Federal agencies’ current positions on hemp-derived CBD products

By Maggie Craig, Jae Yeon Kim, Kelsey Tavares & Stefanie Fogel on October 25, 2021

At the federal level, multiple agencies have oversight over the marketing, sale, distribution, and transportation of hemp-derived CBD products. The chart below offers a high-level summary of these federal agencies’ current positions on products containing hemp-derived CBD.

Note that we intend this chart to provide general insights based on public commentary, enforcement actions and guidance from federal agencies; it is not intended to provide legal advice. Federal and state laws, regulations, rules and policies regarding hemp-derived CBD products are continuously evolving; given that, before you proceed with the sale or introduction of hemp-derived products, we recommend seeking legal advice.

Food and Drug Administration (FDA)

APPLICABLE PRODUCTS Drugs, food, dietary supplements, cosmetics, animal foods, animal drugs
FDA generally prohibits hemp-derived CBD from being added to dietary supplements, foods, and OTC drugs intended for use by humans or animals. FDA says in a public statement, “Essentially, the relevant statutory provisions prohibit these uses of CBD because CBD was the subject of substantial clinical investigations into its potential medical uses before it was added to foods (including dietary supplements), and, separately, because CBD is the active ingredient in Epidiolex, an FDA-approved prescription drug product to treat rare, severe forms of epilepsy.” FDA has reiterated that CBD may not be added to dietary supplements due to the prior drug exclusion under section 201(ff)(3)(B) of the FD&C Act [21 U.S.C. § 321(ff)(3)(B)] given research involving CBD and given the approval of Epidiolex. Regarding conventional foods, CBD is similarly prohibited via the prior drug exclusion under section 301(ll) of the FD&C Act, 21 U.S.C. 331(ll), given research involving CBD and the approval of Epidiolex. FDA has concluded that CBD was not marketed in food or dietary supplements before Epidiolex was approved or before substantial clinical investigations involving CBD had been instituted. In addition, regarding conventional foods, CBD is not an approved food additive, nor is FDA aware of any conclusion that CBD is GRAS for use in conventional foods. The latest commentary from FDA indicates that the agency does not believe existing data provides an adequate basis to conclude that CBD is GRAS. Similarly, FDA has not approved CBD as a new dietary ingredient (NDI) for use in dietary supplements. Notably, FDA does permit the use of certain hemp seed-derived ingredients – including hulled hemp seed, hemp seed protein powder and hemp seed oil – which have been deemed generally recognized as safe (GRAS) and which may therefore be legally marketed in human foods for the uses described in FDA’s GRAS notices. Regarding OTC drug products (including certain topical creams), FDA has reiterated that new human and animal drugs must be approved by the FDA or conform to a “monograph” for a particular drug category before they can be legally marketed as drugs. CBD was not an ingredient considered under the OTC Drug Review. CBD may not be added as an “active” ingredient to OTC drug products, nor as an inactive ingredient, given that CBD has known pharmacological effects on humans as well as demonstrated risks and therefore cannot be regarded as safe and suitable as an inactive ingredient. Although FDA does not expressly prohibit CBD in cosmetic products, the agency has indicated that it may take action regarding such products if it has information that an ingredient or cosmetic is unsafe for consumers. In particular, cosmetic products containing cannabis or cannabis-derived ingredients must not be injurious to users under the conditions of use prescribed in the labeling of the product or the customary use of the product.

APPLICABLE PRODUCTS

Drugs, food, dietary supplements, cosmetics, animal foods, animal drugs

CURRENT POSITION[1]

FDA generally prohibits hemp-derived CBD from being added to dietary supplements, foods, and OTC drugs intended for use by humans or animals. FDA says in a public statement, “Essentially, the relevant statutory provisions prohibit these uses of CBD because CBD was the subject of substantial clinical investigations into its potential medical uses before it was added to foods (including dietary supplements), and, separately, because CBD is the active ingredient in Epidiolex, an FDA-approved prescription drug product to treat rare, severe forms of epilepsy.”

FDA has reiterated that CBD may not be added to dietary supplements due to the prior drug exclusion under section 201(ff)(3)(B) of the FD&C Act [21 U.S.C. § 321(ff)(3)(B)] given research involving CBD and given the approval of Epidiolex.

