California Regulators Adopt Emergency Rules Allowing Marijuana Retail Licenses to Be Split Ahead of Federal Rescheduling Deadline
- California’s Department of Cannabis Control (DCC) has introduced emergency regulations allowing marijuana retailers to separate their combined adult-use and medical licenses into individual Aand M-designated licenses.
- Licensees currently holding combined Aand M-licenses can request a modification to split these into standalone adult-use and medical licenses by submitting required business and license information through Form 9207 or email.
- The changes aim to prepare businesses for federal registration opportunities following marijuana’s rescheduling, with a priority registration deadline from the DEA on June 26, urging timely submissions.
- DCC clarified that businesses must maintain current operations until approval of the request, inventory must remain under the existing license’s track-and-trace system, and advised consulting legal counsel for federal registration decisions.
California’s Department of Cannabis Control has adopted emergency regulations allowing certain marijuana retailers to separate their adult-use and medical license designations in response to federal rescheduling.
The emergency rules apply to licensees currently authorized to conduct retail activity under a combined adult-use and medicinal-use license, known as an A- and M-designated license. Under the new process, those businesses may request to modify the license into a standalone A-license and a separate M-license.
The move comes as marijuana businesses prepare for potential federal registration opportunities tied to rescheduling. DCC said licensees are encouraged to submit modification requests as soon as possible to avoid delays in obtaining a separate M-designated retail license before the Drug Enforcement Administration’s priority registration window closes on June 26.
To request the separation, the designated responsible party for the license must submit information including the legal business name and license number for the existing A- and M-license, the legal business name of the related entity, its Federal Employer Identification Number, seller’s permit number from the California Department of Fee and Tax Administration, and business formation documents.
The new M-license may be held by a different entity than the existing license, but DCC said the ownership listed on both the existing license and the related M-license must match exactly. The two licenses also cannot share the same CDTFA seller’s permit number or FEIN.
Requests may be submitted using Form 9207, Request to Separate M-designation Retail License, or by emailing the required information and supporting documents to DCC’s license change email address. The request must be submitted by the designated responsible party using the email address listed in the license record.
DCC said businesses must continue operating under their existing A- and M-designation until a request is approved. Once approved, separate A- and M-license certificates will be available in the license record.
The department also noted that licensees issued a separate M-license must continue holding all inventory and conducting all sales through the existing license’s track-and-trace account until additional guidance or statutory or regulatory changes are made.
DCC emphasized that it is not advising businesses on whether pursuing federal registration is the right decision or whether the license modification is necessary to obtain registration approval, and said licensees should consult with legal counsel and business advisors.