Massachusetts Cannabis Control Commission Releases Draft Social Consumption Establishment Regulations for Informal Public Comment

By David Ullian, Tim Callahan

Dec 19, 2024

The Massachusetts Cannabis Control Commission (the “Commission”) voted on December 17, 2024 to release its initial draft amendments to the Social Consumption Establishment regulations and accept informal public comments on the proposed regulations until January 23, 2025.

The Commission has proposed three separate Social Consumption Establishment License types: (1) Supplemental On-Site Consumption; (2) Hospitality On-Site Consumption; and (3) Marijuana Event Organizer. As proposed, a Person or Entity Having Direct or Indirect Control could be granted or hold up to three Licenses of each type. A Social Consumption Establishment would have to provide consumers access to non-infused food and water, but the sale and consumption of alcohol and tobacco would be prohibited. The Commission’s proposed regulations also designate three separate types of Consumption Areas: Non-Smoking, Indoor Smoking, and Outdoor Smoking.

Supplemental On-Site Consumption

The Supplemental On-site Consumption license would allow certain types of existing Marijuana Establishments (including Retailer, Cultivator, Product Manufacturer, Microbusiness, Craft Marijuana Cooperative, and Delivery Operator) to sell marijuana or marijuana products to consumers for consumption in a designated Consumption Area.
A Supplemental On-site Consumption Licensee could be sited within or attached to a Marijuana Establishment with the same ownership and control.
A Supplemental On-site Consumption Licensee could not operate an Indoor Smoking Consumption Area at the same time as the existing Marijuana Establishment if they operate in the same space and during the same operating hours.
Indoor Smoking Consumption Areas would have to be separated from the existing Marijuana Establishment’s operations by either walls or other barriers approved by the Commission.
A Supplemental On-site Consumption Licensee could not allow consumption in Limited Access Areas.

Hospitality On-Site Consumption

The Hospitality On-site Consumption License type would allow an individual or entity to establish a new business or operate within an existing Non-Cannabis Business to sell marijuana and marijuana products to consumers for consumption within designated Consumption Areas.
A Hospitality On-site Consumption Licensee could not operate a Consumption Area in the same location and at the same time as an existing Non-Cannabis Business if the Non-Cannabis Business serves alcohol or tobacco on the same premises.
As a condition of being hosted by a Non-Cannabis Business, a Hospitality On-site Consumption Licensee could not accept an ownership or control interest by a Non-Cannabis Business or provide a set percent or a set portion of sales to the Non-Cannabis Business.
The Hospitality On-site Consumption Licensee would be permitted to pay a fee or rent to the Non-Cannabis Business for hosting the Hospitality On-site Consumption Licensee.
Simply partnering with a Non-Cannabis Business to operate within that Non-Cannabis Business’ space would not make the Non-Cannabis Business a Person Having Direct or Indirect Control over the Hospitality On-site Consumption Licensee by virtue of that partnership relationship alone.

Marijuana Event Organizer

The Marijuana Event Organizer License type would allow an individual or entity to coordinate Temporary Consumption Events.
Marijuana Event Organizer Licensees would be allowed to host up to 24 events per year, with each event not to exceed five consecutive days.
Licensees would be required to receive a Temporary On-site Consumption Permit from the Commission for each Temporary Consumption Event.
Marijuana Event Organizers would have the option to warehouse marijuana and marijuana products at their Principal Place of Business.
Marijuana Event Organizers would be responsible for all security, age verification, and all other activities at a Temporary Consumption Event.
A Marijuana Event Organizer would be required to enter into a Host Community Agreement (“HCA”) or HCA Waiver with the municipality in which the Licensee’s Principal Place of Business is located and would also have to obtain the necessary local permits, licenses and approvals from the municipality where the Temporary Consumption Event takes place.
Only Marijuana Establishments licensed to conduct retail sales would be allowed to participate in a Temporary Consumption Event.
Marijuana Event Organizers who do not Warehouse marijuana or marijuana products would be required to ensure that at least 66% of Marijuana Establishments participating at a Temporary Consumption Event are businesses controlled by and with majority ownership comprised of Social Equity Businesses; Economic Empowerment Priority Applicants; Social Equity Program Participants; Microbusinesses; or Craft Marijuana Cooperatives.

Exclusivity

As currently proposed, Social Consumption Establishment Licenses would be available on an exclusive basis for 60 months to Social Equity Businesses, Social Equity Program Participants, Certified Economic Empowerment Priority Applicants, Microbusinesses, and Craft Marijuana Cooperatives.
Unless extended by the Commission, the exclusivity period would conclude 60 months after the date that the first Hospitality On-Site Consumption Licensee receives a notice to Commence Operations from the Commission.

Informal Public Comment Period and Looking Ahead

The Commission is accepting comments on the proposed Social Consumption Establishment regulation redlines during this informal public comment period until 5:00 PM on Thursday, January 23, 2025. Comments on the proposed redlines can be submitted via email to the Commission (Commission@CCCMass.com) with the subject line “Social Consumption.”

While the Commission’s informal public comment period ends on January 23^rd, there will be another more formal public comment period as the rulemaking process continues, with the ultimate goal of having final regulations in place by the middle of 2025. After the promulgation of final regulations, the Commission will still need to implement a licensing process for these Social Consumption Establishment License types, and any municipalities that opt into allowing Social Consumption Establishment Licensees to operate within their borders will need to develop their own local approval and permitting processes, which would include the issuance of the required HCA.

If you have any questions or would like to schedule a call with a Vicente LLP team member to discuss the proposed Social Consumption Establishment regulations, please contact us at boston@vicentellp.com or 617-934-2121.