Indicates Matter Stricken

Indicates New Matter

 

Committee Report

February 26, 2026

 

H. 3924

 

Introduced by Reps. Wooten, W. Newton, Erickson, Neese, Hager, Bannister, Herbkersman, M. M. Smith, Pedalino, C. Mitchell, Bustos, Lawson, Guffey, Hiott, Taylor, Ballentine, Vaughan, White, Long, Ligon, Guest, Gilliam, Hartnett, Bailey, Landing, B. J. Cox, Hayes, Atkinson, Willis, Lowe, T. Moore, Davis, Hixon, Martin, Pope, Henderson-Myers and Robbins

 

S. Printed 2/26/26--S.

Read the first time April 15, 2025

 

________

 

The committee on Senate Agriculture and Natural Resources

To whom was referred a Bill (H. 3924) to amend the South Carolina Code of Laws by adding Chapter 56 to Title 46 so as to regulate the sale of hemp-derived consumables, among other things, etc., respectfully

Report:

That they have duly and carefully considered the same, and recommend that the same do pass with amendment:

 

    Amend the bill, as and if amended, by striking all after the enacting words and inserting:

SECTION 1.  The General Assembly finds and declares that:

    (A) The State has a substantial interest in regulating intoxicating beverages that may cause impairment, such as beer, wine, liquor, and hemp-cannabinoid beverages, and an interest in regulating the activities of manufacturers, importers, wholesalers, and retailers; and the influences that affect the consumption levels of such intoxicating beverages by the people of the State.

    (B) The State has a substantial interest in exercising its police power to promote the public health, safety, and welfare of the State by regulating the business of manufacturing, distributing, and retail sales of intoxicating beverages that may cause impairment in the manner and to the extent allowed by law to promote and preserve public health and safety while providing for economic opportunities within the State.

    (C) The State has a substantial interest in prioritizing the health and safety of the children of South Carolina and is committed to ensuring proper age verification and efficient enforcement of the requirements and restrictions of this act. 

    (D) By this act, the General Assembly intends to promote the public health, safety, and welfare of residents of this State with laws intended to strictly regulate intoxicating beverages containing beer, wine, liquor, or hemp-cannabinoid products.

    (E) This act has been enacted pursuant to the powers reserved to the states under the Tenth Amendment to the United States Constitution, and the inherent powers of the State under the Constitution of the State of South Carolina, 1895, and the statutes promulgated thereunder. It is the intent of the General Assembly that this act do all of the following:

       (1) further regulate and control transactions in this State as to intoxicating beverages that may cause impairment under the control and supervision of the Department of Revenue;

       (2) strictly regulate all intoxicating beverage transactions by fostering moderation and responsibility in the use and consumption of all intoxicating beverages;

       (3) promote and assure the public's interest in fair and efficient distribution and quality control of intoxicating beverages in this State;

       (4) promote orderly marketing of intoxicating beverages;

       (5) provide for an orderly system of public revenues by facilitating the collection and accountability of this State and local excise taxes;

       (6) facilitate the collection of state and local revenue;

       (7) maintain trade stability and provide for the continuation of control and orderly processing by the State over the regulation of intoxicating beverage manufacturing locations and the process of selling intoxicating beverages to the state's consumers;

       (8) ensure that the Department of Revenue and State Law Enforcement Division are able to monitor licensed operations through on-site inspections to confirm compliance with state law and that any intoxicating beverages shipped into, distributed, and sold throughout this State:

           (a) have been registered for sale in this State with the Department of Revenue, as prescribed by law;

           (b) are not subject to a government mandated or supplier initiated recall;

           (c) are not counterfeit;

           (d) are labeled in conformance with applicable laws, rules, and regulations;

           (e) can be inspected and tested by the Department of Revenue or the State Law Enforcement Division; and

           (f) are not prohibited by this State;

       (9) promote and maintain a sound, stable, and viable three tier system of distribution of intoxicating beverages to the public; and

       (10) ensure that statutes and regulations relating to intoxicating beverages exist to serve the interests of the State of South Carolina and its citizens rather than to serve or protect the interests of market participants by adopting protectionist measures with no demonstrable connection to the state's legitimate interests in regulating intoxicating beverages that may cause impairment.

 

SECTION 2.  Chapter 55, Title 46 of the S.C. Code is amended by adding:

 

    Section 46-55-5. The purpose of this chapter is to regulate the sale and distribution of hemp products. It is the intent of the General Assembly that the manufacture, sale, and distribution of hemp-cannabinoid products are strictly prohibited unless specifically provided for in this chapter and Chapters 4, 6, and 14 of Title 61, and synthetic cannabis products are strictly prohibited and a violation should be treated as marijuana under Chapter 53, Title 44.

 

SECTION 3.  Section 46-55-10 of the S.C. Code is amended to read:

 

    Section 46-55-10.  For the purposes of this chapter:

    (1) "Cannabidiol" or "CBD" means the compound by the same name derived from the hemp variety of the Cannabis sativa L. plant.

    (2) "Cannabinoids" means any compounds that bind to cannabinoid receptors.

    (3) "Synthetic cannabis products" are prohibited products that are comprised of derivatives, extracts, cannabinoids, isomers, esters, ethers, acids, salts, and salts of isomers, esters, and ethers whenever the existence of such isomers, esters, ethers, and salts is possible within the specific chemical designation, including but not limited to:

       (i) exo-tetrahydrocannabinol

       (ii) delta-10 tetrahydrocannabinol;

       (iii) delta-8 tetrahydrocannabinol;

       (iv) delta-7 tetrahydrocannabinol;

       (v) delta-6a10a tetrahydrocannabino;

       (vi) hydrogenated forms of tetrahydrocannabinol, including hexahydrocannabinol; hexahydrocannabiphrol, and hexahydrocannabihexol;

       (vii) ester forms of tetrahydrocannabinol, including delta-8 tetrahydrocannabinol, tetrahydrocannabinol-O-acetate, delta-9 tetrahydrocannabinol-O-acetate, delta-10 tetrahydrocannabinol-O-acetate, delta-6a10a tetrahydrocannabinol-O-acetate, and hexahydrocannabinol-O-6 acetate;

       (viii) ether forms of tetrahydrocannabinol and hexahyrdocannabinol, including delta-9 tetrahydrocannabinol methyl ether and delta-8 tetrahydrocannabinol methyl ether;

       (ix) analogues or tetrahydrocannabinols with an alkyl chain of four or more carbon atoms, including tetrahydrocannabiphorols, tetrahydrocannabioctyls, tetrahydrocannabihexols, or tetrahydrocannabutols;

       (x) delta-8 isotetrahydrocannabinol, delta-4 isotetrahydrocannabinol and isohexahydrocannabinol; or

       (xi) any combination of the compounds, including hexahydrocannabiphorol-o-ester and delta-8 tetrahydrocannabiphorol acetate, or delta-9 tetrahydrocannabiphorol acetate.

    (2)(4) "Commercial sales' means the sale of hemp products in the stream of commerce, at retail, wholesale, and online.

    (3)(5) "Commissioner" means the Commissioner of the South Carolina Department of Agriculture.

    (4)(6) "Cultivating" means planting, watering, growing, and harvesting a plant or crop.

    (7)   "Delta-8" means delta-8 tetrahydrocannabinol.

    (8)   "Delta-9" means delta-9 tetrahydrocannabinol. 

    (9)   "Delta 10" means delta-10 tetrahydrocannabinol.

    (5)(10) "Department" means the South Carolina Department of Agriculture.

    (11) "Division" means the South Carolina Law Enforcement Division.

    (6) "Federally defined THC level for hemp" means a delta-9 THC concentration of not more than 0.3 percent on a dry weight basis, or the THC concentration for hemp defined in 7 U.S.C. SECTION 5940, whichever is greater.

    (7)(12) "Handling" means possessing or storing hemp for any period of time. "Handling" also includes possessing or storing hemp in a vehicle for any period of time other than during its actual transport from the premises of a licensed person to cultivate or process industrial hemp to the premises of another licensed person. "Handling" does not mean possessing or storing finished hemp products.

    (8)(13)(a) "Hemp" or "industrial hemp" means the plant Cannabis sativa L. and any part of that plant, including the nonsterilized seeds thereof and all derivatives, extracts, cannabinoids, isomers, acids, salts, and salts of isomers, whether growing or not, with the federally defined THC level for hempa  total delta-9 THC concentration of not more than 0.3 percent on a dry weight basis. Hemp shall be considered an agricultural commodity.

       (b) "Hemp" does not include:

           (i) any viable seeds from a Cannabis sativa L. plant that exceeds a total THC concentration of 0.3 percent in the plant on a dry weight basis; or

           (ii) any intermediate hemp-derived cannabinoid products containing:

               (I) cannabinoids that are not capable of being naturally produced by a Cannabis sativa L. plant;

               (II) cannabinoids that:

                  (aa) are capable of being naturally produced by a Cannabis sativa L. plant; and

                  (bb) were synthesized or manufactured outside the plant; or

               (III) more than 0.3 percent combined total of:

                  (aa) total tetrahydrocannabinols (including tetrahydrocannabinolic acid); and

                  (bb) any other cannabinoids that have similar effects (or are marketed to have similar effects) on humans or animals as a tetrahydrocannabinol (as determined by the Secretary of Health and Human Services); or

           (iii) any intermediate hemp-derived cannabinoid products which are marketed or sold as a final product or directly to an end consumer for personal or household use; or

           (iv) any final hemp-derived cannabinoid products containing:

               (I) cannabinoids that are not capable of being naturally produced by a Cannabis sativa L. plant;

               (II) cannabinoids that:

                  (aa) are capable of being naturally produced by a Cannabis sativa L. plant; and

                  (bb) were synthesized or manufactured outside the plant; or

               (III) greater than 0.4 milligrams combined total per container of-

                  (aa) total tetrahydrocannabinols (including tetrahydrocannabinolic acid); and

                  (bb) any other cannabinoids that have similar effects (or are marketed to have similar effects) on humans or animals as a tetrahydrocannabinol (as determined by the Secretary of Health and Human Services).

    (14) "Hemp product" means all products containing cannabidiol with a total delta-9 THC concentration of not more than 0.3 percent on a dry weight basis derived from, or made by, processing hemp plants or hemp plant parts, that are prepared in a form available for commercial sale, including, but not limited to, cosmetics, personal care products, food intended for human and animal consumption, cloth, cordage, fiber, fuel, paint, paper, particleboard, plastics, and any product containing one or more hemp-derived cannabinoids, such as but not limited to: CBD, CBG, CBC, or CBN provided the product does not cause a psychoactive reaction. Unprocessed or raw plant material, including nonsterilized hemp seeds, is not considered a hemp product.

    (9)(15) "Hemp-cannabinoid products" only means all products with the federally defined THC level for hemp derived from, or made by, processing hemp plants or hemp plant parts, that are prepared in a form available for commercial sale, including, but not limited to, cosmetics, personal care products, food intended for animal or human consumption, cloth, cordage, fiber, fuel, paint, paper, particleboard, plastics, and any product containing one or more hemp-derived cannabinoids, such as cannabidiol. Unprocessed or raw plant material, including nonsterilized hemp seeds, is not considered a hemp product  permitted under Title 61 for human consumption.

    (10)(16) "Licensee" means an individual or business entity possessing a license issued by the department under the authority of this chapter to cultivate, handle, or process hemp.

    (11)(17) "Marijuana" has the same meaning as in Section 44-53-110 and does not include  tetrahydrocannabinol in hemp or, hemp products, or hemp-cannabinoid products as defined herein.

    (12)(18) "Processing" means converting an agricultural commodity into a marketable form.

    (19) "Psychoactive reaction" means an altered state of the brain that has significant effects on a person's psychological processes, consciousness, thinking, physical ability, perception, or emotion.

