Cannabis may be legal to use in 47 out of 50 U.S. states, but the inconsistencies in each state’s safety regulations could harm both customers and businesses, a new report warns.
According to the report, each state has differing standards for factors such as the acceptable potency and contamination levels of marijuana products. It was also found that even the testing labs responsible for measuring these levels are inconsistent, with the state-run labs noted to have more standardized testing approaches than independent labs. Some marijuana businesses also favored specific testing labs over others because those labs tended to inflate the potency levels of any product they tested.
The report warns that inconsistent state cannabis regulations could lead to severe consumer health consequences. Citing previous research, the report noted that state-level regulatory discrepancies could raise the risk of contaminant exposure for people with compromised immunities while confusing marijuana growers, distributors and testing labs.
How cannabis regulation disparities affect new businesses
Because cannabis regulation varies wildly between states, it’s challenging for new businesses looking to expand their operations in other jurisdictions. For instance, some states might allow recreational use of marijuana, while others restrict usage to only medicinal purposes.
The dire health implications aside, the state variations in cannabis regulation can make or break a marijuana business. Cannabis businesses must comply with state rules or else they’ll face penalties.
Penalties for violation
California has a dedicated Department of Cannabis Control that carries out routine inspections to ensure business licensees comply with state rules. Businesses that don’t comply can face the following penalties:
- Fines of up to $5,000 per violation for licensed cannabis businesses
- Fines of up to $30,000 per violation for unlicensed businesses
- An order of abatement
- Embargo on cannabis stocks
- Business license suspension or revocation
- Other disciplinary fines
If you’re a cannabis business owner looking to expand into California, you’ll want to comply with state rules to open a shop and remain in business. Opening a marijuana shop while assuming the rules in your home state are the same as California’s could get you into trouble with the law. Consider consulting a local attorney familiar with regulations and business formation to ensure your business meets state standards.