Extensive regulations for cannabis distributors: What you need to know
When the Bureau of Cannabis Control (BCC) published emergency regulations last month, there was a lot of information to take in. Distributors, of course, are one cannabusiness type affected. Here, we go over some of the specific regulations and how CCA can help you along the way.
Cannabis distributor regulations
A distributor is a cannabusiness type that procures, sells and/or transports cannabis between licensed cannabis businesses (which can include a cultivator, manufacturer or retailer). They are regulated by the BCC and are ultimately responsible for filing and paying cannabis excise tax and cannabis cultivation tax to the California Department of Tax and Fee Administration (CDTFA).
According to the new regulations, cannabis distributors are authorized to engage in the following activities:
- Provide storage-only services to a licensed cultivator, manufacturer, microbusiness, nonprofit or another distributor.
- Package, repackage, label and relabel cannabis for retail sale
- Package, re-package, label and relabel manufactured cannabis, but only if they also hold a manufacturing license and is packaging and labeling its own products.
Distributors are also required to contact a testing lab and arrange for product testing after taking physical possession of a batch of cannabis goods. Additionally, they are required to select a batch size in compliance with state regulations, physically observe and record video footage of the sampling by the lab testing employee, and sign and date the chain of custody form.
Licensed distributors are the only cannabusiness type that can transport cannabis or cannabis products. Cannabis products must be transported in a vehicle or a trailer, and it cannot be visible from outside the vehicle. Products must also be kept in a locked container that is secured to the vehicle, and this container cannot be opened or tampered with during transport. Vehicles or trailers with cannabis goods on board cannot be left unattended, nor parked overnight in residential areas.
Also, there is the possibility of a "transport-only" license, which simply means this distributor can only transport goods between licensees, and cannot perform other functions, such as testing, packaging or labeling. A transport-only licensee does not hold title to cannabis goods, and cannot transport to retailers, unless it is immature plants and seeds.
Let CCA be your guide
This list is not all inclusive. There are a lot of regulations for cannabis distributors, and it's easy to become overwhelmed when considering setting up a cannabis distributor business. If you'd like a company to stand by your side throughout every stage of the process, call us. CCA can assist with licensing and help ensure your business is compliant.