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Washington Marijuana: State May Allow CBD Additives

The Washington State House of Representatives is considering House Bill 2334, which would allow licensed marijuana producers and processors to use cannabidiol (CBD) from a source not licensed by the Washington State Liquor and Cannabis Board (LCB). The bill defines a “CBD product” as “any product containing or consisting of cannabidiol” and would permit the use of CBD products from unlicensed sources so long as the CBD product has a THC level of 0.3 percent or less on a dry weight basis and has been lab tested.

Washington’s regulated cannabis market is a closed loop that works on the principle that no marijuana comes in and none goes out. Everything sold in a licensed retail store is grown by licensed producer and processed into products like oils and edible by a licensed processor. If a licensee is caught bringing in marijuana from an outside source, the LCB will cancel the license.

HB 2234 would have the most impact on processors who could add CBD to products such as marijuana oils, candies, capsules, and other infused products. Though HB 2334 is still far from being law, processors in Washington have flirted with the idea of using unlicensed CBD to create products with higher CBD concentrations. Processors who choose to enrich products with unlicensed CBD do so at their own risk.

The legal basis for claiming that using CBD from cannabis outside of Washington’s regulated market is based on the idea that not all cannabis is in fact “marijuana” and that products containing CBD derived from “Industrial Hemp” or from portions of the cannabis plant that are excluded from the federal Controlled Substances Act’s (CSA) definition of “marijuana” are legal under federal law.

Section 7606 of the 2014 US Farm Bill (the Farm Bill) creates the framework for the legal the cultivation of “Industrial Hemp”, which is defined as cannabis with a THC concentration of less than 0.3% on a dry weight basis. The Farm Bill allows states to enact pilot programs for hemp research purposes. Washington has such a program, though it is underfunded. Hemp that is cultivated in compliance with a state’s pilot program is legal pursuant to the Farm Bill, although the sale of any products derived from this research is not explicitly allowed.

Last year, the state legislature required that the LCB study the viability of allowing processors to use hemp cultivated by licensed hemp farmers. See RCW 15.120.060. It’s also possible that a processor could use CBD derived from a hemp cultivator in another state that has implemented an Industrial Hemp program under the Farm Bill, but the Drug Enforcement Administration (DEA) has issued a Statement of Principle claiming that the interstate transfer of Industrial Hemp is outside the scope of the Farm Bill and therefore unlawful.

Processors may also claim that if CBD is derived from the mature stalks of the cannabis plant, it is not prohibited by the CSA. The CSA’s definition of marijuana “does not include the mature stalks of such plant, fiber produced from such stalks, oil or cake made from the seeds of such plant, any other compound, manufacture, salt, derivative, mixture, or preparation of such mature stalks (except the resin extracted therefrom), fiber, oil, or cake, or the sterilized seed of such plant which is incapable of germination.” 21 USC §802(16). In the early 2000’s, two cases out of the Ninth Circuit, Hemp Indus. Ass’n v. DEA, 357 F.3d 1012 (9th Cir. Cal. 2004) and Hemp Indus. Ass’n v. DEA, 333 F.3d 1082 (9th Cir. 2003) clarified that the DEA could not regulate hemp products merely because they contained trace amounts of THC. According to these rulings, some portions of the cannabis plant are explicitly outside the scope of the CSA. Thus, the court ruled that the DEA was not permitted to expand the scope of the CSA to encompass all parts the cannabis plant.

Because it was illegal to grow hemp in the United States until 2014, the Ninth Circuit decisions only applied to hemp imported from other countries. For CBD sourced from domestically grown hemp, today’s processors would need to know for certain from which part of the cannabis plant the CBD was derived to have a credible argument. If the CBD were sourced from any portion other than the mature stalks or seeds incapable of germination, then the product would be derived from marijuana and the processor could lose its license. There is also a question of whether a meaningful amount of CBD can even be extracted from mature stalks and seeds incapable of germination.

