template for selling cbd oil to a third party

Shopify CBD stores: Templates, Best Practices and Tutorial

In recent years, CBD has become increasingly popular on e-commerce sites and it is gradually becoming a familiar product for the average person.

According to Gallup, more than 64% of Americans had heard of CBD in 2019, and about 64 million Americans have tried CBD in the last two years. It can be said that this is a robust booming market, especially in the US. According to Cowen, the US’s CBD market is estimated to reach $16 billion by 2025.

CBD’s benefits are increasingly recognized by experts, and it’s gradually becoming commonplace for it to be consumed. Along with that, the number of people trying CBD for the first time is also increasing dramatically. This is a perfect time for you to enter this market. You can quickly start to sell CBD products by opening a Shopify CBD store.

However, selling CBD is a high risk business. It’s a new type of product with unclear legislation. If you violate the rules when selling, it can lead to serious consequences like your store being shut down.

If you are researching for or want to enter this niche, this article will give you a quick overview of the CBD market and how you can use Shopify to sell hemp derived CBD products.

01. What Is CBD?

People often don’t distinguish between hemp and CBD, with marijuana.

So we will start by determining the differences between these two substances. CBD (cannabidiol) is one of the more than 85 most common chemical compounds found inside the resin gland of female hemp (cannabis).

The difference between CBD and marijuana is that CBD products don’t contain any THC (the ingredient that makes you high) like marijuana. CBD has absolutely no effects on the user’s nerves and doesn’t intoxicate you.

Cannabidiol is known for its therapeutic properties. CBD oil has a wide range of benefits to relieve symptoms associated with inflammation, anxiety, depression, pain, and epilepsy.

However, many CBD uses have not yet been validated by the FDA, and CBD’s effects on people can vary, so be careful when advertising about its benefits.

There are different types of hemp derived CBD products and several great ways to use them. Depending on the method and dosage used, each customer will have his or her own preference. You can find the following CBD on the market:

  • Oil
  • Capsule
  • Concentrate
  • Vape
  • Spray

Each type of CBD will have different dosages and effects on each person. You should provide customers enough information about each so they can make the best choice.

There is currently only one CBD-based and FDA-licensed drug. It’s Epidiolex, the first and only hemp derived CBD product to be certified by the FDA.

Selling hemp and CBD is a high-risk business so if you see an FDA logo on other products, then be careful because this is likely an untrustworthy one and the business is using false advertising tactics.

02. Can CBD Be Sold On Shopify?

In 2019, Shopify began supporting the sale of hemp and hemp-derived cannabidiol products. However, Shopify currently only supports the hemp and CBD market in the US (maybe Canada), so for now, you can only have a Shopify CBD business in this market..

CBD is legal to buy, sell, and use in a limited number of countries and territories around the world.

The Farm Bill 2018 Act passed by the US Department of Agriculture state that: hemp is clearly defined as “the plant Cannabis sativa L. and any part of that plant, including the seeds thereof 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.”

Hemp is also removed from the CSA, which means that cannabis or derivatives with a THC of less than 0.3% will no longer be substances enforced under federal law.

To have a legal CBD business in the US, the CBD in your product must be extracted from female hemp and have less than 0.3 THC%. However, this law may differ in some countries and some states.

For example, in the UK, CBD must be THC-free and extracted from industrial hemp to be legal. In other EU countries, the THC level must be at 0.2% or less. In Switzerland, this figure is reduced to 0.1%.

CBD products extracted from marijuana and with a THC concentration more than 0.3% are illegal under the Controlled Substances Act since the Drug Enforcement Administration (DEA) classifies marijuana as a Schedule I drug. In DEA parlance, that means the administration believes it has “no currently accepted medical use and a high potential for abuse.”

If you are in a country outside the US, you should research the market and the laws since CBD is still being assessed as an illegal product in many countries.

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03. Can I Dropship CBD?

It is possible to dropship CBD products in the US market. In order to do this, merchants will have to find suppliers to partner with.

One caveat when you open a CBD dropshipping store is the quality of the supplier’s product. Make sure the quality is good and safe before it goes on sale in your store.

