Common Cannabis Industry Regulatory Violations and How To Avoid Them
This article was originally written for Viridian Sciences, developers of cannabis seed-to-sale and ERP software. The original article can be found here: Common Cannabis Industry Regulatory Violations and How To Avoid Them
The cannabis industry is often referred to as the most highly regulated industry in the world. Its regulations are more strict than those related to the production and sale of alcohol and cigarettes. In some cases, cannabis regulations are even more strict than those created for the pharmaceutical industry. Anyone can get a prescription from a doctor and walk into a pharmacy and purchase medication. The same is not true for cannabis.
With regulations comes government oversight. And with oversight comes citations for violations. And with citations comes punitive action. In some cases, this might simply mean a fine or a temporary lapse in doing business until the violations are cleared up. But in more serious cases, violating state regulations can mean the end of the line for an entrepreneur who has given their life over to building a successful cannabis business.
The bulk of violations are the result of standard compliance checks. In 2015, in the state of Washington, there were a total of 368 compliance checks. In 2016, that number rose to 889. And in 2017, there were a total of 1264 compliance checks statewide. On top of this, as of March 2017, there were nearly 20,000 enforcement checks by regulators. So, you can be assured that if you’re violating any regulations, chances are this will be uncovered by regulatory personnel.
According to IndicaOnline, a publication focused on cannabis retailers, the five most common violations committed by dispensaries as of January 2018 were operating without a license, failing to report inventory, exceeding patient purchase limits, sales to minors, and lack of documentation for deliveries. The article, which refers specifically to California regulations stipulates, “If cannabis compliance violations are committed, the offending cannabis retailer will first be sent a notice to comply. If the violation is not addressed within 15 days of receiving the notice, the marijuana dispensary could be subject to citations and administrative fees up to $5,000.”
Most Common Violations
The Washington State Cannabis and Liquor Board publishes an array of industry statistics that are specific to the state. One of the categories which is tracked by the board is “Violations Issued to Marijuana Licensees.”
Let’s take a look at some of the more common violations listed on their website.
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