California’s adult use cannabis market has been up and running for about six months now. It has been nothing short of a complicated transition for businesses and regulators alike. All eyes are still on the state as it builds the foundation for what is expected to be the biggest cannabis market in the nation.
At Simplifya, we do everything we can to help businesses manage compliance in such a heavily regulated industry. If you keep up with our blog, you’ve already seen how our standard operating procedures can help your business, as well as our coverage of the most common compliance issues regulators are running into (see part 1 and part 2).
As the initial six-month transition period comes to an end, we thought it’d be helpful to share five compliance tips:
1. Limits on Total THC Content in Cannabis Products
During the transition period, medical retailers have been allowed to sell cannabis products with any amount of total THC in the package, as long as edible products contain less than 10 mg of THC per serving.
Starting July 1, all edible products must be limited to a total of 100 mg of THC per package. This is in addition to being limited to 10 mg of THC per serving. Non-edible products must be limited to 1,000 mg of THC per package if they are intended for the adult-use market and 2,000 mg per package if they are intended for the medical market.
Unfortunately, products that do not meet these requirements by July 1 will need to be destroyed.
2. Testing Requirements Become Mandatory
Cannabis goods held in inventory at the time of licensing that have not undergone laboratory testing can be transported and sold through June 30, as long as a label is added to each package stating that the goods have not undergone the required testing. But once July 1 rolls around, products can only be sold if they have passed all required testing.
Any untested goods that were manufactured or harvested before January 1, 2018, which are in the possession of a distributor but owned by a manufacturer or cultivator, can be returned to the owning licensee. The licensee can have the products tested if they wish to sell them. However, any untested goods owned by a retailer or distributor must be sold by June 30 or destroyed.
3. Packaging and Labeling Requirements
Cannabis products that don’t meet current labeling requirements can be sold until June 30, as long as the applicable warning sticker is added to the goods before being sold to consumers. After July 1, all packaging and labeling must be completed before the goods are transported to a retailer.
Retailers cannot package or label any goods, regardless of when they were acquired, and they cannot send the products to any other licensee for packaging and labeling. However, retailers will be able to add a sticker stating “FOR MEDICAL USE ONLY” to products that do not already have the statement printed on the package.
After July 1, retailers must destroy any cannabis goods that do not meet the packaging and labeling requirements.
4. Child-Resistant Packaging
Until June 30, cannabis products not in child-resistant packaging can be sold if they are placed into child-resistant packaging by a retailer at the time of sale (aka, exit packaging). But beginning July 1, exit packaging will no longer satisfy the child-resistant packaging requirements. All cannabis goods must be placed in child-resistant packaging before being delivered to a retailer. Any products that haven’t been before July 1 must be destroyed.
5. Interaction Across Market Designations
There is also some good news! California’s cannabis-regulating agencies have mutually agreed to extend the provision allowing businesses to interact across license market designations. Licensees no longer face a July 1 deadline to restrict commercial activities to only businesses with the same market designation. Instead, businesses will be allowed to interact with any licensee, regardless of their market designation.