Recent Changes in California Cannabis Laws 2023

There is a myriad of cannabis legislation that has recently been passed in Sacramento and signed by the Governor that will majorly impact cannabis business activity in the state. The following is an overview of some of this legislation as of January 1, 2023. We hope that this is helpful for your cannabis business. Our attorneys are available for a consultation to discuss how this legislation may impact your cannabis business.

Interstate Cannabis Activity (SB 1326)

The Control, Regulate and Tax Adult Use of Marijuana Act (AUMA) is an initiative measure approved as Proposition 64 on November 8, 2016. AUMA authorizes a person who obtains a state license under AUMA to engage in commercial adult-use cannabis activity pursuant to that license and applicable local ordinances. The Medicinal and Adult-Use Cannabis Regulation and Safety Act (MAUCRSA), among other things, consolidates the licensure and regulation of commercial medicinal and adult-use cannabis activities. MAUCRSA however specifies that unless authorized by federal law, a licensee under MAUCRSA is not permitted to transport or distribute cannabis or cannabis products outside the state. SB 1326 makes an exception to the above prohibition and allows the Governor to enter into an agreement with other states authorizing medicinal or recreational commercial cannabis activity between valid licensees of both states. Essentially this bill serves as a framework to allow for interstate cannabis commerce between California and other legal states in the future. This interstate cannabis activity is contingent on an official assurance that this interstate commercial activity would not put the state at risk of federal enforcement action.

Employment Rights of Cannabis Consumers (AB 2188) 

This bill, on and after January 1, 2024, makes it unlawful for an employer to discriminate against a person in hiring, termination, or any term or condition of employment, or otherwise penalize a person, if the discrimination is based upon the person’s use of cannabis off the job and away from the workplace, except for pre-employment drug screening, as specified, or upon an employer-required drug screening test that has found the person to have no psychoactive cannabis metabolites in their hair, blood, urine, or other bodily fluids. However, this bill exempts certain applicants and employees from the bill’s provisions, including employees in the building and construction trades and applicants and employees in positions requiring a federal background investigation or clearance. It is very important to note that the bill does not preempt state or federal laws requiring applicants or employees to be tested for controlled substances as a condition of employment, receiving federal funding or federal licensing-related benefits, or entering into a federal contract. This is a step forward in the controversial topic of cannabis use outside of the workplace. This bill is an important milestone in creating a potential solution to an issue that is heavily discussed in the field of employment law as well as human resources management.

Veterinary Bill Re Cannabis for Animals (AB 1885)

This bill expands the purpose of the system established by the Medicinal and Adult-Use Cannabis Regulation and Safety Act (MAUCRSA) to include the control and regulation of the cultivation, distribution, transport, storage, manufacturing, processing, and sale of cannabis products intended for use on, or consumption by, animals. This bill makes various revisions of the definitions under MAUCRSA which would exclude livestock and other food animals from the definition of “animal” for these purposes and specify that cannabis concentrate, and edible cannabis products would not be considered processed pet foods as defined under the Pure Pet Food Act of 1969.

Existing law prohibits a licensed veterinarian from dispensing or administering cannabis or cannabis products to an animal patient. This bill changes that and additionally prohibits the Veterinary Medical Board from disciplining a veterinarian who recommends the use of cannabis on an animal for potential therapeutic effect or health supplementation purposes, unless the veterinarian is employed by or has an agreement with a cannabis licensee (conflict of interest), as specified. The bill would require the Veterinary Medical Board to adopt guidelines, by January 1, 2024, for veterinarians to follow when recommending cannabis within the veterinarian-client-patient relationship and would require the board to post the guidelines on its internet website.

The bill requires that cannabis products intended for animals comply with additional concentration and other standards adopted by regulations of the department. The bill also requires the department to publicize regulations for animal product standards no later than July 1, 2025. The bill also prohibits the marketing or sale of those products before the regulations take effect. This bill opens the doors for cannabis businesses to enter a historically massive market worth over $99 billion dollars domestically.

