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CA Law: CBD in Beer

Chocolate brownie with raspberries and dark beer.

With the legalization of hemp and cannabis, new products and cottage industries are popping up across the state. Back in 2018, bars and liquor stores started selling cannabidiol (CBD)-infused beer and mixed drinks, in celebration of the new generation accepting the positive impacts the cannabis industry can bring. Unfortunately, this particular trend was short-lived. Read on to learn about California’s law regarding CBD content in beer. If you are interested in CBD manufacture or distribution, or if you have other questions or legal concerns about the CBD or cannabis industries in California, contact a dedicated cannabis business attorney for assistance.

California Legalizes Sale of CBD-Infused Food and Beverages

On October 6, 2021, Governor Gavin Newsom signed Assembly Bill 45 into law. AB 45 explicitly legalized the inclusion of hemp and its derivatives in food and beverage products distributed across the state. More specifically, the law removed hemp and derivatives such as CBD from the list of ingredients that would render a food or beverage dangerously “adulterated” and thus prohibited from manufacture or sale.

With regard to hemp and hemp extracts like CBD, a food or beverage qualifies as unadulterated (and thus legal to sell) so long as it contains less than 0.3% of THC by weight, as well as certain other requirements. So long as those requirements are met, food and beverage items (such as gummies and soft-gel supplements) are legal to distribute under state law.

Notably, AB 45 explicitly conflicts with the existing U.S. Food and Drug Administration (FDA) position on the matter. The FDA still prohibits the sale or transfer of CBD-infused food, beverages, or dietary supplements. Though that represents the FDA’s current position, they have not taken enforcement action against CBD companies that distribute products within the state. Congress is considering legislation to directly address the issue of CBD-infused food and beverage products.

CBD and Beer in California: No Mixing

According to the California Department of Alcohol and Beverage Control (ABC), under the current state of the law, a single party may hold both a license to manufacture or sell alcoholic beverages as well as a license to manufacture or sell cannabis products issued under the Medicinal and Adult-Use Cannabis Regulation and Safety Act (MAUCRSA).

The ABC explicitly notes, however, that California law prohibits a MAUCRSA license-holder from selling alcohol or tobacco products on the same premises licensed to sell cannabis products. That means that a party licensed to sell cannabis products cannot also sell beer or other alcoholic products from the same location. Moreover, the ABC states that bars and other alcohol-providing establishments cannot permit customers to smoke or otherwise ingest cannabis products on their premises, as such locations are considered “public places.”

The ABC’s guidance goes further to specifically address the infusion or mixing of alcoholic beverages with cannabis or industrial hemp products. Pursuant to California’s Business and Professions Code Section 25621.5, parties licensed to sell alcoholic beverages are not permitted to “sell, offer, or provide cannabis or cannabis products, . . . including an alcoholic beverage that contains cannabis or a cannabis product,” nor can they distribute any alcoholic beverage that “contains tetrahydrocannabinol or cannabinoids, regardless of source. In guidance published after the passage of AB 45 last year, the ABC made clear that “neither cannabis products nor industrial hemp products (that contain tetrahydrocannabinol [THC] or cannabinoids [CBD]) may be used in the manufacture of alcoholic beverages or in mixed drinks prepared at ABC-licensed premises.”

Unfortunately, until the laws and regulations are changed, that means that cannabis or CBD-infused beer or other alcoholic beverages may not be distributed in the state. Moreover, bars that sell alcohol cannot also sell cannabis, and marijuana distributors cannot also sell alcohol on the same premises.

These restrictions stem primarily from a 2018 law signed by former Governor Jerry Brown in response to an explosion of CBD cocktails at locations statewide. Given the lack of scientific evidence supporting the view that CBD mixed with alcohol poses any health risks, we can hope that the law is repealed or modified soon.

Call a Seasoned and Professional California Cannabis Business Lawyer for Help With Your Marijuana Business

If you are interested in manufacturing or distributing CBD products in California, or if you are dealing with regulatory, licensing, or other legal issues with your hemp, CBD, or cannabis business in Los Angeles or Southern California, call McReynolds Vardanyan, LLP, in Glendale at 818-855-2115. Our California cannabis business lawyers will work with you to get your budding business off the ground efficiently, effectively, and legally.

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