23.8110.01000
Sixty-eighth
Legislative Assembly SENATE BILL NO. 2096
of North Dakota
Introduced by
Agriculture and Veterans Affairs Committee
(At the request of the Agriculture Commissioner)
1 A BILL for an Act to create and enact section 4.1-18.1-01.1 and nine new sections to chapter
2 4.1-18.1 of the North Dakota Century Code, relating to administrative rules, hemp commodities
3 or products, powers of the commissioner, and civil enforcement remedies; to amend and
4 reenact sections 4.1-18.1-01 and 4.1-18.1-04.3, subparagraph a of paragraph 2 of
5 subdivision m of subsection 5 of section 19-03.1-05 of the North Dakota Century Code, relating
6 to definitions, prohibited acts by licensees, schedule I controlled substances
7 tetrahydrocannabinols; and to provide a penalty.
8 BE IT ENACTED BY THE LEGISLATIVE ASSEMBLY OF NORTH DAKOTA:
9 SECTION 1. AMENDMENT. Section 4.1-18.1-01 of the North Dakota Century Code is
10 amended and reenacted as follows:
11 4.1-18.1-01. Definitions.
12 1. "Hemp" means the plant cannabis sativa L. and any part of the plant, including the
13 seeds and all derivatives, extracts, cannabinoids, isomers, acids, salts, and salts of
14 isomersflowers, whether growing or not, with a total tetrahydrocannabinol
15 concentration in an amount determined by the commissioner. The term does not
16 include anyhemp extract, commodity or product using hemp which exceeds the
17 allowable amount of total tetrahydrocannabinol determined by the commissioner, or a
18 hemp substance or product prohibited by this chapter.
19 2. "Hemp commodity or product" means a product made from hemp, including cloth,
20 cordage, fiber, food, fuel, paint, paper, particleboard, plastics, seeds, seed meal, and
21 seed oil for consumption, a hemp tincture, and a hemp topical.
22 a. The term includes:
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1 (1) Hemp processed through retting or other processing such that it is a
2 suitable fiber for textiles, rope, paper, hempcrete, or other building or fiber
3 materials;
4 (2) Hemp seed processed such that it is incapable of germination and
5 processed such that is suitable for human consumption;
6 (3) Hemp seed pressed or otherwise processed into oil; and
7 (4) A hemp commodity or product approved in writing by the agriculture
8 commissioner.
9 b. The term does not include:
10 (1) Hemp that has been chopped, separated, or dried for purposes of transfer
11 or storage;
12 (2) Hemp extract;
13 (3) A chemical compound extracted from hemp used to formulate, process, or
14 otherwise make an inhalant, edible, or combustible;
15 (4) A product containing chemically derived cannabinoids. Including:
16 (a) Delta-8 tetrahydrocannabinol, also known as delta-8 THC;
17 (b) Tetrahydrocannabinol acetate, also known as THC-O-Acetate and
18 THC-O;
19 (c) Hexahydrocannabinol, also known as HHC; and
20 (d) Tetrahydrocannabiphorol, also known as THCP; or
21 (5) A psychotropic hemp commodity or product disapproved in writing by the
22 commissioner.
23 3. "Hemp extract" means a concentrate or extract obtained by separating cannabinoids
24 from hemp by a mechanical, chemical, or other process. The term does not include
25 hemp seed pressed or otherwise processed into oil.
26 4. "Hemp topical" means a hemp commodity or product intended to be applied to the skin
27 or hair. The maximum concentration or amount of total tetrahydrocannabinol permitted
28 in a hemp topical is fifty milligrams per container.
29 5. "Tetrahydrocannabinol" means delta-9 tetrahydrocannabinol and any structural,
30 optical, or geometric isomers of tetrahydrocannabinol, including:
31 a. Delta-7 tetrahydrocannabinol;
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1 b. Delta-8 tetrahydrocannabinol; andor
2 c. Delta-10 tetrahydrocannabinol.
3 6. "Hemp tincture" means a solution consisting of a mixture created from a hemp extract
4 and other ingredients. A container holding a hemp tincture may not exceed thirty
5 milliliters. The maximum concentration or amount of total tetrahydrocannabinol
6 permitted in a hemp tincture is fifty milligrams per container.
7 3.7. "Total tetrahydrocannabinol" means the sum of the percentage, by weight, of
8 tetrahydrocannabinolic acid multiplied by eight hundred seventy-seven thousandths
9 plus the percentage of weight of tetrahydrocannabinol.
10 SECTION 2. Section 4.1-18.1-01.1 of the North Dakota Century Code is created and
11 enacted as follows:
12 4.1-18.1-01.1. Administrative rules.