    (13)(20) "State plan" means the plan submitted by the department and approved by the Secretary of the United States Department of Agriculture pursuant to which the department regulates hemp production.

    (14)(21) "THC" means tetrahydrocannabinol.

 

SECTION 4.  Chapter 55, Title 46 of the S.C. Code is amended by adding:

 

    Section 46-55-70.  (A) Any hemp product processed, distributed, sold, or offered for sale to consumers in this State in violation of this chapter is considered contraband and may be seized by law enforcement as provided for by law.

    (B) The Division is vested with the enforcement of this section.

 

    Section 46-55-80.  Nothing in this chapter may be construed to limit the interstate commerce of any product being transported through this State.

 

Chapter 55, Title 46 of the S.C. Code is amended by adding:

 

    Section 46-55-90.  Cannabidiol in a hemp product that does not have a psychoactive reaction is not restricted by this chapter.

 

SECTION 5.  Section 61-2-60 of the S.C. Code is amended to read:

 

    Section 61-2-60. The department and the division are authorized to promulgate regulations necessary to carry out the duties imposed upon them by law for the proper administration and enforcement of, and consistent with this title including, but not limited to:

    (1) regulations for the application and issuance of alcoholic liquor and hemp-cannabinoid beverages licenses, permits, and certificates;

    (2) regulations to prevent the unlawful manufacture, bottling, sale, distribution, transportation, and importation of alcoholic liquors and hemp-cannabinoid beverages;

    (3) regulations necessary to effect an equitable distribution of alcoholic liquors and hemp-cannabinoid beverages in this State;

    (4) regulations for the analysis of alcoholic liquors and hemp-cannabinoid beverages sold in this State and for a procedure for obtaining the samples for this purpose;

    (5) regulations governing the administration and enforcement of provisions relating to producers and wholesalers of beer and wine and hemp-cannabinoid beverages ;

    (6) regulations for application for and issuance of beer licenses, permits, or brewers' certificates of approval and the sale, distribution, promotion, and shipment of beer into and within the State;

    (7) regulations for the operation of breweries and commercial wineries;  and

    (8) regulations governing the enforcement of provisions relating to brewpubs.

    (9) regulations governing the development, implementation, education, and enforcement of responsible alcohol server training provisions.

 

Section 61-2-100(I) of the S.C. Code is amended to read:

 

    (I) The department may not issue a wholesale beer and wine or a hemp-cannabinoid beverage permit pursuant to this title unless the applicant is a legal resident of the United States and has been a legal resident of this State and has maintained his principal place of abode in this State for at least thirty days before the date of the application.

 

Section 61-2-135 of the S.C. Code is amended to read:

 

    Section 61-2-135.  When a person licensed to sell alcoholic liquor or, beer and wine, or hemp-cannabinoid beverages moves his business to a new location in the same county that was licensed in the same manner within ninety days of the time of the move, the person may use his current license and is not required to initiate a new application upon approval by the department. In addition to a hemp-cannabinoid beverage retail license, the person must also have a license for alcoholic liquor or beer and wine and continue selling both types of products in the new location.

 

Section 61-2-136 of the S.C. Code is amended to read:

 

    Section 61-2-136.  Notwithstanding another provision of law, a currently licensed beer and wine wholesaler, or currently licensed alcoholic liquor wholesaler, or currently licensed hemp-cannabinoid wholesaler who wishes to relocate the licensed business to a new location within the State must notify the department.  This notice must be in writing, must precisely describe the premises to be licensed, must give the date of the move, and must be filed with the department at least thirty days prior to the move. Upon receipt of this notice, the department shall transfer the permit to the new premises effective on the date of the move. In addition to a hemp-cannabinoid beverage wholesaler license, the person must also have a license for alcoholic liquor or beer and wine and continue servicing both types of products in the new location.

 

Section 61-2-150 of the S.C. Code is amended to read:

 

    Section 61-2-150.  If a fine is imposed by the department for a violation by a beer, wine, hemp-cannabinoid beverage, or liquor licensee, and the licensee fails to pay the fine and ceases doing business on the premises where the violation occurred, the department must not require a subsequent tenant of the premises to pay the fine as a condition to being issued a beer, wine, hemp-cannabinoid beverage, or liquor license.  However, this prohibition does not apply to any person who is related by blood within the third degree or marriage to, is in business with, or is acting for or on behalf of, directly or indirectly, the licensee so fined.

    The burden is on the new tenant to prove that no such relationship exists between him and the licensee.

 

Section 61-2-170 of the S.C. Code is amended to read:

 

    Section 61-2-170.  The department may not generate license fees to be deposited in the general fund of the State through the issuance of licenses or permits for on or off premises consumption which authorize alcoholic liquors, beer, or wine, or hemp-cannabinoid beverages to be sold on a drive-through or curb service basis.

 

SECTION 6.  Chapter 4, Title 61 of the S.C. Code is amended by adding:

 

    Section 61-4-15. (A) "Hemp-cannabinoid beverage" which is a chemically intoxicating beverage subject to the exercise of the police power of the General Assembly, pursuant to Section 1, Article VIII-A of the South Carolina Constitution.

    (B) For the purposes of this chapter, hemp-cannabinoid beverages that contain no more than five milligrams of an allowable THC concentration in a single serving in a twelve-ounce container shall be treated as beer or wine as described in Chapter 4, except for the provisions in Chapter 14 including creation of hemp-cannabinoid licenses, violations and penalties.

 

SECTION 7.  Section 61-4-20 of the S.C. Code is amended to read:

 

    Section 61-4-20. It is unlawful for a person to sell or permit to be sold beer, ale, porter, wine, malt, hemp-cannabinoid beverage, or other beverage authorized to be sold under this chapter on which the tax levied has not been paid.  A person having charge of the sale of one of these beverages who sells or permits it to be sold in violation of the provisions of this section is guilty of a misdemeanor and, upon conviction, for each offense must be fined not less than twenty-five dollars nor more than one hundred dollars or imprisoned for not less than ten days nor more than thirty days, in the discretion of the court.

 

Section 61-4-30 of the S.C. Code is amended to read:

 

    Section 61-4-30. Beer or, wine, or hemp-cannabinoid beverages sold by wholesalers to the holders of retail licenses in this State must be sold for cash only at the time of delivery or prior to delivery.  For purposes of this section, "cash" means money or a bona fide check, money order, or electronic transfer of funds if the transfer of funds is initiated by an irrevocable payment order on or before delivery of the beer or wine.  The electronic transfer must be initiated by the wholesaler no later than one business day after delivery.  A holder of a retail permit who issues a check or an irrevocable payment order in payment for beer or wine with insufficient funds at the bank to cover the check violates the provisions of this section.  This provision for cash payment applies to cash deposits on empties when beer is delivered in returnable containers.  This deposit on bottles or draft beer containers must not be less than the charge from the brewery to the wholesaler.

 

Section 61-4-40 of the S.C. Code is amended to read:

 

    Section 61-4-40. A holder of a beer permit,  or a beer and wine permit, or hemp-cannabinoid beverage permit may not purchase beer or , wine, or hemp cannabinoid beverages or bothall three, on credit by a dishonored check, an unpaid note or invoice, or other insufficient manner from a permitted beer and wine wholesaler.  However, no action may be taken against the holder for a first violation of this section.  If a holder commits a second or subsequent violation, his retailer's permit may be suspended, canceled, or revoked by the department, or a monetary penalty of not more than twenty-five dollars may be assessed against him.

 

Section 61-4-50 of the S.C. Code is amended to read:

 

    Section 61-4-50. (A) It is unlawful for a person to sell beer, ale, porter, wine, hemp-cannabinoid beverage, or other similar malt or fermented beverage to a person under twenty-one

years of age. A person who makes a sale in violation of this section, upon conviction:

       (1) for a first offense, must be fined not less than two hundred dollars nor more than three hundred dollars or imprisoned not more than thirty days, or both;  and

       (2) for a second or subsequent offense, must be fined not less than four hundred dollars nor more than five hundred dollars or imprisoned not more than thirty days, or both.

    (B) Failure of a person to require identification to verify a person's age is prima facie evidence of the violation of this section.

    (C) A person who violates the provisions of this section also is required to successfully complete a DAODAS approved merchant alcohol enforcement education program. The program must be a minimum of two hours and the cost to the person may not exceed fifty dollars.

    (D)(1) Whenever any person who has not previously been convicted of any offense under this section, pleads guilty to or is found guilty of a sale in violation of this section, the court, without entering a judgment of guilt and with the consent of the accused, may defer further proceedings and place him on probation upon terms and conditions as it requires provided that one such condition must be that he complete the merchant education program described in subsection (C).  Upon violation of a term or condition, the court may enter an adjudication of guilt and proceed as otherwise provided.  Upon fulfillment of the terms and conditions, the court shall discharge the person and dismiss the proceedings against him.  Discharge and dismissal under this section must be without court adjudication of guilt and is not a conviction for purposes of this section or for purposes of disqualifications or disabilities imposed by law upon conviction of a crime, including the additional penalties imposed for second or subsequent convictions.  However, a nonpublic record must be forwarded to and retained by the South Carolina Law Enforcement Division for the purpose of use by the courts in determining whether or not a person has committed a subsequent offense under this section.  The South Carolina Law Enforcement Division must produce this record upon subpoena or court order.  Discharge and dismissal under this section may occur only once with respect to any person.

       (2) Upon the dismissal of the person and discharge of the proceedings against him pursuant to item (1), the person may apply to the court for an order to expunge from all official records, other than the nonpublic records to be retained as provided in item (1), all recordation relating to his arrest, indictment or information, trial, finding of guilt, and dismissal and discharge pursuant to this section.  If the court determines, after the hearing, that the person was dismissed and the proceedings against him discharged, it shall enter the order.  The effect of the order is to restore the person, in the contemplation of the law, to the status he occupied before the arrest or indictment or information.  No person as to whom the order has been entered may be held pursuant to another provision of law to be guilty of perjury or otherwise giving a false statement by reason of his failure to recite or acknowledge the arrest, or indictment or information, or trial in response to an inquiry made of him for any purpose, except when the person is providing sworn statements or giving testimony under oath.  A conditional discharge granted pursuant to this section does not preclude a person from availing themselves of subsequent pre-trial diversion options provided by law.

       (3) Before a person may be discharged and the proceedings dismissed pursuant to this subsection, the person must pay a fee of three hundred fifty dollars if the person is in a general sessions court and one hundred fifty dollars if the person is in a summary court.  No portion of the fee may be waived, reduced, or suspended, except in cases of indigency.  If the court determines that a person is indigent, the court may partially or totally waive, reduce, or suspend the fee.  The revenue collected pursuant to this item must be retained by the jurisdiction that heard or processed the case and paid to the State Treasurer within thirty days of receipt.  The State Treasurer shall transmit these funds to the Prosecution Coordination Commission which shall then apportion these funds among the sixteen judicial circuits on a per capita basis equal to the population in that circuit compared to the population of the State as a whole based on the most recent official United States census.  The funds must be used for drug treatment court programs only.  The amounts generated by this subsection are in addition to any amounts presently being provided for drug treatment court programs and may not be used to supplant funding already allocated for these services.  The State Treasurer may request the State Auditor to examine the financial records of a jurisdiction which he believes is not timely transmitting the funds required to be paid to the State Treasurer pursuant to this subsection.  The State Auditor is further authorized to conduct these examinations and the local jurisdiction is required to participate in and cooperate fully with the examination.

       (4) Conditional discharge may only be granted by the court in accordance with the provisions of this section upon approval of the circuit solicitor or prosecuting officer.

    (E) Violations for sale of hemp-cannabinoid beverages to a person under the age of twenty-one are provided for in Section 61-14-320.