Regarding conventional foods, CBD is similarly prohibited via the prior drug exclusion under section 301(ll) of the FD&C Act, 21 U.S.C. 331(ll), given research involving CBD and the approval of Epidiolex. FDA has concluded that CBD was not marketed in food or dietary supplements before Epidiolex was approved or before substantial clinical investigations involving CBD had been instituted.

In addition, regarding conventional foods, CBD is not an approved food additive, nor is FDA aware of any conclusion that CBD is GRAS for use in conventional foods. The latest commentary from FDA indicates that the agency does not believe existing data provides an adequate basis to conclude that CBD is GRAS. Similarly, FDA has not approved CBD as a new dietary ingredient (NDI) for use in dietary supplements.

Notably, FDA does permit the use of certain hemp seed-derived ingredients – including hulled hemp seed, hemp seed protein powder and hemp seed oil – which have been deemed generally recognized as safe (GRAS) and which may therefore be legally marketed in human foods for the uses described in FDA’s GRAS notices.

Regarding OTC drug products (including certain topical creams), FDA has reiterated that new human and animal drugs must be approved by the FDA or conform to a “monograph” for a particular drug category before they can be legally marketed as drugs. CBD was not an ingredient considered under the OTC Drug Review. CBD may not be added as an “active” ingredient to OTC drug products, nor as an inactive ingredient, given that CBD has known pharmacological effects on humans as well as demonstrated risks and therefore cannot be regarded as safe and suitable as an inactive ingredient.

Although FDA does not expressly prohibit CBD in cosmetic products, the agency has indicated that it may take action regarding such products if it has information that an ingredient or cosmetic is unsafe for consumers. In particular, cosmetic products containing cannabis or cannabis-derived ingredients must not be injurious to users under the conditions of use prescribed in the labeling of the product or the customary use of the product.

^{[1] The information contained herein is current as of the date of publication.}

Key sources

FDA Regulation of Dietary Supplements & Conventional Food Products Containing Cannabis and Cannabis-Derived Compounds

FDA Regulation of Cannabis and Cannabis-Derived Products, Including Cannabidiol (CBD)

Warning Letters and Test Results for Cannabidiol-Related Products | FDA

FDA Warns Companies Illegally Selling CBD Products

FDA Regulation of Dietary Supplements & Conventional Food Products Containing Cannabis and Cannabis-Derived Compounds

Federal Trade Commission (FTC)

APPLICABLE PRODUCTS All products
CBD products of any type are not permitted to make scientifically unsupported health claims (ie, claims that a product can prevent, treat, or cure serious medical conditions). Such claims, whether represented directly or indirectly, expressly, or by implication, are deemed to be unfair or deceptive acts or practices in violation of the Federal Trade Commission Act. In December 2020, FTC announced Operation CBDeceit, its first law enforcement crackdown on deceptive claims in the CBD product space. The FTC took action against six sellers for making a number of “scientifically unsupported claims” about CBD products’ ability to treat a variety of health conditions, among them cancer, heart disease, diabetes, hypertension, Alzheimer’s disease and anxiety. These products also made comparative health claims stating that CBD products were able to treat pain better than prescription medications and that CBD products were safe for all users. The FTC approved final administrative consent orders against these sellers in March 2021. In May 2021, FTC continued its enforcement under Operation CBDeceit with another round of enforcement targeting the online CBD store Kushly. The agency reiterated that CBD products are subject to the FTC Act. Throughout 2021, FTC also issued a number of warning letters to manufacturers and sellers of CBD products who had made similar unapproved drug and dietary supplement claims. Through this activity, the FTC is affirming that CBD products which make health claims will be “held to the highest substantiation standards” and that marketers “can expect careful scrutiny” of promises made in connection with CBD products.

APPLICABLE PRODUCTS

All products

CURRENT POSITION[1]

CBD products of any type are not permitted to make scientifically unsupported health claims (ie, claims that a product can prevent, treat, or cure serious medical conditions). Such claims, whether represented directly or indirectly, expressly, or by implication, are deemed to be unfair or deceptive acts or practices in violation of the Federal Trade Commission Act.

In December 2020, FTC announced Operation CBDeceit, its first law enforcement crackdown on deceptive claims in the CBD product space. The FTC took action against six sellers for making a number of “scientifically unsupported claims” about CBD products’ ability to treat a variety of health conditions, among them cancer, heart disease, diabetes, hypertension, Alzheimer’s disease and anxiety.

