Do You Need a License to Sell CBD in California?

To sell CBD in California you do not apply for a single “CBD license.” You assemble a stack of permits whose contents depend on two questions: is your product derived from industrial hemp or from cannabis, and are you manufacturing it, retailing it, or both. Compliant hemp-derived CBD sits with the California Department of Public Health (CDPH) and, for sellers, with the California Department of Tax and Fee Administration (CDTFA) and your city or county. Anything cannabis-derived, inhalable, or intoxicating sits with the Department of Cannabis Control (DCC) and requires a full cannabis license. Getting that sorting wrong is the single biggest risk in this business, and the rules were rewritten in 2021 by AB 45 and again in 2025 by AB 8, so older guides online will steer you wrong.

Hemp-Derived or Cannabis-Derived: The Line That Decides Everything

Federal and California law both define “hemp” as cannabis containing no more than 0.3 percent delta-9 THC on a dry weight basis.¹ California’s Health and Safety Code uses the same threshold.² CBD extracted from plants that stay under that line is regulated by CDPH under the framework AB 45 created.

CBD extracted from cannabis that exceeds 0.3 percent THC is a cannabis product, full stop. Selling it requires a license from the DCC, which replaced the former Bureau of Cannabis Control in 2021. DCC licensing covers cultivation, manufacturing, distribution, and retail, and the requirements are significantly heavier than anything on the hemp side. The rest of this guide walks through the hemp-derived path, since that is where most new sellers start.

What CBD Manufacturers Need

If you manufacture CBD food, beverages, dietary supplements, cosmetics, or pet products from industrial hemp, you need two separate CDPH approvals. The first is a registration under the product-specific program within CDPH’s Food and Drug Branch, for example a Processed Food Registration for an edible. The second is an Industrial Hemp Enrollment and Oversight (IHEO) authorization, an annual permit specific to hemp manufacturing.³

IHEO fees scale with gross annual revenue and product type. Extract manufacturers pay the most, from $2,750 per year at $100,000 or less in revenue up to $42,000 above $50 million. Human food manufacturers pay between $1,900 and $14,000. Cosmetics manufacturers pay between $1,600 and $10,500. Each manufacturing facility needs its own authorization and its own fee.⁴

Beyond paperwork, manufacturers must follow Good Manufacturing Practices, test each product through an independent laboratory, and source hemp from a state or country whose industrial hemp program inspects hemp under a food safety program.⁵ You cannot manufacture while your IHEO application is incomplete or your fee is unpaid; CDPH must clear you first.³

What CBD Retailers Need

Retailers selling compliant hemp-derived CBD do not need a DCC cannabis retail license. You do need the ordinary permits any California retailer needs. A seller’s permit from the CDTFA authorizes you to collect and remit state sales tax on tangible goods.⁶ You also need a general business license from your city or county, and depending on local zoning you may need additional land-use or health permits.

Local rules vary. Some California cities place specific restrictions on CBD retail, while others treat it as ordinary food or supplement sales. Call your city or county planning department before you sign a lease or order inventory. An hour on the phone upfront saves months of problems later.

Products You Cannot Sell Without a Cannabis License

This is where the law changed sharply in 2025 and where the compliance risk is highest. Assembly Bill 8, signed in October 2025, bans the sale of inhalable hemp products containing cannabinoids, including CBD vapes and smokable hemp flower, and bans synthetic cannabis products, outside the licensed cannabis system.⁷

AB 8 also treats intoxicating hemp products as cannabis. Manufacturing or selling an intoxicating hemp product without a DCC license exposes you to the same civil and criminal penalties as unlicensed cannabis operators.⁷ If your business plan included CBD vape cartridges, pre-rolls, or smokable flower, those products have to move through the DCC-licensed dispensary system or not be sold in California at all.

Age Restriction at the Point of Sale

CDPH’s current regulations prohibit the sale of all hemp-derived food, beverage, and dietary supplement products to anyone under 21.⁸ That includes non-intoxicating CBD gummies and tinctures. If you sell edibles or supplements, build an age-verification step into every transaction, in-store and online.

