H3935 creates the “Consumable Hemp Licensing and Regulation Act” and adds a new chapter to Title 39 of the South Carolina Code to regulate hemp-derived consumable products. The bill defines hemp-derived consumables broadly to include finished goods intended for ingestion or inhalation that contain hemp-derived cannabinoids, including delta-8 THC, delta-9 THC, delta-10 THC, THCA, CBD, and HHC, while excluding topical products and certain FDA-recognized seed ingredients. It establishes a licensing system for producers, manufacturers, distributors, retailers, and certain food service establishments, administered by the South Carolina Department of Agriculture.
The bill imposes age restrictions and retail controls, including a minimum purchase age of 21, proof-of-age requirements, restrictions on sampling, and requirements that most products be kept behind the counter. It also bars sales near schools, limits youth-oriented packaging and advertising, requires product testing by independent laboratories, mandates detailed labeling and warning statements, and sets potency limits for certain ingestible and inhalable products. In addition, it creates a 2% excise tax on retail sales, authorizes civil penalties and misdemeanor enforcement for violations, and requires annual reporting by the department.
The bill would significantly affect state regulation of hemp products by shifting the market from a largely unstructured retail environment to a licensed and inspected system with product testing, labeling, and location rules. It also creates new compliance obligations for businesses and gives the Department of Agriculture authority to issue rules, inspect inventory, maintain a laboratory registry, and enforce the chapter. The bill further addresses franchise relationships for hemp-derived consumable beverage distributors and manufacturers, and it excludes “safe harbor” hemp products intended only for export from the chapter’s retail-sale rules.
The general sentiment reflected in the bill text is precautionary and regulatory rather than permissive: it allows hemp-derived consumables to remain on the market, but only under strict age, safety, and marketing controls. Because there are no committee transcripts or recorded votes provided, there is no direct evidence of legislative support or opposition in the available materials. The structure of the bill suggests an effort to legitimize the industry while responding to concerns about youth access, product safety, and unregulated intoxicating hemp products.
The main points of contention likely center on how broadly the bill regulates hemp-derived cannabinoids, especially products containing delta-8, delta-10, THCA, and similar compounds, and whether the licensing, testing, and school-zone restrictions are too burdensome for retailers and manufacturers. Other likely issues include the 21-and-over age limit, the 2% excise tax, the prohibition on certain product shapes and marketing, and the residency and licensing provisions affecting beverage distributors. The school-related restrictions and the ban on sales near educational institutions are also likely to be debated by businesses and advocates concerned about access and market viability.
The bill adds a new regulatory chapter to Title 39 that would govern hemp-derived consumable products in South Carolina. It would require licenses for manufacturers, producers, distributors, retailers, and certain food service establishments; impose testing, labeling, packaging, and advertising standards; create enforcement authority and civil penalties for the Department of Agriculture; and establish a 2% excise tax on retail sales. It also amends state law to create criminal penalties for unlicensed activity and underage sales, and it requires local school districts to adopt policies prohibiting hemp-derived consumable use on school property beginning in the 2026-2027 school year.
The bill’s overall tone is cautious and regulatory. It does not ban hemp-derived consumables outright, but it places them under a comprehensive licensing, testing, and age-restriction framework aimed at reducing youth access and improving product safety. With no committee transcripts or votes available, there is no documented public debate in the provided record, but the bill itself reflects a policy approach that appears to balance continued market access with strong public-health and consumer-protection controls.
Likely areas of contention include the breadth of the definition of hemp-derived consumables, especially its inclusion of intoxicating cannabinoids such as delta-8, delta-10, THCA, and HHC; the 21-and-over age limit and proof-of-age requirements; the 1,000-foot school setback; and the restrictions on packaging, potency, and marketing that may be viewed as limiting product appeal and sales. Businesses may also object to licensing fees, testing mandates, the excise tax, and the residency and franchise provisions for beverage distributors, while supporters are likely to emphasize youth protection, product safety, and clearer state oversight.