Check out Dropified – a CBD Dropshipping app that will handle all the heavy works for you.

04. How to market CBD products

The most important thing about when you start selling CBD is marketing. This is a commodity that has been legalized in many states of the US, however, you still cannot freely advertise them online because marketing channels like Facebook or Google will always have their own rules and policy to prevent it.

As a merchant, you’ll need some tips to promote your Shopify CBD store.

4.1. Focus on blogging and SEO.

In addition to advertising on paid channels, you should take advantage of organic traffic from SEO. Having blogs on your site can help customers learn about your brand and choose what right for them.

4.2. Don’t run ads directly to your product page.

Put the link to your landing page on your blog. Although hemp-derived CBD has been legal since the 2018 Farm Bill, channels like Facebook and Google still consider them illegal products. Their policies on advertising CBD have left many merchants feeling confused.

CBD is not mentioned on Facebook’s Advertising Policies page, but is still included in its prohibited items. In its recent announcements, Facebook has taken steps to loosen its ban on advertising for these products.

Specifically, the social network now allows shop owners to run ads about ingestible hemp and topical CBD. At the same time direct these ads to sites with Hemp or CBD content.

However, you will not be allowed to use CBD pages as your ad’s landing page. Instead, you should send visitors to your blog pages and use them like a landing page for the products.

4.3. Influencer Marketing

This is a well-suited marketing method to bypass the ban on CBD products. When choosing to buy, customers will try to find stores with a well-known brand and reputation.

Using influencers will quickly increase your store’s trustworthiness. When you choose the right influencer, you can also find more leads with a smaller budget than paid advertising.

4.4. Native Advertising

Native advertising is where your ads will blend into the website’s interface, creating a more natural feeling for users. This form of marketing is often targeted at customers who have heard of CBD and want more information about it.

4.5. Social Media

While running paid ads on Facebook or Instagram is limited, this is still a great marketing channel to reach customers on CBD groups. Social media is the perfect place for potential customers to find the information they need through tons of groups about CBD or Hemp.

Becoming active in those groups can raise awareness of your brand. Remember to focus on sharing knowledge and provide help to your customers, since the ultimate goal is to make your brand trustworthy.

4.6. Affiliate networks

This can give your brand more coverage. However, you need to develop a good relationship with affiliate brands because they will be promoting your brand to customers.

CBD is relatively new in the online market and there is still false and inaccurate information about it on the Internet.

Be careful your affiliates don’t share false information or violate the terms of social media platforms or the law when advertising your brand. Education and training is important for your affiliates.

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4.7. Email marketing

This is an old marketing style, but still one of the best methods for promoting CBD. By combining pop-ups with lead magnets and discounts, you can convince customers to fill out your form.

4.8. Lead Magnets

These are instrumental in collecting emails while also sharing knowledge about CBD to consumers. By sharing product-related documents, PDFs or helpful videos you can push people closer to making the final purchase decision,

Podcasts: Let them hear your voice. Podcasts are one of the best ways to build trust with your customers simply by having conversations with them. Usually a podcast will specialize in a certain topic, so advertising on podcasts can help you directly reach people interested in CBD and hemp.

Some 55% of the US population has heard of podcasts. They’re a marketing channel that Shopify CBD online store owners should not ignore.


Don’t false advertise. There are many different CBD retailers that advertise divine effects like cancer treatment, or other benefits that have not been confirmed by the FDA. If these cases are found, Shopify will remove the store immediately.

05. Successful Shopify CBD stores – Case Study

Many stores are selling CBD on Shopify. Among those stores is Cannuka, a store famous for its products focused on health and beauty such as eye balm, lip balm, cleansing body bars, and face cream. Let’s look at Cannuka’s Shopify store and find out how they designed it to boost CBD sales.

Cannuka’s homepage shows benefits of their products, as well as educational information about the them to help customers trust the store and choose the product that suits them best.

Cannuka’s footer has links to FAQ, returns and shipping information, and the ingredients used in their products.

They also have a statement about the FDA at the bottom of the footer to confirm that their products have not been approved by the FDA and will not necessarily treat unrelated diseases.

