Tennessee sets new rules for hemp-derived cannabinoids

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New regulations for sellers of hemp-derived cannabinoids in Tennessee are set to go into effect after final approval from state lawmakers on Tuesday.

State House Speaker Cameron Sexton sent Senate Bill 378 to the desk of Republican Gov. Bill Lee, according to a state legislative database, and Lee is expected to sign the measure into law.

Under the bill:

  • Hemp-derived cannabinoid products must undergo lab testing, abide by labeling requirements and be sold in child-resistant packaging.
  • Retailers selling hemp-derived cannabinoids must acquire a license from the state agriculture department by Jan. 1, 2024.
  • The fee for a producer license is $500, while retailers must pay $250. Producers were already subject to a licensing requirement.
  • Sales will be subject to a new “privilege tax” that state law says must “be used exclusively for the regulation of products containing a hemp-derived cannabinoid.”
  • Anyone violating the new rules may be fined $1,000 or charged with a misdemeanor.
  • Purchasers of products containing hemp-derived cannabinoids must be 21 and older.

Tennessee joined a nationwide movement to rein in a largely unregulated market.

Some states that have legal adult-use marijuana industries have even banned hemp-derived cannabinoids such as delta-8 THC altogether.

Meanwhile, states where marijuana is still illegal, such as Tennessee, have acknowledged the demands for such products made federally legal under the 2018 Farm Bill.

The approval of the bill comes only months after the U.S. Department of Agriculture Partnerships for Climate-Smart Commodities awarded nearly $5 million in grant money to a Tennessee consortium of two universities, a hemp trade group and the state agriculture department.

The funding is for the research into and development of new economic opportunities for the Tennessee hemp industry.