HOUSE BILL NO. 2768 103RD GENERAL ASSEMBLY
INTRODUCED BY REPRESENTATIVE OVERCAST.
4217H.01I JOSEPH ENGLER, Chief Clerk
AN ACT To amend chapters 144 and 195, RSMo, by adding thereto twenty-five new sections relating to industrial hemp-derived consumable products, with penalty provisions.
Be it enacted by the General Assembly of the state of Missouri, as follows:
Section A. Chapters 144 and 195, RSMo, are amended by adding thereto twenty-five 2 new sections, to be known as sections 144.028, 195.2550, 195.2555, 195.2557, 195.2558, 3 195.2560, 195.2563, 195.2564, 195.2565, 195.2570, 195.2575, 195.2580, 195.2585, 4 195.2590, 195.2595, 195.2600, 195.2605, 195.2607, 195.2610, 195.2615, 195.2617, 5 195.2620, 195.2625, 195.2630, and 195.2635, to read as follows: 144.028. 1. As used in this section, the term "industrial hemp-derived 2 consumable product" shall have the same meaning given to the term in section 195.2550. 3 2. For all tax years beginning on or after January 1, 2027, an excise tax is hereby 4 levied and imposed upon the retail sale of industrial hemp-derived consumable products 5 to consumers within this state. The rate of tax shall be two percent of the retail 6 purchase price paid or charged and shall be in addition to any tax imposed under any 7 other provision of federal, state, or local law. 8 3. The revenue derived from the two percent rate levied under this section shall 9 be deposited by the department of revenue into the hemp business fund established 10 under section 195.2563. 11 4. The tax imposed under this section is intended to be passed on to and borne by 12 the purchaser of the industrial hemp-derived consumable product. The tax is a debt 13 from the purchaser to the retailer until paid and is recoverable at law by the retailer in 14 the same manner as other debts. A retailer is considered to act as a trustee on behalf of
EXPLANATION — Matter enclosed in bold-faced brackets [thus] in the above bill is not enacted and is intended to be omitted from the law. Matter in bold-face type in the above bill is proposed language. HB 2768 2
15 the state when it collects tax from the purchaser on a taxable transaction. The tax shall 16 be stated and charged separately on any documentation provided to the purchaser by 17 the retailer at the time of the transaction. 195.2550. As used in sections 195.2550 to 195.2635, unless the context otherwise 2 requires, the following terms mean: 3 (1) "Batch", a specific quantity of industrial hemp-derived consumable product 4 that is manufactured at the same time and using the same methods, equipment, and 5 ingredients; that is uniform and intended to meet specifications for identity, strength, 6 purity, and composition; and that is manufactured, packaged, and labeled according to 7 a single batch production record executed and documented; 8 (2) "Batch number", a unique numeric or alphanumeric identifier assigned to a 9 batch of industrial hemp-derived consumable products; 10 (3) "Business", any of the following licensed under sections 195.2550 to 11 195.2635: 12 (a) A distributor; 13 (b) A retailer; or 14 (c) A manufacturer; 15 (4) "Consumer", a person twenty-one years of age or older who purchases or 16 possesses an industrial hemp-derived consumable product for personal use; 17 (5) "Counter", the point of purchase at a retail establishment; 18 (6) "Distributor", a person or entity that purchases industrial hemp-derived 19 consumable products from manufacturers and sells them to retailers; 20 (7) "Division", the division of alcohol and tobacco control of the department of 21 public safety; 22 (8) "Food service establishment", an establishment where food is prepared and 23 served on the premises; 24 (9) "Franchise", a written or oral arrangement for a definite or indefinite 25 period, in which a person grants to another person a license to use a trade name, 26 trademark, service mark, or related characteristic, and in which there is a community of 27 interest in the marketing of goods or services at wholesale, at retail, by lease, by 28 agreement, or otherwise including, but not limited to, a commercial relationship of 29 definite duration or continuing indefinite duration between a manufacturer and a 30 distributor wherein a distributor is granted the right to offer, sell, and distribute within 31 this state or any designated area thereof some or all of the manufacturer's industrial 32 hemp-derived consumable products to retailers; 33 (10) "Hemp", the plant Cannabis sativa L. and any part of that plant, including 34 the seeds thereof and all derivatives, extracts, cannabinoids, isomers, acids, salts, and HB 2768 3