These products also made comparative health claims stating that CBD products were able to treat pain better than prescription medications and that CBD products were safe for all users. The FTC approved final administrative consent orders against these sellers in March 2021.

In May 2021, FTC continued its enforcement under Operation CBDeceit with another round of enforcement targeting the online CBD store Kushly. The agency reiterated that CBD products are subject to the FTC Act.

Throughout 2021, FTC also issued a number of warning letters to manufacturers and sellers of CBD products who had made similar unapproved drug and dietary supplement claims.

Through this activity, the FTC is affirming that CBD products which make health claims will be “held to the highest substantiation standards” and that marketers “can expect careful scrutiny” of promises made in connection with CBD products.

^{[1] The information contained herein is current as of the date of publication.}

Key sources

FTC Approves Final Administrative Consent Orders against Sellers of Deceptively Marketed CBD Products

FTC Announces Crackdown on Deceptively Marketed CBD Products

One Thing Marketers of CBD Products Need to Know Right Now

FTC Sends Warning Letters to Companies Advertising Their CBD-Infused Products As Treatments for Serious Diseases, Including Cancer, Alzheimer’s, and Multiple Sclerosis

FTC Approves Final Administrative Consent Orders

FTC Enforcement Action Against Kushly

Cannafyl Warning Letter and Evolved Ayurvedic Discoveries Warning Letter

US Department of Agriculture (USDA)

APPLICABLE PRODUCTS Not applicable
The 2018 Farm Bill legalized hemp by removing it from the definition of marijuana in the Controlled Substances Act. Under the revised definition, 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 Thus, states may not prohibit the interstate transport or shipment of hemp and derivatives of hemp lawfully produced under the 2018 Farm Bill. Notably, the 2018 Farm Bill does not address CBD consumer products, such as foods, dietary supplements, cosmetics, or OTC drugs. On January 19, 2021 (effective as of March 22, 2021), USDA published a final rule setting forth regulations for the production of hemp in the United States. Importantly, the rule “does not address ‘in-process materials,’ processors, end-products, processing of CBD or other cannabinoids or anything that may contain hemp or hemp byproducts.” The final rule requires producers to dispose of plants which contain THC in excess of 0.3%, with producers subject to negligent violations if found to have produced (and failed to dispose of) plants with THC of 1% or more. Producers may only receive one negligent violation in a growing season. The final rule also sets forth sampling and harvesting requirements (for example, hemp crops must be harvested within 30 days of sampling and testing). Hemp crops must also be tested using DEA-registered laboratories, although in recognition of the insufficient number of DEA registered labs, enforcement flexibility allowing testing at non-DEA registered labs has been extended until January 1, 2022. Additionally, in May 2019 the Office of General Counsel issued a legal memorandum summarizing new hemp authorities, which states USDA’s legal conclusions regarding the 2018 Farm Bill, including: (i) as of the Bill’s enactment, hemp is no longer a controlled substance under schedule I of the Controlled Substances Act; (ii) states and Indian Tribes may not prohibit interstate transport or shipment of hemp lawfully produced under a state or tribal plan or under a license issued under the USDA plan or lawfully produced under the 2014 Farm Bill; and (iii) a person with a state or federal felony conviction related to a controlled substance is subject to a 10-year ineligibility restriction on producing hemp.

APPLICABLE PRODUCTS

Not applicable

CURRENT POSITION[1]

The 2018 Farm Bill legalized hemp by removing it from the definition of marijuana in the Controlled Substances Act. Under the revised definition, 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 Thus, states may not prohibit the interstate transport or shipment of hemp and derivatives of hemp lawfully produced under the 2018 Farm Bill. Notably, the 2018 Farm Bill does not address CBD consumer products, such as foods, dietary supplements, cosmetics, or OTC drugs.

On January 19, 2021 (effective as of March 22, 2021), USDA published a final rule setting forth regulations for the production of hemp in the United States. Importantly, the rule “does not address ‘in-process materials,’ processors, end-products, processing of CBD or other cannabinoids or anything that may contain hemp or hemp byproducts.”

The final rule requires producers to dispose of plants which contain THC in excess of 0.3%, with producers subject to negligent violations if found to have produced (and failed to dispose of) plants with THC of 1% or more. Producers may only receive one negligent violation in a growing season.

