The radiant Arizona sun may soon be setting for unlicensed consumable hemp product retailers who have benefitted from sporadic and inconsistent enforcement. Indeed, a recent letter from Arizona Attorney General Kris Mayes reflects a sharp escalation from the state’s top law enforcement official in stating, unequivocally, that retail sales of THC-infused beverages or edible products without a valid marijuana establishment license from the Department of Health Services are illegal. The letter, issued on March 24, 2025, cites to AGO Opinion No. I24-005 (“AGO Opinion”) as prohibiting “the sale of delta-8 THC products and other hemp-synthesized intoxicants—whether currently existing or developed in the future—to include Delta-9 THC and similar derivatives.”
The AGO Opinion, published on March 11, 2024, cited multiple Arizona laws to support the conclusion that sales of these types of products are illegal in Arizona, notwithstanding the fact that Arizona has legal medical and adult-use cannabis markets. The cited laws include A.R.S. § 3-311(7), which defines “industrial hemp” to mean “the plant cannabis sativa L. and any part of such a plant, whether growing or not, with a delta-9 tetrahydrocannabinol concentration of not more than three-tenths percent on a dry-weight basis.” In contrast to the federal definition of hemp, this definition does not include “derivatives, extracts, cannabinoids, isomers, acids, salts, and salts of isomers.”
The AGO Opinion also cited A.R.S. § 3-311(5), which defines “hemp products” as “all products made from industrial hemp, including cloth, cordage, fiber, fuel, grain, paint, paper, construction materials, plastics and by-products derived from sterile hemp seed or hemp seed oil.” Applying these laws, the AGO Opinion concluded that all hemp products in Arizona must be “uniformly industrial and nonintoxicating in nature” and, therefore, that “Arizona continues to define and regulate ‘industrial hemp’ in a manner that precludes the sale of hemp-synthesized intoxicants in convenience stores, smoke shops, and other unlicensed [locations].”
The Attorney General’s letter also summarily dismissed the notion that Arizona’s prohibitions on consumable hemp products might be preempted by the 2018 Farm Bill. Citing the recent decision from the 4th Circuit in Northern Virginia Hemp and Agriculture LLC v. Commonwealth of Virginia (discussed in more detail here), the letter confirms that the Farm Bill “does not preempt any Arizona law that outlaws these products.” According to the letter, beginning on April 24, 2025, the Attorney General’s Office will take enforcement action against unlicensed businesses that continue selling THC-infused edible products that claim to comply with the 2018 Farm Bill. The letter adds that other Arizona law enforcement agencies and prosecutorial offices may also pursue legal action. Consumable hemp product retailers in Arizona should heed these enforcement warnings given that the 1-month grace period outlined in the letter is expected to expire in roughly two weeks.
But the consumable hemp product market in Arizona is not necessarily doomed to the dark ages. To the contrary, the Arizona legislature has been active in pushing for a regulated consumable hemp product market. As an example, the Arizona Senate’s passing of Senate Bill 1556 in the beginning of March provided a measure of hope to consumable hemp product retailers in the state. The bill, which now sits in the House Commerce Committee, would create a regulatory framework for the legal production and sale of hemp beverages.
Specifically, it would create a licensing regime and impose rules for hemp beverage manufacturing, testing (including testing for potency, pesticides, microbials, residual solvents, and heavy metals), packaging and labeling, serving sizes and containers, delivery and sampling, and retail sales. In addition, it would prohibit any person from processing, distributing, selling or offering for sale in Arizona any:
- adult hemp beverage products without a license;
- adult hemp beverage products in powdered form or as a concentrated tincture for mixing with water or other liquids; or
- spirituous liquor containing any adult hemp beverages or cannabinoid.
It would also apply Arizona statutes governing the unlawful act of providing liquor to a person under 21 years of age to the providing of adult hemp beverages to a person under 21 years of age. Finally, amendments to the bill would limit single serving hemp beverage containers to 10 milligrams of total THC per container for sale in off-premises licensed establishments and 5 milligrams of total THC per container for sale in on-premises licensed establishments.
To be sure, the situation on the ground in Arizona with respect to consumable hemp beverages is dynamic and we are monitoring enforcement updates and legislative activity in real time.
Source: https://www.jdsupra.com/legalnews/push-and-pull-arizona-ag-foreshadows-4072366/