 

Section 61-4-60 of the S.C. Code is amended to read:

 

    Section 61-4-60. It is unlawful for a person to whom beer or, wine, or hemp-cannabinoid beverage cannot be lawfully sold to knowingly give false information concerning his age for the purpose of purchasing beer or wine. A person who violates the provisions of this section, upon conviction, must be fined not less than one hundred dollars nor more than two hundred dollars or be imprisoned for not more than thirty days, or both.

 

Section 61-4-70 of the S.C. Code is amended to read:

 

    Section 61-4-70. A person engaged in the business of selling at retail beer or wine or hemp-cannabinoid beverage must post in each location for which he has obtained a permit a sign with the following words printed thereon:  "The possession of beer, wine, hemp-cannabinoid beverage, or alcoholic liquors, by a person under twenty-one years of age is a criminal offense under the laws of this State, and it is also unlawful for a person to knowingly give false information concerning his age for the purpose of purchasing beer, wine, hemp-cannabinoid beverage or liquor".  The department must prescribe by regulation the size of the lettering and the location of the sign on the seller's premises.

    A retail seller of beer or wine or hemp-cannabinoid beverage who fails to display the sign required by this section is guilty of a misdemeanor and, upon conviction, must be fined not more than one hundred dollars or imprisoned for not more than thirty days.

    A person found guilty of a violation of Section 61-6-1530 and this section may not be sentenced under both sections for the same offense.

 

Section 61-4-90 of the S.C. Code is amended to read:

 

    Section 61-4-90. (A) It is unlawful for a person to transfer or give to a person under the age of twenty-one years for the purpose of consumption of beer or wine or hemp-cannabinoid beverage in the State, unless the person under the age of twenty-one is recruited and authorized by a law enforcement agency to test a person's compliance with laws relating to the unlawful transfer or sale of beer and wine or hemp-cannabinoid beverage to a minor. A person who violates this section is guilty of a misdemeanor and, upon conviction:

       (1) for a first offense, must be fined not less than two hundred dollars nor more than three hundred dollars or imprisoned not more than thirty days, or both;  and

       (2) for a second or subsequent offense, must be fined not less than four hundred dollars nor more than five hundred dollars or imprisoned not more than thirty days, or both.

    (B) A person found guilty of a violation of Section 61-6-4070 and this section may not be sentenced under both sections for the same offense.

    (C) The provisions of this section do not apply to a:

       (1) spouse over the age of twenty-one giving beer or wine to his spouse under the age of twenty-one in their home;

       (2) parent or guardian over the age of twenty-one giving beer or wine to his children or wards under the age of twenty-one in their home;  or

       (3) person giving beer or wine to another person under the age of twenty-one in conjunction with a religious ceremony or purpose if the beer or wine or hemp-cannabinoid beverage was lawfully purchased.

    (D) A person eighteen years of age and over lawfully employed to serve or remove beer, wine, or alcoholic beverages in establishments licensed to sell these beverages are not considered to be in unlawful possession of the beverages during the course and scope of their duties as an employee. The provisions of this subsection do not affect the requirement that a bartender must be at least twenty-one years of age.

    (E) This section does not apply to an employee lawfully engaged in the sale or delivery of these beverages in an unopened container.

    (F) The provisions of this section do not apply to a student who:

       (1) is eighteen years of age or older;

       (2) is enrolled in an accredited college or university and a student in a culinary course that has been approved through review by the State Commission on Higher Education;

       (3) is required to taste, but not consume or imbibe, any beer, ale, porter, wine, or other similar malt or fermented beverage as part of the required curriculum;  and

       (4) tastes a beverage pursuant to item (3) only for instructional purposes during classes that are part of the curriculum of the accredited college or university.

    The beverage must remain at all times in the possession and control of an authorized instructor of the college or university who must be twenty-one years of age or older. Nothing in this subsection may be construed to allow a student under the age of twenty-one to receive any beer, ale, porter, wine, or other similar malt or fermented beverage unless the beverage is delivered as part of the student's required curriculum and the beverage is used only for instructional purposes during classes conducted pursuant to the curriculum.

 

Section 61-4-100 of the S.C. Code is amended to read:

 

    Section 61-4-100.  (A) If a person is charged with a violation of the unlawful sale of beer or wine or hemp-cannabinoid beverage to minors pursuant to Section 61-4-50, the minor also must be charged with a violation of the unlawful purchase or possession of beer or wine or hemp-cannabinoid beverage pursuant to Section 63-19-2440. In addition, if the minor violated false information as to age pursuant to Section 61-4-60 or if an adult violated the unlawful purchase of beer or ,wine, hemp-cannabinoid beverage for a person who cannot lawfully buy pursuant to Section 61-4-80, these persons also must be charged with their violations.

    (B) A person may not be charged with a violation of Section 61-4-50 if the provisions of subsection (A) are not met.

    (C) Nothing in this section requires that charges made pursuant to this section be prosecuted to conclusion;  but rather this determination must be made in the manner provided by law.

    (D) Notwithstanding the provisions of subsections (A) and (B), a person under the age of twenty-one may be recruited and authorized by a law enforcement agency to test an establishment's compliance with laws relating to the unlawful transfer or sale of beer or wine or hemp-cannabinoid beverage to a minor. The testing must be under the direct supervision of a law enforcement agency, and the agency must have the person's parental consent. If the requirements of this subsection are met, a person may be charged with a violation of Section 61-4-50 without the requirement that the minor also be charged.

 

Section 61-4-150 of the S.C. Code is amended to read:

 

    Section 61-4-150.  If beer or wine or hemp-cannabinoid beverage is sold to anyone by a person who does not have a valid license to make the sale, all beer and wine or hemp-cannabinoid beverage found on the premises of the person is contraband and must be seized by a peace officer and treated as contraband liquor.

 

Section 61-4-200 of the S.C. Code is amended to read:

 

    Section 61-4-200.  Notwithstanding any other provision of law, a holder of a retail permit to sell beer and wine or hemp-cannabinoid beverage may transfer beer and wine or hemp-cannabinoid beverage to other businesses.  In order for this transfer to be lawful, all businesses involved in the transfer must hold a retail beer and wine permit or retail hemp-cannabinoid beverage permit issued to the same individual, partnership, or corporation.  In addition, a particular brand of beer may be transferred only between retail stores located within the territorial restrictions described in the distribution agreement between the brewery and the wholesaler on file with the department pursuant to Section 61-4-1300.  Transfers of beer and wine or hemp-cannabinoid beverage between retail beer and wine or hemp-cannabinoid beverage locations in a manner not authorized by this section, purchase of beer or wine by a retailer from another retailer for the purpose of resale, and sale of beer or wine or hemp-cannabinoid beverage by a retailer to a retailer for the purpose of resale are unlawful.  A person who violates the provisions of this section is guilty of a misdemeanor and, upon conviction, must be fined not more than two hundred dollars.

 

Section 61-4-210 of the S.C. Code is amended to read:

 

    Section 61-4-210.  (A) A person who purchases or acquires by lease, inheritance, divorce decree, eviction, or otherwise a retail business which sells beer or wine or hemp-cannabinoid beverage  from a holder of a retail permit to sell beer or wine or hemp-cannabinoid beverage at the business, upon initiating the application process for a biennial retail beer or beer and wine permit or retail hemp-cannabinoid beverage permit, may be issued a temporary retail beer or beer and wine permit or retail hemp-cannabinoid beverage permit  by the department at the time of the purchase or acquisition if the location for which the temporary permit is sought is not considered by the department to be a public nuisance and:

       (1) the applicant currently holds a valid beer or beer and wine permit or retail hemp-cannabinoid beverage permit;  or

       (2) the applicant has had a criminal history background check conducted by the division within the past thirty days.

    (B) A temporary beer or beer and wine or hemp-cannabinoid beverage permit issued pursuant to subsection (A) is valid until a biennial retail beer or , beer and wine, or hemp-cannabinoid beverage  permit is approved or disapproved by the department, but in no case is it valid for more than one hundred twenty days from the date of issuance.

    (C) Notwithstanding subsection (B), the department may revoke a temporary retail beer or, beer and wine, hemp-cannabinoid beverage permit if the applicant fails to pursue the biennial retail beer or , beer and wine, or hemp-cannabinoid beverage permit in a timely manner, as set forth by regulation of the department.

    (D) The department shall collect a fee of twenty-five dollars for each temporary beer or, beer and wine, or hemp-cannabinoid beverage permit. The funds generated by this fee must be deposited in the general fund of the State.

 

Section 61-4-230 of the S.C. Code is amended to read:

 

    Section 61-4-230.  A person who, upon demand of an officer or agent of the division:

    (1) refuses to allow full inspection of the premises or any part of the premises which is licensed to sell beer or wine or hemp-cannabinoid beverage;  or

    (2) refuses to allow full inspection of the stocks and invoices of the licensee;  or

    (3) who prevents or in any way hinders an inspection is guilty of a misdemeanor and, upon conviction, must be fined not more than two hundred dollars or imprisoned for not more than sixty days, or both.

    A person found guilty of a violation of Section 61-6-4190 and this section may not be sentenced under both sections for the same offense.

 

Section 61-4-300 of the S.C. Code is amended to read:

 

    Section 61-4-300.  "Producer" as used in this article means:

       (1)  a brewery or winery or a manufacturer, bottler, or importer of beer or wine into the United States.; or

       (2) as used in this chapter, includes a manufacturer, a bottler, or importer of hemp-cannabinoid beverages into the United States.

 

Section 61-4-310 of the S.C. Code is amended to read:

 

    Section 61-4-310.  (A) A producer must apply to the department on forms the department prescribes for a certificate of registration, which must be approved and issued before the shipment of beer or wine or hemp-cannabinoid beverage by the producer to a point within the State.  A producer, at the same time application is made for a certificate of registration, must remit to the department a fee of two hundred dollars.

    (B) The department, in its discretion upon consideration of the information contained in the application for a certificate of registration, must issue or reject the application.

    (C) A certificate of registration is valid from the date of issue until the second August thirty-first after the issuance of the license.  Beer and wine and hemp-cannabinoid beverage wholesalers must purchase beer, ale, or wine, or hemp-cannabinoid beverage from manufacturers or importers who hold a certificate of registration issued by the department.  Nothing in this section or Section 61-4-940 prohibits the transfer or purchase and sale, for resale to retailers only, between wholesalers authorized by the registered producer or an exclusive agent in the State to distribute the same brand or brands of wine, beer, or ale, or hemp-cannabinoid beverage.

 

Section 61-4-340 of the S.C. Code is amended to read:

 

    Section 61-4-340.  No person other than a registered producer may ship, move, or cause to be shipped or moved, beer, ale, porter, malt beverage, or wine, or hemp-cannabinoid beverage from outside the State to a point in the State, and only in accordance with the provisions of this chapter.  No brand may be registered by the producer unless the person registering the brand is either the American producer or the primary American source of supply in the United States of the brand as herein defined, and it is unlawful for a wholesaler in this State to order, purchase, or receive beer, ale, porter, malt beverage, or wine, or hemp-cannabinoid beverage from a producer who is not the primary American source of supply for the brand ordered, purchased, or received.  The term primary American source of supply means the manufacturer, distiller, vintner, brewer, producer, winery, or owner of vinous or spirituous beverages at the time they become a marketable product, or bottler, or the exclusive agent of these persons, who, if the product cannot be secured directly from the manufacturer by an American distributor, is the source closest to the manufacturer in the channel of commerce from whom the product can be secured by an American distributor, or who, if the product can be secured directly from the manufacturer by an American distributor, is the manufacturer.  The provisions of this section do not apply to a person who produces beer, ale, porter, malt beverage, or wine solely in this State and who subsequently ships or sells this beer, ale, porter, malt beverage, or wine solely in this State.