The final rule also sets forth sampling and harvesting requirements (for example, hemp crops must be harvested within 30 days of sampling and testing). Hemp crops must also be tested using DEA-registered laboratories, although in recognition of the insufficient number of DEA registered labs, enforcement flexibility allowing testing at non-DEA registered labs has been extended until January 1, 2022.

Additionally, in May 2019 the Office of General Counsel issued a legal memorandum summarizing new hemp authorities, which states USDA’s legal conclusions regarding the 2018 Farm Bill, including: (i) as of the Bill’s enactment, hemp is no longer a controlled substance under schedule I of the Controlled Substances Act; (ii) states and Indian Tribes may not prohibit interstate transport or shipment of hemp lawfully produced under a state or tribal plan or under a license issued under the USDA plan or lawfully produced under the 2014 Farm Bill; and (iii) a person with a state or federal felony conviction related to a controlled substance is subject to a 10-year ineligibility restriction on producing hemp.

^{[1] The information contained herein is current as of the date of publication.}

Key sources

USDA Final Rule

U.S. Domestic Hemp Production Program Final Rule Webinar Summary

USDA Office of General Counsel’s Legal Memo

Drug Enforcement Administration (DEA)

APPLICABLE PRODUCTS All products
The 2018 Farm Bill expressly excluded hemp from the definition of marijuana, and therefore removed hemp from the DEA’s schedule of controlled substances. In August 2020, DEA published an Interim Final Rule (IFR) to implement conforming changes to its regulations as a result of the 2018 Farm Bill. Consistent with the 2018 Farm Bill, the DEA IFR modifies the listing of “tetrahydrocannabinols” on the Schedule of Controlled Substances by adding the following stipulation: “Tetrahydrocannabinols does not include any material, compound, mixture, or preparation that falls within the definition of hemp set forth in 7 U.S.C. 1639o.” DEA’s position in the IFR is that the definition of hemp does not “automatically” exempt any products derived from a hemp plant; instead, a cannabis derivative, extract, or product that exceeds 0.3% Delta 9 THC is a Schedule I controlled substance, even if it was derived from a legal hemp plant containing 0.3% or less of Delta 9 THC. Notably, the DEA provides through the IFR that the 2018 Farm Bill does not impact the control status of synthetically derived tetrahydrocannabinols, and all synthetically derived tetrahydrocannabinols remain schedule I controlled substances.

APPLICABLE PRODUCTS

All products

CURRENT POSITION[1]

The 2018 Farm Bill expressly excluded hemp from the definition of marijuana, and therefore removed hemp from the DEA’s schedule of controlled substances.

In August 2020, DEA published an Interim Final Rule (IFR) to implement conforming changes to its regulations as a result of the 2018 Farm Bill. Consistent with the 2018 Farm Bill, the DEA IFR modifies the listing of “tetrahydrocannabinols” on the Schedule of Controlled Substances by adding the following stipulation: “Tetrahydrocannabinols does not include any material, compound, mixture, or preparation that falls within the definition of hemp set forth in 7 U.S.C. 1639o.”

DEA’s position in the IFR is that the definition of hemp does not “automatically” exempt any products derived from a hemp plant; instead, a cannabis derivative, extract, or product that exceeds 0.3% Delta 9 THC is a Schedule I controlled substance, even if it was derived from a legal hemp plant containing 0.3% or less of Delta 9 THC.

Notably, the DEA provides through the IFR that the 2018 Farm Bill does not impact the control status of synthetically derived tetrahydrocannabinols, and all synthetically derived tetrahydrocannabinols remain schedule I controlled substances.

^{[1] The information contained herein is current as of the date of publication.}

Key sources

2020 – Implementation of the Agriculture Improvement Act of 2018 (usdoj.gov)

Court dismisses hemp industry group lawsuit against DEA (naturalproductsinsider.com)

Alcohol and Tobacco Tax and Trade Bureau (TTB)

APPLICABLE PRODUCTS Wine, beer, other malt beverages, distilled spirits
TTB follows FDA’s position that hemp-derived CBD is not permitted in foods, and the agency has stated in Industry Circular 2019-1 that hemp-derived CBD is not permitted in alcoholic beverages. This means that TTB will not approve a formula containing hemp-derived CBD. As noted by TTB, formula approval technically applies to both interstate and intrastate sales (“In the interim, we note that alcohol beverages containing ‘hemp’ ingredients (including alcohol beverages sold exclusively in intrastate commerce) continue to require formula approval under TTB regulations”). Applicants will have the option of resubmitting the formula to TTB upon receipt of a favorable individual determination from FDA on the regulatory status of their ingredients. Ingredients from hemp seeds or hemp seed oil are permitted in alcoholic beverages. TTB is in the process of updating its 2018 Guidance on the use of hemp ingredients in alcohol beverages to reflect the recent changes to the law. Per TTB, the 2019-1 Circular reflects TTB’s most recent guidance.

