In California, there are several different license types for commercial cannabis businesses, and the state will verify with each city that they have approved each location before the state application will be processed to ensure the company is started in an area that allows commercial cannabis activity.
Here is what California residents need to know about opening a new cannabis company or purchasing an existing license.
What are the Different Types of Cannabis Business Licenses in California?
The different types of California cannabis business licenses are issued by the Department of Cannabis Control (DCC) and must be renewed annually.
They include licenses for:
- Cultivating cannabis
- Distribution or transporting cannabis
- Manufacturing or making cannabis products, including beverages or edibles
- Testing or laboratories for cannabis products
- Retail or selling cannabis products
- Event organizer licenses where cannabis products are sold
Once you determine which type of cannabis business is right for you, our skilled California attorneys can help you prepare the necessary paperwork and accompanying documentation to submit a completed application to the DCC for review.
What Information Do I Need to Apply for a California Cannabis Business License?
Before you can begin the California cannabis licensing application, you must have a physical location that is approved for commercial cannabis business operations.
As previously mentioned, not all California cities or counties allow commercial cannabis operations. Do your homework before leasing or purchasing property for your new venture.
Once you are certain a commercial cannabis business can operate on the property, complete any permitting requirements the city or county requires before you apply for a state cannabis license.
Next, you will be required to submit the seller’s permit number issued by the California Department of Tax and Fee Administration.
If you do not have a seller’s permit number, you will be asked to attest that you are currently applying for one.
To apply for a cannabis business license in California, you will also need:
- Legal name of the cannabis license applicant
- Legal business name and trade name/DBA, when applicable
- Contact information for the owner who will serve as the primary contact person
- Name and contact information of any individual or entity serving as an agent for service of process for the business, if different from the applicant
- Physical address of the premises
- Mailing address, if different from premises address
- Phone number for the commercial cannabis business
- Website for the commercial cannabis business, if applicable
- The cannabis business license type
- The business’s organizational structure, such as partnership, joint venture, limited liability company (LLC), sole proprietorship, trust, or corporation
- Federal employer identification number (FEIN or EIN), individual taxpayer identification
- number (ITIN or TIN), or social security number (SSN) the federal taxes will be filed under
- State Employer Identification Number (SEIN) issued by the California Employment Development Department, if applicable
You must also list whether you have previously had a cannabis business license denied, suspended, or revoked, and include the type of cannabis license, the licensing authority that denied, suspended, or revoked the license, and the date it occurred.
Once you sign and submit the cannabis business license application, be on the lookout for any emails from DCC. They may email you to request more information, which must be supplied quickly and accurately to avoid any delays in the licensing process.
If your application is approved, you will receive instructions on how to pay your licensing fee.
Your license will be issued electronically once the DCC receives payment.
The DCC has requirements for standard operating procedures, training employees, and how facilities must be set up. Make sure you understand and can meet these rules.
Can I Purchase an Existing Cannabis Business in California?
There are multiple factors that will determine your eligibility to purchase a commercial cannabis business in California, including the vetting process required by the Bureau of Cannabis Control (BCC).
While the process is underway, the best approach is to learn everything you can about the local regulatory environment before agreeing to the terms of the contract.
While some cities and counties are very cannabis-friendly, others are not and either ban certain licenses or require licensees and applicants to adhere to stringent guidelines before they can begin operating.
Our cannabis law firm in California can provide expert real estate, land use, and zoning advice, regulatory compliance and licensing guidance, and risk mitigation legal representation to provide end-to-end solutions for clients who want to start a new venture or purchase an existing company.
Contact Manzuri Law to Discuss Your California Cannabis Business Needs Today
For more than a decade, our dedicated cannabis law firm has helped our California clients increase the chances of attaining official approval at the local government and state levels by thoroughly helping prepare legal forms and documents.
Schedule a consultation online or call 310.912.2960 to discuss your California cannabis business needs today with our attorneys who have procured and/or maintained over 200 licenses throughout the state, and overseen transactions valuing over $100 million in cannabis mergers and acquisition transaction values to date.
Disclaimer: This article has been prepared and published for informational purposes only and is not offered, nor should be construed, as legal advice.