Labeling and Testing You Have to Get Right

AB 45 requires every hemp-derived CBD product sold as a food, beverage, or dietary supplement to carry on-package information or a scannable QR code that links to a certificate of analysis from an independent testing laboratory. The certificate must show product name, manufacturer information, batch number, cannabinoid concentrations including total THC, and contaminant levels.⁹

Labels also need:

An expiration or best-by date where applicable to the product type.
A statement that children and people who are pregnant or breastfeeding should consult a healthcare professional before use.
A statement that products containing cannabinoids should be kept out of reach of children.
The exact disclaimer “THE FDA HAS NOT EVALUATED THIS PRODUCT FOR SAFETY OR EFFICACY.”

These requirements apply to all products manufactured 90 days or more after AB 45’s enactment.⁹

Proposition 65 adds another layer. If your product contains chemicals on the Proposition 65 list, including substances found in cannabis smoke, you must give a clear warning about exposure to chemicals known to cause cancer or reproductive harm.¹⁰ Any individual can sue a non-compliant business under Proposition 65, so this is not a rule you can quietly ignore.

Selling CBD Online in California

Starting July 1, 2026, SB 378 imposes new duties on online marketplaces that sell or advertise hemp products to California consumers. Platforms cannot run paid advertising for intoxicating or unlicensed hemp products. A platform that does so and contributes to an unlawful transaction can be held jointly and severally liable for damages a consumer suffers from ingesting the product.¹¹

Online marketplaces must also provide a reporting mechanism that lets anyone flag listings for intoxicating hemp products, with no account required.¹¹ If you sell through your own site or a third-party platform, make sure every listed product is properly registered and labeled. Non-compliant listings create exposure for you and for the platform.

What You Can and Cannot Say in Advertising

Federal and California rules overlap on CBD advertising, and the Federal Trade Commission actively enforces. The FTC requires “competent and reliable scientific evidence” for any health-related claim about a CBD product. For claims about preventing or treating disease, the FTC requires human clinical testing.¹²

The FTC has targeted CBD companies for claiming products treat cancer, heart disease, Alzheimer’s, diabetes, and chronic pain without adequate evidence. Statements that a product is “safe for all users” or “medically proven” draw enforcement attention. Softer phrasing like “may help anxiety” is not a safe harbor if you have no supporting research.¹²

If your product is cannabis-derived and sold through the DCC-licensed system, California Business and Professions Code Section 26151 adds further rules. Every advertisement must display the licensee’s number, and broadcast, print, or digital media placements are allowed only where at least 71.6 percent of the audience is reasonably expected to be 21 or older.¹³ Direct consumer communications require age verification first. Social media platforms often add restrictions beyond what the law requires, so read each platform’s policy before you run paid campaigns.

Penalties for Selling Without the Right License

CDPH enforces the Sherman Food, Drug, and Cosmetic Law, which covers hemp-derived CBD products, using investigations, product embargoes, cease-and-desist letters, and formal violation notices.¹⁴ A first violation under the Sherman Law can result in up to six months in jail and a fine of up to $1,000. With a prior conviction or an intentional violation, the jail exposure rises to up to one year with the same $1,000 fine. CDPH can also seek court injunctions to shut down a non-compliant operation.

The hardest penalties fall on anyone selling intoxicating hemp products without a cannabis license. AB 8 subjects those violations to the same penalties as illegal cannabis manufacturing and sales, which can include felony charges depending on the circumstances.⁷ If you are not sure which category your product falls into, that is the question to answer before you print a label or stock a shelf.

1
Office of the Law Revision Counsel. 7 U.S. Code 1639o – Definitions
2
California Legislative Information. California Health and Safety Code 11018.5
3
California Department of Public Health. Industrial Hemp Enrollment and Oversight
4
Cornell Law Institute. California Code of Regulations Title 17 Section 23230 – Fees for the Industrial Hemp Enrollment and Oversight Authorization
5
California Legislative Information. Assembly Bill 45 – Industrial Hemp Products
6
California Department of Tax and Fee Administration. Obtaining a Seller’s Permit
7
California Department of Public Health. Assembly Bill 8 Frequently Asked Questions
8
California Department of Public Health. California’s Ban on Intoxicating Hemp Products Now in Effect
9
California Legislative Information. Assembly Bill 45 – Industrial Hemp Products
10
Proposition 65 Warnings. Cannabis (Marijuana) Smoke
11
California Legislative Information. SB-378 Online Marketplaces – Illicit Cannabis
12
Federal Trade Commission. FTC Announces Crackdown on Deceptively Marketed CBD Products
13
California Legislative Information. California Business and Professions Code 26151
14
California Department of Public Health. DPH-24-005 Emergency and Regular Rulemaking Regulation for Industrial Hemp