 

Section 61-4-350 of the S.C. Code is amended to read:

 

    Section 61-4-350.  Beer or wine or hemp-cannabinoid beverages shipped or moved into this State in violation of this chapter is contraband and may be seized and sold as provided in Section 61-6-4310.

 

Section 61-4-520 of the S.C. Code is amended to read:

 

    Section 61-4-520.  A retail permit authorizing the sale of beer or wine or hemp-cannabinoid beverage must not be issued unless:

    (1) The applicant, a partner, or co-shareholder of the applicant, and each agent, employee, and servant of the applicant to be employed on the licensed premises are of good moral character.

    (2) The applicant is a legal resident of the United States, has been a legal resident of this State for at least thirty days before the date of application, and has maintained his principal place of abode in the State for at least thirty days before the date of application.

    (3) The applicant, within two years before the date of application, has not had revoked a beer or, a wine, or hemp-cannabinoid beverage permit issued to him.

    (4) The applicant is twenty-one years of age or older.

    (5) The location of the proposed place of business of the applicant is in the opinion of the department a proper one.

    (6) The department may consider, among other factors, as indications of unsuitable location, the proximity to residences, schools, playgrounds, and churches.  This item does not apply to locations licensed before April 21, 1986.

    (7)(a) Notice of application has appeared at least once a week for three consecutive weeks in a newspaper most likely to give notice to interested citizens of the county, city, or community in which the applicant proposes to engage in business.  The department shall determine which newspapers meet the requirements of this section based on available circulation figures.   However, if a newspaper is published in the county and historically has been the newspaper where the advertisements are published, the advertisements published in that newspaper meet the requirements of this section.  The notice must:

           (i) be in the legal notices section of the newspaper or an equivalent section if the newspaper has no legal notices section;

           (ii) be in large type, covering a space of one column wide and at least two inches deep;  and

           (iii) state the type license applied for and the exact location of the proposed business.

       (b) An applicant for a beer or wine permit, a hemp-cannabinoid license, and an alcoholic liquor license may use the same advertisement for both if the advertisement is approved by the department.

    (8) Notice has been given by displaying a sign for fifteen days at the site of the proposed business.  The sign must:

       (a) state the type of permit sought;

       (b) state where an interested person may protest the application;

       (c) be in bold type;

       (d) cover a space at least twelve inches high and eighteen inches wide;

       (e) be posted and removed by an agent of the division.

 

Section 61-4-525 of the S.C. Code is amended to read:

 

    Section 61-4-525.  (A) A person residing in the county in which a retail beer and wine permit or a retail hemp-cannabinoid beverage license is requested to be granted, or a person residing within five miles of the location for which a retail beer and wine permit or a retail hemp-cannabinoid beverage license is requested, may protest the issuance or renewal of the permit if he files a written protest setting forth:

       (1) the name, address, and telephone number of the person filing the protest;

       (2) the name of the applicant for the permit and the address of the premises sought to be licensed, or the name and address of the permit holder if the application is for renewal;

       (3) the specific reasons why the application should be denied;  and

       (4) whether or not he wishes to attend a contested case hearing before the Administrative Law Court.

    (B) Upon receipt of a timely filed protest, the department shall determine the protestant's intent to attend a contested hearing before the Administrative Law Court. If the protestant intends to attend a contested hearing, the department may not issue the permanent permit but shall forward the file to the Administrative Law Court.

    (C) If the protestant, during the investigation expresses no desire to attend a contested hearing and offer testimony, the protest is considered invalid, and the department shall continue to process the application and shall issue the permit if all other statutory requirements are met.

    (D) A person who files a protest and fails to appear at a hearing after affirming a desire to attend the hearing may be assessed a fine or penalty to include court costs.

 

Section 61-4-530 of the S.C. Code is amended to read:

 

    Section 61-4-530.  In considering an application for a permit for the sale of beer or wine or hemp-cannabinoid beverage at a location within five miles of a political subdivision of another state in which the sale of beer or, wine, or hemp-cannabinoid beverage is prohibited, the department must, in addition to the factors required to be considered, consider the proximity of the location to the prohibited area, the likelihood that large crowds may gather from time to time with attendant breaches of the peace, the requirement of increased law enforcement officers, and any other factor which in its judgment should be considered before issuing the permit.

    These special considerations, however, do not apply where the application is made with respect to a location within the corporate limits of a municipality.

 

Section 61-4-590 of the S.C. Code is amended to read:

 

    Section 61-4-590.  (A) The department has jurisdiction to revoke or suspend permits authorizing the sale of beer or wine or hemp-cannabinoid beverage. The department may, on its own initiative or on complaint signed and sworn to by two or more freeholders resident for the preceding six months in the community in which the licensed premises are located or by a local peace officer, all of whom are charged with the duty of reporting immediately to the department a violation of the provisions of Section 61-4-580, revoke or suspend the permit pursuant to the South Carolina Revenue Procedures Act. The decision of the Administrative Law Court is not automatically superseded or stayed by the filing of a petition for judicial review.

    (B) In addition to the notice requirements contained in the Administrative Procedures Act, the department may not suspend or revoke a licensee's permit authorizing the sale of beer or wine or hemp-cannabinoid beverage until the division has conducted and completed an investigation, and the department has made a departmental determination, as defined in Section 12-60-30, that the licensee's permit should be revoked or suspended.

 

Section 61-4-600 of the S.C. Code is amended to read:

 

    Section 61-4-600.  Upon the revocation, cancellation, or suspension of a license or permit to sell beer or wine or hemp-cannabinoid beverage at wholesale or retail, the licensee must immediately surrender his license to the department.  A person who violates this section is guilty of a misdemeanor and, upon conviction, must be fined not less than twenty dollars nor more than one hundred dollars or imprisoned for not less than ten days nor more than thirty days, or both, in the discretion of the court.

 

Section 61-4-942 of the S.C. Code is amended to read:

 

    Section 61-4-942.  Notwithstanding any existing beer distribution agreement to the contrary, a manufacturer, brewer, or importer of beer shall not:

    (1) coerce or require a wholesaler to gather or submit sales records, retail placement, price, discount, rebate, or other details for beer brands not manufactured, brewed, or imported by the manufacturer, brewer, or importer;

    (2) mandate wholesaler employee hiring decisions or payment rates, including incentives;

    (3) require a wholesaler to pay or contribute marketing, advertising, or other funds for control or expenditure by the manufacturer, brewer, or importer, except a wholesaler may agree, in writing and in advance of the payment or contribution, to spend or contribute wholesaler funds for a specified marketing or advertising plan or opportunity;

    (4) ship, invoice, or initiate an electronic funds transfer payment for any quantity of beer exceeding any order or forecast submitted by a wholesaler, or include in a beer sales invoice charges for any items other than beer, freight, fuel, cooperage, dunnage, pallets, and related deposits;

    (5) invoice or initiate electronic funds transfer payment for point-of-sale advertising specialties or other items, except a manufacturer, brewer, or importer may place an order and invoice or initiate an electronic funds transfer payment for point-of-sale advertising specialties or other items pursuant to a specific written agreement between the wholesaler and the manufacturer, brewer, or importer made prior to the placement of an order;

    (6) attribute risk of loss, ownership or other financial interest to a wholesaler for beer not in the wholesaler's possession;  or

    (7) require a wholesaler to pay for development, installation, or use of any software owned or mandated by the manufacturer, brewer, or importer, except a wholesaler may be required to maintain data in a format compatible with data format standards adopted by a manufacturer, brewer, or importer.

 

Section 61-4-1100 of the S.C. Code is amended to read:

 

    Section 61-4-1100. (1) It is unlawful for a producer who holds a certificate of registration from the department (hereinafter "registered producer") or an officer, agent, or representative of a registered producer:

       (a) to coerce, attempt to coerce, or persuade a person holding a permit to sell beer, ale, porter, hemp-cannabinoid beverage, and other similar malt or fermented beverages at wholesale (hereinafter "beer wholesaler") to enter into an agreement to take any action which would violate a provision of this article or any ruling or regulation in accordance therewith;  or

       (b) to unfairly, without due regard to the equities of the beer wholesaler or without just cause or provocation, cancel or terminate a written or oral agreement or contract, franchise, or contractual franchise relationship of the wholesaler existing on May 1, 1974, or thereafter entered into, to sell beer manufactured by the registered producer;  this provision is a part of a contractual franchise relationship, written or oral, between a beer wholesaler and a registered producer doing business with the beer wholesaler, just as though the provision had been specifically agreed upon between the beer wholesaler and the registered producer.  However, notice of intention to cancel the agreement or contract, written or oral, franchise, or contractual franchise relationship must be given in writing at least sixty days before the date of the proposed cancellation or termination.  The notice must contain (i) assurance that the agreement or contract, written or oral, franchise, or contractual franchise relationship is being terminated in good faith and for material violation of one or more provisions which are relevant to the effective operation of the agreement, or contract, written or oral, franchise, or contractual franchise relationship, if any, and (ii) a list of the specific reasons for the termination or cancellation.

    (2) It is unlawful for a beer wholesaler:

       (a) to enter into an agreement or take any action which would violate or tend to violate a provision of this article or any rule or regulation promulgated pursuant thereto;

       (b) to unfairly, without due regard for the equities of a registered producer or without just cause or provocation, cancel or terminate a written or oral agreement or contract, franchise, or contractual franchise relationship of the registered producer existing on May 1, 1974, or thereafter entered into, to sell beer manufactured by the registered producer;  this provision becomes a part of a contractual franchise relationship, written or oral, between a beer wholesaler and a registered producer doing business with the beer wholesaler, just as though this provision had been specifically agreed upon between the beer wholesaler and the registered producer.  However, notice of intention to cancel the agreement or contract, written or oral, franchise, or contractual franchise relationship must be given in writing at least sixty days prior to the date of the proposed cancellation or termination.  The notice must contain (i) assurance that the agreement or contract, written or oral, franchise, or contractual franchise relationship is being terminated in good faith and for material violation of one or more provisions which are relevant to the effective operation of the agreement or contract, written or oral, franchise, or contractual franchise relationship, if any, and (ii) a list of the specific reasons for the termination or cancellation;

       (c) to refuse to sell to a licensed retailer whose place of business is within the geographical limits specified in a distributorship agreement between the beer wholesaler and the registered producer for the brands involved;  or

       (d) to store or warehouse beer or other malt beverages to be sold in the State in a warehouse located outside the State.

 

SECTION 8.  Section 61-6-20(1)(a) of the S.C. Code is amended to read:

 

    Section 61-6-20. As used in the ABC Act, unless the context clearly requires otherwise:

    (1)(a) "Alcoholic liquors" or "alcoholic beverages" means any hemp-cannabinoid beverage that contains more than five milligrams of allowable THC concentration but not more than ten milligrams of allowable THC concentration, spirituous malt, vinous, fermented, brewed (whether lager or rice beer), or other liquors or a compound or mixture of them, including, but not limited to, a powdered or crystalline alcohol, by whatever name called or known, which contains alcohol and is used as a beverage for human consumption, but does not include:

           (i) wine when manufactured or made for home consumption and which is not sold by the maker of the wine or by another person;  or

           (ii) a beverage declared by statute to be nonalcoholic or nonintoxicating.

       (b) "Alcoholic liquor by the drink" or "alcoholic beverage by the drink" means a drink poured from a container of alcoholic liquor, excluding hemp-cannabinoid beverage, without regard to the size of the container for consumption on the premises of a business licensed pursuant to Article 5 of this chapter.

       (c) "Powdered or crystalline alcohol" means a powdered or crystalline product prepared or sold for either direct use or reconstitution for human consumption that contains any amount of alcohol when hydrolyzed.