Processors who are using CBD additives do so at their own peril. Neither of the above legal theories provides much security as the licensee is counting on the fact that the LCB will accept this complex legal analysis and determine that the licensee is not using unlicensed cannabis. HB 2334 would provide some clarity and create a legitimate method to use unlicensed CBD. HB 2334 could also create an incentive for more farmers to participate in Washington’s fledgling hemp market. Finally, the bill would likely result in an increase in high-CBD products that some consumers–especially medical cannabis users–feel Washington’s market lacks.

For the bill to become law, it would have to pass the House, pass the Senate, and be signed by the Governor. It’s still too early to tell with HB 2334 will make it, but it’s worth keeping an eye on for now.

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Oregon Cannabis Laws: The 2018 Draft Bills Are Here

oregon marijuana cannabis
Just the facts on pending Oregon cannabis laws.

The Oregon legislative session began on Monday. Because 2018 is an even-numbered calendar year, this session is a short session, lasting just 35 days. That fact hasn’t stopped Oregon democrats from targeting ambitious policy objectives like cap-and-trade, along with a host of other items that will likely not get done. As to cannabis, there won’t be much movement, despite persistent rumors and calls for a limitation on license issuances, and the calls for an uptick in enforcement dollars.

Last year, Oregon kicked off the legislative session with 30 or so draft cannabis bills. This year, we have four. Two of them are likely to go nowhere and two may pass if things go well, but with significant modifications. The aptly named Joint Committee on Marijuana Regulation dissolved last session, which means that cannabis will get even less attention than before. Still, its former co-chair and Senate Majority Leader Ginny Burdick presides over the rules committee, and for that reason alone, we expect these bills get some play.

Below is the 2018 list, including links to each bill. As a reminder, text in bold typeface is proposed new language, and text in [italicized and bracketed] typeface is language that would be removed from existing statutes.

Senate Bill 1544

This bill would remove the 24-inch height limitation on immature plants produced for medical purposes. (Today, medical growers can theoretically have infinite starts.) It would also change the possession limit on immature marijuana plants for registered medical growers and for those responsible for medical grow sites. Finally, the bill proposes to exempt processors from testing requirements in the limited context of processing for a medical marijuana cardholder or that cardholder’s caregiver.

Will this bill pass? It’s possible, but if it does, it will probably look a lot different than it does today. SB 1544 is the “gut and stuff bill” we previously anticipated: it is rife for amending and may look different a few weeks from today. The changes related to medical starts are likely to stay, because this is something the feds are said to have noted as missing from the medical program. We may also see clean-up of language clarifying whether a person can be a designated grower for his or her own home grow under Oregon Health Authority (OHA) rules, and other minor issues. But the chance of consensus on multiple, high-impact issues is small.

Senate Bill 1555

This one has been moving along, with a few amendments already made. It will not impact Oregon cannabis industry players much, however, as it merely modifies the percentage allocation of marijuana tax revenues among various state beneficiaries. This one is an “emergency” bill, for what it’s worth, which means it would take effect immediately on passage.

House Bill 4110

This bill would allow the Oregon Liquor Control Commission (OLCC) to issue temporary “special events” licenses to qualified marijuana processors, producers, retailers and wholesalers. People have advocated for event licensing seemingly forever, but this is not an issue where consensus is easily gathered. For that reason, and because the session is so short, we give this bill a very low chance of going anywhere. If it surprises us, though, this one is also an emergency bill and would take effect immediately.

HB 4089

This is another emergency bill, but it relates to industrial hemp and not marijuana. It’s a big, multifaceted bill that was brought by the Oregon Industrial Hemp Farmers Association, and, like the recent OLCC rule amendments, it does a lot to shore up the Oregon hemp program. As with SB 1544, we anticipated this bill a few weeks back. Here are the highlights:

  • Provides for OHA labs to test industrial hemp and related commodities;
  • Authorizes OLCC to enforce provisions of hemp laws that incorporate provisions of marijuana laws;
  • Changes the description of the limit on production and storage of homegrown cannabis plants;
  • Allows the Oregon Department of Agriculture (ODA) to adopt rules establishing higher average THC limits for industrial hemp if a higher average concentration limit is established by federal law;
  • Establishes a university pilot program to label and certify hemp seed; and
  • Establishes an Industrial Hemp Fund and appropriates money for administering hemp statutes.

