A Quick Cannabis Licensing Guide in California
This year marks the beginning of California’s third year in legal cannabis sales. This new, but lucrative industry has grown tremendously in the last two years, overcoming various challenges such as competing against a strong marijuana black market, constant changes in regulations, and cannabis licensing setbacks. Despite all of these hurdles, California remains on top having the largest legal cannabis market in the world.
For businesses looking to make their way into the cannabis industry, here’s a few things you need to know that will make your life a little easier:
Know The Cannabis Licensing Agencies in California
There are three licensing authorities in charge of regulating the marijuana market and issuing commercial cannabis licenses.
- The Bureau of Cannabis Control – The Bureau of Cannabis Control (BCC) is responsible for licensing cannabis retailers, distributors, testing labs, microbusinesses, and temporary cannabis events.
- CalCannabis Cultivation – CalCannabis Cultivation Licensing is a division of the California Department of Food and Agriculture. This is the agency tasked with licensing and regulating cultivation licenses in California. They also manage the state’s track-and-trace system which tracks all commercial cannabis transactions from cultivation to sale.
- Manufactured Cannabis Safety Branch – The Manufactured Cannabis Safety Branch is a division of the California Department of Public Health. They are responsible for regulating all commercial cannabis manufacturing.
If you’re unsure of which cannabis licensing agency you need to submit your application through, contact WeCann to consult with one of our cannabis licensing experts.
Know What Type of License You Need to Apply For
There are various types of commercial cannabis licenses a business can apply for and various subtypes of licenses in California.
Cannabis Cultivation Licenses
If you’re a cannabis cultivator you will need a cultivation license. Cannabis cultivators can apply for 17 different license types categorized by size and production type. Note that “large” cultivation licenses will not be issued before January of 2023.
- Type 1—Cultivation; Specialty outdoor; Small.
- Type 1A—Cultivation; Specialty indoor; Small.
- Type 1B—Cultivation; Specialty mixed-light; Small.
- Type 1C—Cultivation; Specialty cottage; Small.
- Type 2—Cultivation; Outdoor; Small.
- Type 2A—Cultivation; Indoor; Small.
- Type 2B—Cultivation; Mixed-light; Small.
- Type 3—Cultivation; Outdoor; Medium.
- Type 3A—Cultivation; Indoor; Medium.
- Type 3B—Cultivation; Mixed-light; Medium.
- Type 4—Cultivation; Nursery.
- Type 5—Cultivation; Outdoor; Large.
- Type 5A—Cultivation; Indoor; Large.
- Type 5B—Cultivation; Mixed-light; Large.
Cannabis Manufacturing Licenses
The Manufactured Cannabis Safety Branch offers four types of cannabis manufacturing licenses. Each license type can perform tasks assigned to the license type below it.
- Type 7 – for extraction using a volatile solvent.
- Type 6 – for extraction using a mechanical method or non-volatile solvent.
- Type N – for infusions.
- Type P – for packaging and labeling only.
There’s also a fifth license type (Type S) for shared-used manufacturing facilities.
California Cannabis Retail Licenses
California cannabis retail licenses are issued by the Bureau of Cannabis Control and allow entities to sell cannabis goods either through a storefront retailer or delivery services. Micro-business licensees may cultivate cannabis in regulated areas and also distribute cannabis products.
- Type 10 – General Dispensary (storefront cannabis retailer)
- Type 11 – Distributor (non-storefront retailers sell cannabis goods strictly through delivery services)
- Type 12 – Micro-Businesses
Cannabis Testing Labs
Cannabis testing licenses allow businesses in the state of California to test cannabis goods that they receive from cultivators before they can be sold by cannabis retailers and distributors.
- Type 8—Testing laboratory.
There are over 20 commercial cannabis license types available in California. Having an understanding of the different cannabis licenses and licensing agencies is a solid place to start for businesses entering the cannabis industry in the Golden State.
Obtaining Local Permits
Although the state of California voted to allow commercial cannabis activity beginning in 2018, municipalities have the choice of whether they permit cannabis businesses from operating in their jurisdiction. Out of 482 municipalities, only 161 allow commercial cannabis activity. They can also choose what kind of cannabis activity they allow.
There are many opportunities for cannabis new businesses to grow but it’s important to be aware of what kind of local laws govern the county or municipality where your business will be operating.
Contact us for a list of cities where commercial cannabis activity is permitted in California.