512-808-0280

HEMP LAW

HEMP LAW

STARTING A HEMP OR CBD BUSINESS?

Hire JAMIE SLAUGHTER Hemp Law Attorney
in Austin, Texas

Texas House Bill 1325 was passed during the 86th Legislative Session to regulate the growth, production, transportation, sale and consumption of legal hemp products in the state. When Governor Greg Abbott signed HB1325 into law on June 10, 2019, Texas joined roughly 40 other states and the federal government in legalizing some form of hemp, industrial hemp, or hemp-related products. Implementing the law, however, will be complicated. While the law went into effect immediately, the various state agencies will need time to ramp up the regulatory processes required by the bill and to properly equip laboratories with the instrumentation and expertise needed to distinguish legal hemp from illegal marijuana.

Hemp Versus Marijuana

HB 1325 distinguishes between hemp, which is now legal, and marijuana, which remains illegal. While both refer to the same plant – Cannabis sativa L – the only difference is the concentration of delta-9 tetrahydrocannabinol, more commonly known as THC. Hemp is now defined by the Texas Agriculture Code to mean “the plant Cannabis sativa L. and any part of that plant, including the seeds of the plant and all derivatives, extracts, cannabinoids, isomers, acids, salts, and salts of isomers, whether growing or not, with a delta-9 tetrahydrocannabinol concentration of not more than 0.3 percent on a dry weight basis.”

 

Now under the Texas Controlled Substances Act, cannabis classified as hemp is excluded from the definition of “marhiuana” and hemp and the tetrahydrocannabinols in hemp are now excluded from the definition of a “controlled substance”. As a result, hemp is no longer prosecutable as marijuana or as a Penalty Group 2 tetrahydrocannabinol other than marijuana under the Act.


Instead, the growth, production, transport, sale, and use of hemp will be regulated by the state as (1) an agricultural product or (2) a consumer product, depending on whether the hemp is in a consumable or a non-consumable form.

CONTACT OUR OFFICE TODAY

logo-avvo.png
logo-national-trial-lawyers-top-100.png

Non-Consumable Hemp

To regulate hemp being grown or used for non-consumable purposes, HB 1325 created Texas Agriculture Code Subchapter F (Hemp), which includes Chapter 122 (Cultivation of Hemp) mandating new regulatory processes adopted and overseen by the Texas Department of Agriculture (TDA).


The only criminal sanctions relating to non-consumable hemp are new third-degree felonies, punishable by 2-20 years in prison, for the forgery, falsification, or altering of shipping certificates, cargo manifests, or laboratory tests required under the new law and a Class C Misdemeanor, punishable by a fine up to $1,000, for the improper transportation of hemp. 


Improper transportation can also be pursued as a civil penalty of up to $500 per violation by the Texas Attorney General or a county or district attorney. Any other violation of these new laws relating to the possession, sale, or purchase of non-consumable hemp products are handled as an administrative penalty by TDA.

Consumable Hemp

Under HB 1325, consumable hemp products, such as oils, lotions, tinctures, and other health products, are subject to regulation under the Texas Health and Safety Code. That means that a violation of various consumer protection laws – such as those relating to the mislabeling, misbranding, adulterating, false advertising, or counterfeiting – when made in regard to the sale of consumable hemp products may subject the violator to:

 

  1. Administrative penalties from the Texas Department of State Health Services (DSHS) or the Texas Office of Attorney General (OAG);
     

  2. Civil penalties from OAG or a district, county, or city attorney of up to $25,000 per day for each violation; or
     

  3. Criminal penalties of a Class A misdemeanor or State Jail Felony.

 

HB 1325 enacts new regulations to require anyone who processes, manufactures, or sells consumable hemp products to be licensed by or registered with DSHS for that purpose, and any consumable hemp products must themselves be tested, packaged, and individually labelled according to DSHS regulations. In addition to the enforcement mechanisms, certain other violations of the new law involving consumer products containing cannabinoid oil, including cannabidiol oil (CBD), are also made actionable under the Deceptive Trade Practices Act. Such actions may be pursued by the Consumer Protection Division of the OAG.

Powers and Duties of Peace Officers

To provide some guidance to those attempting to enforce this new law on the streets, HB 1325 enacts Texas Agriculture Code section 122.358 (Powers and Duties of Peace Officers). Pursuant to this section, a peace officer may: 

 

  1. detain any hemp in transit and request documentation proving the product is:
    (a) legal, and 
    (b) legally possessed and transported; 
     

  2. inspect and collect a sample of cannabis found in a vehicle to determine its THC content (but the officer may not seize all of the cannabis or arrest the person transporting it unless the officer has probable cause to believe the cannabis is marijuana); and 
     

  3. seize and impound any cannabis for which there is probable cause to believe that it is marijuana or “any other illegal substance” – such as hemp that does not meet various other regulations required or adopted under HB 1325 – along with any legal hemp being transported with it.


Two other provisions are important to discuss in the context of the powers and duties of peace officers. First, HB 1325 prohibits TDA and DSHS from adopting rules or regulations that would allow the processing or manufacturing of any hemp product in a form suitable for smoking or vaping. And, second, new Agriculture Code prohibits a person transporting hemp from transporting any other cargo at the same time, and that person must provide documentation proving the hemp is legal to any peace officer upon request.


Accordingly, any cannabis plant material found without proper documentation or in a form meant for smoking or vaping may establish probable cause to believe it is not legal hemp. Such logic may also help address challenges propounded by criminal defense attorneys that drug-detection dogs and field tests cannot distinguish between legal hemp and illegal marijuana. Simply put, if the paperwork is not in order, officers are likely to assume the cannabis is marijuana – or at a minimum legal hemp being illegally transported – and proceed as discussed above.

Challenges for Criminal Enforcement and Prosecution of Cannabis-related Laws

One challenge that law enforcement and prosecutors face is that section 11 of HB 1325 includes transition language that allows a retailer to possess, transport, or sell a consumable hemp product (i.e. CBD oil) that became part of the retailer’s inventory before DSHS rules governing those products take effect. 


The only exception is if the product is unsafe for consumption due to the presence in it of pesticides, solvents, or other contaminants, or if the product has a THC concentration higher than 0.3%. But that requires the product to be seized and tested in a laboratory, which can be time-consuming and expensive.


Since the passage of HB 1325, we’ve seen the biggest challenge for the criminal courts is that to distinguish between marijuana and hemp requires proof – beyond a reasonable doubt – of the THC concentration of a specific product or contraband. For now, that evidence can only come from a laboratory. It cannot come from an officer’s “experience and training” nor a drug dog’s sniff test. This means that state agencies – including the Department of Public Safety (DPS), TDA, and DSHS – and other local or private crime labs have to purchase new instrumentation or change testing procedures to be able to supply that evidence to the courts before criminal cases involving marijuana go to trial.

OUR ADDRESS

The Slaughter Law Firm, PLLC
505 West 12th Street, Suite 200-B
Austin TX 78701

 

Get directions

 

512-808-0280 phone
512-870-9000 fax

JD@JDSlaughterLaw.Com