California Changes Its Cannabis Tracking Laws, Only One Company Is Ready

Things are changing in the state of California. Laws around cannabis logistics are getting stricter as the emerging industry begins to mature after a wild wild west style start.

The California Department of Tax and Fee Administration (CDTFA) recently adopted emergencyRegulation 3702, California Cannabis Track‑and‑Trace, which requires distributors and retailers to input the wholesale cost and the retail sale price of cannabis or cannabis products into the California Cannabis Track-and-Trace (CCTT) system. The emergency Regulation 3702 is presently in effect.

The Medicinal and Adult-Use Cannabis Regulations and Safety Act and regulations adopted by the Bureau of Cannabis Control (BCC) require all commercial cannabis activity be listed in the CCTT system. Distributors and retailers that obtain a yearly license together with the BCC must start recording commercial cannabis action in the CCTT system. In addition to the present needs, each licensee should now enter the following information associated with the cannabis excise tax.

Cannabis Distributors

A distributor must input in the CCTT system the retailer’s wholesale cost of the cannabis or cannabis products that can be sold or transferred to a retailer in an arm’s length transaction.

Within an arm’s length transaction, the seller is required to compute the average market price of the cannabis or cannabis products, that’s the retailer’s wholesale price and a mark-up established by the CDTFA. The wholesale cost used to compute the average market cost is the sum entered into the CCTT system.

A cannabis retailer is required to enter into the CCTT system:

  • The wholesale cost of the cannabis or cannabis products.
  • The wholesale cost is the amount paid by the retailer for the cannabis or cannabis products in an arm’s length transaction and is the amount used to calculate the average market price. The retail selling price of the cannabis or cannabis products when the product is sold at retail.

One company is ready for this new change, Trackloop Analytics (TOOL). Trackloop is the first and only company regulated company for coldchain tracking in the state of California, this gives them a big advantage in the cannabis industry in California moving forward. If more states enact similar regulations, Trackloop is ready to jump on those opportunities as well.

According to the new rules, any individual seeking a cannabis license, for cultivation or retail purposes, must complete a training session for the track-and-trace system within 10 days of receiving notice that their complete application has been received and approved by the California Department of Tax and Fee Administration (CDFA).

Click here for the full press release.

Disclaimer: Trackloop is a paid client of High Energy Trading, click here to read full disclosure.

High Energy Trading is not a licensed broker-dealer, market maker, investment advisor, or underwriter. All information that we provide is for informational purposes only and should not be construed as an offer or solicitation of an offer to buy or sell securities.


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