How to Get a CBD License in Oregon & Start Your Business

As the demand for CBD products continues to rise, Oregon stands out as a prime location for entrepreneurs looking to enter this burgeoning industry. Whether you’re a seasoned business owner or a passionate newcomer, this guide will walk you through the essential steps, regulations, and considerations of how to get a CBD license in the Beaver State. Specifically, we’ll go through how to start a CBD business in Oregon, get an Oregon CBD License, and all the laws & regulations surrounding the sale of CBD.

How to Start a CBD Business in Oregon

Starting your CBD business requires proper planning. Begin your CBD business journey with a comprehensive business strategy encompassing your objectives, product range, marketing strategies, financial projections, and operational tactics. With your roadmap, it’s time to choose the appropriate legal structure for your venture. Popular options include forming an LLC, establishing a partnership, or incorporating your business.

After determining your business structure, take the essential step of registering with the Oregon Department of Agriculture. Simultaneously, secure an Employer Identification Number (EIN) from the IRS to fulfill your tax obligations diligently. Remember that obtaining an Oregon CBD license is a mandatory prerequisite before engaging in any cultivation or production activities related to CBD.

Building a solid financial foundation is vital. Start by establishing a dedicated business bank account. This will grant access to credit cards and financing options and aid in building your business credit. Further, it will prove invaluable for future funding endeavors and expansion initiatives.

Licensing requirements can vary in the dynamic CBD industry based on your business goals. A license may not be obligatory if your primary focus is retailing hemp products. Thanks to the 2018 Farm Bill, businesses can sell hemp items provided the THC content threshold of the products is less than 0.3%. However, if your goal is to involve hemp cultivation or handling, then you’ll need a license. You can choose one of the two types of permits to ensure compliance and legitimacy.

How to Get a CBD License in Oregon

To obtain an Oregon CBD license, it’s crucial to follow these steps and adhere to the state’s regulations:

• Business Blueprint — Formulate a comprehensive business plan outlining your objectives, product range, marketing strategies, financial projections, and operational tactics.
• Select Legal Structure — Choose an appropriate legal structure for your hemp cultivation venture. Options include LLC, partnership, or corporation.
• Application Deadline — Remember that all CBD licenses in Oregon expire on December 31 of the calendar year. License fees are not pro-rated. To be eligible for the upcoming growing season, the Oregon Department of Agriculture (ODA) must receive all applications (renewals or new) by May 31 if you intend to grow.
• License Number — Ensure you have a copy of your license number before you start growing. This is a prerequisite for cultivation.
• Complete Applications —Submit complete and accurate applications to the ODA. Incomplete or error-filled applications will not be processed until they are corrected.
• Background Checks —Be aware that Oregon law requires a background check for hemp growers since 2022. All key participants must complete background checks, including fingerprinting. Only those with no felony drug convictions in the last ten years will be eligible to be licensed to grow hemp.
• Moratorium — Be aware of any moratoriums on new hemp licenses in specific counties, which may change from year to year.

CBD License Application Requirements for Oregon

For a Grower Oregon CBD license, you’ll need:

1. Application
2. Criminal history disclosure
3. Proof of residency for Oregon residents
4. Cultivation Plan
5. Information on soil testing and land preparation
6. Security Plan — Outline of security measures in place to protect the hemp crop from theft, vandalism, and unauthorized access
7. Background Checks
8. Fingerprint Information
9. Agricultural Hemp Seed License (if needed) — An additional license may be required if you intend to produce agricultural hemp seed
10. Documentation of Land and GPS Coordinates
11. Proof of ownership or written permission to cultivate hemp on the land
12. Recordkeeping Plan

For a Handler(Processor) Oregon CBD license, you’ll need:

1. Application
2. Business Entity Registration
3. Facility Location
4. Proof of Legal Residency
5. Background Checks
6. Financial Documentation — Provide financial documents, such as bank statements and tax records, to demonstrate your financial stability and ability to operate a CBD production business.
7. Security Plan
8. Inspection
9. Business Insurance
10. Record Keeping
11. Additional Permits — Depending on your specific production methods and products, you may need extra permits or licenses, such as a food processing license, if you produce CBD-infused edibles.

Laws & Regulations for Selling CBD in Oregon

The Oregon Department of Agriculture oversees Oregon’s hemp and CBD regulations. These rules include strict THC limits (0.3% delta-9 THC on a dry weight basis) and licensing requirements for hemp cultivation and processing. Testing and labeling standards are rigorous, focusing on potency, contaminants, and precise CBD content disclosure. Retailers must comply with Oregon’s food safety and labeling laws when selling CBD products.

On the federal level, the 2018 Farm Bill legalized nationwide hemp cultivation, but CBD remains under FDA regulation. CBD businesses in Oregon require various licenses and permits, and quality control mandates lab testing for potency and contaminants. Proper labeling, without unsupported health claims, is crucial. Sales to individuals under 21 are prohibited, and local regulations may apply.

How to Renew Your CBD License in Oregon

Renewing an Oregon CBD license is a straightforward two-step process.

First, you need to complete the Renewal Application Form. This comprehensive form requires you to furnish essential business and contact information, including details such as your Licensee Name, License ID Number, Contact Name, Contact Email, Business Identification Number (BIN), and Federal Employer Identification Number (FEIN). Accurate and up-to-date information is crucial to ensure a smooth renewal process.

The second step involves submitting your renewal online through the Oregon Liquor Control Commission (OLCC) online portal. To initiate this process, log into your license dashboard, where you’ll find a “Renew” button if your license expiration is within 90 days. Ensure you complete this step within the stipulated timeline to maintain your marijuana license. Importantly, refrain from changing your Oregon CBD license business unless you are a Producer seeking specific changes to your Production Tier or Production Type.

Start Selling CBD in Oregon

The initial decision-making process when entering the CBD market in Oregon involves a crucial choice between online and traditional brick-and-mortar sales channels. Both selling CBD online and in a physical store each have their advantages. Nevertheless, even if you opt to establish a physical store, the significance of establishing an eCommerce presence cannot be overstated.

The CBD industry is considered ‘high risk,’ so you need a proactive plan to get started. Kickstart your CBD journey with a unique website tailored to the Oregon CBD market. An effective CBD sales website in this region necessitates a series of essential steps to ensure its reliability and ultimate success. Commence by meticulously defining your CBD product range, gathering essential product details such as comprehensive descriptions, competitive pricing, and engaging visual content. To bolster trust among potential customers, consider integrating authentic customer testimonials and reviews, which serve as social proof of your product’s quality.

To ensure optimal performance, opt for premium hosting services. Adding a dedicated blog section to your website can be valuable for building connections with your customer base and potential partners. This showcases your industry expertise and contributes to driving organic traffic to your site. It’s worth highlighting that if your business plans involve hemp production, securing an Oregon CBD license is an absolute necessity to operate legally.

Building an email list is a highly effective strategy for establishing a direct sales channel for your customers. This approach reduces reliance on external distribution channels, giving you more control over your sales and marketing efforts. When selecting an eCommerce platform, explore reputable options such as Shopify, WooCommerce, and BigCommerce. However, keep in mind that not all platforms readily accommodate CBD sales due to perceived regulatory risks. Therefore, forming a partnership with a suitable payment processor that offers specialized CBD merchant accounts could be a critical step in ensuring your business’s success.