Introduction to California Cannabis Compliance

California Cannabis Compliance: State and Local Cannabis Regulations

California cannabis compliance is complex. Licensees must comply with both local and state cannabis regulations and must recognize that some local jurisdictions may not allow commercial cannabis activity within their borders.

Prop. 64 grants broad authority to local government to regulate cannabis within its jurisdiction, including the discretion to prohibit commercial cannabis activity altogether or to only allow certain license types.

Expanding the Definition of California Cannabis “Compliance”

A business’s definition of “compliance” must include more than just the state and local cannabis regulations.

Focusing only on state and local cannabis regulations ignores potential local, state, and federal law that may apply to a cannabis business. Many state and local cannabis regulations either fail to mention relevant sources of outside law entirely or make cursory mention of them.

For example, California cannabis regulations require licensees to complete a Cal-OSHA 30-hour general industry outreach course but do not otherwise require licensees to comply with Cal-OSHA regulations.

The above examples are not presented as a criticism of the cannabis regulatory agencies in California, or any other state agencies that regulate cannabis. Local, state, and federal law outside of cannabis-specific regulations are often independently regulated and enforced, thereby limiting the information that state and local cannabis regulatory bodies can provide.

Rather, the examples are presented as a warning to businesses and service providers alike:

Do not stop at your state and local cannabis regulations when developing a compliance program.

California Disciplinary Guidelines

Businesses also should search for any disciplinary guidelines published by state or local regulators. Disciplinary guidelines are typically either included within a jurisdiction’s regulations or published as a stand-alone document.

For example, the California Department of Cannabis Control’s disciplinary guidelines establish a three tier disciplinary structure and provide a list of compliance violations and the tier they fall into. The higher the tier, the more serious the punishment a licensee may face. Seek out the most serious compliance violations in your jurisdiction and craft your compliance program accordingly.

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