Thrive Market was forced to say goodbye to its selection of hemp extracts and topicals at the demand of the company that processes its customer payments, reported CNN (June 19).
The online natural and organic product platform received a notice from its unnamed merchant processor “demanding that [they] cease the sale of all hemp and CBD products,” Nick Green, Thrive’s CEO, wrote in a blog post and email to customers. “We unfortunately have no choice but to comply, and we’ll begin removing our assortment as early as Thursday, June 20.”
The company had been selling the products for more than 18 months.
Thrive is not the only one facing these issues. Earlier in June, third-party payment processor Stripe dropped the US Hemp Authority, a nonprofit organization developing a certification program and label for hemp, as a client because it thought it was too much of a liability.
Due to an uncertainty surrounding CBD products, some businesses are uncomfortable dealing with it even as it gained more legal footing in 2018. “Very little, thus far, is cut and dried about the hemp industry,” said Garrett O. Graff, a managing attorney at Hoban Law Group, a Denver, Colorado-based firm representing cannabis businesses.
Specifically, hemp-derived food and personal care products remain in a regulatory gray area after the U.S. Farm Bill in December 2018 deferred to FDA on how they should be dealt with.
Though Los Angeles-based Thrive will remove the products for now, it does not plan on giving up. “We believe that ethical and sustainable hemp is another cause worth fighting for, so rest assured that we will be working behind the scenes in the coming weeks to get hemp products back on Thrive Market,” wrote Green. “In fact, we’re already in conversations with a new processing partner to try to make that happen.”
One payment processor Thrive could take into consideration includes PaymentCloud which has been taking some higher-risk accounts and signed on hemp and CBD clients on a case-by-case basis. Determinations are made carefully as the company still needs to work within the boundaries of its partner wholesale payment processors, according to PaymentCloud CEO Shawn Silver. “We’re not going to push the envelope,” he said.
Meanwhile, as Thrive takes products off the market, Right On Brands is putting more products on it. The company plans to open ENDO Wellness Centers in Texas markets which will offer its full line of CBD-infused ENDO products including pH balancing alkaline water, oils, edibles, coffee, gel caps, tinctures, rubs, lotions, and vapors.
Legal experts view Texas as the “Wild West of CBD,” but now hemp is legal to buy and sell in the state if the product contains less than 0.3% THC. On June 10, the state’s governor signed House Bill 1325 into law, which modifies the Texas Agriculture Code for regulation and sale of hemp and hemp-related products.
“The new legislation has opened the door for the legal sale of CBD products across the state of Texas,” Vic Morrison, Right On EVP, corporate development. “Several major Texas-based distributors have been holding large orders for ENDO Brands products; waiting for the new law to become effective.”
Right On expects its flagship ENDO water to be widely available in Dallas, Austin and Houston by third quarter 2019.