 

SECTION 9.  Section 61-6-100 of the S.C. Code is amended to read:

 

    Section 61-6-100.  Except as otherwise provided, the department has sole and exclusive power to suspend and revoke all licenses provided for in the ABC Act.  The department may issue, subject to revocation, the following licenses under this article:

    (1) manufacturers' licenses which authorize the licensees to manufacture alcoholic liquors and to sell and deliver or ship them, in accordance with regulations, in bottles or in similar closed containers to a person in this State who has a wholesaler's license issued under this article, and in barrels, bottles, or other closed containers to persons outside this State.  However, no deliveries or shipments may be made into another state whose laws prohibit the consignee from receiving or selling alcoholic liquors;

    (2) wholesalers' licenses which authorize the licensees to purchase, store, keep, possess, import into this State, transport, sell, and deliver alcoholic liquors in bottles or similar closed containers, in accordance with regulations, to a person having a manufacturer's or retail dealer's license issued under this article;  and

    (3) retail dealers' licenses which authorize the licensees to purchase alcoholic liquors from wholesalers having licenses issued under this article, and to store, keep, possess, and sell alcoholic liquors at retail for consumption in compliance with the provisions of the ABC Act and regulations not in conflict herewith.

Section 61-6-110 of the S.C. Code is amended to read:

 

    Section 61-6-110.  Unless the department in its discretion otherwise orders, no person is eligible for a license under this article or Article 7 of this chapter if he or the person who will have actual control and management of the business proposed to be operated:

    (1) is less than twenty-one years of age;

    (2) is not a legal resident of the United States and has not been a resident of South Carolina for at least thirty days before the date of application and has maintained his principal place of abode in South Carolina for at least thirty days before the date;

    (3) is not of good repute;  or

    (4) has had a license under this or another statute regulating the manufacture or sale of alcoholic liquors which has been revoked within five years preceding the filing of the application.

 

Section 61-6-120 of the S.C. Code is amended to read:

 

    Section 61-6-120.  (A) The department shall not grant or issue any license provided for in this article, Article 5, or Article 7 of this chapter or Chapter 14 of this title, as applicable to hemp-cannabinoid beverages with an allowable THC concentration of more than five milligrams up to ten milligrams, if the place of business is within three hundred feet of any church, school, or playground situated within a municipality or within five hundred feet of any church, school, or playground situated outside of a municipality. Such distance shall be computed by following the shortest route of ordinary pedestrian or vehicular travel along the public thoroughfare from the nearest point of the grounds in use as part of such church, school, or playground, which, as used herein, shall be defined as follows:

       (1) "church", an establishment, other than a private dwelling, where religious services are usually conducted;

       (2) "school", an establishment, other than a private dwelling, where the usual processes of education are usually conducted;  and

       (3) "playground", a place, other than grounds at a private dwelling, which is provided by the public or members of a community for recreation.

    The above restrictions do not apply to the renewal of licenses and they do not apply to new applications for locations which are licensed at the time the new application is filed with the department.

    (B) An applicant for license renewal or for a new license at an existing location shall pay a five dollar certification fee to determine if the exemptions provided for in subsection (A) apply.

    (C)(1) Notwithstanding the provisions of subsection (A), the department may issue a license so long as any church, school, or playground located within the parameters affirmatively states that it does not object to the issuance of a license. This subsection only applies to a permit for on-premises consumption of alcoholic liquor.

       (2)(a) Any applicant seeking to utilize the provisions of this subsection must provide a statement declaring the church, playground, or school does not object to the issuance of the specific license sought, as follows:

               (i) if a church, from the decision-making body of the local church;

               (ii) if a playground, from the decision-making body of the owner of the playground;

               (iii) if a school, from the local school district board of trustees of the local public school, governing board of the charter school, or governing authority of the private school.

           (b) If more than one church, school, or playground is located within the parameters set forth in subsection (A), the applicant must provide the statement from all churches, schools, or playgrounds.

           (c) At the time of any renewal period for the specific license, a school, from the local school district board of trustees of the local public school, governing board of the charter school, or governing authority of the private school, may withdraw its statement declaring it does not object to the issuance of the specific license sought by notifying the department of its withdrawal.

       (3) The department may promulgate regulations necessary to implement the provisions of this subsection.

 

Section 61-6-185 of the S.C. Code is amended to read:

 

    Section 61-6-185.  (A) A person residing in the county in which a retail liquor license or retail hemp-cannabinoid beverage license is requested to be granted, or a person residing within five miles of the location for which a retail liquor license is requested, may protest the issuance or renewal of the license if he files a written protest providing:

       (1) the name, address, and telephone number of the person filing the protest;

       (2) the name of the applicant for the license and the address of the premises sought to be licensed, or the name and address of the license holder if the application is for renewal;

       (3) the specific reasons why the application should be denied;  and

       (4) whether or not he wishes to attend a contested case hearing before the Administrative Law Court.

    (B) Upon receipt of a timely filed protest, the department shall determine the protestant's intent to attend a contested hearing before the Administrative Law Court. If the protestant intends to attend a contested hearing, the department may not issue the permanent license but shall forward the file to the Administrative Law Court.

    (C) If the protestant during the investigation expresses no desire to attend a contested hearing and offer testimony, the protest is deemed invalid, and the department shall continue to process the application and shall issue the license if all other statutory requirements are met.

    (D) A person who files a protest and fails to appear at a hearing after affirming a desire to attend the hearing may be assessed a penalty to include court costs.

 

Section 61-6-505 of the S.C. Code is amended to read:

 

    Section 61-6-505.  (A) A person who purchases or acquires by lease, inheritance, divorce decree, eviction, or otherwise a retail business which sells alcoholic beverages from a holder of a retail liquor license or a hemp-cannabinoid beverage retail license at the business, upon initiating the application process for a permanent retail liquor license, may be issued a temporary retail liquor license by the department at the time of the purchase or acquisition if the location for which the temporary license is sought is not considered by the department to be a public nuisance and:

       (1) the applicant currently holds a valid retail liquor license, and a retail hemp-cannabinoid beverage license, as applicable;  or

       (2) the applicant has had a criminal history background check conducted by the State Law Enforcement Division within the past thirty days.

    (B) A temporary license issued pursuant to subsection (A) is valid until a permanent license is approved or disapproved by the department, but in no case is it valid for more than one hundred twenty days from the date of issuance.

    (C) Notwithstanding subsection (B), the department may revoke a temporary license if the applicant fails to pursue the permanent license in a timely manner, as set forth by the department by regulation.

    (D) The department shall collect a fee of twenty-five dollars for each temporary license sought. The funds generated by this fee must be deposited in the general fund of the State.

 

Section 61-6-900 of the S.C. Code is amended to read:

 

    Section 61-6-900.  In the event of a licensee's death, except in the case of a license issued to more than one person, the personal representative of the deceased licensee may, with the consent of the probate court and upon permit of the department, continue the operation of the business covered by the license.  If the personal representative elects to discontinue the business or if the department does not issue a permit for its continuance, the unearned portion of the license tax, computed on the basis of the cost of the license per month for the period for which the license was issued, must be refunded to the personal representative.  Alcoholic liquors, including hemp-cannabinoid beverages, of the deceased which are subject to the control of the personal representative may be sold by him as provided in Section 61-6-950.

 

Section 61-6-910 of the S.C. Code is amended to read:

 

    Section 61-6-910.  The department must refuse to issue any license under this article or Article 7 of this chapter or Chapter 14 if the department is of the opinion that:

    (1) the applicant is not a suitable person to be so licensed;

    (2) the store or place of business to be occupied by the applicant is not a suitable place;  or

    (3) a sufficient number of licenses have already been issued in the State, incorporated municipality, unincorporated community, or other community.

 

Section 61-6-4000 of the S.C. Code is amended to read:

 

    Section 61-6-4000. This article, except Section 61-6-4720, is complementary to and not in conflict with the laws providing for the lawful sale of beer, hemp-cannabinoid beverages, wines, and other vinous, fermented, or malt liquors.

 

SECTION 10. Title 61 of the S.C. Code is amended by adding:

 

CHAPTER 14

 

Hemp-Cannabinoid Beverages

 

Article 1

 

Definitions

 

    Section 61-14-10.  For the purposes of this chapter:

    (1) "Allowable THC concentration" means the total naturally derived delta-9 THC concentration of not more than 5 mg on a liquid weight basis in a twelve-ounce serving container or more than five milligrams but not more than 10 mg on a liquid weight basis per serving, which can be up to one and of an ounce, in a 750 mL container.

    (2) "Batch" means a specific quantity of a specific product containing cannabinoids, which is manufactured at the same time and use the same methods, equipment, and ingredients that are uniform and intended to meet specifications for identity, strength, purity, and composition; and is manufactured, packaged, and labeled according to a single-batch production record executed and documented.

    (3) "Cannabinoids" means any compounds that bind to cannabinoid receptors derived from hemp.

    (4) "Certificate of analysis" means a document issued by an independent testing laboratory, which provides information about the chemical composition of a particular batch of a hemp-cannabinoid beverage.

    (5) "Department" means the South Carolina Department of Revenue.

    (6) "Division" means the State Law Enforcement Division.

    (7) "Hemp" has the same meaning as Section 46-55-10(12).

    (9) "Hemp-cannabinoid beverage", which is a chemically intoxicating beverage subject to the exercise of the police power of the General Assembly, pursuant to Section 1, Article VIII-A of the South Carolina Constitution. "Hemp-cannabinoid beverages" may not contain beer, wine, or liquor, and may not contain more than the allowable THC concentration, and must be sold:

       (a) as a single serving in twelve-ounce cans or bottles, or

       (b) as no more than seventeen servings with a total of 170 mg of THC in a single 750-milliliter bottle.

    (10) "Manufacture" or "produce" means to compound, blend, extract, infuse, cook, or otherwise make or prepare hemp-cannabinoid beverages, including the process of extraction, infusion, packaging, repackaging, labeling, and relabeling of hemp-cannabinoid beverages.

    (11) "Manufacturer" means a person or entity who produces hemp-cannabinoid beverages for consumption and not for resale, including compounding, blending, extracting, infusing, cooking, packaging, labeling, or otherwise making or preparing hemp-cannabinoid beverages.

    (12) "Producer" as used in this chapter includes a manufacturer, a bottler, or importer of hemp-cannabinoid beverages into the United States.

    (13) "Proof of age" means a valid driver's license or other government-issued identification card that contains a photograph of the person and confirms the person's age is twenty-one years or older.

    (14) "Retailer" means a person or entity that sells hemp-cannabinoid beverages for consumption and not for resale and is a holder of a license issued under the provisions of this chapter, other than a manufacturer or wholesaler.

    (15) "Retail establishment" means a place of business open to the general public for the sale of goods or services.

    (16) "Serving" means a hemp-cannabinoid beverage containing either:

       (a) twelve fluid ounces in a single serving container; or

       (b) no more than one and one-half fluid ounces in a 750-milliliter bottle.

    (17) "THC" means tetrahydrocannabinol.

    (18) "Wholesaler" means a person who purchases, acquires, or imports from outside this State or who purchases or acquires from a manufacturer or producer in the State hemp-cannabinoid beverages, hemp-cannabinoid ingestible products, or both for resale.

 

Article 3

 

Enforcement

 

    Section 61-14-300. (A) The functions, duties, and powers set forth in this chapter are vested in the department and the division. The department must administer the provisions of this chapter, and the Division must enforce the provisions of this chapter.

    (B) All hemp-cannabinoid beverages distributed into or within the State and offered for sale and sold to consumers in this State must be governed by this chapter, and where applicable Chapter 4, for hemp-cannabinoid beverages containing up to but no more than five milligrams an allowable THC concentration and Chapter 6, for hemp cannabinoid beverages containing more than five milligrams but no more than ten milligrams of an allowable THC concentration.

    (C) Any hemp-cannabinoid beverage possessed, distributed, sold, or offered for sale to consumers in this State in violation of this article must be considered contraband and must be seized by law enforcement as provided for by law.