For all it does, however, HB 4089 may be more notable for what it does not cover. Those items include:

  • A provision limiting the ability of hemp growers to sell high THC products;
  • A bill-of-lading, transport, or manifest requirement for ODA permittees similar to that for OLCC licensees; and
  • Tracking provisions related to the movement of hemp into OLCC channels.

We expect the legislature to look at these possible additions to HB 4089 and more, and we expect this bill to pass in some form. For now, though, it’s time to kick back and watch. We will report with a summary next month, at the end of the session.

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Growing Pains: Can Sustainable Farmers Survive Legalization?

Securing local and state licenses to cultivate cannabis is costly

The California counties of Humboldt, Mendocino and Trinity, which comprise the Emerald Triangle, emerged as the epicenter of domestic cannabis cultivation in the late 1970s and early ‘80s. After the Golden State legalized medical marijuana in 1996, the nascent cannabis industry spread throughout much of Northern California’s remote regions and into the Central Valley. But today anxiety is high in weed country, which desperately needs the industry to survive.

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Green Rush Blues: California Cannabis After Legalization (Part 1)

The huge underground cannabis economy was woven into the commercial fabric of California long before the 2016 passage of Proposition 64, which legalized marijuana for adult use. Transforming a shadowy, multibillion-dollar industry into a heavily taxed and regulated structure presents unique and enormous challenges. Who will gain and who will lose under the new regime? Will the expected financial dividend from legalization be broadly distributed throughout the Golden State?

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New Oregon Cannabis Rules: Part 4 – Industrial Hemp

hemp oregon

In the three previous entires to this series (here, here, and here), we have discussed the major changes in the packet of rules amendments that the OLCC adopted at the end of 2017. Those changes cover promotional events, lender disclosures, and canopy size changes for marijuana grows. Today, we want to talk about the new rules for industrial hemp.

Industrial hemp regulation has been going through a series of rapid shifts since 2016, when the Oregon legislature adopted a two-tier system that allowed for the registration of industrial hemp growers (producers) and handlers (processors). At the time, only hemp handlers could sell industrial hemp products. This changed last year, when Governor Kate Brown signed into law SB 1015, which allows industrial hemp to enter into the recreational cannabis supply line.

Just before the new year, the OLCC adopted amendments to its administrative rules on cannabis that implemented SB 1015, providing much needed guidance on the new hemp regime. First and foremost, the term “industrial hemp” refers to any cannabis plants with a THC concentration below 0.3 percent, mirroring the definition under federal law. Hemp growers and handlers can apply to the OLCC for an industrial hemp certificate ($500 per year, plus a $250 application fee) to transfer hemp to recreational processors, and handlers can also receive a certificate to transfer their hemp concentrates and hemp extracts to recreational processors.

In turn, recreational processors can apply for a special “endorsement” that will allow them to accept hemp and hemp products from the handlers and growers, create hemp concentrates or extracts with a THC concentration below 5 percent, incorporate hemp concentrates or extracts into “marijuana items,” and sell those products to other OLCC processors, wholesalers, and retailers. OLCC retailers can then turn around and sell these hemp-based products to Oregon consumers.

None of this answers the question that we receive most often from industrial hemp producers: “Can I sell my industrial hemp products outside of Oregon?” It goes without saying that OLCC retailers must sell locally, so any hemp products transferred into the recreational supply chain can only be sold in Oregon. Hemp outside of the recreational chain is regulated by the Oregon Department of Agriculture (ODA). The ODA’s rules are surprisingly wide open when it comes to the sale of industrial hemp products. Under OAR 603-048-0100, a hemp handler can sell hemp products “to any person.” The ODA’s rules make no reference to whether that sale must occur in Oregon.

