Cannabis Control Commission Approves Policy Changes to Proposed Regulations for Adult Use Delivery in Massachusetts

WORCESTER— Following a public comment period that closed October 15, the Cannabis Control Commission (Commission) on Tuesday approved additional policy changes to its draft regulations that establish two Marijuana Establishment types authorized to provide limited delivery services to adult-use cannabis consumers in the Commonwealth. A virtual public hearing focused on the delivery licenses is scheduled November 13, and a subsequent public meeting to vote on all modifications to Massachusetts’ adult and medical use of marijuana regulations is slated November 30.

Previously referred to as Limited Delivery Licenses and Wholesale Delivery Licenses, the newly categorized Marijuana Courier and Marijuana Delivery Operator license types discussed Tuesday aim to further the Commission’s mission to ensure meaningful participation in the legal cannabis industry by communities that have been disproportionately harmed by marijuana prohibition and to satisfy consumer demand that is currently being met by illicit market participants. The Commission’s draft delivery regulations specify that both license types will be exclusively available to Certified Economic Empowerment Priority Applicants (EEAs) and Social Equity Program (SEP) Participants for a minimum of three years, with the exclusivity period beginning once the first Marijuana Delivery Operator commences operations.

To that end, among the additional delivery changes approved Tuesday, Commissioners put in place operations restrictions, modified caps on ownership and control, and limits to financial relationships with third-party technology platform providers in order to prevent entities from dominating this emerging delivery market segment. They include:

• Requiring that marijuana products out for distribution by a delivery licensee will be associated with a specific, individual order to prevent entities from operating as mobile warehouses or retail stores;
• Deeming a third-party technology platform provider with any financial interest— including but not limited to, a delivery agreement or other agreement for services—in a delivery license as a person or entity having direct control over that license, and limiting such control by those providers to one delivery license;
• Preventing a single entity from holding direct or indirect control over more than two Marijuana Delivery Operator or Marijuana Courier licenses, under the Commission’s three Marijuana Retailer or Delivery License cap, and restricting a single Marijuana Delivery Operator to maintaining one warehouse as their principal place of business or operations;
• Underscoring that the Commission shall maintain on its website its publicly available and searchable source of information about all operating licensees and include delivery licensees; and
• Revisiting the provisions for Marijuana Delivery Operators two years after the first entity commences operations in the Commonwealth to study the competitiveness and concentration of the license type, and if necessary, responding with further regulatory changes or guidance.

The Commission also approved policy changes that bring the adult-use delivery regulations in line with sister state agency requirements for commercial vehicles and tax collection, including:

• Requiring that commercial vehicles used to transport or deliver marijuana or marijuana products must comply with applicable Registry of Motor Vehicle (RMV) requirements, but may not include any additional external marking that indicates the vehicle is being used to transport or deliver marijuana or marijuana products;
• Clarifying that although Marijuana Delivery Operators are not considered Marijuana Retailers under the Commission’s regulations, they must register as a vendor with the Department of Revenue (DOR) and collect and remit marijuana retail taxes in accordance with DOR regulations.

The Commission’s development of Marijuana Courier and Marijuana Delivery Operator licenses follows the promulgation of a Delivery-Only, Delivery Endorsement, and precertification licensing process in 2019 which received substantial public feedback during the agency’s current regulatory review period. The Marijuana Courier model represents an evolution of the Delivery-Only License the Commission had previously approved in 2019, and maintains those policies and provisions in order to keep barriers to industry entry low and support participation by applicants with limited capital.

In direct response to public comment received during the initial 2020 regulatory review period, the Commission approved the Marijuana Delivery Operator license authorizing businesses to purchase marijuana and finished marijuana products at wholesale from Cultivators, Craft Marijuana Cooperatives, Product Manufacturers, and Microbusinesses, and sell individual orders directly to consumers. By expanding the delivery operations available to licensees, the Commission also has adopted additional compliance requirements for Marijuana Delivery Operators pertaining to wholesaling, warehousing, white labeling, and sales.

During Tuesday’s meeting the Commission acknowledged the important role of municipalities allowing for delivery licensees to operate within their borders, including the local control provisions in state law. Under the Commission’s draft regulations, licensed delivery service will be able to occur within:

• A municipality which the delivery licensee has identified as its place of business;
• Any municipality which allows for adult-use retail within its borders; or
• Any municipality which, after receiving notice from the Commission, has then notified the Commission that delivery may operate within its borders.

Marijuana Retailers and Microbusinesses with Delivery Endorsements will be required to inform their host municipality law enforcement authorities, including police and fire departments, about plans to deliver marijuana and marijuana products directly to consumers.

Tuesday’s session followed multiple public meetings and public comment periods held in June, July, August, and September covering proposed changes across both sets of Commission regulations. To review regulatory drafts, meeting summaries, or minutes from those discussions, visit MassCannabisControl.com. To access video recordings of previous meetings, visit the Commission’s Facebook or YouTube channels. After the Commission reconvenes November 30 to vote on the final adult and medical use of marijuana regulatory changes, those provisions will be submitted to the Secretary of State’s Office for their review and promulgation.

Additional information about the Commission’s regulatory review process is available at MassCannabisControl.Com, by contacting the Commission by phone (774-415-0200) or email (Commission@CCCMass.Com), or following the agency on Facebook and Twitter.

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