Yes. Pursuant to the Medicinal and Adult-Use Cannabis Regulation and Safety Act (MAUCRSA), persons interested in distributing marijuana and marijuana products in the state must obtain distribution licenses. According to MAUCRSA, marijuana distribution refers to the procurement, sale, and transport of marijuana goods between licensees. Only licensed distributors may transport marijuana from one license to another. Marijuana distributors act as intermediaries between cultivators, manufacturers, and retailers. A marijuana distribution license in California is also referred to as a Type 11 license.
A California marijuana distributor licensee can distribute only cannabis goods, cannabis accessories, and licensees' branded merchandise or promotional materials. California defines cannabis goods to mean cannabis, including dried flower, and products containing cannabis. The distribution license also permits the holders to carry out storage services. Per the storage services offered:
Note that a licensed distributor is not permitted to store live plants, except for seeds, on the licensed premises.
Licensed distributors are also permitted to package, re-package, label, and re-label cannabis, including pre-rolls, for retail sale. California requires that cannabis packaging, including pre-rolls, must comply with the requirements under Section 15303 of the Department of Cannabis Control Regulations.
Yes. California offers a transport-only distributor license which restricts licensees to moving cannabis and cannabis products between cultivation, manufacturing, or distribution premises. Transport-only distributor licenses cannot perform any other functions of a distributor, including testing, packaging, or labeling. A transport-only distribution license in California is also referred to as a Type 13 license.
A cannabis transport-only distribution license does not permit the transportation of cannabis goods to a licensed retailer. However, they can transport immature live plants and seeds from a licensed nursery.
According to Section 15005 of the Department of Cannabis Control Regulations, the following persons cannot hold a cannabis distributor license in California:
Persons holding office in or employed by any agency of the State of California or any of its political subdivisions whose responsibilities are related to MAUCRSA enforcement.
Persons holding office in or employed by any agency of the State of California or any of its political subdivisions whose duties involve the enforcement of any penal provisions of California law prohibiting or regulating the sale, possession, use, transportation, distribution, testing, manufacturing, or cultivation of cannabis goods.
These persons include those employed as peace officers by the State of California Department of Justice, district attorneys, city or county attorneys, sheriffs, and municipal police departments. California citizens who fall into these categories are not permitted to have a direct or indirect ownership stake in any business that will be owned or performed under a cannabis license.
An individual with a conviction for a serious felony, as described in Penal Code Section 1192.7
An individual with a conviction for a violent crime, as defined in Penal Code Section 667.5
An individual with a Conviction on a felony charge of embezzlement, deceit, or fraud.
A felony conviction for drug trafficking according to Health and Safety Code sections 11370.4 or 11379.8.
A felony conviction for employing, hiring, or using a minor to transport, carry, sell, give away, prepare for sale, or peddle any controlled substance to a minor; or for selling, offering to sell, providing, intending to furnish, administering, or delivering any controlled substance to a minor.
In California, no one under the age of 21 may legally own a cannabis distributor license. Additionally, the state prohibits licensees from hiring or retaining anyone under the age of 21.
Cannabis distributor license applicants must first obtain approval from the local municipalities in which the prospective business will be situated before submitting an application to the State of California. You will require authorization from cities and counties to conduct business in the area and verification that your cannabis establishment complies with zoning restrictions and building codes.
Additionally, some towns and counties have adopted legislation establishing social equity programs to help applicants who may have been negatively impacted by the War on Drugs. Direct financial aid, expedited application processing, and support with managing cannabis distribution operations are available to individuals in these categories. Equity ordinances enacted by local governments in California include the following:
You can contact your county or city government to learn about any equity programs available to cannabis distribution license applicants. In California, the proposed premises of a cannabis distribution establishment must not be located within a 600-foot of a school providing instruction in kindergarten or any grades 1 through 12, a daycare center, or a youth center. Otherwise, the applicant must provide evidence that the local jurisdiction has approved a different radius that has been adhered to.
Per the Department of Cannabis Control Regulations, an application for a cannabis distributor license must be completed by an owner as defined by the DCC. An owner is a person with an aggregate ownership interest in the cannabis business of 20% or more, unless the interest is solely a security, encumbrance, or lien. An owner includes:
Applications for cannabis distributor licenses may be completed online or in hard copy and submitted along with the required documents to:
Department of Cannabis Control
P.O. Box 942872
Sacramento, CA 94271-2872
To complete an application online, follow these steps:
The DCC licensing system allows you to save your progress during the online application process, so you do not have to complete the application in one sitting. You will be required to sign and submit your application when you have completed it. Note that the DCC will not process your application until you have paid the application fee.