13 The commissioner may adopt and amend rules consistent with this chapter governing the
14 sale, distribution, testing, labeling, and regulation of hemp and hemp commodities or products,
15 and substances and products prohibited by this chapter.
16 SECTION 3. AMENDMENT. Section 4.1-18.1-04.3 of the North Dakota Century Code is
17 amended and reenacted as follows:
18 4.1-18.1-04.3. Prohibited acts - Licensee.
19 A licensee may not:
20 1. Engage in the isomerization of cannabinoids to create isomers of
21 tetrahydrocannabinol, including delta-8, delta-9, and delta-10
22 tetrahydrocannabinolChemically modify or convert a hemp extract, or engage in any
23 process that converts cannabidiol into delta-9, delta-8, delta-10-tetrahydrocannabinol,
24 or other tetrahydrocannabinol isomers, analogs, or derivatives; and
25 2. Sell or distribute hemp or hemp commodities or products that contain chemically
26 derived cannabinoids or were created using the isomerization of cannabinoids to
27 create isomers of tetrahydrocannabinol, including delta-8, delta-9, and delta-10
28 tetrahydrocannabinolby chemically modifying or converting a hemp extract.
29 SECTION 4. A new section to chapter 4.1-18.1 of the North Dakota Century Code is created
30 and enacted as follows:
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1 Hemp commodities or products- Allowable products- Retailers.
2 1. A person may only sell hemp and hemp commodities or products allowed under this
3 chapter. All hemp and hemp commodities or products must undergo testing and report
4 in a certificate of analysis and in the product label the testing results of the total
5 tetrahydrocannabinol concentration amount. The certificate of analysis must be made
6 available to the commissioner upon request.
7 2. A person may not sell hemp, or hemp commodities or products that contain chemically
8 derived cannabinoids.
9 3. All other cannabis- or hemp-derived products that are not allowable hemp
10 commodities or products under this chapter must be regulated in accordance with
11 chapter 19-24.1.
12 4. All hemp commodities or products sold pursuant to this section must comply with all
13 product labeling rules as mandated by the Food, Drug, and Cosmetic Act [21 U.S.C. 9
14 et seq.] and related administrative rules, both the Act and rules incorporated by
15 reference.
16 5. Under the Food, Drug, and Cosmetic Act [21 U.S.C. 9 et seq.], incorporated by
17 reference, non-food and drug administration approved hemp-derived products may not
18 be sold as dietary supplements, food or beverage products, or marketed with medical
19 claims.
20 SECTION 5. A new section to chapter 4.1-18.1 of the North Dakota Century Code is created
21 and enacted as follows:
22 Powers of commissioner.
23 If the commissioner reasonably suspects a person is about to engage in, has engaged in, or
24 is engaging in, a violation of this chapter, the commissioner may:
25 1. Require the person to file, on forms the commissioner prescribes, a statement or
26 report in writing, under oath or otherwise, of all the facts and circumstances
27 concerning the creation, sale, distribution, or advertisement of the hemp commodity or
28 product by the person, as well as other data;
29 2. Examine under oath the person in connection with the creation, sale, distribution, or
30 advertisement of any hemp commodity or product;
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1 3. Examine any merchandise or sample, record, book, document, account, or paper
2 concerning the creation, sale, distribution, or advertisement of hemp commodity or
3 product by the person; and
4 4. Pursuant to an order of a district court, seize and retain any merchandise or sample,
5 record, book, document, account, paper, or other evidence as authorized by the order.
6 SECTION 6. A new section to chapter 4.1-18.1 of the North Dakota Century Code is created
7 and enacted as follows:
8 Subpoena - Hearing.
9 To regulate compliance with this chapter, the commissioner, in addition to other powers
10 conferred upon the commissioner by this chapter, may issue subpoenas to any person,
11 administer an oath or affirmation to any person, and conduct hearings in aid of any investigation
12 or inquiry.
13 SECTION 7. A new section to chapter 4.1-18.1 of the North Dakota Century Code is created
14 and enacted as follows:
15 Failure to supply information or obey subpoena.
16 If a person fails or refuses to file any statement or report requested by the commissioner, or
17 obey any subpoena issued by the commissioner, the commissioner may, after notice, apply to a
18 district court and request an order:
19 1. Granting injunctive relief, restraining the creation, sale, distribution, or advertisement
20 of any hemp commodity or product merchandise by a person;
21 2. Vacating, annulling, or suspending the charter of a for-profit or nonprofit corporation or
22 limited liability company created by or under the laws of this state or revoking or
23 suspending the certificate of authority to do business in this state of a foreign
24 corporation or limited liability company or revoking or suspending any other licenses,
25 permits, or certificates issued pursuant to law to a person which are used to violate
26 this chapter; and
27 3. Granting such other relief as may be required.
