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Maryland Cannabis Administration Publishes new Draft Regulations

  • Writer: Justin Tepe
    Justin Tepe
  • Oct 31, 2024
  • 3 min read

On October 30, 2024, the Maryland Cannabis Administration ("MCA") published a set of new draft regulations. The new regulations are much less voluminous than recent regulatory updates. The MCA has made several technical corrections to ensure consistency in cannabis license operation from before the last regulatory changes in June 2024. These changes are not yet in effect; the regulation changes are simply proposals right now.


Some of the pertinent updates in this round of regulatory proposals:


  • "Capsule" definition - now states that a capsule means a solid dosage form that "is enclosed in a hard or soft soluble container."

  • "Operational" - now this is defined as "physically and actively engaged in the cultivation, processing, or dispensing of cannabis."

  • Processor operations- removed the definition that processors are only authorized to provide processed products to dispensaries (this is consistent with prior MCA practice that processors may provide product to other processors or up the chain back to growers)

  • Medical Cannabis Product Availability

    • The MCA created a mechanism for medical patients, caregivers, certifying providers, and clinical directors to notify the MCA about products that are scare, limited in production, or no longer available.

    • The MCA is then authorized to implement "programs or incentives" to address product scarcity.

  • "Good faith efforts" to extend the deadline to become operational

    • Demonstrating legal control of a premises that is suitable for the business operations and complies with local zoning will "indicate consistent good faith effort"

    • This is a big development - conditional licensees are going to have a tough road ahead to get operational, and being able to get an extension by having control of a property should streamline being able to get an extension.

  • Cannabis Ancillary Businesses/Registrant Renewals

    • Previously ancillary businesses were required to resubmit fingerprints and background checks for every employee at the time of license renewal. For some entities, this resulted in significant duplication of efforts and cost to re-fingerprint dozens of employees who may have been fingerprinted in the last year.

    • NEW: no longer are renewed fingerprints/background checks part of the application process based in COMAR.

      • Important note: ancillary businesses and licensees are under an ongoing obligation to monitor and report any material criminal activity of agents during the course of their employment. This just removes the obligation to formally send every employee in for fingerprinting at the time of renewal.

  • Definition of Indoor vs. Outdoor Growing:

    • Indoor cultivation = growing plants in a permanent structure that provides control of environmental conditions;

      • A permanent structure is one designed to remain in place for 180 days or more; and includes a building, shipping container, and greenhouses.

    • Outdoor cultivation = producing flowering cannabis plants in an area that is directly or indirectly exposed to outdoor elements

      • Outdoor space may not "employ any artificial heating, air conditioning, or other climate control."

    • With the inclusion of greenhouses and shipping containers, this appears to still define a hybrid grow space as indoor. These definitions are significant when growers are considering the caps on canopy space.

  • Theft and diversion reporting

    • Removed the obligation to report theft and diversion to local law enforcement within 1 business day. REPORTS MUST STILL BE MADE TO MCA within 1 business day.

      • This is significant for protection of cannabis licensees. In certain jurisdictions in MD, local law enforcement and state's attorneys have stated that petty cannabis crimes will not be prosecuted. If a licensee reports an agent for theft or diversion, then the local law enforcement chooses not to prosecute, the licensee could be subject to civil liability to the agent.

    • Dispensaries must report a discrepancy of greater than 0.5% total product weight or items to the MCA and conduct investigations.

    • For dispensary discrepancies less than 0.5%, the dispensary would make adjustments in METRC to explain and report the discrepancy.

  • Lab Testing for growers and processors:

    • Removed the requirement to notify the MCA if a test batch does not meet specifications.

  • Dispensary Displays

    • Dispensaries can put flower, concentrates, edibles, and cannabis products in transparent (tamper-evident) containers for display purposes. They must be kept behind the counter and inaccessible to customers/patients except when examined by customers/patients.

    • All display products must be tracked in METRC and green-wasted after it's no longer in use.


A reminder: these are just DRAFT proposed regulations. None of these changes take effect until the regulations go through the normal rule-making process, are published in the Maryland Register, and final regulations are adopted.


If you have questions about these changes, please contact Justin Tepe at justin@tepe-law.com




 
 
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