While interstate sales of hemp products may be legal in Oregon in certain circumstances, federal law on the issue is anything but clear. The DEA has taken the position that any concentrate or extract derived from the flower, leaves, or resin of any plant of the cannabis family, regardless of relative THC concentration, is a prohibited Schedule I drug. In contrast, the mature stalks of such a plant and fiber from such stalks, as well as oils or cake derived from hemp seeds or stalks are not included in the federal definition of marijuana, and are not subject to federal prohibition. There is currently a lawsuit pending before the Ninth Circuit Court of Appeals that challenges the DEA’s position, and we can hope that the court will provide a bit of guidance in this area. For now, we still advise our clients to keep their products in Oregon.

Note: Portions of this post were originally published in the Portland Mercury and are republished here with permission.

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Thank you Dennis Peron

Dennis Peron

To accommodate a deluge of new members, Dennis Peron moved the San Francisco Cannabis Buyers Club in 1995 to a converted five-story warehouse at 1444 Market Street, a busy locale near the San Francisco Civic Center.

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Green Rush Blues: California Cannabis After Legalization

The huge underground cannabis economy was woven into the commercial fabric of California long before the 2016 passage of Proposition 64, which legalized marijuana for adult use. Transforming a shadowy, multibillion-dollar industry into a heavily taxed and regulated structure presents unique and enormous challenges. Who will gain and who will lose under the new regime? Will the expected financial dividend from legalization be broadly distributed throughout the Golden State?

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CBD Beauty and Skincare Products in California’s Shifting Regulatory Landscape

marijuana CBD cannabis
CBD and skin care: it’s complicated.

As I read this week’s Forbes article titled, “Cannabis Could Be The Most Profitable Ingredient In Skincare, If The U.S. Government Allows It,” it felt like déjà vu. Legislators, law enforcement, lawyers, and cannabis business owners have been going in circles for years now trying to figure out how, exactly, CBD products fit within the current state and federal regulatory structure. But despite the potential legal ramifications of violating the Controlled Substances Act (CSA), CBD companies, particularly those manufacturing beauty and skincare products, are cropping up everywhere and expanding rapidly.

We wrote a few months ago about Target, which pulled a line of CBD products from its website after a BuzzFeed article calling out the sales. And even Forbes, which stated that “A Sephora executive who asked to remain anonymous confirmed the beauty giant has plans to launch at least one CBD-based skincare brand this year,” was unable to reach anyone at Sephora for comment. These large companies have legal counsel who are undoubtedly cautioning them against venturing into the realm of cannabis and CBD; such high-profile sales of CBD products would be an easy target for federal enforcement.

Because we’ve been getting so many inquiries on this topic in California and elsewhere from companies that are unsure whether or not they need a manufacturing license to make these products and a retail license to sell them, and because this is obviously still a hot topic in the media, we thought it would be a good time to revisit the Drug Enforcement Agency’s (“DEA”) stance on the subject, as well as the scenarios under which CBD products are arguably legal under federal law.

Currently, the DEA’s stance is that CBD as well as other cannabinoids derived from cannabis are Schedule I substances under the CSA, regardless of their source. In 2016, the DEA clarified that “marihuana extract,” which is an extract “containing one or more cannabinoids derived from any plant of the genus Cannabis,” is marijuana, and therefore a Schedule I controlled substance. The DEA’s use of the word “any” means that this interpretation applies to any derivative of the cannabis plant, including CBD and any of the other cannabinoids found in cannabis. This definition is extremely broad, and according to the DEA, makes derivatives of the cannabis plant that were formerly thought to be legal, illegal.

