Regulations are an important aspect of owning your own cannabis business, but unfortunately, they do not make this knowledge easy to attain. Since cannabis is not federally legal, each state has their own requirements and regulations. Especially for New York, it has been a slow and not-so-steady process for regulations, getting a cannabis business license, and being able to sell recreational cannabis.
Businesses Will Not Be Getting Cannabis Licenses Anytime Soon
New York legalized adult-use cannabis on March 31, 2021 with the Marijuana Regulation & Taxation Act (MRTA). This legislation created the new Office of Cannabis Management (OCM) governed by the Cannabis Control Board to oversee and implement the law. The OCM’s job is to issue licenses and develop regulations outlining how and when a business can participate in the new industry, as well as oversee the state’s existing Medical Marijuana Program and Cannabinoid Hemp Program, previously regulated by the Department of Health.
Fast forward to November 3, 2021, New York approved regulations presented by the OCM, establishing the State’s Cannabinoid Hemp Program, according to a press release. The regulations created new standards for processing, manufacturing, laboratory testing, and packaging, but only for cannabinoid hemp products. The release mentioned that further changes will be coming in the near future to account for additional public comments and harmonize certain regulations with the upcoming Adult-Use Cannabis Program.
“In New York, we will not see licenses until 2023, and I see that as a bit of a positive because we have the opportunity to do this right — to take things slow and get regulations right. ” Megan Dubatowka, a partner at Harris St. Laurent & Wechsler LLP, said. “A longer time-frame allows the regulators to get things right and allows the public to be involved in the process. Companies looking to be successful in New York can be involved in the process early and become both educated about the rules and able to provide feedback as they are being written. The OCM board meetings are public. Attend them. You can be a part of this process. You will be educated about what is expected of you for the application process, and your name will be out there as someone that is already involved and advocating for the right process where your businesses fall. That is what I would encourage for businesses that are anxious to get started.”
Everything You Need to Know About Getting a Cannabis License in New York
Even though the Marijuana Regulation and Taxation Act gave all New Yorkers the legal right to use, smoke, or possess less than three ounces, the state still has not issued any licenses to companies who will supply, ship, and sell legal cannabis to customers. There are 11 types of licenses that will be available to create that pot supply chain, including:
- Adult-use Cultivator
- Adult-use Nursery
- Adult-use Processor
- Adult-use Distributor
- Adult-use Cooperative
- Adult-use Micro Business
- Adult-use Retail Dispensary
- Adult-use On-site Consumption
- Adult-use Delivery
- Registered Organization Adult-use Cultivator Processor Distributor Retail Dispensary
- Registered Organization Adult-use Cultivator Processor Distributor
According to the New York Times, in order for the OCM to start giving out cannabis licenses, officials must first determine how the industry will operate, from the regulation and taxation of sales to the allocation of licenses for all the types of businesses listed above. The CCB is expected to release regulations between January and March of 2022.
Understanding Regulations is Crucial for Businesses
Understanding and following the regulations that each state requires is crucial for running a successful cannabis business. “If you do not have a firm understanding, you are not going to be able to comply. That can be a struggle, particularly because the regulations are not always straightforward or clear. Make sure everyone in the company knows the regulations and understands the importance of them. Participating in the cannabis market in New York is a privilege, it is not a right. If you want to have that privilege, you need to make sure you are doing so in an ethically and compliant way,” Dubatowka said.
Expanding the Medical Cannabis Program
While businesses are still waiting to be able to sell adult-use cannabis, the OCM announced on January 24, 2022 a significant expansion of the existing medical cannabis program. Now, doctors will be able to issue medical marijuana recommendations to customers for any condition that they feel could be treated by cannabis, rather than rely on a list of specific eligible maladies. Physicians were granted that discretion through the state’s recreational marijuana law that was enacted last year, according to Marijuana Moment.
This is a big leap for the New York cannabis industry and will hopefully help to push adult-use regulations and business licenses. The legalization law signed by former Gov. Andrew Cuomo already permits adults 21 and older to possess and publicly consume cannabis, but we are still waiting for retailers to be able to launch in the state. Experts say most of the state may not see marijuana retail shops until very late in 2022 or, more likely, early 2023.