Texas 2025 - 89th Regular

Texas House Bill HB5643 Compare Versions

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1	1		By: Cain H.B. No. 5643
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4	6		A BILL TO BE ENTITLED
5	7		AN ACT
6	8		relating to the production, sale, distribution, delivery, and
7	9		regulation of hemp; creating a criminal offense; imposing a tax.
8	10		BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
9	11		SECTION 1. Section 443.001, Health and Safety Code, is
10	12		amended by adding Subsections (12) and (13) to read as follows:
11	13		(12) "Hemp plant material" has the meaning assigned by
12	14		Section 121.001, Agriculture Code, and any stalks, stems, flowers,
13	15		or parts of hemp that does not exceed 0.3 percent delta-9
14	16		tetrahydrocannabinol by dry weight at the time of harvest, as
15	17		demonstrated by a certificate of analysis issued within the
16	18		previous twelve months by an independent testing laboratory.
17	19		(13) "Independent Testing Laboratory" means a laboratory
18	20		that:
19	21		(a) holds an ISO 17025 accreditation or is registered
20	22		with the federal Drug Enforcement Administration in accordance with
21	23		21 C.F.R. Section 1301.13;
22	24		(b) does not have a direct or indirect interest in the
23	25		entity whose product is being tested; and
24	26		(c) does not have a direct or indirect interest in a
25	27		facility that cultivates, processes, distributes, dispenses, or
26	28		sells consumable hemp products in this state or any other
27	29		jurisdiction.
28	30		SECTION 2. Subchapter A, Chapter 443, Health and Safety
29	31		Code, is amended by adding Sections 443.005 and 443.006 to read as
30	32		follows:
31	33		Sec. 443.005. CONSUMABLE HEMP PRODUCTS ACCOUNT. (a) The
32	34		consumable hemp products account is an account in the general
33	35		revenue fund administered by the department.
34	36		(b) The account consists of:
35	37		(1) appropriations of money to the account by the
36	38		legislature;
37	39		(2) public or private gifts, grants, or donations,
38	40		including federal funds, received for the account;
39	41		(3) fees collected under this chapter or under Chapter
40	42		431 as it applies to consumable hemp products;
41	43		(4) interest and income earned on the investment of
42	44		money in the account;
43	45		(5) penalties for violations of this chapter as it
44	46		applies to consumable hemp products; and
45	47		(6) funds from any other source deposited in the
46	48		account; and
47	49		(7) funds from the excise tax described in Section
48	50		443.006 of this Section at a rate of five percent on hemp consumable
49	51		products.
50	52		(c) The department may accept appropriations and gifts,
51	53		grants, or donations from any source to administer and enforce this
52	54		chapter as it applies to consumable hemp products. Money received
53	55		under this subsection shall be deposited in the account.
54	56		(d) Money in the account may be appropriated to the
55	57		department for the administration and enforcement of this chapter
56	58		as it applies to consumable hemp products and for juvenile mental
57	59		health programs, drug abuse prevention education, and for funding
58	60		of the Dementia Prevention Research Institute of Texas.
59	61		Section. 443.006. TAX IMPOSED ON CONSUMABLE HEMP PRODUCTS.
60	62		An excise tax at the rate of five percent shall be imposed on the
61	63		retail sale of a consumable hemp product. The tax is in addition to
62	64		any tax imposed under any other provision of federal, state, or
63	65		local law.
64	66		SECTION 3. Section 443.103, Health and Safety Code, is
65	67		amended to read as follows:
66	68		Sec. 443.103. APPLICATION; ISSUANCE. An individual or
67	69		establishment may apply for a license under this subchapter by
68	70		submitting an application to the department on a form and in the
69	71		manner prescribed by the department. The application [must be
70	72		accompanied by] shall include:
71	73		(1) the physical address [a legal description] of each
72	74		location where the applicant intends to process hemp or manufacture
73	75		consumable hemp products [and the global positioning system
74	76		coordinates for the perimeter of each location];
75	77		(2) written consent from the applicant or the property
76	78		owner if the applicant is not the property owner allowing the
77	79		department, the Department of Public Safety, and any other state or
78	80		local law enforcement agency to enter onto the [all] premises
79	81		during normal business hours [where hemp is processed or consumable
80	82		hemp products are manufactured] to conduct a physical inspection or
81	83		to ensure compliance with this chapter and rules adopted under this
82	84		chapter;
83	85		(3) any reasonable fees to cover the cost of the
84	86		processing of the application; [required by the department to be
85	87		submitted with the application;] and
86	88		(4) any other relevant information required by
87	89		department rule.