Cannuka’s product page has useful elements such as product description, usage, benefits, and ingredients, providing complete details. The reviews on the page also contribute to confirm the quality and reliability of the brand.

Cannuka puts a lot of emphasis on the ingredients in their products. They even have a dedicated page showing information on each one. On this page, Cannuka provides information that users should know about CBD, Manuka honey, and other ingredients in their products. This helps them build trust.

06. How To Build A Shopify CBD Store

61. Start with Shopify

With Shopify officially supporting CBD stores since 2019, they’ve quickly become the top choice for many large and small CBD brands. You can easily open a Shopify CBD store online at a low cost – it’s completely free for the first 14 days.

6.2. Submit An Attestation

If in the US, you will need to submit an Attestation for the Sale of Hemp and Hemp-Derived Products. You can only see this page if your Shopify store is in the US.

If you are in another country or territory, you will be bound by the laws and policies there. For example, if you are in Canada, you will need a license to sell cannabis, as well as a Shopify Plus store, to be able to sell CBD online.

6.3. Set Up Payment

Although Shopify has support for stores that sell CBD, the Shopify payments system doesn’t support these products. Shopify Payments/Stripe, Square and Paypal are great for many sites, but when it comes to CBD sales, you need to get another Payment processor.

To be able to sell CBD on Shopify, you must use payment gateways from third party payment processor:

By having fully integrated with Shopify, DigiPay offer Shopify sellers streamlined CBD payment processing with great flexibility for business of all size, its features include, but not limited to:

  • Fast-track approval
  • Full credit card suite
  • Powerful protection and vetted security

eMerchant Brokers has also partnered with Shopify to save merchant’s time with their CBD payment processor. To get a full understanding of how they can help Shopify sellers, you would need to fill in an application form.

Besides, if you want to use a different third party payment gateway, then it must:

  1. Be integrated with Shopify
  2. Support buying, exchaging, selling hemp, CBD & hemp related items.

Note that, due to American laws, class all CBD products as a narcotic, which means that Paypal does not accept the transactions of any hemp -derived products . The stance that PayPal has taken is very similar to the stance that it has with any transactions that include cannabis plants.

Here’s What You Need to Know about Selling CBD on Shopify

On January 1, 2019, the 2018 Farm Bill removed restrictions on selling CBD online as long as it is derived from hemp plants.

Updated: February 2022

On January 1, 2019, the 2018 Farm Bill removed restrictions on selling CBD online as long as it is derived from hemp plants.

CBD, or cannabidiol, sales are expected to reach nearly $80 billion by 2030. With that much money on the table, it’s no wonder Shopify CBD stores are popping up everywhere as everyone tries to get their share.

For the small business owner, branching into CBD-related sales in their Shopify store (or launching a new CBD store from scratch) seems like a natural choice–but there are a few things you should know first.

Shopify CBD Requirements

It should come as no surprise with a substance like CBD, but Shopify has to cover themselves on the legal side. The first thing you’ll need to do is fill out the “Attestation for the Sale of Hemp and Hemp-Derived Products.”

This form basically says that as a seller of CBD products, you will abide by all Federal, state, and local laws as they pertain to these sales. It also indemnifies Shopify, which is a fancy way of saying that if you run afoul of the law, you can’t turn around and blame Shopify for it.

It also means that it’s your responsibility to keep track of the CBD related laws relevant to your target sales areas.

Legislation like this is a moving target. It’s entirely possible that states may backtrack and repeal the existing laws. If you’re opening a CBD store on Shopify (or any other eCommerce platform), be sure to keep up with the rules.

Which States Allow CBD Sales Online?

As of February 2022, you can legally sell CBD products on Shopify in all 50 U.S. states, so long as the products are hemp-derived (as opposed to marijuana-derived) and contain less than 0.3% THC. Huzzah!

It’s definitely worth noting, though, that there are some states with extra restrictions. (Every party needs a pooper and all that.)

Shopify expressly states that they are not responsible for informing CBD shop owners if there are any changes in the law. That responsibility lies with you.

