On July 17, the U.S. House Committee on Agriculture hosted a closed-door roundtable briefing focused on the regulatory gray areas surrounding hemp-derived cannabinoid products. The session, convened in response to ongoing concerns over consumer safety, regulatory ambiguity, and market disruption, featured expert insights from four panelists: Jonathan Miller, general counsel for the U.S. Hemp Roundtable; Pamela Epstein, chief legal and regulatory officer at Terpene Belt Farms; Cole White, attorney at Troutman Pepper Locke, in his capacity as special counsel for the Attorney General Alliance; and Dr. Gillian Schauer, executive director of the Cannabis Regulators Association. The discussion reflected mounting congressional interest in addressing the unintended consequences of the Agriculture Improvement Act of 2018’s (2018 Farm Bill) legalization of hemp and its derivatives.
Background
The 2018 Farm Bill removed “hemp” from the federal Controlled Substances Act, defining it as any part of the cannabis plant containing no more than 0.3% delta-9 THC by dry weight. While the intent was to legalize nonintoxicating hemp for industrial purposes, the legislation inadvertently opened the door to a wide array of novel, intoxicating hemp-derived cannabinoids, such as delta-8 THC. In the absence of federal regulation, these products have flooded gas stations, convenience stores, and online marketplaces nationwide, often with little to no regulatory oversight requiring testing, labeling, or age restrictions. While many states have taken steps to regulate these products within their borders, this national gray market poses significant challenges to consumer safety, state enforcement, and the integrity of state-legal cannabis programs.
Panelist Perspectives
Miller emphasized the industry’s precarious position, describing an “existential crisis” for thousands of hemp farmers in the wake of FDA’s inaction on CBD regulation. He suggested that while bad actors have introduced unsafe or misleading products into the market, the hemp industry has made strides in self-regulation, establishing testing protocols and labeling standards to meet existing state requirements. Miller cautioned that overly broad federal restrictions risk wiping out the majority of the current market for hemp-derived products.
Epstein echoed concerns about bad actors and regulatory gaps, arguing that the 0.3% delta-9 THC threshold, designed for dry plant material, has led to a market characterized by ambiguity, with products potentially containing high levels of THC and other cannabinoids without proper regulation. She emphasized the need for Congress to address these regulatory gaps to protect consumers, support responsible manufacturers, and ensure agricultural stability, while also recognizing the states’ right to regulate hemp products.
White reemphasized the proliferation of intoxicating hemp-derived THC products in what state attorneys general have called a “massive gray market.” He highlighted state efforts to regulate these products and associated litigation brought against the states by the hemp industry, pointing to recent court rulings reinforcing the principle that states retain the core authority to regulate these products to protect public health and safety. However, he stressed that any federal solution — whether regulatory or prohibitory — should clearly preserve the states’ authority to address these products within their borders.
Dr. Schauer offered a regulatory perspective, noting that hemp and cannabis are chemically and functionally identical in many forms, yet are subject to vastly different regulatory standards. She underscored the lack of federal testing, labeling, or age restrictions on intoxicating hemp products in comparison to state-regulated cannabis products, and emphasized the need for a comprehensive federal regulatory framework with clear definitions and minimum standards.
Why It Matters
The roundtable discussion highlighted a growing bipartisan recognition that the current federal framework for hemp-derived cannabinoid products is inadequate and unsustainable. Panelists argued that the absence of federal clarity has allowed bad actors to flourish and placed unnecessary strain on legitimate hemp and cannabis operators. For legal and business professionals involved in cannabis and hemp markets, the message from panelists was clear: any federal solution should protect the integrity of state-regulated markets by distinguishing intoxicating products, setting clear minimum standards, and preserving states’ authority to act in the interest of public health and safety.
Our Cannabis Practice provides advice on issues related to applicable federal and state law. Cannabis remains an illegal controlled substance under federal law.
