May 9, 2022

CBD Lincense

Ahh yes, CBD. The complicated sibling of THC.

As of April 2022, yes, you will need a license to sell CBD in California.

CBD is produced in both the marijuana and hemp plant. However, if CBD is manufactured into products with a THC level greater than 0.3%, these products will have to go through the traditional cannabis regulatory oversight channels.

Ultimately, these THC rich products with CBD will be regulated by the Department of Cannabis Control (DCC) and you will need to obtain a cannabis manufacturer license.

However, CBD that is manufactured from industrial hemp in the state of California will now be regulated by the California Department of Public Health (CDPH).

When Was CBD Legalized for Use in Products?

Assembly Bill 45, passed in California in October 2021, legalizing the production of human food, drink, cosmetics, and animal food with CBD in it. As of last week, the CDPH has finally released proposed emergency regulations. From their date of publication, there is a mandatory 30-day period for public comment.

The emergency regulations essentially lay out the terms of licensing and registration for CBD manufacturers, the registration and application fees and terms for the production of CBD products.

The Types of Products Manufactured Determine the Types of Registration and Fees

Depending on what type of product the manufacturer intends to make, they will need to adhere to various registration and licensing requirements. These products can include human food (food, beverages, dietary supplements and acidified and/or low acid food), processed pet food, cosmetics, and/or later, inhalable products.

Currently, inhalable CBD products are still prohibited until the California Legislature establishes a cogent tax structure on the products. However, the emergency regulations lay out the application requirements and licensing requirements for the inhalable CBD product manufacturers.

If a CBD manufacturer produces several different types of CBD products, they will need to obtain multiple registrations. If an out-of-state manufacturer intends to import CBD products into the State of California, they will also need to register with the CDPH.

The proposed emergency regulations indicate that manufacturers will also need to obtain a separate “enrollment and oversight authorization” that is valid for a period of one year.

These authorizations will be location specific and non-transferable.

Applications for oversight authorizations require detailed information about sources, types of products, extract methods, and other regulated details. Similarly, to manufacturers of THC rich cannabis product manufacturers, owners will be expected to sign these applications under penalty of perjury.

Interestingly, there are two separate fee structures for applications/registrations: one for extract manufacturers and the other for all other types of CBD product manufacturers. Like the already established cannabis regulatory scheme, application and registration fees are dependent on an applicant’s gross revenue in the trailing 12 months. Therefore, new applicants will need to calculate and then estimate their fees utilizing a fairly complex formula.

Contact Our Trusted Cannabis and CBD Attorneys in California for Help Today

If you are interested in entering the California CBD market, or are facing regulatory or compliance challenges, contact our California cannabis law firm specialists at Manzuri Law today by phone at 310-912-2960 or online to today to discuss your complete legal needs.

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