The United States Department of Agriculture (USDA) has released a draft of its interim final rule establishing the U.S. Domestic Hemp Production Program, in advance of the rule’s Federal Register publication, which is expected on Thursday, October 31. The interim rule provides guidance on a number of issues and uncertainties that have plagued the industry since the passage of the Agriculture Improvement Act of 2018 (commonly known as the 2018 Farm Bill). 

The rule outlines requirements for states and Indian tribes to craft their own hemp production programs and also undertakes the monitoring and regulation of hemp grown in states and territories without a USDA-approved plan. To date, ten states and ten tribes have submitted plans for hemp production to USDA, a number that is anticipated to grow rapidly. USDA previously indicated that it would review these plans once its rule was published, and will begin doing so using its interim rule upon publication in the Federal Register this week. 

Whether operating under a state plan or the federal plan, the rule provides much-needed guidance to growers, processors, manufacturers, and transporters of industrial hemp on issues of sampling and testing. For example, under the rule, crop sampling must be conducted by a federal, state, local or tribal law enforcement agency within fifteen days of the anticipated date of harvest. The samples must be tested for delta-9 tetrahydrocannabinol (THC) by a Drug Enforcement Administration-registered laboratory. Simultaneous with the rule, USDA published separate guidelines for the sampling and testing of hemp for THC content.

The interim rule is expected to remove the “guesswork compliance” that has previously been the industry norm and provide direction to hemp business owners who have long sought to conduct their businesses legally and ethically. Simultaneously, the rule will help weed out any bad actors who may have been using the previous regulatory ambiguity to their advantage.

Comments on the interim rule will be due within sixty days of its publication in the Federal Register. After considering all comments, USDA will publish a final rule within two years of the interim rule’s effective date. In the meantime, the interim final rule will remain in effect. 

Beveridge & Diamond will publish a detailed analysis of the interim rule’s provisions and anticipated impacts to the industry over the next week.

Beveridge & Diamond's Industrial Hemp & Cannabis industry group assists cannabis-based businesses with state-level environmental compliance, product liability, project planning, environmental risk avoidance, and, when appropriate, litigation and defense against state-level environmental enforcement actions. Click here to sign up for our Industrial Hemp & Cannabis industry list to receive topical news alerts and event invitations by email. Possession, use, distribution and sale of cannabis may be a federal crime. These materials, and any advice provided herein, are not intended to provide any guidance or assistance in violating federal law, or in providing guidance or assistance in complying with federal law.