The hemp business in Texas — from small retail shops to CBD store chains sprouting across Houston, Austin, and major cities — is being forced to make a difficult choice: spend tens of thousands of dollars to continue operating legally, or shut down. This is not a distant story for the Vietnamese American community in Texas: many nail salons, grocery stores, and convenience shops owned by Vietnamese Americans have added CBD and hemp products as a supplementary revenue stream in recent years, and they are the group most directly impacted by this regulatory crackdown.
The question is not whether to support or oppose the law, but whether spending tens of thousands of dollars in licensing fees still makes sense when courts have not yet ruled and a federal ban is coming.
Compliance costs surge dramatically
Under the new regulations, the annual licensing fee for hemp manufacturers has risen from 258 USD to 10,000 USD per facility — an increase that the chairman of the Texas Hemp Business Council says even exceeds the 3,000 USD fee that distilleries must pay every two years to the Texas Alcoholic Beverage and Cannabis Products Commission, despite their operations typically being far larger in scale. Statewide, there are more than 9,100 retail locations registered to sell consumer hemp products — meaning the number of small shops potentially facing unaffordable cost increases is enormous, not to mention that Austin alone has 93 hemp-THC businesses according to state health agency records.
Banning sales, not possession — and the legal gray zone
The crux of industry pushback is that the new regulations change how THC is measured: instead of counting only Delta-9 THC as the 2019 hemp law did, the state health agency now includes THCA — a compound that converts to an intoxicating substance only when burned or heated. This calculation method renders most hemp flower and pre-rolled joints non-compliant, even though the original hemp law has not changed. A hemp business coalition has filed a lawsuit against two state agencies, arguing that the administrative agency lacks authority to redefine statutory language enacted by the legislature in 2019 — a dispute over the boundary between executive and legislative power, not merely a public health matter.
Courts have intervened, but it is not over
A judge in Travis County blocked part of the new regulation in early May, showing that this legal battle is far from settled — meaning hemp shop owners, including Vietnamese Americans considering investment in this sector, must factor in the risk that the law could still change after July 31. Meanwhile, beverages and food products containing THC — a rapidly growing segment in major retail chains — are generally not directly affected by the ban on smokeable products, as long as they meet new packaging and testing requirements.
Why the state is cracking down
The state's stated reason for tightening regulations goes beyond market control: calls to the state poison control center related to cannabis increased from 923 to 2,592 cases during 2019-2024, with most involving suspected poisoning of children under five and adolescents — data that lawmakers cite to justify tightening rules, though the hemp industry argues the proper approach is to regulate packaging and age of purchase, not ban an entire product line.
What to watch
For Vietnamese American business owners operating in this sector, the practical question is not whether to support or oppose the law, but rather: does spending 5,000 to 10,000 USD on licensing fees still make sense when courts have not yet issued a final ruling, and when Congress has passed a federal ban on intoxicating hemp products set to take effect in November. While awaiting resolution of lawsuits, the safest option may be to pivot toward beverages and food products — a segment with lower legal risk — or pause expansion until the legal landscape becomes clearer.