As we’ve discussed before, there are three scenarios in which cannabis extracts are arguably legal under federal law. The first scenario is when extracts are derived from the “mature stalk” of the cannabis plant, because the CSA’s definition of marijuana “does not include the mature stalks of such plant, fiber produced from such stalks, oil or cake made from the seeds of such plant, any other compound, manufacture, salt, derivative, mixture, or preparation of such mature stalks (except the resin extracted therefrom), fiber, oil, or cake, or the sterilized seed of such plant which is incapable of germination.” 21 USC §802(16). The DEA has clarified that the rule does not apply to portions of the plant specifically exempt from the CSA’s definition of marijuana, but there is debate as to whether products that contain any meaningful amount of CBD can be derived from the mature stalks.

Another scenario is when extracts are derived from an industrial hemp plant lawfully grown in compliance with Section 7606 of the 2014 US Farm Bill (“The Farm Bill”). The Farm Bill allows states to enact pilot programs for hemp research purposes. Hemp that is cultivated in compliance with a state’s pilot program is legal pursuant to the Farm Bill, although the sale of any products derived from this research is not explicitly allowed.

The third scenario is when products are derived from imported hemp. In the early 2000’s, two cases out of the Ninth Circuit, Hemp Indus. Ass’n v. DEA, 357 F.3d 1012 (9th Cir. Cal. 2004) and Hemp Indus. Ass’n v. DEA, 333 F.3d 1082 (9th Cir. 2003) clarified that the DEA could not regulate hemp products merely because they contained trace amounts of THC. This was because some portions of the cannabis plant are explicitly outside the scope of the CSA, and the DEA was not permitted to expand the scope of the CSA to encompass all parts the cannabis plant. At the time of the ruling, it was illegal to grow hemp so it only applied to hemp imported from outside the USA. Some now argue that the holding could apply to hemp grown pursuant to the Farm Bill although, as stated above, commercial sales of these products is not explicitly allowed.

The Hemp Industries Association has sued the DEA over the “marijuana extract” rule, and that case is still pending. Until it’s decided, we’re left with a legal quagmire of rules interpretations that leave businesses selling CBD products in a precarious legal position. And of course, if you’re hoping to sell to cannabis dispensaries in any regulated state, including California, you’ll have to be licensed by that state, and you’ll only be able to sell to other licensees. Given the recent shift in federal enforcement priorities, we wouldn’t be surprised to see an uptick in enforcement action against companies selling CBD skincare and beauty products, particularly in interstate commerce and outside the ambit of state regulatory systems. But that’s a legal and business risk that many are clearly still willing to take.

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Cannabinoid-Pharmaceutical Interactions: What You Need to Know

Cannabis samples being prepared at Sonoma Lab Works for analysis

Interactions between medications are very common, especially in elderly populations that medicate for pain, diabetes and high cholesterol. The geriatric population is also the fastest-growing group of medical cannabis users. Cannabis has demonstrated efficacy in treating pain, and some phytocannabinoids have been suggested for various metabolic conditions.

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Get High and Lose Weight?

cannabis for weight loss

Evidence shows marijuana users are much less likely to develop metabolic syndrome, a significant risk factor for obesity, diabetes, and heart disease.
By Martin A. Lee On January 03, 2018

Marijuana Use Associated with Decreased Chance of Developing Metabolic Syndrome

First the bad news: The United States is facing epidemic levels of obesity, diabetes, and cardiovascular disease.

Now the good news if you are a cannabis consumer: According to a study published in the American Journal of Medicine, marijuana users are much less likely than non-users to develop metabolic syndrome, which is a significant risk factor for obesity, type II diabetes, and heart disease.

Conducted by scientists at the University of Miami in Florida, this study examined the relationship between cannabis consumption and the individual components of metabolic syndrome, such as high blood pressure, increased abdominal fat, elevated blood sugar, and unhealthy cholesterol levels.

Nearly 8,500 people from age 20 to 59 provided survey data for the study. Participants were separated into three categories—current marijuana users, past users, and those who had never smoked the herb. Whereas metabolic syndrome afflicts 22 percent of the U.S. adult population, less than 14 percent of current cannabis-using adults in this study had metabolic syndrome.