Marketing CBD Online

CBD containing less than 0.3% THC became federally legal long before all the states caught on. What this means is that the Drug Enforcement Agency (DEA) gave up their control of the sale of these products. Instead, the handling has passed to the Food and Drug Administration.

The FDA has not approved CBD as a medicine (except for a single prescription drug, Epidiolex), or as a food additive or a dietary supplement. As a result, you’re technically not supposed to market CBD by making any health claims or add it to food or drink. That remains illegal at the Federal level.

That said, you can sell cannabidiol and hemp products as such and ship them to any customer within the United States.

The laws surrounding selling CBD online can be extremely confusing. Many sellers choose to retain a law firm that specializes in “cannabusiness” to keep themselves abreast of all of the laws and how they pertain to them.

Shopify CBD Payment Processors

The last major component of selling CBD products on Shopify is how you accept online payments. With cannabis-related products, several banking laws have strange effects on who can take payments and who can’t.

Federal law forbids banks from taking money involved in the marijuana industry. That law makes payment processors uneasy when it comes to handling funds as well. You can’t use Shopify’s in-house payment processing, Shopify Payments, either. (And in case you’re wondering, yep, PayPal put the kibosh on CBD payment processing as well.)

Finding a payment solution that will deal with online CBD sales can be challenging, but not impossible. You just have to go through an outside payment vendor that integrates with Shopify.

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Shopify currently recommends two CBD payment processors – DigiPay and Sezzle .

But getting approval from these third party merchants isn’t as easy as signing up. For DigiPay, you must provide test results from an independent lab that demonstrate your CBD products don’t contain more than the 0.3% THC concentration as allowed by Federal Law. You’ll also need to submit photos of your product and inventory.

For our Shopify CBD merchants (and all merchants really!), we love to refer them to a third option: Sezzle, a convenient and CBD-supported payment solution. This innovative approach to sales growth allows customers to split up their total purchase into four interest-free payments–lowering the objection to purchasing.

Best of all, for Tako readers only, Sezzle is currently offering a FREE 30-day trial. Just enter code SZORNYO at checkout.

Click here to see how Sezzle can help you close more sales.

For CBD companies offering subscriptions, we recommend Pinwheel, which is the only payment processor that supports recurring billing for CBD products!

Selling CBD On Shopify: Is It Really Worth It?

Many ardent CBD proponents claim that it can prevent, diagnose, or even treat cancer, diabetes, Alzheimer’s, and even psychiatric disorders.

Officially, the FDA prohibits CBD sellers from making any claims about efficacy in treatment. Additionally, because CBD is now in an FDA-approved medication (Epidiolex, used to treat Lennox-Gastaut syndrome and Dravet syndrome), it can’t be used as a food additive.

However, the fact that CBD has been approved as medication shows that it does have some definite and clinically proven effects.

In 2012, a research team published a study in the Journal of Experimental Medicine that showed cannabinoids are highly effective in treating neuropathic pain and inflammation.

It also notes that marijuana has been used to treat neuropathic pain for centuries, but the psychoactive components of THC make it a problematic solution for many. However, because CBD has low amounts of THC, it avoids those side effects.

Currently there is a boatload of studies examining the efficacy of CBD, particularly for insomnia and anxiety. One oft-cited study concluded that CBD was effective in treating anxiety and insomnia in a ten-year-old girl suffering from PTSD connected to a sexual assault. Earlier attempts with standard pharmacotherapy were only partially successful, while CBD was a fully effective treatment.

There is no doubt that CBD has many great benefits. However, because this is such new ground for regulatory agencies, knowing what you can and can’t legally say in marketing is tricky.

Congress is currently pushing the FDA to make changes in CBD regulations, in part because of public demand. The next few years should be interesting, as the Federal government takes a more firm position on the legal and marketing status of CBD as a supplement and food additive.

All The Toppings

As more states change their laws regarding the sale of marijuana-derived CBD products, the landscape for online CBD sales will continue to change as well. With many states having already legalized medical–or even recreational–marijuana and several more on the cusp of doing so, you can expect to see even more potential markets open up. As the banking industry catches on to the potential windfall that CBD-related money represents, their desire to stay on the sidelines will fade as well.