88	90		SECTION 4. Subchapter C, Chapter 443, Health and Safety
89	91		Code, is amended by adding Section 443.106 to read as follows:
90	92		Sec. 443.106. EXPEDITED LICENSING PROCESS. The department
91	93		by rule may provide an expedited licensing process for the renewal
92	94		of a license in good standing or the purchaser of a business by a
93	95		qualifying party of a currently licensed business.
94	96		SECTION 5. Section 443.151, Health and Safety Code, is
95	97		repealed and replaced in its entirety as follows:
96	98		Sec. 443.151. TESTING REQUIRED. (a) To ensure consumer
97	99		safety, consumable hemp must be tested as provided by this section.
98	100		(b) Before a consumable hemp product may be distributed or
99	101		sold as a final product, including hemp plant material, a sample
100	102		representing the final product must be tested, as required by the
101	103		executive commissioner, to determine:
102	104		(1) the concentration of various cannabinoids,
103	105		including delta-9 tetrahydrocannabinol;
104	106		(2) the presence or quantity of heavy metals,
105	107		pesticides, microbial contaminants, mycotoxins, harmful
106	108		microorganisms and pathogens, and residual solvents;
107	109		(3) the presence of any synthetic cannabinoids meaning
108	110		a substance included in Penalty Group 2-A under Section 481.1031 of
109	111		the Health and Safety Code; and any other substance prescribed by
110	112		the department.
111	113		(c) All cannabinoid testing required under this Chapter
112	114		must be performed by a laboratory that is accredited by an
113	115		accreditation body in accordance with International Organization
114	116		for Standardization ISO/IEC 17025 or a comparable or successor
115	117		standard to determine the delta-9 tetrahydrocannabinol
116	118		concentration of the product.
117	119		SECTION 6. Section 443.152, Health and Safety Code, is
118	120		amended by adding Subsection (d) to read as follows:
119	121		(d) The executive commissioner by rule may exclude a
120	122		substance from the testing required under Section 443.151 that is
121	123		generally recognized as having no risk of contaminating a finished
122	124		consumable hemp product, including a microorganism or other
123	125		substance that is inevitably destroyed or removed while processing
124	126		or manufacturing the product.
125	127		SECTION 7. Section 443.201, Health and Safety Code, is
126	128		amended by adding Subsections (c), (d), and (e) to read as follows:
127	129		(c) A person may transport and deliver a consumable hemp
128	130		product in compliance with this chapter to a lawful purchaser of the
129	131		product. A person may also transport or deliver raw hemp extract
130	132		intended to be remediated into a final form product. The person
131	133		transporting the consumable hemp product or raw hemp extract shall
132	134		maintain documentation during transport to demonstrate the
133	135		transaction complies with this chapter. The person transporting
134	136		and the consumable hemp product is not required to:
135	137		(1) obtain a license under Section 443.101, unless the
136	138		person processes or manufactures the product delivered; or
137	139		(2) register under Section 443.2025, unless the person
138	140		sells the product delivered.
139	141		(d) A person may not manufacture or sell a non-compliant
140	142		consumable hemp product in this state.
141	143		(e) To the extent this Section conflicts with Chapter 481,
142	144		the Texas Controlled Substances Act, Chapter 481 shall prevail.
143	145		SECTION 8. Section 443.2025, Health and Safety Code, is
144	146		amended by amending Subsections (b), (d), and (f) and adding
145	147		Subsection (d-1) to read as follows:
146	148		(b) A person that sells [may not sell] or distributes
147	149		consumable hemp products [containing cannabidiol at retail] in this
148	150		state, other than products generally recognized as safe by the
149	151		United States Food and Drug Administration, shall register with the
150	152		department [unless the person registers with the department each
151	153		location owned, operated, or controlled by the person at which
152	154		those products are sold. A person is not required to register a
153	155		location associated with an employee or independent contractor
154	156		described by Subsection (d)].