If the information provided in any section of your application is insufficient, you will receive an email from the DCC licensing team. You will be notified of any required adjustments or additional information. Additionally, you will be given a deadline for responding. By promptly submitting the required information to complete the application, you can have your application processed in time by the DCC.
The DCC will not process an incomplete application. Applications will be deemed complete only if all necessary information has been submitted. If an applicant does not submit the needed information within the stipulated timeline, the application is considered abandoned. Application costs are non-refundable for abandoned applications. After abandoning an application, an applicant may resubmit a license application at any time. However, a new application will be necessary, along with a new application fee.
After the DCC approves your application, you will get an email from the DCC with instructions on how to pay your license cost. The cost may be paid using a bank account, a check, a money order, or a credit card. Cash payments can also be made at the DCC office by scheduling an appointment and paying in person. For security concerns, cash payments are not accepted without planned appointments. Your license will be issued only when you have paid the licensing cost.
If the fee is paid by debit or credit card, it will be processed via the DCC's online licensing system, and the applicant will be responsible for any related processing or convenience costs charged by the third-party vendor processing the payment on the DCC's behalf. California considers nonpayment of the required license fee to be cause for punishment. If it is found that the licensee paid less than the applicable licensing price, the licensee will be required to pay the difference in the applicable fee plus a penalty equal to 50% of the applicable licensing cost; however, the DCC may waive the penalty fee at its discretion.
If an application is denied, the DCC will notify the applicant in writing of the rejection and the applicant's entitlement to an administrative hearing to dispute the refusal. The applicant may request a hearing by submitting a written petition to the DCC within 30 calendar days following the serving of the notice of rejection. The written petition must be postmarked within the 30-day timeframe. If a hearing request is not made within 30 days, the applicant waives the right to a hearing.
Note that an applicant may withdraw an application at any time before the DCC issues or denies the license application. The request to withdraw an application must be submitted to the DCC in writing, dated, and signed by the applicant. The DCC will not refund application fees for withdrawn applications. After withdrawing an application, an applicant may reapply at any time, but will need to submit a new application and application fee.
A distributor license is only valid for one year. When your license is approved, the licensing system will make the license certificate accessible for download. It is recommended that you display your license certificate at the entrance of your cannabis business.
Cannabis distribution license fees in California are based on the gross annual revenues generated by the cannabis businesses. License and application fees are:
Distribution License Fees
|Gross Annual Revenue||Application Fee||License Fee|
|Less than or equal to $1,000,000||$1,000||$1,500|
|$1,000,001 to $2,500,000||$1,000||$6,000|
|$2,500,001 to $5,000,000||$1,000||$11,250|
|$5,000,001 to $10,000,000||$1,000||$22,500|
|$10,000,001 to $20,000,000||$1,000||$45,000|
|$20,000,001 to $30,000,000||$1,000||$75,000|
|$30,000,001 to $50,000,000||$1,000||$120,000|
|$50,000,001 to $70,000,000||$1,000||$180,000|
Distributor Transport-Only Licenses: Reduced license fees are available to businesses that transport only goods they cultivate or manufacture.
|Gross Annual Revenue||Application Fee||License Fee|
|Less than or equal to $1,000||$1,000||$200|
|$1,001 to $3,000||$1,000||$500|
|More than $3,000||$1,000||$1,000|
The gross annual revenue of a licensed premises is calculated based on the gross annual sales of cannabis products and, if applicable, the gross annual revenue from manufacturing, packaging, labeling, or otherwise handling cannabis products for other licensees in the 12 months preceding the application date. Gross annual income is determined for a new license application based on gross sales and revenue anticipated during the first 12 months after licensing.
Cannabis distribution licenses are renewable every year. The license fee corresponding with the licensing tier category identified by a licensee based on the expected gross revenue over the next 12-month period will be the renewal fee.
Distributor licensees (Type 11) must also hold transportation licenses (Type 12) but may not hold any other license type. Transport-only distributor licensees (Type 12) may also hold Type 11 distribution licenses, but it is not mandatory.