The biggest challenge for you as a Shopify merchant is staying abreast of these changes.

Setting up your Shopify CBD store and developing a marketing strategy that’ll separate your products from the ocean of other CBD-related goods can be an equally daunting challenge.

Contact us to see how we can help you get up and running faster.

Oregon Cannabis Laws

Measure 91 (M91) allows any individual over the age of 21 to grow, purchase, and possess cannabis in limited quantities. There is no residency requirement to purchase, possess, or use marijuana, nor are non-residents prohibited from owning and operating OLCC licensed cannabis businesses. Public consumption remains illegal, though the Oregon State legislature will be considering public consumption during the 2019 legislative session.

The OLCC is designated to oversee and regulate recreational cannabis businesses. The OLCC has the responsibility to issue and monitor six types of licenses. They also have the authority suspend or revoke these licenses for noncompliance with state law or OLCC rules.

Measure 91 establishes taxation rates based upon the sale volume of flowers, leaves, and plants. Subsequently, the taxation rate was changed to 17% for all sales, with an option for local city and county government to impose an additional 3%. Tax revenue from cannabis sales is distributed between the common school fund, mental health, alcoholism and drug services, cities and counties, law enforcement, and alcohol and drug prevention and treatment services.

Which Cities and Counties Prohibit Cannabis Sales?

The private sale of cannabis and its byproducts is illegal throughout the state, and 95 cities and counties that prohibit the sale of marijuana from licensed marijuana retailers. The full list can be found on the OLCC website at: https://www.oregon.gov/olcc/marijuana/Documents/Cities_Counties_RMJOptOut.pdf

Age Limits

A person must be 21 years old, with proper identification, or 18 years old with a medical marijuana program card to purchase, possess or consume cannabis products in Oregon. An individual must also be 21 or older to enter into any licensed hemp or cannabis facility, with very limited exceptions. Proper identification includes a passport, driver’s license, military ID card, or any other state issued identification that includes a person’s name, picture, physical description, and date of birth.

How Much Cannabis Can You Buy in Oregon?

The following are amounts of recreational cannabis products that can be purchased by any person over 21 with proper identification in any single day. There is no Oregon residency requirement for cannabis sales, but all cannabis products sold in Oregon must be consumed in Oregon.

Purchase limits for recreational user:

  • 1 ounce of flower
  • 5 grams of concentrate or extracts
  • 16 ounces of edibles in solid form
  • 72 ounces of edibles in liquid form
  • 10 cannabis seeds
  • 4 immature plants

Purchase limits for OMMP cardholders:

  • 24 ounces of usable marijuana (1 ounce from a recreational dispensary)
  • 16 ounces of a medical cannabis product in solid form
  • 72 ounces of medical cannabis product in liquid form
  • 16 ounces of a cannabis concentrate (alone or contained in an inhalant delivery system)
  • 50 cannabis seed
  • 4 immature plants

* Medical patients have access to medical grade products if available.

Personal Growing Limits

Oregon is one of the few states that currently allows for personal cultivation of cannabis. A household can grow up to a total of 4 plants on their private property. The 4 plant limit is a household limit regardless of the number of adults living in the household. OMMP cardholders can have 6 mature plants, 12 immature plants 24 inches or taller. and 36 immature plants under 24 inches.

Plants can be grown inside or outside; if grown outside, the plants must be out of public view. Some cities or counties restrict the sale of recreational marijuana, but this restriction does not limit household growing. Homegrown cannabis is for personal consumption only and cannot be sold or given to someone in exchange for something of value.

The ability to grow your own cannabis plants is not absolute: If you are leasing your home, the landlord can restrict the property from being used in the cultivation of cannabis. Federal law prohibits growing the plant within 1,000 feet of a school, even if it is on private property. While growing at home is legal, processing the plant into a concentrate without a state-compliant facility is illegal and could be dangerous.

