It goes without saying, but 2020 was a pretty wild year for the California cannabis and hemp industry. We think 2021 will be a pretty active year and we’d like to list a few things to look out for as we start the new year.
Agency consolidation: In January 2020 it was announced that the regulator of the three California cannabis agencies will be merged into a single new agency, the Department of Cannabis Control. We anticipate significant efforts will be made to make this happen in 2021, which will be a major shake for the regulated cannabis industry in California.
Adoption of the hemp production plan: California recently submitted a hemp production plan to the U.S. Department of Agriculture that is currently under review. The plan will eventually be approved in early 2021 (although the USDA may require some changes), which will require changes to regulate California’s hemp industry.
Enforcement: We predicted in late 2019 that 2020 would be the year California cannabis agencies start serious enforcement actions and efforts. In large part, this was delayed due to COVID-19, but we still saw some enforcement efforts (i.e. the BCC’s civil sanctions lawsuit). We expect enforcement efforts and actions to increase significantly in 2021.
Prop. 65 litigation: With the expansion of Prop. 65 to include additional cannabis and hemp products, we expect more and more lawsuits and claims against companies that allegedly do not meet these requirements.
Trade pattern: One of the major loopholes in California cannabis law is its failure to provide an efficient mechanism for handling commercial samples. Efforts were made in 2019 to pass a law allowing trade sampling, but those efforts failed. We anticipate additional efforts to regulate trade samples will be made in 2021.
CBD legislation: In recent years the state has tried (and failed) to pass laws that would “legalize” CBD. Most recently, in the eleventh hour, the state tried to pass a CBD law AB-2028, but failed. Part of this was again due to COVID-19 – the bill was only really discussed at the end of the legislative period. We expect the CBD legislation to be introduced in early 2021. Hopefully something will work this time.
Local control debates: In recent years there has been a lot of debate between government agencies and local jurisdictions regarding local control. Basically, state law gives cities and counties a lot of leeway to decide whether to allow cannabis surgeries within their borders, which has resulted in many places choosing not to allow them. That culminated in a recent BCC withdrawal in a lawsuit by cities against a rule that allowed mail carriers to deliver anywhere in the state (even in cities that didn’t allow deliveries), effectively generating a profit for local control. Given that there are still so many cities where cannabis activities are banned or restricted, we expect the debate about local control to continue and possibly even to introduce statewide laws aimed at local control to restrict.
Decriminalization of psychedelics: Okay, okay, this has nothing to do with cannabis or hemp. But California could be the next state to pass a nationwide decriminalization measure for psychedelics, as Senator Scott Wiener previously announced that it would legislate in the next legislature.
While 2020 was a busy year, we expect it to continue in 2021. Please visit the law Law Blog to see how things play out in the new year.