S265 Protecting Our Community Act: What You Need to Know

North Carolina lawmakers are taking significant steps to regulate the hemp industry. On March 12, 2025, Senate Bill 265, titled the "Protecting Our Community Act," was introduced with bipartisan sponsorship. The legislation seeks to create a comprehensive regulatory framework for hemp-derived consumable products, aiming to address safety concerns and underage access while holding manufacturers and sellers accountable.

If you're in the hemp industry or a concerned citizen, here's what you need to know about the bill and how it could reshape the sector.

What is Senate Bill 265?

The S265 Protecting Our Community Act is a draft legislation proposed in the North Carolina General Assembly. Its objective is to regulate the sale, production, and distribution of hemp-derived consumable products, including cannabinoids such as THC. This regulation is designed to safeguard public health, particularly young people, while promoting consumer trust in a burgeoning industry.

The bill is backed by both Republican and Democratic senators, emphasizing its bipartisan support. The primary sponsors include Senators Johnson (R), Britt (R), and Lazzara (R), with co-sponsors such as Adcock (D) and Chaudhuri (D).

Key Provisions of S265

Here’s a breakdown of the major aspects addressed by the bill:

1. Age Restrictions

The legislation prohibits the sale of hemp-derived consumable products to anyone under the age of 21. Currently, no legal framework exists to enforce age-specific purchasing restrictions, leaving minors vulnerable to psychoactive substances.

2. Mandatory Licensing

Sellers, distributors, and manufacturers must secure a valid license to operate legally in the hemp space. Noncompliance may result in penalties, suspension, or license revocation upon repeated offenses.

3. THC Concentration Caps

The bill introduces strict guidelines for THC levels in consumable products. THC, the psychoactive component in cannabis, must align with acceptable thresholds to reduce potential misuse.

4. Enhanced Testing Standards

Under S265, manufacturers will be required to test their products for:

• Heavy metals

• Pesticides

• Other toxic substances

This ensures safer products for consumers, as current laws do not enforce testing standards.

5. School Grounds Ban

The bill explicitly bans hemp-derived consumable products on school property, eliminating the risk of exposure to and misuse by students.

6. Civil & Criminal Penalties

Violators face fines ranging between $500 and $2,000. Repeat offenders may encounter stricter consequences, including criminal charges for exceeding THC limits.

7. Fraudulent Identification Penalties

Using fake identification to purchase restricted products will incur significant penalties. This provision mirrors existing alcohol and tobacco restrictions, aiming to deter underage abuse.

8. Advertising Limitations

To curb youth-targeted marketing, S265 bans:

• Cartoon characters or designs

• Candy-like flavors

• Packaging that mimics familiar snacks or school supplies 

These measures aim to align product promotion with ethical advertising standards.

9. Directory of Approved Products

The state will compile a publicly accessible directory listing approved hemp-derived consumable products. This transparency ensures that consumers can easily identify legitimate and safe options.

10. Regulatory Oversight

The bill assigns enforcement responsibility to the NC Alcohol Law Enforcement (ALE) agency, offering a clear protocol for monitoring compliance within the hemp industry.

How Will S265 Change the Hemp Industry in NC?

These regulations could significantly alter North Carolina’s currently laissez-faire hemp sector. Here’s a look at the key transformations:

Stricter Oversight

By introducing licensing requirements and assigning regulatory oversight to ALE, the bill aims to hold manufacturers and retailers accountable, reducing the risk of illicit operations.

Safer Consumer Products

Mandatory product testing ensures better-quality hemp consumables, protecting customers from harmful substances.

Youth Protection

Age restrictions, advertising limitations, and school prohibitions prioritize the safety of North Carolina’s youth by reducing potential exposure to psychoactive substances.

Better Supply Chain Management

The creation of supply chain categories—manufacturer, distributor, and retailer—lays the groundwork for a more organized and transparent hemp industry. Each category must meet specific requirements, ensuring accountability at every stage.

Industry Legitimacy

The public directory of approved products enhances consumer trust by allowing verified access to safe and regulated items.

Industry Challenges Ahead

While many hail these changes as long overdue, not everyone is on board. Critics of S265 argue the following:

• Burden on small businesses: The license fees, testing requirements, and penalties may create financial and operational hurdles for smaller hemp enterprises with fewer resources.

• Reduced innovation: Licensing and production mandates could add red tape, stifling the entrepreneurial spirit that drives the industry.

• Consumer affordability: Stricter regulations might eventually increase product costs, potentially pricing out budget-conscious consumers.

Despite challenges, the Protecting Our Community Act seeks to balance safety with industry growth. The bill reflects a broader trend of states taking steps to regulate hemp and cannabis-related products in response to widespread market concerns.

Current Status of S265

The bill passed its first reading in the NC Senate and was sent to the Senate Rules Committee, where it'll undergo further review before heading to committee assignments and subsequent hearings.

Concerns about underage access, product safety, and youth-focused marketing have brought urgency to this legislation. Public support for regulatory measures, particularly regarding psychoactive products, has been growing—heightening the probability of this bill advancing through the legislative process.

Why S265 Matters to You

Whether you’re a consumer, advocate, or hemp business owner, understanding S265 is essential. For industry professionals, this legislation could redefine operational norms by imposing higher standards for production and marketing.

For consumers, S265 provides peace of mind, ensuring access to safe, scrutinized products that meet ethical standards and legal regulations.

Curious about S265's latest updates? You can read the full bill on the NC General Assembly website here.

Final Thoughts

The Protecting Our Community Act represents a bold move to regulate North Carolina’s hemp industry. By addressing safety concerns, advocating for youth protections, and tightening operational standards, S265 aims to pave the way for a more secure and ethical marketplace.

Businesses and individuals impacted by the bill should stay informed and participate in the discussion. Whether it's providing feedback, adapting to new requirements, or capitalizing on opportunities created by increased consumer confidence, the time to act is now.

What’s your stance on S265? Share your thoughts in the comments below.