    (D) The department shall administer the provisions of this chapter related to the licensing and taxation of hemp-cannabinoid beverages.

    (E) The division is vested with the enforcement of this chapter.

    (F) The department and the division are authorized to promulgate regulations necessary to carry out the duties imposed upon them by law for the proper administration and enforcement of, and consistent with, this chapter, including but not limited to:

       (1) regulations for the application and issuance of hemp-cannabinoid beverage licenses;

       (2) regulations to prevent the unlawful manufacture, bottling, packaging, sale, distribution, transportation, and importation of hemp-cannabinoid beverages;

       (3) regulations necessary to effect an equitable distribution of hemp-cannabinoid beverages in this State;

       (4) regulations for the analysis of hemp-cannabinoid beverages sold in this State and for a procedure for obtaining the samples for this purpose;

       (5) regulations governing the administration and enforcement of provisions relating to producers and wholesalers of hemp-cannabinoid beverages; and

       (6) regulations for the application for and issuance of hemp-cannabinoid licenses and the sale, distribution, promotion, and shipment of hemp-cannabinoid beverages into and within this State.

 

    Section 61-14-310. The division has the exclusive authority to enforce the provisions of this chapter in a manner that may reasonably be expected, and shall conduct random, unannounced inspections of locations where such products are manufactured, produced, sold, or distributed to ensure compliance with this chapter.

 

    Section 61-14-320. (A) It is unlawful for a person to knowingly sell or distribute hemp-cannabinoid beverages to a person who is under twenty-one years of age or to purchase hemp-cannabinoid beverages on behalf of a person who is under twenty-one years of age.

    (B) A person who violates this section:

       (1) for a first offense within a three-year period, is guilty of a misdemeanor and, upon conviction, must be imprisoned not more than two years, or fined not more than five thousand dollars, or both;

       (2) for a second offense within a three-year period, is guilty of a felony and, upon conviction, must be imprisoned not more than five years or fined not more than ten thousand dollars, or both; and

       (3) for a third or subsequent offense within a three-year period, is guilty of a felony and, upon conviction, must be imprisoned for not more than five years or fined not more than ten thousand dollars, or both, and the licensee is subjected to revocation by the Department of all licenses under Title 61.

    (C)(1) It is unlawful for a person under the age of twenty-one to purchase, attempt to purchase, consume, or knowingly possess hemp-cannabinoid beverages. Possession is prima facie evidence that it was knowingly possessed. It is also unlawful for a person to falsely represent his age for the purpose of procuring hemp-cannabinoid beverages.

       (2) A person who violates the provisions of this subsection is guilty of a misdemeanor and, upon conviction, must be fined not less than one hundred dollars nor more than two hundred dollars or must be imprisoned for not more than thirty days, or both.

    (D) The manufacture, production, distribution, importation, sale or possession of a hemp-cannabinoid beverage containing more than the allowable THC concentration is prohibited by law and punishable in the same manner as marijuana pursuant to Sections 44-53-190 and 44-53-370.

    (E) A person who is charged with a violation of this section may avail themselves of any affirmative defenses, diversion programs, conditional discharge provisions, intervention programs, or similar alternatives to conviction and sentencing that are provided by law and would be available to a person charged with a similar violation involving alcoholic liquor.

 

    Section 61-14-330. (A) A person engaged in the business of selling retail hemp-cannabinoid beverages must post in each location that he has obtained a license, a sign with the following words printed: "The possession of hemp-cannabinoid beverages by a person under twenty-one years of age is a criminal offense under the laws of this State, and it also is unlawful for a person to knowingly give false information concerning his age for the purpose of possessing or acquiring hemp-cannabinoid beverages." The department shall proscribe by regulation the size of the lettering and the location of the sign on the seller's premises.

    (B) A retail seller of hemp-cannabinoid beverages who fails to display the sign required by this section is guilty of a misdemeanor and, upon conviction, must be fined not more than one hundred dollars or imprisoned for not more than thirty days.

 

    Section 61-14-340. (A) This article does not permit a person to:

       (1) undertake any task under the influence of hemp-cannabinoid beverages when doing so would constitute negligence or professional malpractice; or

       (2) operate, navigate, or be in actual physical control of a motor vehicle, aircraft, motorized watercraft, or any other vehicle while under the influence of a hemp-cannabinoid beverage.

    (B) This article does not exempt a person from prosecution for a criminal offense related to impairment or intoxication resulting from the use of hemp-cannabinoid beverages or relieve a person from any requirement under the law to submit to a breath, blood, urine, oral swab, or other test to detect the presence of a controlled substance.

 

    Section 61-14-350. It is unlawful for a person to have in his possession, except in the trunk or luggage compartment, a hemp-cannabinoid beverage in an open container in a motor vehicle of any kind while located upon the public highways or highway rights-of-way of this State. This section must not be construed to prohibit the transporting of hemp-cannabinoid beverage in a closed container in the trunk or luggage compartment, and this section does not apply to vehicles parked in legal parking places during functions such as sporting events where law enforcement officers are on duty to perform traffic control duties. A person who violates the provisions of this section is guilty of a misdemeanor and, upon conviction, must be fined not more than one hundred dollars or imprisoned for not more than thirty days.

 

    Section 61-14-360. (A) For purposes of this section:

       (1) it is unlawful to sell hemp-cannabinoid beverages in bottles from liquor stores on Sundays, on Christmas Day, or during periods proclaimed by the Governor in the interest of law and order or public morals and decorum. Full authority to proclaim these periods is conferred upon the Governor in addition to all other powers conferred upon the Governor.

       (2) For purposes of this chapter, a permit authorized by this section to sell hemp-cannabinoid beverages with an allowable THC concentration of five milligrams or less, may be issued only in those counties or municipalities where a majority of the qualified electors voting in a referendum vote in favor of the issuance of the permit for retail sales of hemp-cannabinoid beverages on Sundays in retail stores. The county or municipal election commission, as the case may be, shall conduct a referendum upon petition of at least ten percent but not more than seven thousand five hundred qualified electors of the county or municipality, as the case may be. The petition form must be submitted to the election commission not less than one hundred twenty days before the date of the referendum. The names on the petition must be on the petition form provided to county election officials by the State Election Commission. The names on the petition must be certified by the election commission within sixty days after receiving the petition form. The referendum must be conducted at the next general election. The election commission shall cause a notice to be published in a newspaper circulated in the county or municipality, as the case may be, at least seven days before the referendum. The state election laws shall apply to the referendum, mutatis mutandis. The election commission shall publish the results of the referendum and certify them to the South Carolina Department of Revenue.  

    (B) A person who violates a provision of this section is guilty of a misdemeanor and, upon conviction, must be punished as follows:

       (1) for a first offense, by a fine of two hundred dollars or imprisonment for sixty days;

       (2) for a second offense, by a fine of one thousand dollars or imprisonment for one year; and

       (3) for a third or subsequent offense, by a fine of two thousand dollars or imprisonment for two years.

 

Article 5

 

Product Requirements

 

    Section 61-14-500. (A) A hemp-cannabinoid beverage may not be distributed into or within the State or offered for sale or sold at retail within the State, unless the product:

       (1) has a corresponding certificate of analysis as described in Section 61-14-520, issued by an independent testing laboratory that tests the batch from which the hemp-cannabinoid beverage was produced;

       (2) is in the original sealed container as packaged by the producer and meets the packaging restrictions in Section 61-14-530;

       (3) meets the serving size and product content requirements, including total THC, described in this chapter; and

       (4) meets the labeling requirements described in Section 61-14-540.

    (B) Every manufacturer, producer, importer, and distributor shall maintain and make immediately available for inspection to any law enforcement officer or authorized agent of the department a copy of the certificate of analysis of each hemp-cannabinoid beverage being distributed by a distributor or offered for sale by a retailer.

    (C) Any person, including any servant, agent, or employee of the person who distributes, sells, or offers for sale any hemp-cannabinoid beverage in violation of this section is subject to the following penalties:

       (1) for a first offense within a three-year period, is guilty of a misdemeanor and, upon conviction, must be imprisoned not more than two years, or fined not more than five thousand dollars, or both;

       (2) for a second offense within a three-year period, is guilty of a felony and, upon conviction, must be imprisoned not more than five years or fined not more than ten thousand dollars, or both; and

       (3) for a third or subsequent offense within a three-year period, is guilty of a felony and, upon conviction, must be imprisoned not more than five years or fined not more than ten thousand dollars, or both. A third offense within a three-year period subjects the licensee of the retailer to revocation by the Department of all licenses under Title 61.

 

    Section 61-14-510. For the purpose of protecting the health, safety, and welfare of the residents of this State from dangerous foreign products, an independent testing laboratory must meet all the following requirements:

       (1) accreditation by a third-party accrediting body as a competent testing laboratory pursuant to International Organization for Standardization/International Electrotechnical Commission (ISO/IEC) 17025:2017 of the International Organization for Standardization;

       (2) having no direct or indirect interest in the producer whose product is being tested; and

       (3) having no direct or indirect interest in the facility that cultivates, processes, distributes, or sells hemp-cannabinoid beverages in this State or in another jurisdiction.

 

    Section 61-14-520. (A) The protocols for testing a hemp-cannabinoid beverage by an independent testing laboratory must include the following, as well as a determination of corresponding tolerance limits:

       (1) a cannabinoid profile of content and potency including, but not limited to, all the following:

           (a) total THC (THC+THCA);

           (b) total CBD (CBD+CBDA);

           (c) other detectable cannabinoids; and

           (d) total THC/CBD ratio; if applicable.

       (2) terpene profiles;

       (3) heavy metals including, but not limited to, arsenic, cadmium, mercury, and lead;

       (4) chemical contamination, such as residual solvents remaining after extraction, and concentration;

       (5) microbials including, but not limited to, pathogenic microbials such as E. coli, salmonella, and mold;

       (6) mycotoxins, and

       (7) residual insecticides, fungicides, herbicides, and growth regulators used during cultivation.

    (B) The certificate of analysis must include, at a minimum, all of the following:

       (1) the product name, the manufacturer name and location, and the laboratory name;

       (2) the date the certificate of analysis is issued;

       (3) the method of analysis for each test conducted;

       (4) the batch number or lot number of the product;

       (5) the results of the tolerance limits tested in (A)(1)-(7), including the cannabinoid profile by the percentage of dry weight of CBD and total THC content and verification that the product contains an amount of total THC not exceeding that which is stated on the label of the product;

       (6) a listing of all ingredients for each product, including, if present, solvents, pesticides, microbial contaminants, and heavy metals.

    (C) The manufacturer must include a scannable barcode or quick response code linked to the certificate of analysis on the label on the hemp-cannabinoid beverage container.

 

    Section 61-14-530. (A) Packaging of hemp-cannabinoid beverages:

       (1) may not bear the likeness or contain cartoon-like characteristics of real or fictional persons, animals, or fruits that appeal to children;

       (2) may not be modeled after a brand or products primarily consumed by or marketed to children;

       (3) may not include a statement, artwork, or design that could reasonably appeal to children or mislead an individual to believe that the package contains anything other than a hemp-cannabinoid beverage;

       (4) may not be packaged in any way that violates federal trademark or copyright laws.

    (B) A person who knowingly sells, holds for sale, or distributes a hemp-cannabinoid beverage that violates subsection (A):

       (1) for a first offense within a three-year period, is guilty of a misdemeanor and, upon conviction, must be imprisoned not more than two years, or fined not more than five thousand dollars, or both;

       (2) for a second offense within a three-year period, is guilty of a felony and, upon conviction, must be imprisoned not more than five years or fined not more than ten thousand dollars, or both; and

       (3) for a third or subsequent offense within a three-year period, is guilty of a felony and, upon conviction, must be imprisoned not more than five years or fined not more than ten thousand dollars, or both. A third offense within a three-year period subjects the licensee of the retailer to revocation by the Department of all licenses under Title 61.

