New Jersey’s personal-use cannabis industry takes major step forward with Cannabis Regulatory Commission’s approval of permanent, expanded rules

Rules include details for Wholesalers, Distributers, and Delivery Services; expand flexibility for microbusinesses; and codify penalties for unsafe, dishonest business practices.

TRENTON – The New Jersey Cannabis Regulatory Commission (CRC) voted on Thursday afternoon to approve and formally propose its permanent rules that guide the cultivation, manufacture, wholesale, distribution, sale and delivery of recreational cannabis in the state. The rule proposal, which will appear in the August 1, 2022, New Jersey Register, expands upon the initial CRC rules from August 2021 by adding three new license types – Class 3 Cannabis Wholesalers, Class 4 Cannabis Distributors, and Class 6 Cannabis Delivery Services – and improving key facets of the Commission’s approach to both equity and safety.

“Today, the Cannabis Regulatory Commission took the historic step of proposing permanent rules for New Jersey’s cannabis industry and expanding our focus on both equity and safety,” said CRC Chair Dianna Houenou. “The regulations approved for formal proposal reflect will create new opportunities for entrepreneurs to join this nascent industry.”

The rules, set to be proposed formally on August 1, include the following key additions:

• The addition of Class 3 Cannabis Wholesalers, Class 4 Cannabis Distributors, and Class 6 Cannabis Delivery Services to the slate of cannabis businesses that are able to operate in New Jersey;
• The expansion of flexibility for microbusinesses, by clarifying that areas like breakrooms and bathrooms – where cannabis is not handled or otherwise present – do not count toward the 2,500 square foot limit established by the law;
• Codifies sales limits for recreational consumers – 1 ounce of cannabis flower, 4 grams of extracts or concentrates, or 1,000 mg of THC in edible form;
• Improves the label requirements for THC and CBD so consumers are better informed as to how much THC and CBD are included in cannabis items;
• Requires retailers to provide information to consumers on safe cannabis use when they purchase recreational cannabis products;
• Provides flexibility on logo size and placement on packaging to help new businesses better establish brands in the market; and
• Provides clarity on the range of penalties that can be imposed by the Commission for violation of the regulations.

The permanent rules also codify the CRC’s innovative licensing process, which prioritize social equity business applications and applications from certified minority-, women-, and disabled veteran-owned businesses, and include some of the lowest application fees in the nation.

“The proposed permanent rules will empower the CRC to continue our mission to make New Jersey the premier cannabis market on the East Coast,” said CRC Executive Director Jeff Brown. “They improve safety for consumers, they continue to promote equity, and they include new license types and new flexibilities that will create new opportunities for businesses in New Jersey.” 

After the approval, the notice of proposed readoption will be filed June 30, with a publication date of August 1 in the New Jersey Register.  Following publication there is a 60-day public comment period to close on September 30, 2022.  Interested members of the public should submit written comments on the proposed rules electronically at nj.gov/cannabis.

The CRC will then have until February 15, 2023, to respond to public comments, incorporate any changes based on public comments, and adopt the final rules. 

“The rules will help create a market that is competitive, diverse, and that puts our core values of equity and safety first,” noted Sam Delgado, the CRC’s Vice Chair. “They will ensure that entrepreneurs have access to the market, especially those who have been negatively impacted by cannabis prohibition; and ensure that consumers and stakeholders can have confidence in safe, well- regulated legal cannabis sales.”

The CRC also took action on the following items at the June 30^th meeting:

• Approved the Social Equity Excise Fee recommendation report, recommending that Excise Fee revenue be reinvested in grants and loans for social equity cannabis businesses which will be made possible by the recent passage of S2945;  and
• Approved 81 new conditional licenses for cultivation, manufacturing, and retail.

The New Jersey Cannabis Regulatory Commission establishes and enforces the rules and regulations governing the licensing, cultivation, testing, selling, and purchasing of cannabis in the state.