155	157		(d) A person is not required to register with the department
156	158		under Subsection (b) if the person is:
157	159		(1) an employee of a registrant; or
158	160		(2) an independent contractor of a registrant who
159	161		sells the registrant's products to consumers [at retail].
160	162		(d-1) unless such employee or independent contractor works
161	163		for a person located outside of the state who is not a registrant
162	164		and sells or distributes products covered by Subsection (b) in this
163	165		state.
164	166		(f) The registration shall [department by rule may adopt a
165	167		registration fee schedule that establishes reasonable fee amounts
166	168		for the registration of]:
167	169		(1) identify the responsible party to direct
168	170		correspondence [a single location at which consumable hemp products
169	171		[containing cannabidiol are sold]; and
170	172		(2) be subject to a nominally reasonable fee [multiple
171	173		locations at which consumable hemp products [containing
172	174		cannabidiol] are sold under a single registration].
173	175		SECTION 9. Section 443.204, Health and Safety Code, is
174	176		amended by adding Subsection (b) to read as follows:
175	177		Sec. 443.204. RULES RELATED TO SALE OF CONSUMABLE HEMP
176	178		PRODUCTS. (a) Rules adopted by the executive commissioner
177	179		regulating the sale of consumable hemp products must, to the extent
178	180		allowable by law, reflect the following principles:
179	181		(1) hemp-derived cannabinoids, including cannabidiol
180	182		and raw hemp extract intended to be remediated into a finished good,
181	183		are not considered controlled substances or adulterants;
182	184		(2) products containing one or more hemp-derived
183	185		cannabinoids, such as cannabidiol, intended for ingestion are
184	186		considered foods, not controlled substances or adulterated
185	187		products; and
186	188		(3) consumable hemp products must be packaged and
187	189		labeled in the manner provided by Section 443.205.
188	190		(b) Not later than the 90th day after a change to this
189	191		chapter takes effect, the department shall adopt rules to resolve
190	192		any conflicts arising from the change. Until such rules are
191	193		adopted, the department shall enforce the provisions of this
192	194		chapter to the fullest extent possible without exceeding its
193	195		authority or conflicting with federal law or other controlling
194	196		legal requirements.
195	197		SECTION 10. Section 443.205, Health and Safety Code, is
196	198		amended to read as follows:
197	199		SEC. 443.205 CONSUMER SAFETY [PACKAGING AND LABELING]
198	200		REQUIREMENTS. (a) before a finished [Before a] consumable hemp
199	201		product, including hemp plant material, may be distributed or sold,
200	202		it [that contains or is marketed as containing more than trace
201	203		amounts of cannabinoids may be distributed or sold, the product]
202	204		must be labeled in the manner provided under this section and with
203	205		the following information:
204	206		(1) a statement of identify or product name.labeled
205	207		in the manner provided by this subchapter, including [section with]
206	208		the following information:
207	209		(2) [(1)] batch or lot identification number;
208	210		(3) [(2)] Net contents [batch date];
209	211		(4) [(3)] ingredients contained in the product,
210	212		including hemp-derived cannabinoids [product name];
211	213		(5) [(4)] major food allergens as identified by the
212	214		U.S. Food, Drug, and Cosmetic Act [a uniform resource locator (URL)
213	215		that provides or links to a certificate of analysis for the product
214	216		or each hemp-derived ingredient of the product];
215	217		(6) [(5)] the name of the product's manufacturer;[and]
216	218		(7) [(6)] a [certification]certificate of analysis
217	219		that the delta-9 tetrahydrocannabinol concentration of the product
218	220		[or], each hemp-derived ingredient of the product, or the hemp
219	221		plant material, is not more than 0.3 percent by dry weight; and
220	222		(8) contact information of the manufacturer or
221	223		licensed party.
222	224		(9) Packaged in a container that is:
223	225		(a) tamper evident; and
224	226		(b) child resistant
225	227		(b) The label required by Subsection (a) may be in the form
226	228		of:
227	229		(1) a uniform resource locator (URL) [for the
228	230		manufacturer's Internet website] that provides or links to a
229	231		certificate of analysis for the product [the information required
230	232		by that subsection]; and
231	233		(2) a QR code or other bar code that may be scanned and
232	234		that leads to the information required by that subsection.