APPLICABLE PRODUCTS

Wine, beer, other malt beverages, distilled spirits

CURRENT POSITION[1]

TTB follows FDA’s position that hemp-derived CBD is not permitted in foods, and the agency has stated in Industry Circular 2019-1 that hemp-derived CBD is not permitted in alcoholic beverages. This means that TTB will not approve a formula containing hemp-derived CBD. As noted by TTB, formula approval technically applies to both interstate and intrastate sales (“In the interim, we note that alcohol beverages containing ‘hemp’ ingredients (including alcohol beverages sold exclusively in intrastate commerce) continue to require formula approval under TTB regulations”). Applicants will have the option of resubmitting the formula to TTB upon receipt of a favorable individual determination from FDA on the regulatory status of their ingredients.

Ingredients from hemp seeds or hemp seed oil are permitted in alcoholic beverages.

TTB is in the process of updating its 2018 Guidance on the use of hemp ingredients in alcohol beverages to reflect the recent changes to the law. Per TTB, the 2019-1 Circular reflects TTB’s most recent guidance.

^{[1] The information contained herein is current as of the date of publication.}

Key sources

Industry Circular 2019-1, Hemp Ingredients in Alcohol Beverage Formulas

United States Postal Service (USPS)

APPLICABLE PRODUCTS All products
CURRENT POSITION[1]
In June 2019, USPS added a new section for Hemp-based Products (453.37) in its Publication 53. This section provides that hemp and hemp-based products, including CBD with THC concentration not exceeding 0.3% on a dry weight basis, are permitted to be mailed when: (1) the mailer complies with all applicable federal, state and local laws pertaining to hemp production, processing, distribution and sales; and (2) the mailer retains records establishing compliance with such laws, including laboratory test results, licenses or compliance reports, for no less than two years after the date of mailing. With respect to vaping products specifically, the status of mailability of CBD vapes is unclear. USPS issued a Proposed Rule on April 19, 2021 that would prohibit the mailing of ENDS (electronic nicotine delivery system) products through USPS. Included in the Proposed Rule were several potential exceptions from the Prevent All Cigarette Trafficking Act (PACT Act) restrictions, among them products containing CBD with a THC concentration not exceeding 0.3%. USPS stated it would not accept applications for PACT Act exceptions before the final rule is finalized. Whether any ENDS mailers, including companies offering CBD vape products, may ultimately be allowed to use the exceptions set forth in the interim rule remains to be determined.

^{[1] The information contained herein is current as of the date of publication.}

Key sources

Publications (usps.com) [Publication 52]

Federal Register: Treatment of E-Cigarettes in the Mail

US (Customs and Border Protection (CBP)

APPLICABLE PRODUCTS All products
CURRENT POSITION[1]
CBP has not issued regulations or formal policies with respect to the import or export of finished consumer products containing hemp-derived CBD. In informal FAQ guidance, Customs and Border Patrol has publicly acknowledged only that hemp seeds can be imported into the United States pursuant to the 2018 Farm Bill. Thus, some uncertainty remains around importing finished CBD consumer products into the United States. There still is significant confusion among regulators regarding such things as differentiation between marijuana and hemp based on currently available analytical methods. These uncertainties may lead to the risk of seizure. Companies should consider obtaining a Ruling Letter from CBP to confirm the tariff classification of the proposed shipment of CBD products pursuant to 19 CFR Part 177. Such Ruling Letters have been issued to companies proposing to import CBD Oil and CBD in bulk powder (isolate) form.

^{[1] The information contained herein is current as of the date of publication.}

Key sources

Importing hemp seeds into the U.S. (cbp.gov)

What are Ruling Letters? | U.S. Customs and Border Protection (cbp.gov)

CROSS Customs Rulings Online Search System (cbp.gov) [Direct link to search of rulings mentioning “CBD”]