The California Department of Cannabis Control (DCC) has adopted the final version of cannabis regulations. These regulations went into effect on November 7, 2022. Our blog post last week, Part I of the series, discussed the general changes applicable to all licensees. Below is Part II, a summary of the major license-specific changes. DCC has also provided technical guidance documents on inhalable products and tinctures and beverages to help licensees understand the new requirements. The full text of the regulations can be found here.

Please note that while the summary below includes a number of major changes, it is not a comprehensive list of all of the regulatory revisions. We urge you to review the full text of the regulations and consult with us to ensure that you are in compliance with all of the requirements that may be applicable to your business.

If you have any questions, please feel free to contact Katchko, Vitiello & Karikomi, PC for more information and a member of the team will be happy to assist.

CHANGES TO REGULATIONS AFFECTING DISTRIBUTORS 

Distributor Storage Services [§15301]

• Items held for storage-only services by a licensed distributor may be distributed from the premises of the licensed distributor providing the storage-only services. 

Licensed Distributor to Licensed Distributor Transfers [§15307.2]

• Revised to clarify that retesting for cannabis goods that have not been transported to retail within 12 months of the date of the Certificate of Analysis is only permitted if the cannabis goods have not been modified in any way. 
• If the cannabis goods are being repackaged, relabeled, reformulated, or modified in any way, the licensee modifying the cannabis goods shall submit a corrective action plan and receive approval from DCC before beginning modifications to the cannabis goods.

Transportation Requirements for Distributors [§15311]

• All transportation vehicles must be owned by the licensee, provided however that a licensee is not required to be the sole owner or lessor of the vehicle. Owners and lessors may use the vehicle for non-cannabis related activities. 
• Cannabis and cannabis products shall be transported:
  • In a fully enclosed, windowless, locked trailer or trunk that cannot be accessed from inside the vehicle, or in a secure area within the interior of the vehicle. 
    • “Secured area” is defined as an area where solid or locking metal partitions, cages, or high-strength shatterproof acrylic can be used to create a secure compartment in the fully enclosed vehicle.
  • The Secured Area may include three sides of any part of the body of the vehicle, provided the parts of the vehicle used are shatterproof and not made of glass. 

CHANGES TO REGULATIONS AFFECTING RETAILERS 

Curbside Delivery [§15402(d)]

• Any storefront retailer or microbusiness may conduct sales through curbside delivery.
  • This involves delivering goods purchased by a customer using “a vehicle parked immediately outside the licensed retail premises.”
• The delivery must satisfy all video surveillance requirements for point-of-sale areas.

Food and Drink in Consumption Lounge [§15407]

• A licensed retailer or licensed microbusiness authorized for retail sales who operates a consumption area on the licensed premises may also sell prepackaged non-cannabis infused, non-alcoholic food and beverages, provided the applicable local jurisdiction allows such sales.
• Consumers are allowed to bring or receive non-cannabis infused, non-alcoholic food and beverages from a restaurant or delivery service for consumption in the consumption area, provided the applicable local jurisdiction allows such activities. 

CHANGES TO REGULATIONS AFFECTING NON-STOREFRONT RETAILERS

Delivery Requirements [§§15415-15418]

• Deliveries shall only be received by customers during the hours of operation
• Delivery employees only have to return to the licensed premises after making their last delivery of the day if they have any unsold cannabis goods to return to the premises. 
• While carrying cannabis goods for delivery, cannabis goods must be stored in either a:
  • Secure, fully enclosed trunk that cannot be accessed from inside the vehicle; or 
  • In a Secured Area or compartment within the vehicle. 
    • “Secured Area” is defined as an area where solid or locking metal partitions, cages, or high-strength shatterproof acrylic can be used to create a secure compartment in the fully enclosed vehicle. 
    • The Secured Area may include three sides of any part of the body of the vehicle, provided the parts of the vehicle used are shatterproof and not made of glass.
• Maximum value of cannabis goods carried in a delivery vehicle has been increased to $10,000. 
• The $3,000 limit for goods without a corresponding purchase order has been removed.

CHANGES TO REGULATIONS AFFECTING TEMPORARY EVENT LICENSES 

Participation in Temporary Cannabis Events by Non-Retail Licensees [§15603.1]

• Non-retail licensees can now participate in temporary events and display cannabis or cannabis products, provided such licensees comply with the applicable product limits set forth in Section §15603.1(a)(1).
• Non-retail licensees can provide cannabis or cannabis products to attendees of the event for inspection and educational purposes only. 
• Non-retail licensees can display non-cannabis products such as cannabis accessories, packaging materials, promotional materials, and branded merchandise. 
• Non-retail licensees can sell branded merchandise and cannabis accessories.

CHANGES TO REGULATIONS AFFECTING REGULATORY PRODUCTS

Prohibited Products [§17300]

• Caffeine is no longer included as a prohibited additive. 
• New prohibition on any product delivered using a metered-dose or dry-powder inhaler.
• New prohibition on any product administered to the eye or nasal passages. 
• New prohibition on any product injected by piercing the skin. 

NEW REGULATION Additional Requirements for Tinctures [§17302.1]

• A tincture: 
  • Shall be no more than 2 fluid ounces, AND 
  • Shall include a calibrated dropper or similar device for measuring a single serving.
• Can include other ingredients, provided that the primary ingredient is alcohol, vegetable oil, or glycerin.

NEW REGULATION Additional Requirements for Inhaled Products [§17303.1]

• Products intended for inhalation can only contain:
  • Cannabis
  • Cannabis concentrate
  • Terpenes
  • Rolling paper
  • Leaf
  • Pre-roll filter tips
  • Ingredients permitted by the FDA as an “inactive ingredient” for inhalation.
    • FDA inactive ingredient list available here
• The intent of this regulation is to limit the substances that can be used to add flavor to inhaled products, including flavors that are attractive to children, by masking the natural flavor and aroma of cannabis.
  • Artificial, synthetic, and natural flavorings or terpenes that do not contribute to the natural flavor or aroma of cannabis are not permitted. 
  • Added terpenes do not need to be cannabis derived but they must be consistent with the terpenes that naturally exist in cannabis. 

Cannabis Beverages [§17411(a)(6)]

• May now be packaged in glass containers that are clear or any color (previously beverage container had to be opaque).