I’ve preached before on the blog about how often our firm gets pulled into M&A deals where the parties have screwed up reporting the transaction to cannabis regulators on both the state and local levels. In California, in particular, changes of ownership have been a painful affair where the Bureau of Cannabis Control (“BCC”) routinely has changed its position around when a complete change of ownership (in violation of the regulations) has occurred.
As we previously wrote, the Department of Cannabis Control (“DCC”–the new sheriff in town regarding all things California cannabis) recently proposed emergency regulations that, among other things, create some much needed technical fixes to the state’s cannabis licensing program. Public comments on these regulations are due by today, September 20 (!), but the reality is very likely that these rules will be adopted as-is with some very interesting “Final Statement of Reasons” to follow from the DCC in the event these emergency rules become permanent.
Back to changes of ownership. Part of the previous issue with the BCC was identifying “owners” versus “financial interest holders” in the first place. The previous definitions of both terms were somewhat vague and hardly detailed by practical example in many cases.