28 SECTION 8. A new section to chapter 4.1-18.1 of the North Dakota Century Code is created
29 and enacted as follows:
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1 Assurance of voluntary compliance.
2 The commissioner may accept an assurance of voluntary compliance for an act or practice
3 the commissioner determines may be in violation of this chapter, from any person the
4 commissioner alleges is about to engage in, engaging in, or has engaged in the violation. The
5 assurance of voluntary compliance must be in writing and must be filed with and is subject to
6 the approval of the district court of the county in which the alleged violator resides or has as a
7 principal place of business, conducts business, or in Burleigh County.
8 SECTION 9. A new section to chapter 4.1-18.1 of the North Dakota Century Code is created
9 and enacted as follows:
10 Remedies - Injunction - Other relief - Receiver - Cease and desist orders - Civil
11 penalties - Costs recoverable in adjudicative proceedings.
12 1. If the commissioner reasonably suspects a person is about to engage in, has engaged
13 in, or is engaging in a practice in violation of this chapter, the commissioner may seek
14 and obtain in an action in a district court an injunction enjoining the person from
15 engaging in the violation, continuing the violation, or doing any act in furtherance of
16 the violation after proper notice to the person. The notice must state generally the
17 relief sought and be served at least ten days before the hearing of the action.
18 2. If the commissioner reasonably suspects a person is about to engage in, has engaged
19 in, or is engaging in a violation of this chapter, and the person is about to conceal
20 assets that may have been acquired in violating this chapter, conceal oneself, or leave
21 the state, the commissioner may apply to the district court, ex parte, for an order
22 appointing a receiver of the assets of the person.
23 3. Upon a showing made by affidavit or other evidence that shows reasonable grounds
24 the person is about to engage in, has engaged in, or is engaging in a violation of this
25 chapter and the person is about to conceal assets that may have been acquired in
26 violating this chapter, conceal oneself, or leave the state, the court shall order the
27 appointment of a receiver to receive the assets of the person. From the received
28 assets, the court may make an order or judgment necessary to restore to another
29 person who has suffered damages due to another person violating this chapter any
30 money or property.
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1 4. If the commissioner reasonably suspects a person is about to engage in, has engaged
2 in, or is engaging in a violation of this chapter, or by an order of the commissioner
3 issued under this chapter, the commissioner, without notice and hearing, may issue a
4 cease and desist order.
5 a. In addition to any other remedy authorized by this chapter, the commissioner may
6 impose by order and collect a civil penalty against a person found in an
7 adjudicative proceeding to have violated a cease and desist order issued
8 pursuant to this section, in an amount not more than five thousand dollars for
9 each violation.
10 b. The person may request a hearing before the commissioner if a written request is
11 made within ten days after the receipt of the order. Unless otherwise specifically
12 provided, an adjudicative proceeding under this section must be conducted in
13 accordance with chapter 28-32.
14 c. If the commissioner prevails in an adjudicative proceeding pursuant to this
15 section, the commissioner may assess the nonprevailing person for all
16 adjudicative proceeding and hearing costs, including reasonable attorney's fees,
17 investigation expenses, costs, and other expenses of the investigation and
18 action.
19 SECTION 10. A new section to chapter 4.1-18.1 of the North Dakota Century Code is
20 created and enacted as follows:
21 Powers of receiver.
22 1. When a receiver is appointed by the court pursuant to this chapter, the receiver may
23 sue for, collect, receive, or take into possession all the goods and chattels, rights and
24 credits, moneys and effects, lands and tenements, books, records, documents,
25 papers, choses in action, bills, notes, and property of every description, derived by
26 means of a violation of this chapter, including property with which the property has
27 been commingled if it cannot be identified in kind because of the commingling, and
28 sell, convey, and assign the property and hold and dispose of the proceeds under the
29 direction of the court.
30 2. A person who has suffered damages due to another person violating this chapter and
31 submits proof to the satisfaction of the court that the person has in fact been damaged
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1 may participate with general creditors in the distribution of the assets to the extent the
2 person has sustained losses. The court has jurisdiction of all questions arising in these
3 proceedings and may make orders and judgments as necessary.
4 SECTION 11. A new section to chapter 4.1-18.1 of the North Dakota Century Code is
5 created and enacted as follows:
6 Costs recoverable.
7 If the commissioner prevails in an action brought to district court under this chapter, the
8 court shall award the commissioner reasonable attorney's fees, investigation expenses, costs,
9 and other expenses associated with the action. All attorney's fees, investigation expenses,
10 costs, and other expenses received by the commissioner under this section must be deposited
11 into the commissioner's general operating fund for use in regulating compliance with this
12 chapter.
13 SECTION 12. A new section to chapter 4.1-18.1 of the North Dakota Century Code is
14 created and enacted as follows: