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In 2017, Arkansas legalized CBD, which spurred a widespread market for CBD products throughout the state. This shift not only offered a more accessible means for people to explore potential health benefits but also presented entrepreneurial opportunities for businesses.
As someone interested in starting a CBD business, you might be wondering whether obtaining a CBD license is necessary. Truthfully, it depends on what you’re selling. If you’re ready to start a CBD-based business: good news, you’re in the right place. This article offers a high-level overview of the process you’ll need to follow to obtain a CBD license.
How to Start a CBD Business in Arkansas
Even though it is legal to sell CBD products, CBD businesses are classified as high-risk. Business owners need to secure a high-risk merchant account to process non-cash payments. Let’s dive in and explore the things you should know and the steps involved in starting your CBD venture in Arkansas.
How to Get a CBD License in Arkansas
Arkansas has a designated Hemp Program that allows you to start a CBD-based business. This type of business is legislated by the “Arkansas Hemp Production Act of 2021” (A.C.A. § 2-15-501 et seq.) and the 2018 Farm Bill.
The Arkansas Department of Agriculture’s Hemp Program licenses are divided into two groups: Hemp Growers and Hemp Processor/Handler. Licensed Hemp Growers may legally produce or grow hemp crops, whereas Licensed Hemp Processors/Handlers must obtain hemp crops to be processed into “publicly marketable hemp products,” like CBD oil.[1]Department of Agriculture. “Hemp Home – Arkansas Department of Agriculture”. Accessed on December 13, 2023.
CBD License Application Requirements for Arkansas
CBD licenses in Arkansas are subject to application deadlines. For initial processors/handlers or indoor growers, you can apply anytime throughout the year. Finally, for outdoor growers, the window for applications typically closes on the last business day of April. Similarly, for the renewal of any CBD license, you’ll need to apply before the end of April in the year of expiry.
There are a lot of farming laws, inspections, and additional steps to take for a Growers’ license, but if you’d like to start a hemp farm in Arkansas, you can find great information about that license at the Arkansas Department of Agriculture.
CBD License Eligibility
To be eligible for a Processor/Handler CBD license, you need to be able to pass a state background check. In the AR Hemp Program, anyone who is a key participant or a signing authority for your company must get an “annual criminal history background check from the Arkansas State Police (ASP) Identification Bureau.”
Steps to Obtain Your CBD License in Arkansas
Handler/Processor CBD License in Arkansas:
- Background check: Fill in the Arkansas Background Check Form. Read the instructions carefully, as it is a $25 check or money order and a notarized signature for processing. You will also need to authorize its release to the Arkansas Department of Agriculture under the “Applicant Record Notification” section on page 2.
- Read Hemp Program rules: The applicant will need to read, understand, and legally acknowledge that they agree and abide by the Program Rules for the entire life of their issued license. You can find that document here. Section 12: Restrictions on Sale and Transfer and Section 17: Prohibitions Summarized are especially important sections that may require significant attention.
- Fill out the Application: Submit your fees on time.
CBD Licensing Fees
| Title | Amount | How to Pay |
| Application fee | $50 | With your application by check or money order via post. |
| License fee | $200 | If approved, you will receive an invoice. |
| Site Modification Fee | $200 | If approved, you will receive an invoice. |
| GPS Verification Fee for Each Storage Location ID | $100 | If approved, you will receive an invoice. |
| Applied Processor/Handler Fee | $500-$1,500 | If approved, you will receive an invoice. |
Your license will not be issued until the above invoices have been paid.
Laws & Regulations for Selling CBD in Arkansas
The Arkansas Industrial Hemp Research Program Rules create a safe and fair environment for CBD business owners and customers. Under these regulations, hemp products can be bought and sold. Business owners may not sell CBD products exceeding the 0.3% THC limit. THC is the psychoactive compound found in cannabis. You’ll need proper documentation and testing to prove your products meet this limit.
Merchants must properly manage their products. You cannot allow unsupervised access to the products, transport them to unapproved locations, or store them irresponsibly. All participants must comply with FDA, federal, and state regulations regarding sale and disclosure. This includes proper labeling and warnings. Among other important rules, you must maintain proper documentation around maintaining good business practices things like sales to wholesalers or consumers, storage, procedures, etc.
How to Renew Your CBD License in Arkansas
To renew your CBD license, it’s important to note that licenses do not follow through the calendar year. Their validity typically runs from July 1 through June 30 of each year. You’ll need to apply for renewal by the last business day in April before expiry. The application is the same as the initial application.
Start Selling CBD in Arkansas
Arkansas is among the states that have embraced the sale of CBD, but it’s crucial to navigate the legal landscape, especially considering the high-risk nature of the CBD industry. With that being said, it’s important to find a reputable CBD merchant service provider to ensure smooth transactions. These providers understand the unique requirements and compliance standards associated with CBD businesses, allowing you to accept various forms of payment, including credit and debit cards, online transactions, and mobile payments.
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Arkansas CBD License: FAQs
Is CBD legal in Arkansas?
Yes, CBD is legal in Arkansas and it’s federally cleared in all 50 states + U.S. territories. In 2017, the state passed the Arkansas Industrial Hemp Act, which legalized the cultivation, production, and sale of industrial hemp-derived CBD products containing no more than 0.3% THC. CBD products, however, are derived from marijuana, a sister plant to the hemp plant, and are still considered illegal under Arkansas law unless prescribed for medical use.
How much does a CBD license cost in Arkansas?
There are two costs when it comes to CBD licensing in Arkansas. The first is the initial application fee, which will run you $50 (non-refundable). The fee schedule is as follows:
| Title | Amount | How to Pay |
| Application fee | $50 | With your application by check or money order via post. |
| License fee | $200 | If approved, you will receive an invoice. |
| Site Modification Fee | $200 | If approved, you will receive an invoice. |
| GPS Verification Fee for Each Storage Location ID | $100 | If approved, you will receive an invoice. |
| Applied Processor/Handler Fee | $500-$1,500 | If approved, you will receive an invoice. |
Can you sell CBD without a license in Arkansas?
No, growing or selling CBD products in Arkansas without obtaining a proper license is illegal. To operate legally and avoid potential legal consequences, you must first secure the necessary licenses and comply with all state and federal regulations governing the sale and distribution of CBD products.
How long is a CBD license valid in Arkansas?
In Arkansas, a CBD license is valid for the remainder of the hemp year (July 1 through June 30) from the date of issuance, and regardless of when it was issued, it typically expires the nearest June 30. However, it’s important to note that license renewal requirements and procedures may vary. It is recommended to stay updated with the regulations and requirements set by the Arkansas Department of Agriculture or consult legal professionals to ensure compliance and timely license renewal – especially in the first year when the timeframe is less straightforward.
What else should I know about my CBD Business in Arkansas?
Your CBD business is considered high-risk. This makes things like getting a business bank account and merchant account a bit trickier than a low-risk business. As such, you’ll need to obtain a specialized CBD merchant account so you can securely accept debit and credit cards from your customers without the risk of being shut down or having funds withheld without notice.