 

    Section 61-14-540. Each container of a hemp-cannabinoid beverage must be labeled to include, at a minimum:

       (1) a list of all ingredients in descending order of predominance;

       (2) a scannable barcode or quick response code linked to the certificate of analysis;

       (3) the manufacture location, date of manufacture, and expiration date;

       (4) the batch number, which must correspond to the certificate of analysis;

       (5) the total number of milligrams of all THCs and types of THCs found in the container;

       (6) the serving size;

       (7) the total number of milligrams of all THCs per serving;

       (8) the country of origin of all THCs and cannabinoids found in the container;

       (9) warnings for health and safety concerns regarding:

           (a) hemp-cannabinoid beverage consumption while pregnant or breastfeeding may be harmful;

           (b) consumption of certain cannabinoids may impair your ability to drive or operate heavy machinery;

           (c) keeping products away from children;

           (c) consumption of this product may cause the person to fail a drug test due to the presence of THC;

           (d) the product is not intended for use by anyone under the age of twenty-one; and

           (e) hemp-cannabinoid beverages are not approved for any medical use by the United States Food and Drug Administration.

 

Article 7

 

Licensing; Relationship between Manufacturers, Wholesalers, and Retailers; Taxation

 

    Section 61-14-700. (A)(1) A manufacturer, wholesaler, or retailer of hemp-cannabinoid beverages must be in possession of a valid, applicable hemp-cannabinoid license issued by the department that has sole and exclusive power to issue hemp-cannabinoid licenses.

       (2) A manufacturer, wholesaler, or retailer of hemp-cannabinoid beverages must be in possession of a valid applicable beer and wine or liquor license issued by the department.

    (B) The department may issue, subject to revocation, the following licenses:

       (1) hemp-cannabinoid beverage manufacturer's license, which authorizes the licensee to manufacture hemp-cannabinoid beverages and to sell, deliver, or ship hemp-cannabinoid beverages in accordance with regulations in bottles or cans to a person in this State who has a wholesaler's license issued pursuant to this article and in bottle or cans to person outside this State. However, deliveries or shipments may not be made into another state whose laws prohibit the consignee from receiving or selling hemp-cannabinoid beverages;

       (2) hemp-cannabinoid beverage wholesaler's license, which authorizes the licensee to purchase, store, keep, possess, import into this State, transport, sell, and deliver hemp-cannabinoid beverages in bottles or cans in accordance with regulations to a person having a manufacturer's or retail license issued pursuant to this article; and

       (3) hemp-cannabinoid beverage retail license, which authorizes the licensees to purchase hemp-cannabinoid beverages from wholesalers having licenses issued pursuant to this article, and to store, keep, possess, and sell hemp-cannabinoid beverages at retail.

    (C) The department is authorized to issue, suspend, revoke, renew, or decline to renew hemp-cannabinoid beverage licenses pursuant to Article 3, Chapter 6, Title 61, Sections 61-2-90 through 140, and Section 61-2-260 or to revoke or decline to renew any licenses under Title 61 for violations of this chapter, or both.

 

    Section 61-14-710. (A) A manufacturer of hemp-cannabinoid beverages or a person who imports these beverages produced outside the United States may not sell, barter, exchange, transfer, or deliver for resale hemp-cannabinoid beverages unless the person holds a valid hemp-cannabinoid beverage wholesaler's license, and a holder of a hemp-cannabinoid beverage wholesaler's license may not sell, barter, exchange, transfer, or deliver for resale hemp-cannabinoid beverages to a person who does not have a hemp-cannabinoid beverage manufacturer's, or retailer's license.

    (B)(1) Manufacturers of hemp-cannabinoid beverages containing up to five milligrams of allowable THC concentration are subject to Chapter 4, Title 61 in the same manner and to the same extent as those provisions apply to manufacturers of beer or wine.

       (2) Manufacturers of hemp-cannabinoid beverages containing more than five milligrams but no more than ten milligrams of allowable THC concentration are subject to Chapter 6, Title 61 in the same manner and to the same extent as those provisions apply to manufacturers of alcoholic liquor.

    (C)(1) Wholesalers of hemp-cannabinoid beverages containing up to five milligrams of allowable THC concentration are subject to Chapter 4, Title 61 in the same manner and to the same extent those provisions apply to wholesalers of alcoholic liquor.

       (2) Wholesalers of hemp-cannabinoid beverages containing more than five milligrams but no more than ten milligrams of allowable THC concentration are subject to Chapter 6, Title 61 in the same manner and to the same extent those provisions apply to wholesalers of alcoholic liquor.

       (3) Wholesalers of hemp-cannabinoid beverages must also maintain a wholesaler license issued under Chapter 4 or Chapter 6.

    (D)(1) Retailers of hemp-cannabinoid beverages containing up to five milligrams of allowable THC concentration are subject to Chapter 4 of Title 61, in the same manner and to the same extent those provisions apply to beer and wine; and

       (2) Retailers of hemp-cannabinoid beverages more than five milligrams but no more than ten milligrams of allowable THC concentration are subject to Chapter 6 of Title 61, in the same manner and to the same extent those provisions apply to alcoholic liquor.

       (3) Retailers of hemp-cannabinoid beverages must also maintain a retail license for beer and wine or for alcoholic liquor to be eligible for a hemp-cannabinoid beverage retailer's license in addition to any additional requirements required by the department.

 

    Section 61-14-720. (A) The biennial license taxes on hemp-cannabinoid licenses granted pursuant to this article in addition to all other licenses taxes are as follows:

       (1) manufacturer's license: fifty thousand dollars;

       (2) wholesaler's license: twenty thousand dollars;

       (3) retail license: one thousand two hundred dollars.

    (B) Each applicant shall pay a filing fee of one hundred dollars, which must accompany the initial application for each location and is not refundable.

    (C) A person who applies for a license after the first day of a license period shall pay license fees in accordance with the schedule provided in Section 61-6-1810.

 

    Section 61-14-730. (A) The license tax or taxes imposed on wholesale sales by this section shall, except as otherwise expressly provided, be in addition to all other licenses and taxes levied by law, as a condition precedent to engaging in any business or doing any act taxable under this chapter.

    (B) In addition to all other taxes levied, assessed, collected, and paid in with respect to hemp-cannabinoid beverages, every licensed wholesaler shall be subject to the payment of a tax of six-tenths cents per ounce or fractional quantity thereof on sales of each hemp-cannabinoid beverage sold and containing five (5) milligrams or less of an allowable THC concentration.

    (C) In addition to all other taxes levied, assessed, collected, and paid in with respect to hemp-cannabinoid beverages, every licensed wholesaler shall be subject to the payment of a tax of one hundred two thousandths cents per ounce or fractional quantity thereof on each hemp-cannabinoid beverage sold and containing more than five (5) milligrams of an allowable THC concentration.

    (D) Eleven percent of the excise tax revenues collected pursuant to this section must be placed on deposit with the State Treasurer and credited to a fund separate and distinct from the general fund and distributed pursuant to Chapter 12, Title 61

 

    Section 61-14-740. The tax prescribed in this article must be paid by requiring each wholesaler to make a report to the Department, in the form the department prescribes, of all hemp-cannabinoid beverages sold or disposed of within this State by the wholesaler and to pay the tax due thereon not later than the twentieth of the month following the sale of the hemp-cannabinoid beverages. Any wholesaler who fails to file the report or to pay the tax as prescribed in this section must pay a penalty of one quarter of one percent of the amount of the tax due and unpaid or unreported for each day the tax remains unpaid or unreported. The penalty must be assessed and collected by the Department in the manner as other taxes are assessed and collected. The Department may grant any wholesaler extensions of time for filing the reports and paying the taxes prescribed in this article and no penalties may be assessed or collected to the extent that the extensions of time are granted.

 

    Section 61-14-750. (A) For hemp-cannabinoid beverages containing five milligrams or less of an allowable THC concentration, and under the reporting method of tax payment on such sales of hemp-cannabinoid beverages as prescribed in Section 61-14-730, the Department shall allow a discount of two percent to the wholesaler on the amount of tax reported on each monthly report.

    (B) For hemp-cannabinoid beverages containing more than five milligrams of an allowable THC concentration, and under the reporting method of tax payment on such sales of hemp-cannabinoid beverages as prescribed in Section 61-14-730, the Department shall allow a discount of one percent to the wholesaler on the amount of tax reported on each monthly report.

    (C) In no case shall any discount be allowed if the taxes are not paid in full or if either the report or the taxes are received by the department after the date due, or after the expiration of any extension granted by the department

 

    Section 61-14-760. Every person, firm, corporation, club, or association, or any organization or individual within this State, importing, receiving, or acquiring from without the State or from any other sources whatever, hemp-cannabinoid beverages as defined in this chapter on which the tax imposed by this chapter has not been paid, for use or consumption within the State, shall be subject to the payment of a license tax at the same rates provided in sections 61-14-730 and 61-14-740.

 

    Section 61-14-770. The department may promulgate rules and regulations for the payment and collection of the taxes levied by this article. The administrative provisions of  Article 21, Chapter 21, Title 12 and Articles 3 and 5, Chapter 33, Title 12  wherever applicable, are adopted for the administration and enforcement of the provisions of this article

 

    Section 61-14-780. The department or any agent or representative designated by it for that purpose and all peace officers or police officers of the State may enter upon the premises of any person selling or offering for sale any hemp-cannabinoid beverages without a warrant and examine or cause to be examined any books, records, papers, memoranda or commodities and secure any other information directly or indirectly pertaining to the enforcement of this article.

 

    Section 61-14-790. (A) The cost of supplies and other expenses of the administration of this article shall be paid out of the proceeds derived from the collection of this tax upon warrants drawn by the department upon the State Treasurer.

    (B) The hemp-cannabinoid beverages taxes and license fees provided for by this article must be paid to and collected by the department and deposited to the credit of the general fund of the State, unless otherwise specified by this article.

 

    Section 61-14-800. (A) It is unlawful for a person to sell or permit to be sold hemp-cannabinoid beverages authorized to be sold under this chapter on which taxes levied have not been paid.

       (1) For a first violation of this section, a person is guilty of a misdemeanor and, upon conviction, must be fined not less than twenty dollars nor more than one hundred dollars or imprisoned for not less than ten days nor more than thirty days, in the discretion of the court.

       (2) For a second offense of this section, a person is guilty of a misdemeanor and, upon conviction, must be fined not more than two hundred dollars, imprisoned not more than thirty days, or both.

       (3) For a third or subsequent offense of this section, a person is guilty of a felony and, upon conviction, must be fined not less than five hundred dollars nor more than one thousand dollars, imprisoned for not less than thirty days nor more than sixty days, or both.

    (B) It is unlawful for a person who does not hold a license pursuant to this chapter to sell or permit to be sold hemp-cannabinoid beverages. A person who violates this subsection is guilty of a felony and, upon conviction, must be fined not less than one thousand dollars nor more than two-thousand five hundred dollars or imprisoned for not less than thirty days nor more than sixty days, or both, and is prohibited from being a licensee under any chapter of Title 61.

    (C) Each hemp-cannabinoid beverage sold on which taxes levied have not been paid is a separate offense.

 

Article 9

 

Provisions Affecting Hemp-Cannabinoid Beverages Only

 

    Section 61-14-900. (A) A manufacturer, producer, distributor, wholesaler, and retailer must abide by the regulations of practices between each other, as established in Section 61-4-735 and Section 61-4-940, as applied to hemp-cannabinoid beverages.

