Oct 7, 2021
Gov. Newsom Signs Hemp Bill AB45

California’s Governor Gavin Newsom signed AB45, establishing a regulatory framework for the manufacture and sale of hemp products in California. The law goes into effect immediately.

AB45, upon the enactment of a tax on inhalable products, would require the department to regulate those products, as specified, or enter into a memorandum of understanding or other interagency agreement with another state agency to do so. Until that tax is enacted, the bill would prohibit the manufacture and sale of inhalable products, except for the sole purpose of sale out of state.

The bill amends Control, Regulate and Tax Adult Use of Marijuana Act (AUMA) by changing the definition of “industrial hemp” to include cannabis plants and any part of that plant, including the seeds of the plant and all derivatives, extracts, the resin extracted from any part of the plant, cannabinoids, isomers, acids, salts, and salts of isomers, with a delta-9 THC concentration of no more than 0.3% on a dry weight basis.

The bill has faced support and opposition throughout the hemp and cannabis industries.

In support

U.S. Hemp Roundtable: “After more than three years of stops and starts and difficult negotiations, the era of CBD prohibition in California will soon be over,” said Jonathan Miller, general counsel of the USHR. “Retailers and product manufacturers will no longer have to fear embargoes and product seizures. Consumers will have access to products that promote their health and wellness. And most importantly, California hemp farmers will see a wide opening of opportunity for their crops, as the nation’s largest wellness market is now open for sale.”

California Cannabis Industry Association: “AB 45 establishes a long-overdue, comprehensive framework for the manufacture and sale of hemp products in California, but our work is not over,” said Lindsay Robinson, CCIA executive director. “We look forward to working with the author on future legislation to establish a pathway for the incorporation of hemp into the cannabis supply chain.”

In opposition

Hemp Farmers Guild: “AB45 will take this promising market away from our diverse hemp farmers and hand it to Big Marijuana and Big Pharma,” said Josh Schneider, CEO of Cultivaris Hemp and president of Hemp Farmers Guild.

National Industrial Hemp Council: “California’s AB45 legislation appears on the surface to be an attempt to put the hemp genie back into the bottle and regulate it like higher THC marijuana,” wrote Chief Economist Beau R. Whitney in an NIHC blog. “The law would likely limit nearly all extracted hemp CBD, with the exception being highly refined THC free Isolate. Combined with a proposed ban on smokable hemp, as well, it is looking more and more like the California hemp market would be virtually destroyed.”

StopAB45, an online movement, offered talking points for growers, manufacturers and sellers to use when reaching out to senators and assembly contacts.

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