Cannabis News

Oregon Cannabis: New Rules, Part 1


The coming new year has announced new administrative regulations for marijuana in the state of Oregon. These changes came as part of the Oregon Liquor and Cannabis Commission (OLCC) rulemaking process. This process, in turn, stems from cannabis laws passed by the Oregon legislature. earlier this year.

We gave a brief overview of the new rules Last week. With the volume of changes, we plan to write a few articles analyzing these changes. Today I will focus on “common property” issues. The following articles will focus on the regulation of hemp, artificial cannabinoids, and CBN.

New rules: definition of “common property”

Oregon allows verticality in its regulated cannabis program. Some of the new rules arise from the fact that licenses are often held jointly between producers, retailers, etc. The Oregon legislature addressed this issue in SB 408, providing:

As used in this section, “commonly owned” means, as further defined by the Oregon Liquor Control Board, that a person included in an application for a license under ORS 475B .070 has an interest in or authority over the management of another entity for which a license has been issued under ORS 475B.070.

This legislative change led the OLCC to revise the definition of common property in OAR 845-025-1015. to the following:

(21) “Common ownership” (a) means any point in common between natural or legal persons designated as applicants or persons having a financial interest in a license or a business proposed for obtaining a license. who have a financial interest or management responsibilities for one or more additional licenses.

(new language in italics). The commercial reality of common ownership between licenses of the same and different types has led the OLCC to revise several other rules, discussed below.

New rules: transfer of privileges

Important changes included the transfer of privileges between the four different types of licenses: producer, processor, wholesaler and retailer.

For years, the rules have restricted who marijuana growers can sell, transfer, transport, and deliver their product to. Important restrictions included the ban on transfers from producer to producer. Most of these restrictions have been lifted:

  1. Marijuana growers can now engage in grower-to-grower sales, transfers, transportation and deliveries of usable marijuana when growers are in common ownership.
  2. Marijuana growers may also transfer whole, non-living marijuana plants removed from a growing medium to the licensed premises of another commonly owned grower. Previously, these transfers were only allowed to processors, wholesalers, not-for-profit dispensaries and holders of research certificates.
  3. Marijuana growers can also transfer kief between growers with common ownership.

Additionally, a marijuana grower can now purchase and receive:

  1. marijuana and marijuana plants from a commonly owned producer;
  2. marijuana produced by the licensee that has not been processed by a processor;
  3. cannabinoid products, cannabinoid extracts and cannabinoid concentrates from a marijuana processor that have been manufactured using only marijuana produced by the recipient producer;
  4. up to 200 total marijuana seeds per month from any source in the State of Oregon other than a licensee, laboratory licensee or research certificate holder; and
  5. marijuana seeds from a retailer.

The OLCC also simplified the language of retailer-to-retailer shopping by simply allowing a retailer to buy, possess, or receive “common property retailer marijuana items.” Previously, the rule described the category of persons eligible for such transactions as those belonging to “the same or substantially the same persons”.

How (and to whom) the new rules are helping

The main benefits of these changes will be for business structures that have a horizontal component at the marijuana cultivation level, as well as those that have a vertical organizational structure.

Changes to producer transfers in particular are expected to reduce internal transaction costs, as many operations have been forced to obtain a wholesale license to engage in producer-to-producer transactions, with the wholesale license acting as ” man in the middle ”for those kind of deals.

Another benefit may arise from multi-license operations which are engaged in the sale of an entity and which wish to transfer inventory between other assets held in common.

Stay tuned for further analysis and commentary, including around the work OLCC is doing on cannabinoid definitions. For other relevant reading, see also:



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