PROCEED WITH CAUTION: NAVIGATING CALIFORNIA’S HIGHLY REGULATED CANNABIS SUPPLY CHAIN – PART 1

PROCEED WITH CAUTION: NAVIGATING CALIFORNIA’S HIGHLY REGULATED CANNABIS SUPPLY CHAIN – PART 1

BY: DAVE MINER: LinkedIn

Part 1: Meet the Regulators

CA State Cannabis Regulators:

There are three regulators in California that oversee licensing and operations for the legal medical and adult use cannabis industry. Each regulates a subset of the plant-touching businesses and license types within the California Cannabis Supply Chain.

The lead agency in cannabis regulation in California is the Bureau of Cannabis Control (BCC). The BCC is modeled after the ABC or Department of Alcoholic Beveridge Control and is currently headed by former ABC Director, Lori Ajax. The BCC regulates all retail businesses, testing labs, and event organizers. Here is how it breaks down:

Regulates the following Business & License Types:

Retailers

(Type 9) Retailer, Non-Storefront Delivery Service

(Type 10) Retailer Dispensary

Distributors

(Type 11) Distributor

(Type 13) Distributor, Transportation Only

Microbusinesses

(Type 12) Microbusiness must conduct 3 of the following 4 (combined under one roof)

  • Retail: Dispensary or Delivery Service (Non-Storefront Retail)
  • Distribution: Traditional Distribution or Distribution – Transportation Only
  • Cultivation (10,000 sq. ft. or less of canopy)
  • Manufacturer (Level 1, Type 6) *

*For sites that manufacture cannabis products using no or non-volatile solvents

Testing Laboratories

Event Organizers

Website: https://www.bcc.ca.gov/

What’s new?

The BCC just posted an updated license search system on its website to make it easier to find information on state-licensed cannabis businesses. Read about it on the BCC’s Facebook Page: BCC’s Facebook Page – New License Search System

The existing California Department of Public Health (CDPH) is the regulating body that oversees cannabis manufacturing. The CDPH created a new branch, the Manufactured Cannabis Safety Branch (MCSB) to oversee the regulation of all commercial cannabis manufacturing in California. This includes the production of extracts and the manufacturing of any other cannabis infused products like edibles, vape pen cartridges, tinctures, topicals, etc. 

MCSB Regulates the following Business & License Types*:

(Type 7) Volatile Extraction

(Type 6) Non-volatile Extraction

(Type N) Infusions

(Type P) Packaging & Labeling

*Please Note: Each Manufacturing License Type listed can conduct the functions of the License Types listed below it (e.g., Type 7 can also conduct non-volatile extraction, infusions, and Packaging & Labeling; Type N can do Infusions and Packaging & Labeling)

Website: https://www.cdph.ca.gov/Programs/CEH/DFDCS/MCSB/Pages/MCSB.aspx

What’s New?

Well it’s not really new, but the CDPH launched a grant funded campaign called “Let’s Talk Cannabis” just prior to the passing of Prop 64. The campaign is designed to communicate what is legal in California and the potential health impacts of cannabis use. Visit their website

Finally, the third regulating body is a division of the California Department of Food and Agriculture called CalCannabis Cultivation Licensing (CAL). CAL “ensures public safety and environmental protection by licensing and regulating commercial cannabis cultivators in California. CalCannabis also manages the state’s track-and-trace system, which tracks all commercial cannabis and cannabis products—from cultivation to sale. CalCannabis is organized into three branches: Licensing, Compliance and Enforcement, and Administration.” (CalCannabis, 2018)

Regulates the following Business & License Types:

(Type 1) Cultivation; Specialty Outdoor; Small – Up to 5,000 sq. ft. of canopy

(Type 1A) Cultivation; Specialty Indoor; Small – Up to 5,000 sq. ft. of canopy

(Type 1B) Cultivation; Specialty Mixed Light; Small – Up to 5,000 sq. ft. of canopy

(Type 2) Cultivation; Outdoor; Small – Between 5,000 and 10,000 sq. ft. of canopy

(Type 2A) Cultivation; Indoor; Small – Between 5,000 and 10,000 sq. ft. of canopy

(Type 2B) Cultivation; Mixed Light; Small – Between 5,000 and 10,000 sq. ft. of canopy

(Type 3) Cultivation; Outdoor; Medium – Between 10,001 and 1 acre of canopy

(Type 3A) Cultivation; Indoor; Medium – Between 10,001 and 22,000 sq. ft. of canopy

(Type 3B) Cultivation; Mixed Light; Medium – Between 10,001 and 22,000 sq. ft. of canopy

(Type 4) Cultivation; Nursery

(Type 5) * Cultivation; Outdoor, Large – Greater than 1 acre of canopy

(Type 5A) * Cultivation; Indoor, Large – Greater than 22,000 sq. ft. of canopy

(Type 5B) * Cultivation; Mixed Light: Large – Greater than 22,000 sq. ft. of canopy

*No licenses for Type 5, Type 5A, or Type 5B will be issued prior to January 2023

Website: http://calcannabis.cdfa.ca.gov/

What’s New?

Medical marijuana collectives and cooperatives are now illegal. As of January 9, 2019, Medical collectives became illegal without a state license under Prop 64. MMJ collectives and co-ops were allowed to operate through 2018 because they were grandfathered in and protected under Prop 64. The deadline has now passed forcing co-ops to either obtain licensing or close up shop. If this applies to you, please contact us to discuss how to get licensed right away!

 Stay tuned for Part 2 of our series: Required Track-and-Trace System

Dave Miner writes on behalf of Cannabiz Trusted Advisors

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