In late February, we blogged about legislation passed by the Virginia General Assembly legalizing recreational marijuana. On March 31, 2021, Virginia Governor Ralph Northam submitted a substitute bill to the Senate for consideration. See https://lis.virginia.gov/cgi-bin/legp604.exe?212+sum+SB1406. The General Assembly is scheduled to reconvene Special Session I on April 7th, when it will consider the Governor’s marijuana proposal.
Continue Reading Virginia Governor Pushes for Additional Changes to Marijuana Legislation Passed by the General Assembly
News and Updates
Biden Administration Moves Forward with the USDA Final Hemp Rule
In January, we reported that the United States Department of Agriculture (USDA) issued its final rule establishing a domestic hemp production program, publishing it days before President Biden was inaugurated. The new Administration then instituted a “regulatory freeze pending review” with respect to published rules not yet in effect.
U.S. Postal Service Issues Proposed Rule Regarding ENDS Nonmailability and Exceptions
On February 19, 2021, a proposed rule from the U.S. Postal Service (the “USPS”), regarding the treatment of electronic nicotine delivery systems (“ENDS”) in the mail, was published in the Federal Register. The USPS will receive comments on or before March 22, 2021.
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Virginia Set to Become the 16th State to Legalize the Recreational Use of Marijuana
Last year, voters in Montana, Arizona, New Jersey, South Dakota and Mississippi approved ballot measures to legalize marijuana in their states. It appears Virginia will continue this state legalization trend in 2021. In a historic vote last Friday, February 5, 2021, the Virginia General Assembly passed two bills (one in the House and one in the Senate) that would legalize the recreational use of marijuana in the Commonwealth. There are some key differences in the two bills that will need to be reconciled before heading to Governor Ralph Northam’s desk before signature, who has indicated his support for such legislation. If signed into law, the legislation would make Virginia the 16th state in the country to legalize recreational use. Below is a summary of some of the key similarities and differences between the two bills.
Continue Reading Virginia Set to Become the 16th State to Legalize the Recreational Use of Marijuana
Tobacco & Cannabis Policy in 2021
The Biden administration and Democratic majorities in both the Senate and House could implement significant changes to federal tobacco and cannabis policy over the next two years. For tobacco, the change in party control of the White House and Senate will likely revive the debate around electronic nicotine delivery systems (ENDS) products. For cannabis, the policy may shift toward outright reform (such as federal decriminalization or legalization), federal taxation, or the enactment of legislation beneficial to the cannabis industry.
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USDA Finalizes Rule to Establish Domestic Hemp Production Program
In November 2019, we reported that the United States Department of Agriculture (USDA) issued an interim final rule establishing a domestic hemp production program that was intended to go into effect for two years before being replaced by a final rule. On January 19, 2021, USDA published that final rule after considering nearly 5,900 public comments and incorporating lessons learned from the 2020 growing season. While the final rule focuses on industrial hemp production, not processed hemp products (such as CBD derived from hemp), it may be particularly important to those who wish to exercise due diligence on their agricultural supply chains. It will be effective March 22, 2021, unless the new Administration changes the timeline.
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Washington State Attorney General’s Office Announces $65,000 Settlement with Online Retailer for Illegal Online Tobacco Sales
On Wednesday, December 23, 2020, the Washington State Attorney General’s office issued a press release that Smoker’s Outlet Online, a Pennsylvania online tobacco retailer, would be forced to pay $65,885 for allegedly distributing tobacco products into Washington state. The payment by Smoker’s Outlet Online was a settlement to avoid a lawsuit from the Attorney General’s …
Paycheck Protection Program Loans for Tobacco, Hemp, and Marijuana Businesses?
On March 27, 2020, the President signed the Coronavirus Aid, Relief, and Economic Security Act, expanding the Small Business Administration’s (SBA’s) 7(a) loan program by establishing the Paycheck Protection Program (PPP). The PPP authorizes up to $349 billion in federally backed loans through June 30, 2020, or until funds run out, for many small businesses across the country.
Continue Reading Paycheck Protection Program Loans for Tobacco, Hemp, and Marijuana Businesses?
Citing Novel Coronavirus, TTB Extends Certain Deadlines
On March 31, 2020, the U.S. Treasury Department’s Alcohol and Tobacco Tax and Trade Bureau (“TTB”) issued a newsletter and industry circular extending certain filing and payment deadlines on account of the novel coronavirus (“COVID‑19”).
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Canadian Cannabis Company Receives SEC Inquiry Over Revenue Recognition
The Securities and Exchange Commission (SEC) continues to investigate cannabis companies for possible enforcement actions related to investment fraud and market manipulation, with an increasing focus on Canadian companies. Most recently, Cronos Group, one of the largest cannabis producers in Canada, received an inquiry from the SEC related to its revenue recognition practices. As reported by MarketWatch, a Cronos company lawyer sent an e-mail to employees on March 10 instructing staff to retain certain records pertaining to a “confidential and non-public inquiry by the Securities and Exchange Commission.”
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