Among young adults, cannabis consumers are 54 percent less likely than non-consumers to present with metabolic syndrome. Past marijuana use is associated with lower odds of metabolic syndrome among middle-aged adults. And seniors who medicate with cannabis tend to be slimmer and less insulin-resistant than seniors who just say no.

The Munchies Receptor

The results of the study, entitled “Metabolic Syndrome among Marijuana Users in the United States,” may seem counterintuitive given marijuana’s notorious appetite-stimulating effects, jocularly known as “the munchies.” Under the influence of marijuana, flavors seem to jump right out of food. That’s because tetrahydrocannabinol (THC) activates CB1 cannabinoid receptors in the brain that rouse one’s appetite and heighten one’s sense of smell.

The munchies are a scientifically proven phenomenon. THC is a CB1 “agonist” that turns on the appetite receptor and causes it to signal. An “antagonist” will block the receptor and prevent it from signaling. Tetrahydrocannabivarin (THCV), a minor but medically significant component of the cannabis plant, is a neutral CB1 receptor antagonist.

Scientists have also synthesized “inverse agonists” that can activate a cannabinoid receptor and cause it to signal in the opposite manner from how it functions naturally. A CB1 inverse agonist will curb appetite and reduce food intake by binding to CB1 receptors, whereas THC boosts appetite and food intake by binding to CB1.

One could reasonably assume, given what we know about the munchies, that increased use of marijuana will result in greater caloric consumption with consequent adverse metabolic outcomes, including obesity. However, the results of this study and other reports indicate that such is not the case. Indeed, the opposite appears to be true.

In addition to underscoring potential health benefits of herbal cannabis, these findings highlight the discrepancy between human research that links marijuana use to lower rates of obesity compared to preclinical studies involving synthetic isolates in which CB1 antagonism (blocking the munchies receptor) and CB1 inverse agonism (flipping the anti-munchies switch) are shown to prevent obesity.

How is it possible that marijuana consumption, which activates CB1, is associated with preventing obesity in humans, while blocking or reversing the CB1 receptor via a synthetic, single-molecule compound results in weight-loss in animal models and human trials? What can explain this apparent contradiction? It may have something to do with the complementary, yet opposing functions of two different sets of cannabinoid receptors.

CB2 Receptor Activation

Australian scientists recently examined the role of the cannabinoid CB2 receptor “in modulating energy homeostasis and obesity-associated metabolic pathologies.” The CB2 receptors are concentrated in the peripheral nervous system, immune cells, and in metabolically active tissue. The Australian researchers found that CB2 receptor activation by JWH-015, a “selective CB2 receptor agonist,” reduces food intake in mice and prevents the build-up of body fat.

THC, a non-selective, plant-derived agonist, binds to both the CB1 receptor and the CB2 receptor. The fact that THC and other cannabis components (including the aforementioned THCV) activate CB2 receptor signaling may explain why marijuana users are less likely to develop metabolic syndrome than marijuana abstainers. Metabolic syndrome is a generalized, low-grade inflammatory condition, and the THC-sensitive CB2 receptor regulates immune function and inflammation.

CB2 receptor activation—through healthy diet and cannabis-enabled stress reduction—may prove to be a better strategy for preventing and treating metabolic syndrome than the misguided attempt by French pharmaceutical giant Sanofi-Aventis to market Rimonabant, a synthetic CB1 inverse agonist as an appetite suppressant. Promoted as a blockbuster diet drug in 2006, Rimonabant was soon recalled in Europe because of severe side effects, including neurological deficits, depression, and suicide. The anti-munchies pill was never approved for sale in the United States.

Sorry Big Pharma, but when it comes to preventing or mitigating metabolic dysfunction, synthetic isolates are much less effective than whole plant cannabis with its synergistic treasure trove of natural medicinal components that enhance and balance each other’s effects.

