboratories report the measurement of uncertainty as part of any hemp test results and include a definition of an “acceptable hemp THC level” to account for uncertainty in test results.
Provides that states and institutions of higher education can continue operating under the 2014 Farm Bill which expires in October 2020.

The interim rule DOES NOT:

Include a seed certification program since the same seeds can react differently when grown in different geographical locations
Allow for the exportation of hemp. The USDA indicated that it will rule on this later.
Limit the U.S. Food and Drug Administration’s (FDA) authority to prohibit the sale of CBD in foods, drugs, and cosmetics.

Generally speaking, the USDA interim final rules simply implement the provisions of the 2018 Farm Bill. Of particular note; the variance allowance means that farmers growing hemp will not be in negligence noncompliance for crop testing between 0.3% and 0.5% THC concentration, however, plants in this range would still need to be disposed. Additionally, the express allowance for the interstate shipment of hemp should hopefully eliminate the crop seizures that have been reported in jurisdictions with overzealous law enforcement officials. Finally, the rules do not clear the path for the permissible addition of CBD to food which will still require approval from the FDA. If you have questions about these rules and/or other legal issues like the North Carolina hemp program and FDA regulations, you are encouraged to speak with an experienced attorney.