FDA’s jurisdiction over interstate CBD sales could be possibly avoided with a CBD E-Commerce multi-vendor marketplace offering hemp products in each state separately. Customers living in a particular state could only purchase CBD products from merchants based in their own state. Spree Commerce can help to make that happen.
In the final months of 2019 FDA has made it clear that it will track down and prevent CBD merchants from
- introducing CBD medicinal dietary supplements, food or drugs into interstate commerce,
- making unsubstantiated medicinal claims regarding offered CBD products.
FDA on interstate CBD commerce
FDA has published 22 detailed warning letters sent to hemp merchants in late 2019. Hemp-derived CBD is a legal product under federal law but it must be marketed without violating the FDCA regulations. All 22 CBD merchants got into trouble by claiming that CBD cures disease and has medicinal properties without FDA’s approval while at the same time introducing CBD products into interstate commerce.
How about selling CBD products in each state separately? This could be achieved through a multi-vendor marketplace aggregating offers from CBD merchants from all states in which CBD is legal. Each merchant could sell products only in their home state. As a User, I would be required to enter my home state and I would be limited to shopping for products offered by my home state merchants.
CBD multi-vendor marketplace based on Spree Commerce
Spree Commerce allows you to build an E-Commerce marketplace platform hosting products from multiple vendors. Such a marketplace user could be prompted for their home state and limited to shopping from their home state merchants. Products from multiple vendors would be listed together and could be added to the cart. A user could then checkout making a single payment for a cart containing products from multiple vendors. The user pay-in would then be split into pay-outs owed to each vendor minus the marketplace commission.
Spree Commerce is an open-source E-Commerce framework allowing CBD businesses to operate and grow without the risks, limitations, and uncertainty introduced by many online service providers and financial institutions.
Feel free to contact us to learn more about what Spree can do for your CBD business.
Please note that this blog post doesn’t contain legal advice and you should always consult your attorney and research the latest regulations concerning your CBD business.