January 21, 2016

AB 1575 is meant to clean up parts of the existing MMRSA. The revision clarifies existing stipulations and spells out new ones. It touches on a variety of aspects, including the industry’s business model, licensing issues, banking services, and research and development.

On Monday, January 4, 2016, AB 1575 was introduced to the California Assembly by the same bipartisan group that authored the Medical Marijuana Regulation and Safety Act (MMRSA).

Called the Refinement of the Medical Marijuana Regulation and Safety Act, AB 1575 cleans up inconsistencies, amends errors, and refines issues in the law that became evident almost as soon as it was enacted. These revisions will help improve implementation of the industry’s regulatory infrastructure and facilitate the transition for local governments, existing MMJ enterprises, and the general public.

Key stipulations from AB 1575 as are as follows:

For-Profit MMJ Business Model To Be Allowed

The bill explicitly states that MMJ businesses will be allowed to operate not-for-profit, for-profit, or in any combination thereof. This includes allowance for existing collectives to operate for profit.

Refinements to Licenses

One important aspect is that AB 1575 clearly defines testing standards for medicine, especially that a licensed lab analyze medicine in the exact final form in which patients will consume it.

Another one is that a license for non-traditional dispensaries has been created, which allows these enterprises to operate without traditional storefronts open to the walk-up public. Simply put, the guidelines set forth in MMRSA now apply to delivery services.


AB 1575 dictates that the Board of Equalization (BOE) form an advisory group of various stakeholders (representatives from financial institutions, the medical marijuana industry, and both state and federal banking regulators) to discuss the issue of the medical marijuana industry’s access traditional banking services. The BOE will then be required to report its findings to the Legislature by July 1, 2017.

Guidelines for Research & Development

AB 1575 stipulates that research institutions and businesses have access to limited amounts of medical marijuana for research purposes. Guidelines for this R & D are to be set forth by the Bureau of Medical Marijuana Regulation, which would also issue the medical marijuana research permit.

Disclaimer: This article has been prepared and published for informational purposes only and is not offered, nor should be construed, as legal advice.

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