On September 8, 2021, the California Department of Cannabis Control (DCC) published proposed emergency cannabis regulations. These emergency regulations harmonize the previous regulations that were ported over from the prior three agencies into one combined set, and they modify some of those rules and add also new ones. The DCC also published a revised set of Disciplinary Guidelines to go along with the emergency regs.
In terms of procedure, the DCC sent an email to stakeholders stating that:
DCC will file the emergency package with the Office of Administrative Law (OAL) after the required five-working day notice to the public. The public comment period, which lasts five-calendar days, will begin when OAL publishes the proposed regulations as being “under review” on its website: https://oal.ca.gov/.
If approved, the proposed regulations would become effective at the end of September. More work is anticipated over the coming months, after the emergency rulemaking process is completed, to further improve the regulations for commercial cannabis activity.
We plan on writing a lot about these emergency regs, but wanted to highlight a few key things in this initial post giving the quick timing around their effectiveness:
Rule 15001.1 allows the issuance of provisional cultivation licenses so long as:
Issuance of the license would not cause the commercial cannabis business to hold multiple cultivation licenses on contiguous, connecting premises to exceed one acre of total canopy for outdoor cultivation, or 22,000 square feet for mixed-light or indoor cultivation, if the application is received on or after January 1, 2022.
The rules go on to say that “For the purposes of this section, premises will be considered contiguous if they are connected, touching, or adjoining.” So, it’s clear that there will be restrictions on aggregating multiple cultivation licenses throughout connecting premises, but what’s not clear is how the DCC will deal with contiguous real estate parcels that have licensed premises on each but where those premises don’t necessarily touch each other border to border. We don’t know just yet, but it looks like the answer is that this practice may not be forbidden outright.
DCC is changing how it determines who constitutes an “owner” or “financial interest holder” (FIH) of a cannabis business. Here are some of the key points:
The proposed regulations would finally allow licensees to provide each other, and for a licensee to provide its employees, with cannabis goods for sampling purposes to aid in making purchasing decisions. Trade samples will still need to be plugged into METRC and will need to be designated as trade samples and in their final form for sale. There are a host of restrictions and rules that apply to trade samples, which licensees will need to study closely.
This article was originally published on harrisbricken.com
Thorne, Griffen. “Breaking News: California Drops New Emergency Cannabis Regulations - Canna Law Blog™.” Harris Bricken, 8 Sept. 2021, harrisbricken.com/cannalawblog/breaking-news-california-drops-new-emergency-cannabis-regulations/.
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