How to Get a CBD License

Overview

Are you interested in getting a CBD license and becoming part of the growing cannabis industry? This guide will help you understand requirements, compliance and next steps as it relates to the production, distribution, and sale of your CBD products. 

What is CBD?

CBD, or cannabidiol, is a naturally occurring compound found from cannabis plants. It was first discovered in 1940 by Dr. Roger Adams, an American chemist.  Next to delta-9 THC, CBD is the 2nd most popular compound from the cannabis plant making up 40% of the plant’s extract. Unlike Delta-9 THC, CBD does not produce psychoactive effects that result in a high. 

CBD can come in many forms including:

Oils or tinctures – a concentrated liquid form of CBD that is typically taken sublingually (under the tongue) or added to food or drinks

Topicals – any lotion, cream, or balm that may be applied directly to the skin and contains CBD 

Capsules – a convenient way to take a precise dose of CBD and are swallowed like regular pills

CBD edibles – gummies, chocolates, and other food items that are infused with CBD

CBD products can be bought at brick and mortar stores or online retailers in most parts of the United States. 

Studies suggest CBD could benefit one’s health in a variety of ways including: 

Inflammation, arthritis, and nerve damage-related pain – CBD may help alleviate pain by interacting with certain chemicals in your body that transmit signals in your nervous system. In a study, individuals who had nerve damage in the lower half of their body reported significant pain reduction after using a CBD oil product applied topically.

Anxiety and depression – CBD (cannabidiol) may help reduce symptoms of anxiety and depression. A study found that CBD treatment was more effective for patients with moderate to severe symptoms, and it improved their overall well-being. 

Post-Traumatic Stress Disorder – A review of studies in 2019 found that CBD (cannabidiol) may help ease symptoms of PTSD in some people. However, researchers need to conduct more studies to fully understand how effective and safe it is for treating PTSD with CBD.

Epilepsy – CBD has been shown in a research to lessen seizures in several kinds of pediatric epilepsy that are resistant to therapy.

It is important to note that even though evidence supporting CBD benefits exists, its potential uses are not yet fully understood and more research needs to be done. 

Is CBD Legal in the United States?

CBD’s legality depends on factors such as:

• Federal and State Regulations
• Source of the CBD (if it’s marijuana or hemp-derived) 
• FDA Oversight

At the federal level, hemp-derived CBD that contains less than 0.3% THC was legalized when then-President Trump signed into law the 2018 Farm Bill on December 20, 2018. The measure essentially made it legal to cultivate and manufacture hemp and items derived from it, such as CBD, by removing hemp from the Controlled Substances Act. 

CBD derived from marijuana is still illegal under federal law. Some states have taken steps to legalize marijuana use for both medical and recreational purposes, which may include CBD products made from marijuana. For information on the legal status of cannabis in each state, you can check out this map.

While CBD is legalized at the federal level, states still have the ability to regulate CBD within their borders. To identify your state’s stand regarding CBD, here’s a list of states that have conditionally and fully allow CBD:

In addition to federal and state rules, CBD vendors and consumers must also follow FDA requirements. The FDA currently prohibits:

• addition of CBD to food, drinks, or nutritional supplements
• sale of CBD as an unapproved drug
• Sale of CBD as a dietary product

As of 2023, only one CBD-based medicine has been approved by the FDA – the Epidiolex, which was developed for rare forms of epilepsy.

Is It Legal To Sell CBD?

The same as mentioned above, the legality of selling CBD also depends on the jurisdiction, the source of the CBD and complying with FDA regulations. It’s important to research and understand the laws and regulations in your specific area before selling CBD products.

According to the FDA, these are among the factors to be considered to determine if it is legal to sell CBD:

• the product’s intended usage
• manner in which it is promoted and labeled

Even if a CBD product satisfies the 2018 Farm Bill’s definition of “hemp,” it must also abide by all other relevant rules, including the Food, Drug, and Cosmetic Act. For more information about this, the FDA has provided a question and answer you can check.

How To Get CBD Licenses

To sell CBD products legally, you will likely be required to acquire specific licenses, such as a general business and resale license. The requirements can vary depending on the state you are operating in.

One way to determine a suitable business license for your company is by researching the available options on your state’s website. 

A resale license may also be required if you plan to purchase goods from wholesalers or distributors and sell it. Conduct research beforehand to determine the requirements for obtaining a resale license in your state and whether or not you still need one.

Under federal regulations, selling CBD is permitted and will not require a license. But then again, laws still vary from state to state. To give you an idea, here are some examples of the requirements to obtain a CBD license in select states:

How To Get a CBD License in New Jersey

To grow, produce, or sell hemp for CBD or CBD products in New Jersey, individuals must register with the NJDA Hemp Program and obtain an industrial hemp license. There are two types of licenses that you can choose from: the Grower license and the Processor/Handler license. To apply, individuals or businesses are required to provide personal or business information, details about the property, and any required documentation. There is a non-refundable application fee of $50 that needs to be paid only once. 

How To Get a CBD License in New York

Businesses that would like to sell cannabis hemp products must obtain a Cannabinoid Hemp Retail License from the NY Office of Cannabis Management. This requirement is applicable for both sales made online and in-person. To sell or distribute cannabis hemp products from outside of New York State to certified Cannabinoid Hemp Retailers, distributors must obtain a Cannabinoid Hemp Distributor Permit. Before submitting your application, make sure to review the requirements for the Cannabinoid Hemp Retail & Distributor application. The license to sell Cannabinoid Hemp at retail outlets requires a fee of $300 per outlet while permit for distributing Cannabinoid Hemp requires $300 per distribution site.

Types of CBD Licenses

Depending on the state, there may be different types of CBD licenses that are required to legally cultivate, process, or sell CBD products such as:

• Cultivation License is required for individuals or companies that intend to grow hemp or cannabis plants that are rich in CBD. 
• A processing license is necessary for individuals or businesses that plan to extract, refine, or manufacture CBD products. 
• Retail licenses are required for businesses that sell CBD products directly to consumers. 
• Distribution licenses are necessary for individuals or companies that transport and sell CBD products to retailers or other wholesalers. 

At Cannaspire, we can assist your company in navigating the constantly shifting CBD landscape to ensure its continued success. Our team can help you with licensing your business with the state and more. Learn more about how Cannaspire can help you here or contact us today to get started.