Tennessee’s Hemp Overhaul Is Here. Let’s Talk About What It Means for Your Business

If you're running a hemp business in Tennessee, 2026 isn’t as far away as it sounds. The state has passed a new law that changes nearly everything about how hemp-derived cannabinoid products (HDCPs) will be handled. That includes how they’re made, sold, transported, and even where they can sit on a store shelf.

This isn’t just about paperwork. It’s about whether your business survives in a market that’s getting a full legal makeover. So let’s break it down. Then, let’s talk about how Hemp Law Group can help you make the right moves—while there’s still time.

A Quick Recap of the New Law

The TABC (Tennessee Alcoholic Beverage Commission) will soon be in charge of regulating HDCPs, thanks to House Bill 1376, passed and signed into law in May 2025. The law is sweeping. It doesn’t just tweak a few rules. It completely replaces the old system and creates a new licensing framework that covers:

• Suppliers (those who manufacture or contract to manufacture HDCPs)
• Wholesalers (those who store and distribute products)
• Retailers (those who sell directly to consumers)

Importantly, the new law requires ALL hemp and HDCPs in Tennessee to be sold through a wholesaler. While wholesalers cannot sell directly to consumers, retailers will have to purchase all of their products through a wholesaler.

Each of these roles has its own license, application process, fees, and compliance requirements. These go into full effect on January 1, 2026, but businesses need to start preparing now.

If you’re already in the business, the Department of Agriculture will renew your licenses this summer. The TABC has said it will honor those licenses through their typical expiration in summer 2026. But that won't get you out of the upcoming requirements.

What’s Actually Required?

Here’s what the law covers—and this is just the surface:

• Licensing fees: $2,500 per location for suppliers, $5,000 for wholesalers, and $1,000 per retail location. Additional $300 to register each HDCP brand.
• Taxation: They 6% HDCP tax at retail will sunset January 1st and replaced with a new tax assessed at the wholesale level, charging 2 cents per mg of THC.
• Selling THCA: THCA flower and concentrates are restricted. Nothing with a total-THC percentage above 0.3% will be legal to sell.
• Edible dosage: Edibles and drinks will now be limited to a max dosage of 15mg per serving. Edibles will be limited to 20 servings per container (300mg THC total). Beverages under 750ml in size will be limited to two servings and provisions governing larger beverage containers (kegs, half-kegs, etc.) are being implemented.
• Product testing: Full-panel tests before final production and potency tests for finished goods, all by certified third-party labs.
• Packaging rules: Child-resistant packaging, QR code links to batch testing, strict serving sizes, and no packaging that appeals to kids.
• Display restrictions: Many products must be kept behind a barrier or in areas only accessible to employees. New sign will be required in areas where HDCP products are displayed.
• No delivery or direct shipping: HDCPs must be sold in person at a licensed retail location. Shipping to consumers is banned.
• Flower sales: Only flower meeting the total-THC standards will be allowed for sale. The law limits containers to half an ounce max.
• Beverages: Must meet new resealability and serving size standards
• Using cartoon branding or animal shapes for edibles: Not allowed.

Are You Ready for Licensing?

Maybe you're planning to keep your business going under the new rules. Maybe you’re considering scaling back, selling, or changing direction. No matter where you are, the decisions you make between now and 2026 are going to matter.

That’s where we come in.

Hemp Law Group works with businesses at every stage—from startups trying to break in, to established companies facing shutdown or exit. We’ll help you understand what your options are, what it will cost to stay compliant, and how to move forward without risking penalties or losing your investment.

This law is detailed and dense. Most businesses don’t have time to wade through 19 pages of legal code, let alone interpret what it means for day-to-day operations. We’ve already done that work, and we’re advising clients across the state on how to adjust.

Common Questions We’re Hearing

Can I keep selling while I wait for the TABC to launch licensing?

Yes, but only if you're registered through the Department of Agriculture. Your registration from this year will carry over until it’s expiration in 2026, at which point you will need to be licensed by the TABC.

Does this mean I can continue selling THCA?

After January 1, 2026, you will no longer be able to sell THCA, full stop. You will only able to continue to sell hemp and HDC products permitted under the new law.

Can I ship products to customers?

No. Shipping and delivery to consumers in Tennessee is explicitly banned under the new law. All transactions must be face-to-face, unless it is shipped from out-of-state into the state of Tennessee.

What happens if I don’t comply?

Penalties range from $1,000 fines to license revocation and even seizure of your products. The state is not playing around. Beginning on January 1, 2026, you can be charged with a number of misdemeanors outlined in the new law – many issues that were previously dealt with as regulatory noncompliance can now be charged criminally.

Your Next Move Starts With a Conversation

Don’t wait for 2026 to start planning. Whether you want to stay, scale, or exit, you need a strategy that protects your business and your investment.

Let’s talk. We’ll walk through your current operations, explain the new rules in plain language, and help you figure out the smartest path forward. No jargon. No guesswork. Just clear, experienced guidance.

This law is a game-changer. But with the right help, it doesn’t have to be the end of your business. It might even be the start of something smarter, cleaner, and more profitable.

Let’s figure that out together.

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