Kristin Jordan, Senior Counsel
At the close of the legislative session last week, lawmakers in Albany – led by downstate Assemblywoman Donna Lupardo and Senator Jen Metzger – successfully passed a bill which aims to regulate the New York state industrial hemp market while providing consumer protections. The New York market has been flooded with hemp and hemp-derived CBD products in recent years, yet lacked the regulatory guidelines to support safe and legal commerce.
The bill, to be reviewed by Governor Cuomo, provides the regulatory framework for two-year renewable licensing (growing, manufacturing, extracting), packaging and labeling requirements (including negative health impact warning information and restrictions on health claims), and laboratory testing oversight to include QR codes linked to consumer information. In addition to authorizing the issuance of retail, wholesale and distributor permits to sell hemp-derived products, the bill also seeks to stimulate investment in farm operations across the state, with the inclusion of language favoring hemp-derived products grown in NYS. This would also require the Department of Agriculture and Markets to create new regulations around extract production.
In adherence to the Food and Drug Administration’s stance that hemp-derived CBD is not permitted to be combined in food or beverages – which was reaffirmed in May of this year – the New York City Department of Health enacted a ban on retailers and restaurant owners on providing such products to consumers as of Monday, July 1. Violators could see their products “embargoed,” making them unavailable for sale for now, and may face fines from $250-$600, according to the NYC Health Code starting October 1. Manufacturers of CBD-infused products will likely see similar restrictions unless and until New York State affirmatively regulates this ubiquitous niche in the market.
“While many hemp farmers have chosen to grow hemp for fiber and grain, many others are growing the type of hemp that produces extracts like CBD,” said Assemblywoman Lupardo, Chair of the Assembly Committee on Agriculture. “Because of increasing consumer demand and interest from farmers, processors and manufacturers, specific guidelines are needed to guarantee the safety of the complete supply chain.”
“Hemp cultivation offers a tremendous opportunity for our local and small farms in New York to diversify into this high-value crop,” said Senator Metzger, Chair of the Senate Agriculture Committee. “This legislation provides a regulatory framework that will give our farmers and our nascent hemp industry the confidence they need to invest and take advantage of this enormous market opportunity, while also creating standards for CBD products that consumers can trust.”
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