Texas Adopts New, Temporary THC Sales Rules

Responding to a Sept. 10 executive order issued by Gov. Greg Abbott, two Texas state agencies have adopted temporary rules affecting the sales of THC products to customers.

Broadcasters should note that the rules adopted by the Texas Health and Human Services Commission and Texas Alcoholic Beverage Commission contain no restrictions on THC and CBD-related product advertising, but both agencies will continue to work on permanent rules affecting THC and CBD products. The content of such changes could impact broadcasters' due diligence on a product's ability to be advertised. TAB will monitor the rulemaking process and will advise stations, as necessary.

The temporary rules are in effect for 180 days, with a potential extension of 60 more days. Formal rulemaking will take place later this year.

Under Abbott's order, the Texas Department of State Health Services must review current rules for potentially requiring stricter labeling and testing requirements, as well as additional recording keeping and licensing fees.

While the sale and advertising of certain types of THC and CBD-related cannabis products is currently legal, TAB reminds stations that the regulations that allow it are quite specific. Stations accepting such advertising do so at their own risk and therefore must perform the necessary due diligence or risk the consequences of advertising an illegal product.

TAB's longtime state legal counsel, Jackson Walker LLP, has prepared an advisory on advertising marijuana and hemp-based CBD products under current Texas law.

View TAB's CBD Advertisement Legal Advisory.

The main takeaways from the advisory are:

Marijuana remains illegal in almost all contexts, and only three entities are authorized to dispense it for medical use under the Texas "compassionate use" law. Broadcasters should deal only with those entities and should not air advertisements that depict the consumption of marijuana.

Broadcasters should avoid advertisements depicting consumption, suggesting illegal drug use, targeting children, or promising miraculous medicinal results that have not been adopted by the FDA.

Broadcasters should avoid advertisements for CBD products derived from any source other than legal hemp. Broadcasters should also ask advertisers to warrant the purity and THC content of their products-only hemp-derived products with Delta-9 THC in concentrations less than .3% are legal.

Broadcasters should only air advertisements for CBD processed by licensed manufacturers, from hemp grown by licensed producers, and sold by registered distributors. Where possible, broadcasters should obtain appropriate representations, warranties, indemnification, or other certifications from prospective advertisers as to those issues.

Questions? Contact TAB's Michael Schneider or call (512) 322-9944.