DEA Hemp Rule Raises Questions About Compliance

Uncertainty and questions about testing and enforcement abound

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The release of a new interim final rule on hemp from the Drug Enforcement Administration in August has caused some concern within the hemp industry. Public comment is currently being taken on the rule until Oct. 20, however, the interim rule has highlighted issues within the hemp industry in testing for THC and concerns over remaining compliant. 

The Agricultural Improvement Act of 2018, also known as the Farm Bill, allows production of hemp, and the Controlled Substances Act no longer controls hemp, according to the U.S. Department of Agriculture website. The bill also directed the USDA to issue regulations and guidance to implement a regulatory framework around hemp production across the nation. 

The DEA’s interim rule seeks to codify the amendments to the Controlled Substances Act made by the Farm Bill into their regulations. The DEA website states that the interim final rule regards the scope of regulatory control over “marihuana, tetrahydrocannabinols [THC] and other marihuana-related constituents” and doesn’t add additional requirements to the regulations. 

Under the Farm Bill, the definition of “marihuana” means all parts of the plant “Cannabis sativa L.” growing or not, the seeds, resin extracted from the plant and every compound, manufacture salt, derivative, mixture or preparation of such plant seeds or resin, according to the DEA website. 

Hemp, however, is defined as any part of the same plant, including seeds and derivatives, extracts, cannabinoids, isomers, acids, salts and salts of isomer whether growing or not “with a delta-9-tetrahydrocannabinoil concentration of not more than 0.3 percent on a dry weight basis,” according to the DEA site. 

The website goes on to state that with these definitions, any such material that contains greater than the .3% of THC “on a dry weight basis remains controlled in schedule I. 

However, keeping hemp below that .3% can be difficult, and has several members of the hemp community concerned that they may inadvertently break the law. 

 The USDA is delaying enforcement based on comments from states and tribes that said the provisions of the rule “will serve as a significant hindrance to the growth of a domestic hemp market at this nascent stage.” 

The DEA is taking public comment on the interim rule until Oct. 20, however industry members have already made it clear they have concerns about the rule’s legal, industrial and enforcement impact. Several groups, such as the non-profit Hemp Industries Association, have filed lawsuits challenging the rule and arguing that the agency exceeded its authority and violated the farm bill with the interim rule. In January, both Gov. Jared Polis and Colorado Attorney General Phil Weiser signed a letter to the USDA identifying key issues with the rule and suggestions for the proposed regulatory system. 

Henry Baskerville, Fortis Law partner, said many clients  were concerned about the DEA’s new rule and nervous about their interest in hemp after the recent removal from the Controlled Substances Act.  

“I think that the DEA is largely trying to identify how it reads the Controlled Substances Act, and trying to be clearer about certain things,” Baskerville said. 

Tyler Williams, founder of Cannabis Safety & Quality, a cannabis certification program, said facilities are struggling now to be compliant, and many want to be compliant. As a consultant in the industry, he has been telling his clients to wait to see how the new guidance plays out. He said he has been advising clients to continue operating the way they have previously to be compliant with the law. 

“When people are getting ensnarled accidently, that’s a problem,” Baskerville said. “I think the industry needs more clarity on where the line is between legal and illegal — and to the extent the DEA is trying to make that more clear, I applaud them for doing so — I just want to make sure they’re drawing the line in the right place,” Baskerville said. 

Baskerville does not read the interim rule as an attempt to apply the Controlled Substances Act to hemp. He pointed to language within the Farm Bill listing hemp as a de-controlled substance below that .3% figure. But failing to meet that guideline can have severe financial consequences in addition to legal ones.  

The interim final rule from the DEA requires THC testing of hemp be performed by labs registered with the agency. The USDA is delaying enforcement of the requirement to use registered labs with the DEA. Testing can be conducted by labs not yet DEA registered until a final rule is published or in one year, allowing for the DEA to increase their registered analytical lab capacity. 

If a tested sample returns results beyond the threshold, the plant must be shipped back to the customer or destroyed. Baskerville said he believes that will be seen a lot at the beginning of the process, leading to many farmers having their plants returned to them. Thinking as a farmer, Williams wondered where they should draw the line to know where they stand to make a profit because they cannot test all their products.  

“If that result is going to determine if I have to destroy my product or sell my product — that’s a big deal,” Williams said. 

Part of the issue, Baskerville said, is the lack of uniform testing for hemp. He said he has heard stories of results from two different labs, and the results vary on a myriad of topics ranging from THC to CBD content and whether there are solvents within the plant. He pointed to issues with people being arrested for hemp under the assumption it was marijuana. 

That variation can spell trouble in both directions. Williams echoed Baskerville in saying he’s aware of cases where test samples sent to different labs have returned wildly different results, with products on the market returning results both below and above that limit. The same is true of sending farmers’ products to labs with a variation in the reported number. He wondered if too many above .3% results could cause some to leave the industry. 

“I think that what the industry really needs is clarity,” Baskerville said. “At the end of the day, you have a lot of people in the industry who are just honest people trying to create a good business and be successful.

And, when any industry has a lack of clarity on what it is that is legal and illegal — that’s where you run into a problem.” 

– Avery Martinez

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