    (B) Except as provided in (C), a manufacturer, producer, or wholesaler of hemp-cannabinoid, or a person acting on his behalf, must not give, furnish, rent, lend, or sell, directly or indirectly, to the holder of a hemp-cannabinoid beverage retail license any equipment, fixtures, free hemp-cannabinoid beverages, or service. The holder of a hemp-cannabinoid beverage retail license or a person acting on his behalf may not accept, directly or indirectly, any equipment, fixtures, free hemp-cannabinoid beverages, or service referred to in this subsection from a manufacturer, producer, wholesaler of hemp-cannabinoid beverages, except as provided in (B).

    (C) A wholesaler may furnish at no charge to the holder of a hemp-cannabinoid beverage retail license equipment, replacement parts of nominal value, and product displays as provided under 27 Code of Federal Regulations, Section 6.83, and point of sale advertising specialties. A wholesaler also may furnish the following services to a retailer: rotating stock, affixing price tags to hemp-cannabinoid beverages, building hemp-cannabinoid beverage displays, setting boxes, developing shelf schematics, stocking shelves, and assisting  in hemp-cannabinoid beverage resets at the same rate as beer resets for any store having a retail permit during the hours of 8:00 a.m. to 8:00 p.m. Resets are defined as being a change in the location of the hemp-cannabinoid beverage department within a store or a rearrangement of the products on shelves within the store's hemp-cannabinoid department, which involves more than one wholesaler's products. All wholesalers must be notified in writing of any resets being requested by a retail store at least fourteen days prior to reset.

    (D) Producers, manufacturers, and importers of hemp-cannabinoid beverages are declared to be in business on one tier, a wholesaler on another tier, and a retailer on another tier. For the purposes of this section, a manufacturer or producer of hemp-cannabinoid beverages is declared to be a tier one business, a wholesaler or importer owned solely by a wholesaler is declared to be a tier two business, and a retailer is declared to be a tier three business. A person or entity in the hemp-cannabinoid beverage business on one tier or a person acting directly or indirectly on his behalf may not have ownership or financial interest in a hemp-cannabinoid beverage business operated on another tier.

    (E) A manufacturer, producer, importer, or wholesaler of hemp-cannabinoid beverages may discount product price based on quantity purchases if all discounts are on price only, appear on the sales records, and are available to all retail customers.

    (F) A a person or entity on one tier that has ownership or financial interest on January 1, 2026 in a business that upon the effective date of this section will be an entity on another tier has two years from the effective date of this section to divest the interest in either of the entities so as to only have ownership or financial interest in one tier as described in (D). This section does not exempt any requirements of the three-tier system as described in Title 61. For purposes of this subsection, ownership or financial interest does not include the ownership of less than one percent of the stock in a corporation with a class of voting shares registered with the Securities and Exchange Commission or other federal agency under Section 12 of the Securities and Exchange Act of 1934, as amended, or a consulting agreement under which the consultant has no control over business decisions and whose compensation is unrelated to the profits of the business.

 

    Section 61-14-920. Hemp-cannabinoid beverages in a 750 mL bottle or a single serving can with 10 mg of the allowable THC concentration per serving may be sold only in licensed alcoholic liquor stores.

 

SECTION 11. If the federal government exercises its right to regulate hemp-cannabinoid beverages through prohibition or regulation, then the allowable THC concentration shall be the lesser of either the federally defined THC level for hemp-cannabinoid beverages or delta-9 tetrahydrocannabinol that is not more than three-tenths of one percent on a dry weight basis or more than ten milligrams on a liquid basis.

 

SECTION 12. Pre-existing stock, purchased prior to the effective date of this act, may be sold through November 12, 2026, provided a certificate of analysis is available and sales are prohibited to anyone under the age of twenty-one.

 

SECTION 13. The repeal or amendment by this act of any law, whether temporary or permanent or civil or criminal, does not affect pending actions, rights, duties, or liabilities founded thereon, or alter, discharge, release or extinguish any penalty, forfeiture, or liability incurred under the repealed or amended law, unless the repealed or amended provision shall so expressly provide. After the effective date of this act, all laws repealed or amended by this act must be taken and treated as remaining in full force and effect for the purpose of sustaining any pending or vested right, civil action, special proceeding, criminal prosecution, or appeal existing as of the effective date of this act, and for the enforcement of rights, duties, penalties, forfeitures, and liabilities as they stood under the repealed or amended laws.

 

SECTION 14. If any section, subsection, paragraph, subparagraph, sentence, clause, phrase, or word of this act is for any reason held to be unconstitutional or invalid, such holding shall not affect the constitutionality or validity of the remaining portions of this act, the General Assembly hereby declaring that it would have passed this act, and each and every section, subsection, paragraph, subparagraph, sentence, clause, phrase, and word thereof, irrespective of the fact that any one or more other sections, subsections, paragraphs, subparagraphs, sentences, clauses, phrases, or words hereof may be declared to be unconstitutional, invalid, or otherwise ineffective.

 

SECTION 15. The prohibition and enforcement of hemp beverage distribution and sales to individuals under the age of twenty-one are effective upon the signature of the Governor, and the remaining provisions of this act take effect sixty days after approval by the Governor.

Renumber sections to conform.

Amend title to conform.

 

WES CLIMER for Committee.

 

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A bill

 

TO AMEND THE SOUTH CAROLINA CODE OF LAWS BY ADDING CHAPTER 56 TO TITLE 46 SO AS TO REGULATE THE SALE OF HEMP-DERIVED CONSUMABLES, AMONG OTHER THINGS.

 

Be it enacted by the General Assembly of the State of South Carolina:

 

SECTION 1.  Title 46 of the S.C. Code is amended by adding:

 

CHAPTER 56

 

Consumable Hemp Products

 

    Section 46-56-10.  It is unlawful for a person under the age of twenty-one to possess or consume a "consumable hemp product." A "consumable hemp product" is defined as a hemp, tetrahydrocannabinol (THC) or cannabinoid product that is a hemp- or cannabinoid- derived good intended for human ingestion, absorption, or consumption made from a cannabinoid that is naturally occurring in a hemp plant or made from a cannabinoid that is chemically derived or otherwise synthetically manufactured  that has been extracted or purified from an agricultural product. The following chemically derived hemp cannabinoids are specifically included in the definition of a consumable hemp product:

       (1) Hexahydrocannabinol (HHC);

       (2) Tetrahydrocannabinol acetate ester (THCo);

       (3) Tetrahydrocannabiphorol (THCp);

       (4) Delta 8 Tetrahydrocannabinol;

       (5) Delta 10 Tetrahydrocannabinol;

       (6) Delta 4 Tetrahydrocannabinol;

       (7) Delta 11 Tetrahydrocannabinol;

       (8) Delta 6a10a Tetrahydrocannabinol;

       (9) Hexahydrocannabinol Acetate (HHC-O);

       (10) Delta 9 Tetrahydrocannabiphorol;

       (11) Delta 9 Tetrahydrocannabihexol;

       (12) Delta 9 Tetrahydrocannabinol octyl;

       (13) Delta 9 Tetrahydrocannabinol methyl ether (THC-M);

       (14) Delta 8 Tetrahydrocannabinol octyl;

       (15) Delta 7 Tetrahydrocannabinol; or

       (16) any synthetic derivative or analog of the above compounds.

 

    Section 46-56-20.  (A) No person may knowingly:

       (1) sell or distribute a product containing a consumable hemp product to a person who is under twenty-one years of age or purchase a product containing a consumable hemp product on behalf of a person who is under twenty-one years of age;

       (2) persuade, entice, send, or assist a person who is under twenty-one years of age to purchase, acquire, receive, or attempt to purchase a consumable hemp product. This section does not preclude law enforcement efforts involving:

           (a) the use of a minor if the minor's parent or legal guardian has consented to this action; or

           (b) the use of a person under twenty-one years of age who is not a minor if the individual has consented to this action;

       (3) distribute samples of consumable hemp product in or on a public street, sidewalk, or park; or

       (4) sell or distribute a consumable hemp product without having first obtained proof of age from the purchaser or recipient.

    (B) Any consumable hemp beverage product offered for retail sale shall be merchandised in such a manner including, but not limited to, signage, shelf-talkers, and stickers on cooler doors, so as to clearly indicate to consumers the product contains hemp-derived cannabinoids.

    (C) With the exception of consumable hemp beverages, it is a violation to fail to maintain any product containing consumable hemp products locked away or behind the counter of a retail establishment in an area inaccessible to the customer.

    (D) A person violating subsection (A) is guilty of a misdemeanor and, upon conviction:

       (1) for a first offense, must be fined not less than two hundred dollars nor more than three hundred dollars or imprisoned not more than thirty days, or both; and

       (2) for a second or subsequent offense, must be fined not less than four hundred dollars nor more than five hundred dollars or imprisoned not more than thirty days, or both.

    (E) Section 61-6-4080 is applicable to a person who is in violation of subsection (A)(1) for the sale or distribution of a consumable hemp product.

    (F) It is unlawful for a person under twenty-one years of age to:

       (1) knowingly purchase, possess, or accept receipt of a consumable hemp product; or

       (2) knowingly present purported proof of age that is false, fraudulent, or not actually that person for the purpose of purchasing or receiving a consumable hemp product.

    (G) A person violating subsection (F) is guilty of a misdemeanor and, upon conviction, must be fined not less than one hundred dollars nor more than two hundred dollars or must be imprisoned for not more than thirty days, or both.

    (H) A person eighteen years of age and older lawfully employed to serve or remove consumable hemp products, beer, wine, or alcoholic beverages in establishments licensed to sell these beverages is not considered to be in unlawful possession of the beverages during the course and scope of his duties as an employee. The provisions of this subsection do not affect the requirement that a bartender must be at least twenty-one years of age.

 

    Section 46-56-40.  (A) A person engaged in the business of selling at retail consumable hemp products must post in each location for which he has obtained a license a sign with the following words printed thereon:

"The possession of a consumable hemp product by a person under twenty-one years of age is a criminal offense under the laws of this State, and it is also unlawful for a person to knowingly give false information concerning his age for the purpose of purchasing a consumable hemp product."

    (B) The South Carolina Department of Agriculture must prescribe by regulation the size of the lettering and the location of the sign on the seller's premises.

    (C) A retail seller of consumable hemp products who fails to display the sign required by this section is guilty of a misdemeanor and, upon conviction, must be fined not more than one hundred dollars or imprisoned for not more than thirty days, or both.

 

    Section 46-56-50.  (A) Nothing in this act shall be construed to:

       (1) legalize the sale, possession, or consumption of THC products by any person in this State where such products are otherwise prohibited by law;

       (2) permit the sale or distribution of any product that exceeds the established THC limits; or

       (3) prohibit the sale or distribution of any hemp product that is otherwise legal under state or federal law provided the sale or distribution is not in violation of this article.

    (B) This article does not limit or affect any other federal or state law more strictly regulating THC or controlled substances in this State.

 

    Section 46-56-60.  An entity that is in the business of manufacturing or selling products containing a hemp-derived cannabinoid in this State, including a producer or retailer, may not be located within one thousand feet of a school, daycare facility, or other similar locations.

 

SECTION 2.  If any section, subsection, paragraph, subparagraph, sentence, clause, phrase, or word of this act is for any reason held to be unconstitutional or invalid, such holding shall not affect the constitutionality or validity of the remaining portions of this act, the General Assembly hereby declaring that it would have passed this act, and each and every section, subsection, paragraph, subparagraph, sentence, clause, phrase, and word thereof, irrespective of the fact that any one or more other sections, subsections, paragraphs, subparagraphs, sentences, clauses, phrases, or words hereof may be declared to be unconstitutional, invalid, or otherwise ineffective.

 

SECTION 3.  During the first 180 days after the effective date of this act, law enforcement officers shall only issue warnings for violations of this article.

 

SECTION 4.  This act takes effect upon approval by the Governor.

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