California has suspended nearly 400 marijuana business permits, temporarily paralyzing roughly 5% of the state’s legal cannabis supply chain ranging from retailers to distributors.
Those companies must cease all sales transactions until their licenses are reinstated to “active” status, leading one prominent trade group to criticize the state for temporarily reducing the number of legal shops.
The Bureau of Cannabis Control (BCC) on Nov. 1 issued notices to 394 retailers, delivery services, distributors and micro-businesses that they won’t be legally able to conduct business until they’ve undergone mandatory track-and-trace system training and credentialing, a spokesman for the agency confirmed.
As of Wednesday, the suspended licenses had dipped to 385 and included:
The BCC currently oversees 2,630 marijuana companies that hold either provisional or annual licenses, while the California Department of Public Health (CDPH) oversees an additional 932 manufacturers, and the state Department of Food and Agriculture (CDFA) oversees 3,830 MJ farmers.63 retailers
- 61 delivery services
- 47 microbusinesses
- 185 distributors
- 29 distributors that are transport-only
All told, California has a total of 7,392 licensed cannabis businesses.
Failure to complete track-and-trace steps
The problem, said BCC spokesman Alex Traverso, is that all the 394 affected businesses have had ample time to complete the required track-and-trace steps and to begin uploading their inventory data so state regulators can keep tabs on the cannabis supply chain via Florida-based Metrc’s software.
The Metrc requirement is part of being awarded a provisional license, a transitional process from a temporary license to a permanent annual permit. All temporary licenses expired over the summer.
Any business that was given a provisional business permit was also given five days to sign up for Metrc, take required training and begin using the system.
But the 394 companies hadn’t done so.
“So, finally, about a week ago, we sent out another note, saying, ‘By this past Friday (Nov. 1), you guys need to be in Metrc, signed up or officially your license is going to be suspended,’” Traverso said. “The gist of it is, now if they go out and they get their credential, the suspension is lifted.”
By comparison, Traverso noted, another 2,236 licensed businesses completed the Metrc credentialing process and are uploading their inventory data.
Published: November 06, 2019
Founder & Interim Editor of L.A. Cannabis News