Committee Blog: Navigating Cannabis Marketing Regulations – NCIA’s Marketing & Advertising Committee’s Compliance Quick-Reference Guide

As a cannabis industry professional, you know that navigating the maze of marketing regulations is essential for success. This comprehensive guide introduces and explores six key compliance guidelines outlined by Helen Mac Murray, Partner, Mac Murray & Shuster LLP and recommended by the National Cannabis Industry Association ‘s Marketing & Advertising Committee:

1. Steering Clear of Deceptive Practices
2. Backing Health Claims with Science
3. Understanding Social Media Policies
4. Environmental Claims in Cannabis Advertising
5. Trademarks, Packaging & Branding Guidelines
6. Texting and Calling Compliance

Let’s ensure your marketing strategies are not only effective but also compliant with the ever-evolving legal landscape. For an even deeper dive into these topics, join us for our upcoming #IndustryEssentials webinar, where industry experts will provide actionable insights to help you thrive in this complex regulatory landscape.

Unlocking Compliance: Understanding Cannabis Marketing Regulations

Steering Clear of Deceptive Practices

The NCIA’s Marketing & Advertising Committee stresses the importance of avoiding unfair, abusive, and deceptive practices (UDAAP) in your marketing materials. UDAAP laws prohibit misrepresentations about product quality, and availability, failing to include appropriate warnings, and more. 

However, what constitutes “deceptive” can be subjective, varying by state. With state attorneys general empowered to bring lawsuits against violators, staying informed about state-specific regulations is crucial. Additionally, federal implications under the FTC, FDA, and CFPB underscore the need for compliance. 

Backing Health Claims with Science

Product substantiation and health claims are under scrutiny, especially in the CBD arena. While no single federal entity has jurisdiction over the nebulous area of “product substantiation,” the FDA and FTC have issued warning letters and fines related to companies making unsubstantiated health and wellness claims involving cannabis and hemp-derived products. 

The FDA requires reliable and competent scientific evidence to support claims. Such claims can be difficult to validate in the cannabis industry, where federal prohibition has hampered research.

What about CBD? Although the 2018 Farm Bill opened the doors to more CBD research, the FDA concluded in 2023 that the existing regulatory framework for foods and supplements was not appropriate for CBD, and that it would work with Congress to determine how to properly substantiate claims for CBD products. 

Amidst this uncertainty, it’s essential to prioritize reliable evidence to support your product claims. 

Understanding Social Media Advertising Policies

Social media can be a potent tool for cannabis marketing, but it comes with challenges. Major platforms impose strict terms of use, often banning cannabis-related content including any imagery, sale, and even discussion about cannabis. It is important to familiarize yourself with each platform’s terms of use. 

Despite these hurdles, compliant advertising strategies can leverage platforms such as X (formerly Twitter) and Pinterest, which at the time of this article’s publication offer more lenient policies. For example, on X, advertisers must be preapproved but can promote brands and include informational content for THC and CBD with some targeting restrictions.

The sale of cannabis products on social media is always prohibited. 

Businesses must also navigate the FTC’s regulations on influencer endorsements to avoid misrepresentation as they may be held liable for third-party statements about their products. Endorsers should always disclose any relationship they have with a product they are recommending or reviewing.  

Environmental Claims in Cannabis Advertising

As environmental consciousness rises, so do consumers’ expectations. Marketers must substantiate claims of being “environmentally friendly” or “organic” to avoid UDAAP violations. Businesses should consider how consumers are likely to interpret particular claims and avoid using vague terms such as “eco-friendly” or “sustainable,” which may be misleading.

 Aligning with state and federal regulations regarding pesticide use and environmental claims is essential to maintain consumer trust. The FTC’s Green Guides sets the tone for environmental claims in cannabis. 

Trademarks, Packaging & Branding Guidelines

Understanding trademark protections post-2018 Farm Bill is vital for brand protection. 

Following the passage of the Bill, the United States Patent Office (USPTO) has allowed registration of marks for hemp and hemp-derived products containing <.3% or less THC. Federally registered marks offer broader protection, state, and common law protections may apply to legally classified marijuana products with >.3% THC. Cannabis-adjacent products such as t-shirts and caps are also registerable.

Cannabis operators should avoid branding or packaging that may be appealing to children.

Most states containing cannabis regimes prohibit such packaging and deem it an unfair trade practice. 

Texting and Calling Compliance

Cannabis companies making calls or sending text messages to consumers should be aware of the Telephone Consumer Protection Act (TCPA) and relevant do-not-call (DNC) laws. Non-compliance can lead to hefty fines and legal repercussions. 

The TCPA requires certain levels of consent before cannabis businesses or authorized telemarketers may make prerecorded or auto-dialed calls to consumers. Federal TCPA and DNC laws apply regardless of whether a cannabis business is making calls/texts itself or has hired a telemarketer or affiliate to place calls/texts. 

“TCPA lawsuits premised on unlawful calling and texting practices are often bet-the company scenarios. Businesses may face class actions and millions in fines if their calling and texting practices are not TCPA compliant,” Helen Mac Murray, Partner | Mac Murray & Shuster LLP

With consumer protection laws evolving and states beginning to enact their own more rigorous “mini-TCPA” bills, staying updated and ensuring compliance with legal requirements are essential to mitigate risks. TPA lawsuits are difficult to defeat early in litigation and can lead to burdensome and invasive discovery.

In addition to TCPA and DNC laws, short message service (SMS) providers may not allow the promotion of hemp or cannabis via text message. 

Protect Your Marketing Strategy with Compliance

Compliance isn’t just about following rules; it’s about building trust and integrity in your brand. It is the cornerstone of successful cannabis marketing. By prioritizing transparency, evidence-based claims, and ethical practices, you can navigate the complex world of cannabis marketing with confidence. Let’s work together to create a responsible and sustainable future for cannabis marketing.