35 salts of isomers, whether growing or not, with a delta-9 tetrahydrocannabinol 36 concentration of not more than three-tenths of one percent on a dry-weight basis; 37 (11) "Hemp product", any product that contains an industrial hemp-derived 38 cannabinoid. The term "hemp product" shall not include: 39 (a) Any industrial hemp-derived product intended for topical application; 40 (b) Any industrial hemp-derived animal feed product; 41 (c) Any hemp seeds or hemp-seed-derived ingredients that are generally 42 recognized as safe by the United States Food and Drug Administration; or 43 (d) Any product that contains a cannabinoid that is not an industrial hemp- 44 derived cannabinoid; 45 (12) "Independent testing laboratory", a laboratory that meets all of the 46 following conditions: 47 (a) Holds an International Organization for Standardization (ISO) 17025 48 accreditation or is registered with the Drug Enforcement Administration in accordance 49 with 21 CFR 1301.13; 50 (b) Does not have a direct or indirect interest in the entity whose product is being 51 tested; 52 (c) Does not have a direct or indirect interest in a facility that cultivates, 53 processes, distributes, dispenses, or sells industrial hemp-derived consumable products 54 in this state or any other jurisdiction; and 55 (d) Performs tetrahydrocannabinol concentration sampling and testing using the 56 high-performance liquid chromatography (HPLC) method or, when appropriate, gas 57 chromatography; 58 (13) "Industrial hemp-derived cannabinoid", any cannabinoid naturally 59 occurring in, and originating from, the hemp plant including, but not limited to, 60 delta-9 tetrahydrocannabinol (delta-9 THC), tetrahydrocannabinolic acid (THCA), 61 cannabidiol (CBD), cannabidiolic acid (CBDA), cannabinol (CBN), cannabigerol 62 (CBG), cannabichromene (CBC), cannabicyclol (CBL), cannabivarin (CBV), 63 tetrahydrocannabivarin (THCV), cannabidivarin (CBDV), cannabicitran (CBT), and 64 delta-8 tetrahydrocannabinol (delta-8 THC). The term "industrial hemp-derived 65 cannabinoid" also includes any synthetic cannabinoid or semi-synthetic cannabinoid 66 with the same molecular structure as a cannabinoid naturally occurring in the hemp 67 plant as long as such cannabinoid was derived from the hemp plant; 68 (14) "Industrial hemp-derived consumable beverage product", an industrial 69 hemp-derived consumable product that is a liquid intended for ingestion and that is not 70 a tincture; HB 2768 4
71 (15) "Industrial hemp-derived consumable product", a hemp product that is a 72 finished good intended for human ingestion or inhalation and that does not contain a 73 total delta-9 THC concentration of more than three-tenths of one percent on a dry- 74 weight basis; 75 (16) "Ingestion", the process of consuming an industrial hemp-derived 76 consumable product through the mouth by swallowing into the gastrointestinal 77 system or through tissue absorption; 78 (17) "Inhalation", the process of consuming an industrial hemp-derived 79 consumable product through the respiratory system through the mouth or nasal 80 passageway; 81 (18) "License", a license issued in accordance with sections 195.2550 to 82 195.2635; 83 (19) "Manufacture", to compound, blend, extract, infuse, cook, bake, or 84 otherwise make or prepare products containing an industrial hemp-derived 85 cannabinoid, including the processes of extraction, infusion, packaging, repackaging, 86 labeling, and relabeling of products containing an industrial hemp-derived 87 cannabinoid; 88 (20) "Manufacturer": 89 (a) Any person who engages in the process of manufacturing, preparing, or 90 packaging industrial hemp-derived consumable products; or 91 (b) Any supplier of industrial hemp-derived consumable products who contracts 92 with a third party described in paragraph (a) of this subdivision for the production of 93 the supplier's industrial hemp-derived consumable products; 94 (21) "On-premises retailer", a retailer that sells industrial hemp-derived 95 consumable products for on-site consumption; 96 (22) "Proof of age", a valid driver's license or other government-issued 97 identification card that contains a photograph of the person and confirms the person's 98 age as twenty-one years of age or older; 99 (23) "Retail establishment", a place of business open to the general public for 100 the sale of goods or services; 101 (24) "Retailer", a person or entity that sells industrial hemp-derived consumable 102 products for consumption and not for resale. The term "retailer" shall include on- 103 premises retailers and any food service establishments engaged in such sales; 104 (25) "Serving", the amount of an industrial hemp-derived consumable product 105 the manufacturer suggests be consumed at a single time; HB 2768 5
