New Mexico Passes Legislation that Limits CBD Sales to In-State Licensed Hemp Growers and Manufacturers

The New Mexico Legislature voted to create a commercial hemp industry by passing the Hemp Manufacturing Act. The bill will be presented by Governor Grisham, and it will become law upon her signature. The bill directs New Mexico’s Department of Agriculture to establish a licensing and oversight program for a commercial hemp industry. The legislation would result in Schedule 1 criminal charges for the growing of hemp or manufacturing of CBD products without a license.

Under the bill, the Department of Agriculture would establish a hemp harvest certification program requiring the state verify that each licensed grower’s harvest is below the maximum .3% THC threshold. The harvest certification program prevents non-licensed growers or manufacturers from selling or transporting hemp to or in New Mexico. Growing hemp or manufacturing hemp products without a license would be a Schedule 1 offense, and transporting hemp without a harvest certificate is a petty misdemeanor that is subject to a $500 fine. New Mexico law enforcement may also seize the hemp for up to five days if the transporter does not have a harvest certificate. These ramifications are serious as a Schedule 1 violation would limit a business from obtaining a hemp growing license under the 2018 Farm bill or obtaining cannabis or hemp licenses at the state level.

The Department is also directed to adopt rules that govern the manufacturing of hemp products. Persons who are interested in extracting, processing or engaging in other manufacturing activities for hemp products must obtain a permit or face Schedule 1 criminal charges. The Department will oversee the industry’s manufacturing practices to ensure the safety, sanitation and security of the finished product. New Mexico’s focus on manufacturing has brought CBD products into the regulated realm, and thereby limiting the products sold in the state to licensed manufacturers.