The cannabis market in New York is booming as it welcomes adult-use cannabis. And one of the most sought-after licenses is the cannabis adult-use distribution license, which allows businesses to help move cannabis products from where they’re produced to where they’re sold. Getting this license is a complex process that requires proper planning and a good understanding of the rules & cannabis provisions.
So, in this post, we’re going to discuss how to get a cannabis distribution license in New York.
What Exactly Does a Cannabis Adult-Use Distribution License Mean?
Adult-use distributor license permits the purchase, possession, and distribution of wholesale cannabis products (except medical cannabis) to adult-use retail dispensaries, Registered Organizations with Dispensing (ROD), and on-site consumption licensees. These licenses play a vital role in bridging the gap within the cannabis supply chain, facilitating the delivery of New York’s cannabis products to discerning customers.
Is It Currently Possible to Apply for a Distribution License?
As per the state’s cannabis regulations, a fresh licensing application window will start on October 4th, 2023. Application submissions will be allowed until 5:00 PM EST on Monday, December 18, 2023.
How to Apply for a Distribution License in New York?
- Submit applications through New York Business Express (NYBE).
- Sign in or create a NY.gov account.
- Enjoy the flexibility of a save and resume feature during the application process.
- Check your application status at any time by logging into NYBE after submission.
What are the Distribution License Requirements in New York?
Below are the key requirements to obtain a cannabis adult-use distribution license in New York. So, let’s check them out.
- The applicant and anyone in the ownership structure must be 21 years or older.
- The applicant must be a citizen of the United States, or a person lawfully admitted for permanent residence in the United States.
- For privately traded businesses, each director and principal officer must have citizenship of the United States or persons lawfully admitted for permanent residence.
- If the business is publicly held, the majority of directors and all principal officers must be U.S. citizens or persons lawfully admitted for permanent residence.
- Applicants are required to submit their Federal Employer Identification Number (FEIN). If the applicant is operating as a sole proprietor with no employees, then they can also provide an SSN number (Social Security Number).
- A business/operating location is not initially required during the license application submission. You must determine the operating location if provisionally approved, before your final license is issued.
True Parties of Interest:
- You must provide the names and contact information of all True Parties of Interest. A True Party of Interest is someone with a significant interest or influence in the business.
- Submit ownership, management, and financial information, including organizational structure/charts, capitalization tables, and sources of capital (proposed or existing).
- Payment of a non-refundable Application Fee is required to process your application.
Who Gets Priority for Adult-Use Distribution Licenses?
Priority will be granted to applications from individuals belonging to the following social and economic equity candidates (SEE groups):
- Individuals from a Community Disproportionately Impacted
- Distressed farmer
- Service-disabled veteran-owned business
- Women-owned businesses
- Minority-owned businesses
- The applicant complies with all relevant state laws and regulations.
- The applicant demonstrates a commitment to effectively combating illegal cannabis trafficking.
- The applicant either possesses or has a plan to access sufficient land, buildings, and equipment for the intended activities or qualifies as a social and economic justice applicant.
- The applicant has an income below 80% of the median income of his county (where he/she resides).
- The applicant, along with the cannabis establishment’s leadership, is well-prepared, willing, and capable of executing the requested license activities.
How Much It Cost?
Image Source: businessexpress.ny.gov
What is an Adult-Use Distribution License Authorized to Do?
Businesses possessing distribution licenses have the ability to sell and transport cannabis and its related products from one licensed adult-use retail location to another. These license holders are permitted to acquire cannabis products from the following categories:
- Duly licensed cultivators
- Registered Organization with Dispensing (ROD)
- Registered Organization No Dispensing (ROND)
What are the Available Payment Methods?
As per the guidelines, distribution license applicants are required to submit their fees online. Credit card payments are also accepted with a maximum limit of $5,000. In case the transactions surpass this limit, applicants can go for a secure payment method ACH (Automated Clearing House) to ensure a smooth financial process for larger amounts.
Where to Submit Distribution License Applications?
Applicants looking forward to applying for distribution licenses can submit their applications through the NYBE platform. The Office of Cannabis Management (OCM) also offers comprehensive and step-by-step instructions on the website for a better understanding of applicants. For more in-depth information regarding license categories, the inclusion of social and economic equity provisions, and NYC’s innovative two-tier system, kindly visit the official website for a detailed insight into the application process.
If you need any assistance to keep up with new and constantly changing cannabis rules and regulations, we recommend hiring an expert. A skilled and experienced professional can help you with obtaining an adult-use distribution license in New York and also share the burden of setting up your cannabis business right.