Cannabis Use Restrictions

While it is legal to possess cannabis in almost any location in the state, the use/consumption of cannabis in Oregon is restricted to private property. Use includes smoking, vaping, eating, or drinking a cannabis product. Private property includes personal residences and may include temporary lodging such as hotels, provided that it is permitted by the property owner. However, public areas of a hotel or apartment complex include hallways, lobbies, or pools. There is no public consumption or consumption on property that is open to the public, such as such as streets, sidewalks, parks, bars or restaurants at the time of this publishing. It is being considered for the 2019 legislative session.

Under federal law, it is illegal to possess or consume cannabis and this restriction specifically applies to all federal property. This is an important restriction because the federal government owns more than 50% of the land in Oregon. Examples of federal property in Oregon include federal buildings, national parks, national forests, wildlife areas, and BLM lands.

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Transporting Cannabis And Its Derivatives

It is legal to carry these products throughout the state, including in a vehicle or on public transportation, unless it otherwise precluded by such areas as federal land within the state. It is also perfectly legal to carry marijuana on commercial airlines traveling between Klamath Falls and Portland. Transporting across state lines is illegal, even if you are transporting it to a state that has also legalized marijuana such as California or Washington. Just remember: Oregon marijuana must stay in Oregon.

Driving While High

Oregon has strict laws regarding driving under the influence of an intoxicant, DUII (Driving Under the Influence of Intoxicants, also known as a DUI). Oregon DUII laws are applied in the same manner with alcohol or marijuana–both are considered intoxicants. For a first offence DUII, a diversion program may be available if the offender was not involved in an accident. This program allows the offender to complete a substance abuse program and be on probation for a period of time. If he successfully completes the diversion program, the DUII charge is dropped and the person will not have a DUII conviction on their record. If it is a second offence, or the offender is not eligible for the diversion program, there is a mandatory minimum jail sentence of 2 days plus substantial fines and the offender must complete a substance abuse program. It is also illegal to consume marijuana in a vehicle even if you are not impaired, similar to open container laws.

Unlike alcohol, there is currently no breathalyzer test for the presence of thc in the blood, but police have drug recognition evaluators conduct tests to determine if a driver is impaired. If the tests suspect a driver is under the influence, Oregon implied consent laws allow police to conduct breath, blood, or urine tests to obtain evidence of drug use.

If you choose to use, make sure to allow enough time for the effect to completely wear off before you drive.

Illegal Acts Related to Cannabis

While Oregon has legalized the recreational use of cannabis, there are limits to what is allowed. Below is a sample of what remains illegal in Oregon:

  • Selling or providing cannabis to minors (anyone under the age of 21, or 18 with an OMMP card)
  • Transporting cannabis across state lines, including to states where cannabis is legal
  • Unlicensed growing, processing, transporting, or sales of cannabis

OLCC and the Cannabis Industry in Oregon

The OLCC oversees six license types; producer, processor, wholesaler, retailer, laboratory, and research licenses. Once products get into the OLCC system, they can only be transferred between OLCC licensed facilities, until they are sold to the end user by a retailer or destroyed, and must be recorded in the Cannabis Tracking System, METRC, which provides seed-to-sale tracking. OLCC rules limit how product can flow between license types and licensees.

The OLCC has regulatory authority of all aspects of the recreational cannabis market, including:

  • Product Testing for contaminants, such as pesticides, solvents, and potency
  • Packaging and Labeling
  • Security systems
  • Operational procedures

The OLCC provides strict regulatory oversight by means of scheduled visits, surprise inspections, and third-party complaints to trigger investigations. The OLCC has authority to issue violations with sanctions including fines, license suspension, or license revocation.

The Oregon Medicinal Marijuana Program (OMMP) is administered by the OHA. The OHA licenses and regulates medical cannabis growers, processors, and dispensaries. Cannabis grown or processed under the OMMP program can only be sold to OMMP patients. There are certain exceptions that allow growers and processors to sell products to a recreational licensed facility.

To become an OMMP patient, an individual must be at least 18 years old and have a qualifying condition and a recommendation for using medicinal canabis from their attending physician. OMMP patients are issued medical cards that allow them to purchase cannabis from a medical marijuana dispensary. They can also purchase medical or recreational cannabis tax-free from a recreational cannabis retailer.

