Texas Moves to Ban Hemp-Derived THC Consumables, Weighs Regulation and Market Impact
Texas is moving towards a complete ban on hemp-derived tetrahydrocannabinol (THC) consumables such as gummies and edibles, which have created an $8 billion industry in the state. The Texas House voted 95-44 to criminalize possession, sale, and manufacture of these low-dose intoxicating products, following the Senate's earlier approval. The legislation exempts non-intoxicating hemp derivatives like cannabidiol (CBD) and cannabigerol (CBG), which are federally approved for certain medical conditions and are widely used in health products. The ban responds to concerns about unreliable state lab testing for THC levels, reports of products with higher-than-allowed THC content, and alleged illegal sales to minors in the unregulated marketplace.
Supporters, led by Lt. Gov. Dan Patrick and lawmakers including Rep. Tom Oliverson, emphasize that the ban targets products that intoxicate rather than hemp itself. They argue the current market lacks sufficient testing, dosing regulation, and medical oversight and that the ban will allow controlled expansion of medical marijuana access through existing programs. Texas’s Compassionate Use Program provides authorized medical access to THC for qualifying patients, particularly veterans.
Opponents, including Democrats and industry representatives, argue the ban will eliminate an important industry that has generated approximately 50,000 jobs and millions in sales tax revenue. They warn that prohibition may drive the market underground, increasing risks associated with black market products. Some lawmakers proposed a regulatory framework to allow sales of hemp-derived intoxicating products under stringent testing, age restrictions, and local control via county elections. This proposal failed in the House.
The legislation sets penalties for possession (Class A misdemeanor) and manufacturing (third-degree felony) of THC-containing consumables, with a compliance deadline in January. The ban excludes smoky hemp flower, low-dose edible products that do not intoxicate, and hemp derivatives with no psychoactive effects.
Texas’s 2019 hemp law allowed hemp farming and commercialization with limits on delta-9 THC but lacked comprehensive restrictions on other hemp derivatives. This regulatory gap contributed to substantial industry growth without clear consumer protections. The current bill seeks to address this gap by eliminating intoxicating hemp products from the retail market.
Law enforcement investigations have confiscated large quantities of cash and assets from suspected illegal sales, underscoring concerns over the lack of regulation. The state’s forensic commission identified issues in lab testing methods that potentially inflated THC measurements, complicating enforcement efforts.
Retailers and their legal representatives contend they operate within current law, highlighting the ambiguity and evolving nature of the regulatory environment in Texas. Advocates for regulation suggest that a controlled market with age limits, child-resistant packaging, and quality assurance would better serve consumers and industry stakeholders.
Texas is revising its approach to hemp-derived THC products amid growing scrutiny of public safety, market integrity, and medical access, balancing the interests of public health, law enforcement, hemp farmers, retailers, and patients. The debate reflects broader challenges across U.S. states in regulating hemp derivatives that contain psychoactive compounds at low levels.
The final legislative vote and regulatory outcomes from this session are expected to significantly reshape the hemp-derived THC consumables landscape in Texas, affecting market participants and consumers. Insurance and risk professionals should monitor these developments as they may influence liabilities, compliance requirements, and healthcare-related insurance products tied to hemp-derived substances.