106 (26) "Tincture", an industrial hemp-derived consumable product that is a 107 hemp-infused liquid or oil administered orally in small amounts using a dropper that 108 indicates the serving size. 195.2555. 1. A person shall not: 2 (1) Knowingly sell or distribute an industrial hemp-derived consumable product 3 to a person who is under twenty-one years of age; 4 (2) Knowingly purchase an industrial hemp-derived consumable product on 5 behalf of a person who is under twenty-one years of age; 6 (3) Knowingly persuade, entice, send, or assist a person who is under twenty-one 7 years of age to purchase, acquire, receive, or attempt to purchase an industrial hemp- 8 derived consumable product; 9 (4) Knowingly distribute free samples of an industrial hemp-derived consumable 10 product in or on a public street, sidewalk, or park without first obtaining a temporary 11 event permit from the division; 12 (5) Knowingly sell industrial hemp-derived consumable products in or on a 13 public street, sidewalk, or park without first obtaining a temporary event permit from 14 the division; or 15 (6) Knowingly sell or distribute an industrial hemp-derived consumable product 16 without having first obtained proof of age from the prospective purchaser or recipient 17 unless an ordinary person would conclude on the basis of appearance that the 18 prospective purchaser or recipient is not under twenty-one years of age. 19 2. (1) A person under twenty-one years of age shall not: 20 (a) Knowingly purchase, possess, or accept receipt of an industrial hemp-derived 21 consumable product; or 22 (b) Knowingly present purported proof of age that is false or fraudulent or that 23 does not actually identify the person for the purpose of purchasing or receiving an 24 industrial hemp-derived consumable product. 25 (2) Notwithstanding the provisions of subdivision (1) of this subsection to the 26 contrary, it shall be lawful, and shall not constitute a violation of sections 195.2550 to 27 195.2635, for a person under twenty-one years of age to consume industrial hemp- 28 derived consumable products under the supervision of the person's parent or legal 29 guardian or in accordance with the provisions of section 195.2635. Nothing in this 30 subdivision shall be construed to alter the prohibition on persons under twenty-one 31 years of age possessing industrial hemp-derived consumable products. 32 3. A retailer or retail establishment shall maintain any industrial hemp-derived 33 consumable product other than industrial hemp-derived consumable beverage products 34 on or behind the counter, in an area or retail establishment restricted to adults twenty- HB 2768 6
35 one years of age or older, or in a locked cabinet. Any industrial hemp-derived 36 consumable beverage product, including those in cases or boxes, offered for retail sale 37 shall be merchandised in such a manner, which may include, but shall not be limited to, 38 signage, shelf-talkers, and stickers on cooler doors, so as to clearly indicate to consumers 39 the products contain industrial hemp-derived cannabinoids and are for sale only to 40 persons twenty-one years of age or older. 41 4. Any person who violates any provision of this section shall be subject to a fine 42 not to exceed two hundred fifty dollars for a first violation to be paid into the state 43 school moneys fund established under section 166.051 as provided by law for other fines 44 and penalties. The penalty for any second or subsequent violation shall be a class D 45 misdemeanor. 46 5. The division shall enforce sections 195.2550 to 195.2635 in a manner that may 47 be required or mandated to reduce the extent to which industrial hemp-derived 48 consumable products are sold or distributed to persons under twenty-one years of age 49 and shall conduct inspections at locations where such products are sold or distributed to 50 ensure compliance with sections 195.2550 to 195.2635. 51 6. Nothing in this section shall prohibit law enforcement from using the 52 following persons to enforce the provisions of this section: 53 (1) Any minor under eighteen years of age if the minor's parent or legal 54 guardian has consented to the minor's involvement in the enforcement effort; and 55 (2) Any person eighteen years of age or older and under twenty-one years of age 56 if the person has consented to his or her involvement in the enforcement effort. 