MD HB1631

Maryland Department of Agriculture must establish a hemp manufacturing license allowing licensees to receive hemp from licensed growers, extract and process hemp into in-process hemp extract and finished products, and sell or distribute finished hemp-derived products.

In-process hemp extract (intermediate materials like distillate, crude oil, and concentrates) may be possessed and transported by licensees but cannot be sold for retail; knowing diversion into unlawful commerce subjects violators to license revocation, product seizure, and civil penalties.

Finished hemp products may only be sold if tested by an independent laboratory, issued a certificate of analysis, and compliant with THC content thresholds established by the Department; products exceeding retail THC limits must be distributed through licensed cannabis dispensaries.

Licensees must maintain chain of custody records from receipt through final sale or destruction, and lawful possession of hemp or in-process hemp extract is an affirmative defense against criminal or civil cannabis allegations.

Department of Agriculture must adopt implementing regulations by October 1, 2026 covering licensing categories, security, record-keeping, seed-to-sale tracking, testing standards, packaging, labeling, and enforcement; the act takes effect July 1, 2026.