California Cannabis Regulatory Overview
On November 8, 2016, California voters passed Proposition 64 to "Control, Regulate and Tax Adult Use of Marijuana." Because California had a long-standing medical marijuana marketplace, California sought to harmonize the provisions of the planned adult-use cannabis market with those of its medical cannabis market. To that end, on June 15, 2017, California's legislature passed the "Medicinal and Adult-Use Cannabis Regulation and Safety Act," better known as "MAUCRSA," to unify regulation of those two markets. On November 16, 2017, California regulators made public a set of emergency regulations to govern the industry until permanent regulations could be promulgated. California's first adult-use cannabis sales occurred pursuant to those emergency regulations on January 1, 2018.
California Cannabis License Overview
California has a number of different types of cannabis licenses corresponding to different sectors of the industry. Within those categories, there are also different sub-license depending on volume. These license types are (1) cannabis cultivator licenses; (2) cannabis nursery licenses; (3) cannabis processor licenses; (4) cannabis products manufacturing with volatile solvents licenses; (5) cannabis products manufacturing with non-volatile solvents or via mechanical methods licenses; (6) cannabis products infusion manufacturing licenses; (7) cannabis products packaging and labeling only licenses; (8) cannabis distributor licenses; (9) cannabis distributor transport-only licenses; (10) cannabis retailer licenses; (11) cannabis testing laboratory licenses; and (12) cannabis microbusiness licenses (conducting certain types of limited cannabis cultivation, manufacturing, distribution, and retail business).
California Cannabis Key Regulators
California has three primary regulators of adult-use cannabis activity. The California Department of Food & Agriculture has primary oversight over cultivators (including nurseries and processors). The California Department of Public Health has primary oversight over cannabis products manufacturing licenses and packaging and labeling. The California Bureau of Cannabis Control has primary oversight over cannabis distributors, retailers, testing laboratories, and microbusinesses.
In 2018, California regulators proposed non-emergency regulations to govern the industry. Those regulations became effective in January 2019. It is worth noting that those these regulations are often termed “final” or “permanent,” that is a reference to the manner in which they are adopted. Operators can expect that these rules will be periodically revised, as has occurred in other state-legal cannabis markets throughout the nation.
California Cannabis Locality Options
Local communities have the ability under California's cannabis laws to opt-out of permitting legal commercial activity, or to place further limits on cannabis activity.