195.2557. 1. Notwithstanding the provisions of this chapter or chapter 579 or 2 any other provision of law to the contrary, any person who manufactures, processes, 3 packages, distributes, transports, or sells industrial hemp-derived consumable products 4 in accordance with sections 195.2550 to 195.2635 and rules promulgated thereunder 5 shall not be subject to criminal prosecution, civil penalty, administrative sanction, or 6 professional discipline under the laws of this state. 7 2. Except as specifically provided in sections 195.2550 to 195.2635, any consumer 8 who purchases, possesses, or uses an industrial hemp-derived consumable product 9 lawful under sections 195.2550 to 195.2635 shall not be subject to arrest, criminal 10 prosecution, civil penalty, forfeiture, or any other adverse action under state law. 11 3. Possession of an industrial hemp-derived consumable product lawful under 12 sections 195.2550 to 195.2635 shall not constitute probable cause or reasonable suspicion 13 for a stop, search, seizure, or arrest by any state or local law enforcement officer. 14 4. Except as specifically provided in sections 195.2550 to 195.2635, the possession 15 or use of lawful industrial hemp-derived consumable products shall not be grounds for: HB 2768 7
16 (1) Denial of employment; 17 (2) Denial of education or public accommodations; 18 (3) Loss of child custody or visitation; 19 (4) Denial of state benefits; or 20 (5) The initiation of civil or criminal proceedings under state law. 195.2558. 1. No state agency, political subdivision, state or local law enforcement 2 officer, state or local prosecutor, or state employee shall expend public funds, use 3 personnel, share information, or otherwise assist in the investigation, detention, arrest, 4 or prosecution of any manufacturer, distributor, retailer, or consumer for conduct 5 involving industrial hemp-derived consumable products that is lawful under sections 6 195.2550 to 195.2635. 7 2. This section shall not prohibit compliance with a valid federal court order or 8 the sharing of information required under federal grant conditions unrelated to 9 enforcement of federal drug laws. 10 3. A violation of this section shall constitute unauthorized use of public resources 11 and may result in disciplinary action under state law. 195.2560. 1. A person or entity that is in the business of industrial hemp-derived 2 consumable products in this state, including any manufacturer, distributor, or retailer, 3 shall obtain a license from the division authorizing the person or entity to engage in that 4 business prior to the commencement of the business or, for a business operating before 5 the effective date of the rules promulgated under sections 195.2550 to 195.2635, within a 6 time period specified by the division by rule. 7 2. Any person or entity engaging in the business of manufacturing or selling 8 industrial hemp-derived consumable products in this state without a valid license 9 required under sections 195.2550 to 195.2635 shall be subject to a fine not to exceed one 10 thousand dollars. 11 3. (1) Any license granted to a retailer shall be location specific. The division 12 shall require a retailer to obtain a separate license for each location at which the retailer 13 sells industrial hemp-derived consumable products for consumption. 14 (2) Any license granted to a manufacturer or distributor shall be location 15 specific. The division shall require a manufacturer or distributor to obtain a separate 16 license for each location at which the manufacturer or distributor operates. 17 4. To obtain and maintain a manufacturer, distributor, or retailer license under 18 this section, a person or entity shall: 19 (1) Submit to the division information the division prescribes as necessary for 20 the efficient enforcement of sections 195.2550 to 195.2635; 21 (2) For initial licensing, pay to the division a fee of: HB 2768 8
22 (a) For manufacturers and distributors, five hundred dollars per location; and 23 (b) For retailers, two hundred fifty dollars per location; and 24 (3) Consent to inspection and sampling by the division of the person's or entity's 25 inventory of industrial hemp-derived consumable products. 26 5. A license issued under this section shall be valid for a period of one year and 27 may be renewed annually. The division shall charge an annual renewal fee of