233	235		(c) The label required by Subsection (a) must appear on each
234	236		unit of the product intended for individual retail sale. If the
235	237		unit includes inner and outer packaging, the label may appear on any
236	238		of that packaging.
237	239		(d) This section does not apply to sterilized seeds
238	240		incapable of beginning germination.
239	241		(e) Before a consumable hemp product may be sold to a
240	242		consumer, the product must be either prepackaged or placed at the
241	243		time of sale in packaging or a container that is tamper-evident and
242	244		child resistant. If the product contains multiple servings or
243	245		consists of multiple products purchased in one transaction, the
244	246		package or container must be resealable in a manner that allows the
245	247		child-resistant mechanism to remain intact.
246	248		SECTION 11. Subchapter E, Chapter 443, Health and Safety
247	249		Code, is amended by adding Sections 443.2055, 443.2056, 443.208,
248	250		443.209, 443.210, and 443.211 to read as follows:
249	251		Sec. 443.2055. CONSUMABLE HEMP PRODUCT AND PACKAGING
250	252		ATTRACTIVE TO MINORS. (a) Edible consumable hemp products that
251	253		contain or are marketed as containing hemp-derived cannabinoids may
252	254		not be in the shape of a human, animal, fruit, or toy or in another
253	255		shape known to be marketed to minors.
254	256		(b) Packaging of a consumable hemp product may not include:
255	257		(1) cartoons, being any drawing or depiction of an
256	258		object, person, animal, creature or any similar caricature that
257	259		uses comically-exaggerated features; and
258	260		(2) attributes human characteristics to animals,
259	261		plants, toys or other objects; or
260	262		(3) attributes unnatural or extra-human abilities,
261	263		such as imperviousness to pain or injury, X-ray vision, tunneling
262	264		at very high speeds, or human transformation (i.e.) superheroes; or
263	265		(4) images of children.
264	266		Sec. 443.2056. MISLEADING PACKAGING PROHIBITED. (a) The
265	267		packaging and labeling of consumable hemp products that contain or
266	268		are marketed as containing hemp-derived cannabinoids shall not:
267	269		(1) depict any statement, artwork, or design that
268	270		falsely suggests the product does not contain hemp-derived
269	271		cannabinoids;
270	272		(2) closely resemble a copyrighted, trademarked, or
271	273		widely recognized non-hemp product in a way that could cause
272	274		confusion.
273	275		Sec. 443.208. SALE OF CONSUMABLE HEMP PRODUCTS TO PERSONS
274	276		YOUNGER THAN 21 YEARS OF AGE PROHIBITED; PROOF OF AGE REQUIRED. (a)
275	277		A person commits an offense if the person, with criminal
276	278		negligence, sells a consumable hemp product that contains or is
277	279		marketed as containing hemp-derived cannabinoids, to an individual
278	280		under 21 years of age.
279	281		(b) An employee of an establishment that sells a consumable
280	282		hemp product in violation of Subsection (a), is individually liable
281	283		and may be prosecuted for the offense, regardless of whether the
282	284		owner or operator of the establishment is also held liable. This
283	285		section does not preclude prosecution of the owner or operator of
284	286		the establishment if the violation occurred with their knowledge or
285	287		due to their failure to exercise reasonable supervision and control
286	288		over employees.
287	289		(c) An offense under this section is a Class C misdemeanor.
288	290		(d) It is a defense to prosecution under Subsection (a) that
289	291		the person to whom the consumable hemp product was sold presented to
290	292		the defendant apparently valid proof of identification.
291	293		(e) A proof of identification satisfies the requirements of
292	294		Subsection (d) if it contains a physical description and photograph
293	295		consistent with the person's appearance, purports to establish that
294	296		the person is 21 years of age or older, and was issued by a
295	297		governmental agency. The proof of identification may include a
296	298		driver's license issued by this state or another state, a passport,
297	299		or an identification card issued by a state or the federal
298	300		government.
299	301		(f) It is an exception to the application of Subsection (a)
300	302		that the person to whom the consumable hemp product was sold is at
301	303		least 18 years of age and presented at the time of purchase a valid
302	304		military identification card of the United States military forces
303	305		or the state military forces.
