Hearing About CBD Regulations as More Retailers Enter the Market

May 14, 2019

After major retailers, like Rite Aid, CVS, and Walgreens, announced their plans to test the market’s interest in CBD products, the former U.S. Food and Drug Administration (FDA) commissioner said the pharmacies could expect to run into regulatory problems.

For example, Rite Aid started to sell creams, lotions, and lip balms that contain cannabidiol, which is a non-psychoactive ingredient in cannabis, in April in 200 stores across Washington and Oregon. To avoid filing drug claims, it opted to call the products cosmetics. CVS and Walgreens also will sell CBD products in certain states.

The adoption of the 2018 farm bill legalized hemp and hemp products, including CBD, and it removed it from the controlled dangerous substance list. Despite this, the FDA said companies still can’t sell food, drink, or dietary supplements that contain the hemp derivative.

Why Some Believe the Strategy Won’t Work

Gottlieb was skeptical that Rite Aid or any other pharmacy could sell CBD cosmetics without making drug claims. He said if there are any claims that product treats pain or heals any ailment, it will violate a federal regulation.

Since its legalization, the national demand for CBD has grown. CBD advocates say that it treats everything from back pain to anxiety.

However, Gottlieb, who left the FDA at the beginning of April, has said the benefits were hyped and claims are not backed up by any scientific evidence.

THC, or tetrahydrocannabinol, the psychoactive property in marijuana, does not fall under FDA regulations. The agency only regulates broad claims that marijuana can treat anxiety, acute pain, or even chronic illness.

How the Agency Plans to Handle Regulation and Demands

Since there is so much confusion over regulations and how the sector will be monitored as it moves ahead, the FDA announced it will hold a public hearing to discuss regulating CBD on May 31, 2019.

The government needs to address challenges related to transporting CBD products
There are certain challenges intrinsic with transporting CBD products because of CBD’s close relation to cannabis, which is still illegal at the federal level.

Which CBD Products are Legal Under the Law?

Under the farm law, CBD products cannot contain more than .03 percent THC. Any products containing CBD could be subject to frequent checks and stop points.

There is so much ambiguity surrounding the law that presents more challenges than solutions.

States have different laws concerning hemp.

For example, states, like Ohio, New York, Texas, and Maine, have banned the sale of edibles. However, companies in other states may still be able to sell CBD products based on the federal law concerning hemp.

States and the federal government also will need to address regulatory standards for THC content, as well who will conduct regulatory checks, and other issues.

In Conclusion

As more major retailers put a toe in the CBD industry pool, it proves that there is a market for these products. The upcoming hearing that is scheduled also proves that the agency is interested get regulations squared away.

Until all of the issues get settled, it is up to individual merchants to check out the laws where they plan to sell and then follow them.

If you need a CBD merchant account so you can accept and process credit and debit card payments should contact eMerchantBroker.com (EMB). It works with high-risk merchants, including those in the CBD industry. Its online application is simple and easy.

Let us help you get a high risk merchant account today!

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Having a merchant account allows an account holder to take advantage of merchant cash advances. When a merchant is approved for an advance, the business agrees to receive a lump sum of cash in exchange for an agreed-upon percentage of future credit card sales.

Pricing varies depending on the merchant’s industry, past credit card processing history, the type of business seeking the account, average ticket sales, and average transaction volumes.

Yes, EMB works with merchants who are building their credit, as well as those who have poor credit. EMB also approves merchants that have no credit card processing history and businesses that have lost their merchant accounts due to high chargebacks.

Several factors influence a merchant’s risk level. Though only one factor likely will not get a merchant classified as high risk, a combination of these may: business size, location, and industry, credit score, credit card processing history, a industry’s reputation for excessive chargebacks, a prior history of high chargeback ratios, and whether a merchant exclusively sells online.

Virtual terminals are stationed on a merchant’s website, making it easy for customers to make a payment or purchase online. Merchants or a payment processor can easily set up virtual terminals, so online businesses can accept credit and debit card and e-check transactions.

A merchant account is a business account with an acquiring bank. Without this business account, which actually works more like a line of credit, a merchant cannot accept and process credit and debit card transactions. Businesses need a merchant account to accept major credit cards via a static point-of-sale terminal, mobile card reader, or through a virtual payment gateway.

After filling out EMB’s simple online application and submitting any necessary, requested documents, many merchants get approved within 24 and 48 hours.

EMB specializes in working with high-risk merchants. EMB works with many merchants, including but not limited to businesses in these industries: gambling and gaming, adult entertainment, nutraceuticals, vaping and e-cigarettes, electronics, tech support, travel, high-end furniture, weight loss programs, calling cards, e-books and software, and telecommunications.

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