cbd sales license

Distributors of cannabinoid hemp products must obtain a Distributor Permit before selling or distributing cannabinoid hemp products manufactured outside of New York State to licensed Retailers. The permit ensures that products coming from out-of-state meet all the requirements of the Program.

On January 25, 2021, the New York State Department of Health (“Department”) launched its Cannabinoid Hemp Retail License Application and Distributor Permit Application. The Retail License and Distributor Permit are part of the Department’s new Cannabinoid Hemp Program (“Program”), which New York State Governor Andrew Cuomo announced in October 2020.

In addition, a retailer applicant who submits a complete application before April 1, 2021 may sell cannabinoid hemp products before having the application approved, provided they adhere to all other requirements of the Program.

Retail License Application

A $300 license fee for each retail location must be submitted with all applications to be licensed by the Department, and licenses must be renewed annually.

The Department will prioritize applicants who previously held valid research partnership agreements with the New York State Department of Agriculture and Markets. All other applications will be reviewed in the order they are received, so new applicants should act fast.

As part of the Program, businesses selling cannabinoid hemp products—both online and in person—must obtain a Cannabinoid Hemp Retail License from the Department. To apply, an applicant must submit an online application via the New York Business Express website.

Cannabinoid hemp products include many products containing cannabinoids such as cannabidiol or “CBD,” which come in the form of tinctures, oils, topicals, pills, capsules, and food or beverages that are intended for human or animal consumption or application. The Cannabinoid Hemp Retail Licenses and Distributor Permits are not applicable to recreational adult-use marijuana, but New York’s adult-use legislation is currently pending.

Among other requirements, cannabinoid hemp retail applications must include: (1) a summary and description of the type of cannabinoid hemp products the applicant intends to sell; (2) the sources of the cannabinoid hemp products from whom the applicant intends to purchase, including the name and contact information of any manufacturer or distributor; (3) proof that the applicant is registered to collect sales tax in New York State; and (4) an attestation that the applicant will comply with the rules and regulations of the Program.

Cbd sales license

The retail sale of hemp products including CBD (cannabinoid) oils, foods, and other ingestible products is a business activity that often walks the line between being regulated as a Food Establishment and being regulated as a Marijuana Establishment. Thus, licensing authorities for this industry vary from state departments of health, to departments of agriculture, to marijuana licensing boards. Still, the majority of states either do not have specific licenses for this type of business, or allow that only licensed medical marijuana establishments may sell these products.

Industry Background

In general, licensing requirements are far less strict than those of marijuana establishments, and fees are less steep. Businesses can expect licensing fees of $50 to $650 on average, though some states, like Utah (mentioned above), may have hefty annual costs. Fingerprinting and background checks of owners and officers is common, as well as submission of facility layout plans, samples of labels, and product descriptions. As with any industry, state incorporation filings, tax registrations, and basic local business licenses are more than likely required.

Ramifications of Non-Compliance

Those states that do license retailers of Hemp/CBD Products specifically typically require adherence to state guidelines for product labeling, marketing, and percentage of delta-9-THC in the product (usually capped at 0.3%). Businesses can expect to be required to submit to random inspections by licensing boards of both their facility and their individual products to ensure compliance with regulations. The state of Utah requires that each product offered for sale be annually registered with the Utah Department of Agriculture and Food, with annual registration fees levied per product.