California Governor Gavin Newsom signed into law Assembly Bill 45 (AB 45), allowing the sale of hemp-derived extracts, including but not limited to cannabidiol (CBD), so long as those products comply with certain testing and labeling standards. Prior to the passage of this bill, products containing CBD sold in California were considered “adulterated.”
 
While the 2018 Farm Bill legalized the farming and manufacturing of industrial hemp (defined as cannabis which is less than 0.3% THC by weight), there is no clear regulation in place pertaining to the sale of consumable products which contain CBD. The U.S. Food and Drug Administration currently doesn’t consider CBD to be a legal dietary ingredient, and without federal regulatory guidance, state governments have created a patchwork of different regulations on a state-by-state basis which CBD and hemp extract manufacturers have had to operate under.
 
The bill, authored by Assembly member Cecilia M. Aguiar-Curry, working with principal coauthor Senator Benjamin Allen, allows for the presence of industrial hemp extracts including CBD in food, beverages, dietary supplements, cosmetics, pet food, and inhalable products (the latter of which will may not be sold until a tax is enacted), though hemp derivatives are not allowed in alcoholic beverages or tobacco products.
 
The manufacturers of products containing CBD will be required to register with the California Department of Public Health and comply with current Good Manufacturing Practices, and test extracts to ensure that total THC by volume doesn’t exceed the federal 0.3% limit and max cannabis contaminant levels (which have yet to be specified). Manufacturers must be able to demonstrate that all industrial hemp used in the products comes from a supplier in good standing with the current state or country of origin they operate in, meaning that hemp supply must originate in a place which has an established industrial hemp program.
 
All products must have labels which link to lab testing results for THC and other cannabinoids, and the bill outlaws false claims pertaining to any food, drug, device, or cosmetic. Additionally, the bill outlaws untrue health claims about consuming products which contain industrial hemp or cannabinoids, extracts, or hemp derivatives.
 
The Department of Cannabis Control will be responsible for reporting to the governor and legislature an outline of the steps needed to incorporate hemp products into the supply chain, and develop a registration program for hemp manufacturers which will be shared to all agencies that have enforcement authority.
 
Marketing to children and pregnant women is also prohibited under the law.
 
AB 45 is a ‘Big Win’
Following the signing of this bill into law, whole-plant hemp extract company Charlotte’s Web commented that the passage of this bill represents a big win for those seeking high-quality, tightly-regulated CBD products on the market. The company now anticipates that its retail presence in California will expand, and expressed enthusiasm about the over 1,000 retail locations to which it ships in the Golden State who can now sell their products with clear regulatory guidance.
 
“AB 45 is a big win for Californians seeking wider access to the benefits of safe, high-quality hemp dietary supplements, the retailers who want to sell them, and the farmers and manufacturers who make and ship them,” Deanie Elsner, Charlotte’s Web CEO, said. “We appreciate Assembly member Aguilar-Curry and her staff who have worked extensively to bring oversight to hemp CBD products in the state.”
 
“I want to thank Charlotte’s Web and our coalition of advocates, from consumer and public health groups, to manufacturers, to retailers, who stuck with us through this three-year fight,” Aguiar-Curry said. “The ability to offer safe legal wellness products to Californians, as opposed to the completely unregulated products currently being sold, was my first priority in writing these bills. But the incredible opportunity for California manufacturers and retailers to participate in this booming market will create jobs and economic opportunity for countless people in our state.”
 
The Consumer Healthcare Products Association (CHPA) also applauded passage of the California law as well. “CHPA thanks Governor Newsom for signing AB 45 into law,” said Carlos Gutiérrez, vice president of government affairs for CHPA. “There is strong consumer and commercial interest in CBD and hemp-derived products, and we applaud California for its leadership in creating a regulatory pathway to meet consumer demand, all while protecting the public from potentially unsafe products. CHPA continues to advocate for legislation allowing CBD to become a legally marketed dietary supplement ingredient and will work with federal and state government leaders to develop a regulatory pathway.”
 
Without clear federal regulatory guidance, navigating a patchwork of state-by-state regulations for manufacturing and selling hemp will remain an undue burden on the hemp/CBD industry in the U.S., according to Charlotte’s Web.

“We celebrate state-level progress and believe it underscores the ongoing need for clear, federal regulation of hemp CBD from Congress and the Administration,” Elsner said. “We will continue lending our voice and resources to measures that will ensure a safe, credible, and sustainable industry, such as House of Representatives Bill 841 which deserves a hearing in the Energy & Commerce Committee by year’s end.”