[Update: In July 2021, the three state licensing authorities were consolidated into a single California Department of Cannabis Control (DCC). The DCC is taking steps to consolidate the regulations from the three licensing agencies into one set of regulations. The consolidated emergency regulations have been approved and are now in effect. The three existing sets of cannabis regulations have been moved into one title in the California Code of Regulations – Title 4, Division 19.]
The Office of Administrative Law (OAL) has officially approved the new final California cannabis regulations for cannabis businesses. The California cannabis industry has been operating under emergency regulations adopted by the three state cannabis licensing authorities – the California Bureau of Cannabis Control (BCC), the Department of Food and Agriculture (CDFA), and the Department of Public Health (CDPH). The new permanent California cannabis regulations take effect immediately and the prior California cannabis emergency regulations are no longer in effect.
The new permanent California cannabis regulations include the final cannabis regulations issued by the Bureau of Cannabis Control, the cannabis cultivation regulations issued by the Department of Food and Agriculture, and the manufactured cannabis regulations issued by the Department of Public Health (Manufactured Cannabis Safety Branch). Changes to the cannabis regulations are indicated by strikeout and underline. The permanent California cannabis regulations have been issued pursuant to the California Medicinal and Adult-Use Cannabis Regulation and Safety Act (MAUCRSA) – read more about California cannabis law.
Many of the changes from the emergency cannabis regulations to the permanent cannabis regulations are more clerical than substantive, while other changes are significant. One of the more significant changes relates to the boundaries for licensed cannabis delivery businesses. Under the new permanent California cannabis regulations, licensed cannabis delivery businesses are not limited by local jurisdictional restrictions. Read more at BCC to Permit California Cannabis Delivery Statewide.
Another significant change is the addition of § 5032 (b) which states that “Licensees shall not conduct commercial cannabis activities on behalf of, at the request of, or pursuant to a contract with any person that is not licensed under the Act.” Many in the cannabis industry have referred to this as the “White Label Prohibition.” The BCC explained that the change was necessary because it has received information, and observed, that some cannabis licensees may be engaging in commercial cannabis activity with non-licensees, or conducting commercial cannabis business at the direction of non-licensees.
In the October version of the proposed final BCC cannabis regulations, the BCC included examples of activity that would fall under this prohibition including: (1) procuring or purchasing cannabis goods from a licensed cultivator or licensed manufacturer, (2) manufacturing cannabis goods according to the specifications of a non-licensee, (3) packaging and labeling cannabis goods under a non-licensee’s brand or according to the specifications of a non-licensee, and (4) distributing cannabis goods for a non-licensee. The BCC found that these examples caused more confusion and removed the examples from the final cannabis regulations. The addition of § 5032 (b), however, remains in the final cannabis regulations. Read more about the BCC Statement of Reasons for the cannabis regulation modifications.
Another significant change relates to cannabis product labeling for THC and CBD content. California Cannabis regulations previously required cannabis products be labeled with the THC and CBD content prior to final testing. Cannabis products can now be labeled after the final testing.
There are other substantial changes which we will discuss in future cannabis news articles. Also, keep an eye on our California Cannabis Law Legislative Update for news about new cannabis laws being considered, or enacted, by the California legislature.
[Update: On November 17, 2020, a California court determined that BCC Regulations § 5040(b)(3) regarding cannabis billboard advertising is invalid in that it is inconsistent with the statute that the regulation was intended to implement (i.e., the statute’s cannabis billboard prohibition on Interstate Highways or on State Highways which cross the California border is not limited to just a 15-mile radius of the California border).]
Contact us to learn more about California state or local cannabis regulations, cannabis regulatory compliance, and cannabis litigation.