304	306		(g) A person who owns, manages, or operates an Internet
305	307		website that contains an e-commerce platform on which consumable
306	308		hemp products, including hemp plant material, that contain or are
307	309		marketed as containing hemp-derived cannabinoids are sold at retail
308	310		or offered for retail sale must:
309	311		(1) require a consumer accessing the e-commerce
310	312		platform to state affirmatively that the person is at least 21 years
311	313		of age; and
312	314		(2) verify a consumer's age prior to completing a
313	315		purchase on the e-commerce platform by:
314	316		(A) using a reliable online age verification
315	317		service; or
316	318		(B) obtaining and examining a copy of a valid
317	319		government-issued identification.
318	320		Sec. 443.209. SALE OF CERTAIN CONSUMABLE HEMP PRODUCTS TO
319	321		PERSONS YOUNGER THAN 21 YEARS OF AGE. (a) The department by rule
320	322		shall adopt a list of hemp-derived cannabinoids that are exempt
321	323		from the requirements of Sections 443.205(a)(9), 443.205(e),
322	324		443.2055, and 443.208.
323	325		(b) The list adopted under Subsection (a):
324	326		(1) must include cannabidiol and cannabigerol; and
325	327		(2) may include cannabinoid quantity thresholds.
326	328		(c) Notwithstanding Subsection (a), Sections
327	329		443.205(a)(9), 443.2055, and 443.208 apply to any consumable hemp
328	330		product that contains:
329	331		(1) a hemp-derived cannabinoid not included on the
330	332		list adopted under Subsection (a); or
331	333		(2) a quantity of a hemp-derived cannabinoid that
332	334		exceeds any applicable threshold established under Subsection
333	335		(b)(2).
334	336		Sec. 443.210. APPLICABILITY OF PENALTIES TO CERTAIN
335	337		RETAILERS. Notwithstanding another provision of this subchapter, a
336	338		retailer of consumable hemp products is not liable for a penalty
337	339		under this subchapter if the retailer proves by a preponderance of
338	340		the evidence that the violation was unintentional and due to the
339	341		retailer's good faith reliance on a representation made by a
340	342		manufacturer, processor, or distributor of consumable hemp
341	343		products.
342	344		Sec. 443.211. Notwithstanding any other law, a retailer may
343	345		possess, transport, or sell a consumable hemp product that becomes
344	346		part of the retailer's inventory before rules required to implement
345	347		the changes in law made by this Act become effective unless the
346	348		product:
347	349		(1) is unsafe for consumption based on the presence or
348	350		quantity of heavy metals, pesticides, harmful microorganisms, or
349	351		residual solvents; or
350	352		(2) has a delta-9 tetrahydrocannabinol concentration
351	353		that exceeds 0.3% delta-9 tetrahydrocannabinol by dry weight.
352	354		SECTION 12. Subchapter C, Chapter 122, Agriculture Code,
353	355		Section 122.102 is amended by adding Subsection(c) to read as
354	356		follows:
355	357		(c) Except as provided by subdivision (d) and
356	358		notwithstanding any other law, The department may not issue a
357	359		license under this subchapter to produce hemp on real property
358	360		owned by any of the following:
359	361		(1) a governmental entity of China, Iran, North Korea,
360	362		or Russia;
361	363		(2) a company or other entity that is:
362	364		(A) headquartered in China, Iran, North Korea, or
363	365		Russia;
364	366		(B) directly or indirectly under the control of
365	367		the government of China, Iran, North Korea, or Russia; or
366	368		(C) owned by or under the control of one or more
367	369		individuals who are citizens of China, Iran, North Korea, or
368	370		Russia;
369	371		(3) a company or other entity that is owned by or under
370	372		the control of a company or entity described by Subdivision (2); or
371	373		(4) an individual who is a citizen of China, Iran,
372	374		North Korea, or Russia.
373	375		(d) This subsection does not apply to an individual who is a
374	376		citizen or lawful permanent resident of the United States,
375	377		including an individual who is a citizen of a foreign country.
376	378		SECTION 13. This Act takes effect immediately if it
377	379		receives a vote of two-thirds of all the members elected to each
378	380		house, as provided by Section 39, Article III, Texas Constitution.
379	381		If this Act does not receive the vote necessary for immediate
380	382		effect, this Act takes effect September 1, 2025