A Final Game Board For California Cannabis Regulations

California’s medical marijuana laws continue to grow, and this time the state officials have wrapped up their final version of regulations and have released them online.

The proposed regulations – from the state’s BCC, Department of Public Health and Department of Food and Agriculture – have been successfully submitted to the Office of Administrative Law (OAL) and target areas including cannabis events, packaging and delivery. The rules will not be effective until the Office of Administrative Law approves it.

“If adopted permanently, these new regulations would offer a raft of significant changes for cannabis businesses,” said Juli Crockett, compliance director for Los Angeles-based consultancy MMLG.

Here are primary takeaways from the proposed regulations:

  • A big win for deliveries

In the final regulation, delivery operators are the obvious winners. According to the BCC, third-party companies are prohibited to deliver cannabis anywhere in the state that do not have state medical marijuana commercial licenses. But tech platforms are allowed to deliver provided there is no direct profit-sharing on each sale.  

  • Packaging regulations changed

Apart from deliveries, another imperative win for cannabis industry is contract manufacturing, also called white labeling. White labeling enables a licensed manufacturer of concentrates, or edibles to produce and package products on the behalf of an unlicensed company , for instant an out-of-state company or a celebrity brand.

There is also a significant change to be witnessed in packaging and labeling provision. Previously manufacturers had to hold off on identifying cannabinoids before sending their products to labs for testing.

This would allow distributors to get concentrates and edibles tested for potency and then make that information available on the labels before sending them to retailers. This new California cannabis regulation also announced child-resistant packaging which won’t be required until next year. This means more burden on retailers to use child-resistant exit bags at their stores.

  • Reduced amount of inventory to be carried

The draft is most likely to lower the amount of inventory permitted to be carried by a single delivery vehicle, which would be $5,000 from $10,000. And the delivery vehicle has to have at least $2,000 worth of existing orders in place from buyers before it leaves a delivery hub.  

  • More transparency in stakeholders

The new California cannabis regulation puts a ban on silent partners and would require licensed cannabis businesses to disclose more information about every stakeholder. The BCC demands more transparency and wants to know who all are involved in each of these companies.

  • Significant increase in cannabis events

California Gov. Jerry Brown signed a bill which replaces a law that allowed licenced cannabis events to be held on county fairgrounds. This means there would likely be an increase in various types of cannabis events held in California. The bill was passed to benefit local economies and small businesses by giving cities more independence to govern how such events take place in the state.

These are some of the changes proposed in the latest draft of industry rules. You can check the detailed draft here.

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