Martin A. Lee is the director of Project CBD and the author of Smoke Signals: A Social History of Marijuana—Medical, Recreational and Scientific.

Copyright, Project CBD. May not be reprinted without permission.

Sources

  • Englund A, et al. “The effect of five day dosing with THCV on THC-induced cognitive, psychological and physiological effects in healthy male human volunteers: A placebo-controlled, double-blind, crossover pilot trial.” Journal of Psychopharmacology. 2015 Nov 17.
  • Karlsson C et al, “Baseline anandamide levels and body weight impact the weight loss effect of CB1 receptor antagonism in male rats,” Endocrinology, 2015 April.
  • Verty, AN, et al. “Anti-Obesity Effect of the CB2 Receptor Agonist JWH-015 in Diet-Induced Obese Mice. PLoS One. 2015 Nov 20.
  • Vidot DC, Prad G, Hlaing WM, Arheart KL, Messiah SE. “Metabolic Syndrome among Marijuana Users in the United States: An Analysis of National Health and Nutrition Examination Survey Data.” American Journal of Medicine. 2015.
  • Yale University press release, “Mulling the marijuana munchies: How the brain flips the hunger switch,” 18-Feb-2015.
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New Oregon Cannabis Rules: Part One – Marijuana Promotional Events

Change is the only constant in cannabis regulation.

On December 22, the Oregon Liquor Control Commission (OLCC) adopted a large packet of rules amendments that incorporate the many cannabis bills signed by Oregon Governor Kate Brown this year, as well as “technical amendments [made] in response to market realities.” These changes, effective December 28, 2017, include:

  • implementation of mandatory seed-to-sale tracking for medical cannabis;
  • a new regulatory regime for hemp and hemp products that allows hemp products into Oregon’s recreational cannabis supply chain;
  • new rules governing Marijuana Promotional Events;
  • new canopy limits for growing immature plants outside of the standard canopy areas;
  • an exception to the retailers-must-be-1,000-ft-from-a-school rule if there is a physical or geographical barrier between the retail site and the school that prevents children from traveling to the retailer, such as a river;
  • new certifications for recreational wholesalers that can now trim cannabis, and can offer mobile for-hire trimming services;
  • some minor changes to transportation rules;
  • a small change to the definition of “financial interest” that will have a big impact on what investors must be pre-approved by the OLCC;
  • a new prohibition on sales through walk-up windows to complement the existing prohibition on drive-thru sales (Makes you wonder who came up with the work-around that led to this rule change); and
  • micro-tier producers can now do some processing of cannabis concentrates.

Because the changes cover quite a bit of ground, we’ll dig into several of these in more detail in future installments in this series. For now, we will focus on the new Marijuana Promotional Events, governed by OAR 845-025-1335. This new administrative rule allows recreational licensees to display their products at trade shows, which is something many of our clients have been eager to do for a while.

Under the new rules, trade shows or similar events will be organized by a single licensee or “Event Organizer”, that will be the primary contact with the OLCC. The Event Organizer must submit an application to the OLCC at least 28 days before the event that will include the names and signatures of any participating licensees, the amount and type of cannabis items that will be on display, and a control plan that explains how the participating licensees will prevent violations.

Assuming the OLCC approves an application, the participating licensees may bring and display marijuana and marijuana products from their inventory (sorry, no hemp). All of the marijuana must be returned to the licensee’s premises at the end of the event. Thus, these trade shows are not an opportunity to sell or otherwise distribute any cannabis products. Even samples are prohibited.

The ban on samples will probably dissuade some members of the public from attending, but that rule is no different than the ban on samples from licensed dispensaries generally. On the licensee side, trade shows may prove invaluable for smaller industry players hoping to distinguish themselves in a very competitive market. The other possibility, of course, is that licensees may find the regulations too strict, and decline to participate.

Check back soon for another dive into the new rules governing Oregon’s cannabis market. And Happy New Year!

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