Tick Tock: Licensee Timely Notification to Regulators

Managing all of the notifications required under applicable law to regulators for licensed cannabis companies can be challenging.  Many companies aren’t aware of required timelines or events requiring notification in order to appropriately notify the applicable regulatory bodies governing their licenses.  Keep in mind that any and all of the following events can trigger required notifications to regulators (this is not an all-inclusive list and is just an example of some of the more commonly reported issues):

Bureau of Cannabis Control (Retailers, Distributors, Testing Labs, Microbusinesses):

  • Criminal conviction of an owner (48 hours);
  • Civil penalty or judgment rendered against licensee or licensee owner (48 hours);
  • Order or judgment for violations of labor standards (48 hours);
  • Revocation of a local license or permit (48 hours);
  • Discovery of significant inventory discrepancy (24 hours);
  • Discovery of diversion, theft, loss or other criminal activity (24 hours);
  • Diversion, theft, loss or other criminal activity by an agent or employee (24 hours);
  • Discovery of the loss or unauthorized alteration of records related to cannabis goods customers or the licensee’s employees or agents (24 hours);
  • Discovery of any other breach of security (24 hours);
  • Changes of ownership of the licensee (14 days);
  • Changes of persons with financial interest in the license (14 days);
  • Changes of contact information in the original license application (14 days);
  • Changes of licensee name (14 days);
  • Change in business trade name (DBA) or fictitious name (14 days);
  • Changes to financial information in the original application (14 days);
  • Changes or lapse in required insurance coverage (14 days);
  • Loss of connectivity in connection with track and trace (immediate);
  • If licensee is unable to resolve a compliance notification from the track and trace system within 3 business days of receiving the notification from the track and trace system (immediate);
  • Batch testing failure which batch may be remediated- a corrective action plan must be submitted by a microbusiness (30 days);
  • Changes to transport vehicles for distributors (30 days); and
  • Changes in bond requirements (14 days).

California Dept. of Public Health: Manufactured Cannabis Safety Branch (Manufacturers):

  • Criminal conviction of any owner (48 hours);
  • Civil penalty or judgment against the licensee or any owner (48 hours);
  • Revocation of a local license or permit or other authorization (48 hours);
  • Administrative order for violations of labor standards (48 hours);
  • Change to owners of licensee (10 days);
  • Change in list of financial interest holders of licensee (10 days);
  • Change in owner information (10 days);
  • Death, incapacity, receivership, assignment for benefit of creditors or other event rendering inability to perform duties (10 business days);
  • Change in manufacturing activities (pre-approval);
  • Cessation of activities (10 days of cessation);
  • Changes to product list on file with Department (10 days);
  • Loss of access to track and trace system that exceeds 72 hours (immediate);
  • Change to designated track and trace system account manager (48 hours);
  • Discontinuation of an operation as a shared-use facility (30 days prior);
  • Alteration of occupancy schedule and designated area for Type S licensee (prior notification);
  • Recall of product (24 hours);
  • Discrepancy in inventory records more than 5% of the documented inventory (24 hours);
  • Evidence of theft or diversion of product or cannabis (24 hours); and
  • Notification by a distributor to a manufacturer that product failed testing and is required to be relabeled (3 business days).

California Dept. of Food and Agriculture: CalCannabis (Cultivation):

  • Criminal conviction or civil judgment rendered against licensee or owner (48 hours);
  • Revocation of a local license, permit, or other authorization (48 hours);
  • Administrative order for violations of labor standards (48 hours);
  • Change in track and trace manager (48 hours);
  • Disciplinary proceeding initiated by state or local government agency (10 days);
  • Bankruptcy filing or assignment for the benefit of creditors (10 days);
  • Temporary closure longer than 30 calendar days (10 days);
  • Modification to cultivation plan (10 days) if not requiring pre-approval;
  • Change in ownership of licensee, not impacting entity type (10 days);
  • Death or incapacity of owner (10 days);
  • Moving cannabis in disaster as permitted by regulations (24 hours); and within 10 days request for temporary relief;
  • Theft, diversion, loss of, or criminal activity related to licensee’s cannabis or nonmanufactured cannabis products (3 days);
  • Certain modification to premises (notice and pre-approval); and
  • Loss of access over three days to track and trace (immediately).

At Rogoway Law Group we can help keep you apprised of actions you need to take to stay compliant. Any time there is an event that is material involving the operation or licensee consider whether you need to report something to the appropriate regulatory bodies. Our compliance team is standing by when you’re in doubt and is ready, willing and able to assist.

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