This week, Governor Newsom signed the law, taking an important step in reforming California’s (quite tortured) cannabis licensing program. Parliamentary Bill No. 141, Which usually merges all cannabis licensing and supervision into Cannabis Control Division (“DCC”). In our view, concentrating all licensing and regulatory oversight into one agency in California is a very good move that represents the state. It is necessary to answer three potential administrative agencies that have different views on the regulations, which is very troublesome for the licensee.

The merger will be exclusively carried out within commercial, consumer services and housing agencies, replacing: 1) Cannabis Control Board (previously authorized retailers, delivery services, micro-enterprises, distributors, testing laboratories, and event organizers), 2) California The Department of Public Health-manufactured Cannabis Safety Division (previously provided licenses for manufacturers), and 3) California Department of Food and Agriculture CalCannabis (previously provided licenses for growers, including nurseries and processors).

More specifically, AB 141 transfers all the “powers, duties, purposes, functions, responsibilities, and jurisdictions” of these former agencies to DCC.Governor Newsom also appointed Nicole Elliott As the director of DCC. Close followers of California cannabis regulations may remember that Ms. Elliott has served as the Governor’s senior cannabis policy advisor since 2019.

In addition to the creation of DCC, AB 141 also made some technical fixes and substantial changes to the Medicinal and Adult Use of Marijuana Regulation and Safety Act (“MAUCRSA”). This will inevitably lead to more rules at the DCC level and affect all licensees.What we wrote about before We hope that DCC will be resolved in the current rules (Not so comprehensive or consistent on various licensee issues), but for now, these are the topics that DCC must consider:

A broader definition of commercial cannabis activity

The definition of “commercial cannabis activity” now includes cannabis event organizers that act as temporary cannabis events.

More public information about licensees

To date, the public has not been able to obtain certain information about licensees (for example, other states will release data on taxation and license cancellation quarterly, or even more frequently). Beginning in January 2022, DCC must provide information on the suspension and revocation of licenses and the final decisions adopted by DCC for licensees on its website. The sensitive identification information of the licensee will not be disclosed. I actually just received an email from DCC on the 14th, which contained a spreadsheet for the report of license information for planting licensees.

Temporary permit changes, generally speaking

Temporary license It received great attention in AB 141. The temporary permit was originally scheduled to end on January 1, 2022. However, AB 141 allows applicants and licensees to continue to receive and renew temporary licenses until June 30, 2022, as long as the applicant:

(i) Can prove compliance California Environmental Quality Act (“CEQA”) is complete or “provides evidence of ongoing compliance” (CEQA has always been the main issue of California cannabis, see Here); (ii) Local approval or providing evidence showing that local approval is being obtained; (iii) The application is submitted before March 31, 2022.

If the temporary application is for a planting license, in addition to (i)-(iii), the applicant must also provide DCC with any of the following:

(a) The final riverbed improvement agreement; (b) The draft riverbed improvement agreement provided and signed by the Department of Fish and Wildlife (“DFW”) and returned to DFW; (c) DFW’s written certification that no riverbed change agreement is required; (d) DFW’s written verification, certifying that the applicant has submitted 1602 notice, Submit payment for applicable fees, and “respond” to DFW.

Temporary Planting Permit

Regarding temporary planting permits submitted to DCC after January 1 next year, there is an interesting curveball in AB 141. AB 141 stipulates:

“If an application for a planting permit is submitted on or after January 1, 2022, [DCC] No temporary licenses may be issued. .. If the issuance of a temporary permit will result in the licensee holding multiple planting permits on consecutive sites, the total canopy for outdoor planting exceeds 1 acre, or the mixed light or indoor planting exceeds 22,000 square feet. “

In California, the planting license holder is limited to one type 3 planting license holder, which can provide up to 22,000 square feet of indoor or mixed lighting, and up to 1 acre of outdoor area (this is currently the largest planting license in California Certificate until 2023).At the same time, in order to break through this limitation, practitioners who want to grow on a large scale “Stacking” multiple smaller planting permits On consecutive packages. Another California requirement is “one licensee per site”; in this case, the grower will own multiple contiguous plots of land 0—each is a “site”—and only Each plot/site applies for a smaller permit to “stack” into a huge planting site.

While this new restriction in ABA 141 may address concerns that large-scale plantations must fully comply with CEQA before obtaining temporary permits, it will also close major loopholes that have existed since the permit began in January 2018.Also note that any Update After January 1, 2023, temporary indoor or mixed-lighting permits that violate this new ban will be rejected by DCC (the same is true for outdoor planting temporary permits after January 1, 2024).

Marijuana Fairness Act Grant Program

on California Marijuana Rights Act, The Governor’s Office of Business and Economic Development will manage the grant program created by the bill.

Background document search refinement

The bill does not continue to obtain the criminal history of applicants through the Department of Justice and the FBI, but allows the state government to obtain the criminal history required by the “owner” from the certification records and certification records of all local or state agencies for arrests and convictions. Probation, and any and all other related documents required to complete the investigation of the applicant or licensee.

Laboratory changes

The laboratory will see some changes under ABA 141, including (i) laboratories must now directly hire drivers who transport test samples, (ii) laboratories can receive test samples directly from manufacturers and growers for quality control ( Retail testing must still be coordinated through the distributor), and (iii) the laboratory’s financial interest holder cannot have a financial interest in other cannabis licensing businesses (and vice versa).

Trade samples

California is At last It is planned to establish a trade sample system. By January 1, 2023, DCC must establish the concept of trade samples. As AB 141 details further, trade samples must undergo quality assurance testing, and they must be entered into the tracking and traceability system, and they must be marked as samples accordingly. But don’t get too excited—these samples are for licensees only and are not intended to be distributed to retail customers. In addition, licensees cannot compensate each other for samples in any way. The wording is as follows: “Cannabis or cannabis products designated as trade samples can only be used to provide licensees with targeted advertisements about new or existing cannabis or cannabis products.”

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As of now, the DCC has complete control of the cannabis game in California, and the regulations finally passed by other agencies are still in effect (just under the DCC). As DCC sets out to develop rules to implement the AB 141 Directive, be sure to keep an eye on it.