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California is Legalizing CBD as an Additive in Food, Beverages, and Cosmetics

This Legalization in California will Open up the World’s Fifth-Largest Economy to the CBD Industry

 

By unanimous vote, California’s State Assembly has passed a bill legalizing hemp-derived CBD. The bill also legalizes the sale of beverages, food, and cosmetics that include CBD.

 

The next step will be the passage of the bill by the California Senate, which is anticipated. When it reaches his desk, Governor Gavin Newsom is expected to sign the bill into law. The bill will then take effect immediately.  

 

Despite the Food and Drug Administration’s (FDA) position that CBD as a food or beverage additive is not “Generally Regarded as Safe” (GRAS), this California bill will legalize CBD  in what is now the world’s fifth-largest economy, an economy larger than that of the United Kingdom.

 

California’s legalization is seen as an alternative to either waiting for Congress to legalize CBD as a food, cosmetic, and health wellness additive, or for the FDA changing its regulations to allow CBD for the same purposes.  

 

Upon the signing into law of this legislation, California will join other states, including Illinois and Colorado who have already allowed CBD as an additive in food and beverages. Other states are also seeing the advantages of the new hemp and CBD industries, which include job creation and of course an additional source of tax revenue.  

 

If this bill becomes law, it will be difficult for small, medium, and large food, beverage, and cosmetic CPG (Consumer Packaged Goods) companies to ignore the California market for products that include CBD.

 

If larger CPG companies sit on the sidelines and ignore the California market, it’s likely that they will cede the market to smaller, entrepreneurial competitors, and they will likely lose their first-to-market or early-to-market advantages.   

 

 

 

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