Medical Patients Right to Access (SB 1186)

Again existing law, the Medicinal and Adult-Use Cannabis Regulation and Safety Act (MAUCRSA) consolidates the licensure and regulation of commercial medicinal and adult-use cannabis activities, including the retail sale of medicinal cannabis. SB 1186 enacts the Medicinal Cannabis Patients’ Right of Access Act, which, on and after January 1, 2024, would prohibit a local jurisdiction from adopting or enforcing any regulation that prohibits the retail sale by delivery within the local jurisdiction of medicinal cannabis to medicinal cannabis patients or their primary caregivers by medicinal cannabis businesses. Currently as it stands, local regulations are a major hurdle in the process of commercial cannabis sales. While marijuana may be recreationally legal throughout the state, local regulations have the final say on whether one is able to open any sort of cannabis business within local jurisdiction. SB 1186 will allow for the retail sale of medicinal cannabis by delivery in any area regardless of local jurisdictions. While it may not open the doors for the full sale of recreational marijuana regardless of local jurisdiction, this bill does open doors for new medicinal cannabis sales by delivery in jurisdictions that try to prohibit retail cannabis delivery activity.

Packaging for Cannabis Beverages (AB 1646)

Existing law (AUMA and MAUCRSA) places specified requirements on the packaging of cannabis and cannabis products, including authorizing cannabis beverages to be packaged in glass containers that are clear or any color. This bill authorizes cannabis beverages to be packaged in containers of any material that are clear or any color. Quite simply, this bill will strike down restrictions on the color of packaging for cannabis beverages.

Disposal Requirements for Vape Pens and Cartridges (AB 1894)

Like AB 1646 above, existing law (AUMA and MAUCRSA) places specified requirements on the packaging and labeling of cannabis products by placing various advertising and marketing restrictions on licensees. This bill, commencing July 1, 2024, requires advertisements and marketing of a cannabis cartridge and an integrated cannabis vaporizer to display a message to properly dispose of the cartridge and vaporizer as hazardous waste. This bill also prohibits the package, label, advertisement, and marketing from indicating that the cannabis cartridge or vaporizer is disposable, implying that it may be thrown in the trash or recycled.

Allowing Venues With Liquor Licenses To Host Cannabis Events (AB 2210)

The existing law, the Control, Regulate and Tax Adult Use of Marijuana Act (AUMA), prohibits a person from smoking or ingesting cannabis or cannabis products in a public place, except as specifically provided by local authorization. The other existing law, the Medicinal and Adult-Use Cannabis Regulation and Safety Act (MAUCRSA), gives the Department of Cannabis Control (DCC) sole authority to license and regulate commercial cannabis activity, which MAUCRSA defines to include, among other activities, the sale of cannabis and cannabis products. MAUCRSA authorizes the DCC to issue a state temporary event license to a licensee authorizing onsite cannabis sales to, and consumption by, persons 21 years of age or older at a county fair or district agricultural association event, or at another venue expressly approved by a local jurisdiction, provided that certain other requirements are met.

This new bill prohibits the DCC from denying an application for a state temporary event license solely on the basis that there is a license issued pursuant to the Alcoholic Beverage Control Act for the proposed premises of the event. The bill prohibits the Department of Alcoholic Beverage Control from taking disciplinary action against a person licensed pursuant to the Alcoholic Beverage Control Act on the basis of a state temporary event license issued by the DCC to a licensee that utilizes the same premises.

Following certain requirements such as restrictions on sale and consumption of alcohol on the venue premises, AB 2210 prohibits state marijuana regulators from denying an application for a state temporary event license solely on the basis that there is a license issued pursuant to the Alcoholic Beverage Control Act for the proposed premises of the event. This piece of legislation removes potential barriers for individuals or businesses that want to organize largescale cannabis events. It allows venues with liquor licenses to validly hold cannabis events without fear of disciplinary action for having a state temporary DCC license.