09 Mar Top 5 Things You Need to Know About Foreign Investment Visas and the U.S. Hemp Industry
In the United States, 2019 was a pivotal year for hemp. In late December of 2018, Congress passed the 2018 Farm Bill which contained a provision to remove hemp from the controlled substances list, making it an ordinary agricultural commodity. This opened tremendous business opportunities around hemp and the products it is used to create. This includes opportunities for foreign investment visas and other types of business and employment visas as well. However, as an immigrant, before you consider involvement in the hemp industry, there are five things you should know.
First, it is important to understand how hemp is defined. Under previous law, hemp was not differentiated from other types of cannabis and had effectively been illegal since 1937, officially being declared a controlled substance in 1970. The 2018 Farm Bill reversed this distinction by clearly defining and differentiating hemp from other types of cannabis. Hemp is defined as cannabis with less than 0.3% of tetrahydrocannabinol, or THC. THC is the component in cannabis responsible for its psychoactive effect.
The reason that the definition of hemp is so important is because cannabis containing higher concentrations of THC is legal for medicinal or recreational purposes in some states. In the U.S., to an extent, each state acts as its own country when it comes to certain laws. Cannabis is one area where this is particularly evident. Before investing, it is important to be clear that you are investing in federally legalized hemp and not other types of cannabis.
Cannabidiol, commonly referred to as CBD, is one of the most exciting opportunities that has opened around hemp. CBD is known for a long list of purported health benefits and is ever-increasing in popularity in the United States. Due to the rapid rise in demand, CBD is now found in a wide variety of products from ingestible oils, to body lotions, foods and beverages, and even pet products.
CBD is another active component of cannabis but, unlike THC, does not have a psychoactive effect. Although previously considered a controlled substance, the passage of the 2018 Farm Bill paved the way for hemp-derived CBD. However, CBD can also be extracted from cannabis with higher than 0.3% THC, which is not permitted under federal law. If you want to be involved with a CBD business, you must ensure that it only produces hemp-derived CBD and adheres to all federal standards around testing, labeling, and advertising.
The exact date of the 2018 Farm Bill was December 20, 2018. This date sets an important marker as it relates to the Immigration and Nationality Act (INA) which dictates immigration law in the United States. Investment, employment, or other involvement in any type of hemp or cannabis business prior to this date will most likely lead to being denied access to the U.S. Even if the business was in a state where cannabis or hemp was legal, the INA bases their rules off federal laws and regulations.
After this date, involvement in the hemp industry, so long as it is legal hemp per the Farm Bill definition, is permissible and should not be an issue. This has paved the way for foreigners to get involved in this industry via any one of the several investment visas such as the EB-5 and E-2. The same would be true for any other type of business or employment-based visa program the United States offers. However, as always, check with an immigration attorney with knowledge in the industry.
It is important to remember that even if the business is in a state where other types of cannabis are legal, the business must strictly adhere to federal regulations for a visa to continue to be permitted. The same applies to personal use of cannabis as well. Although you may find yourself located in or visiting a state where recreational or medicinal cannabis is legal, any personal use can potentially jeopardize your immigration or residency status.