The OMMP program is currently in severe decline. In the past year, the number of medical patients has dropped approximately by half and there only 5 OMMP licensed dispensaries, down from about 400 at the peak of the medical program.

Industrial Hemp Regulations

Traditionally, industrial hemp was used for making rope, clothing, and sails for boats, among other products. Now hemp is primarily used to make cannabidiol (CBD) oils. Many people believe that CBD oil has substantial medical benefits such as pain management and reducing swelling. These properties have not been tested by the Food and Drug Administration and the FDA takes the position that no CBD is legal except for the pharmaceutical drug Epidiolex. The FDA has not conducted widespread enforcement action and most CBD products are sold in the market without substantial opposition or testing.

Industrial hemp is defined as the plant Cannabis Sativa with a THC level of less than 0.3%. Industrial hemp in Oregon is regulated by the Oregon Department of Agriculture (the ODA). The ODA issues two type of permits: 1) a grower permit and; 2) a handler permit. These permits are substantially easier and cheaper to obtain as compared to OLCC licenses, and there are much fewer restrictions. If the samples exceed the THC limit, the product must be destroyed. Similarly, processed hemp is required to be tested for THC levels prior to sale. Once the processed hemp is sold by a processor it is considered an agricultural commodity and is not further regulated by the ODA.

Because industrial hemp and cannabis are the same plant species, there is naturally confusion under federal law. In 2014, Congress passed the 2014 Farm Bill which included provisions for industrial hemp. The Farm Bill defines hemp in the same way as Oregon and allows states to grow industrial hemp for experimental purposes under the supervision of a university or a state department of agriculture. Oregon’s industrial hemp program was created under the 2014 Farm Bill.

The Controlled Substances Act (CSA) does not differentiate industrial hemp from recreational cannabis, so hemp and marijuana are treated the same: both are illegal. The CSA does have an exemption for dried mature stalks and sterilized seeds, but there is no economically significant amount of CBD in these parts of the plant, so they are only good for rope and ship sails. This inconsistency in federal law creates confusion and a potential problem for exporting CBD oil out of Oregon or the country. Congress recognizes this issue and the Senate’s version of the 2018 Farm Bill would fix the problem by legalizing industrial hemp. As of this writing, the House version of the bill does not include hemp legalization, but the hemp legalization portion of the Senate’s version, backed strongly by Mitch McConnell and other senate republicans, is widely expected to be passed in the final version of the bill. In addition, the omnibus spending bill they included a provision that prohibits the Department of Justice from using budgetary funds from prosecuting industrial hemp activities conducted in compliance with state industrial hemp pilot programs developed under the 2014 Farm Bill.

History of Cannabis In Oregon

Prior to 1935, cannabis was legal in Oregon. In 1935 Oregon adopted the Uniform State Narcotic Drug Act. This Act made the possession, production, and distribution of any narcotic a crime. The Uniform State Narcotic Drug Act is the precursor to the Controlled Substances Act.

In 1973, Oregon became the first US State to decriminalize small amounts of cannabis for personal use. It was still a crime possess over an ounce or to sell cannabis.

In 1998, Oregon approved its use for individuals for certain qualifying medical conditions. Medically qualified patients could possess up to three mature cannabis plants or could contract for someone to grow them on their behalf.

In 2005, Oregon created the current medical card program and allowed the patient to reimburse their growers for certain growing expenses. They also increased the allowable limit to 24 ounces of usable cannabis and six plants. In 2012, Oregon created a medical registry system which permitted medical marijuana dispensaries by state-issued license.

In 2014, Oregon became the third state to legalize the personal use of cannabis, under ballot measure 91. While it would take another few months for Oregon’s recreational marijuana program to fully take effect, under emergency legislation, medical dispensaries were permitted to sell medical cannabis to recreational customer beginning October 1, 2015.

In 2016, the Oregon Liquor Control Commission (the OLCC) began issuing licenses to recreational facilities. By January 2017, only OLCC licensed facilities could sell to the recreational market.