New Laws Around Cannabis Advertising and Marketing

When you open a cannabis-friendly magazine or newspaper, you’ll see dozens of advertisements for dispensaries, 420-doctors, delivery services, events and product companies. But since the Medicinal And Adult Use Cannabis Regulatory And Safety Act (MAUCRSA) has gone into effect, the amount of cannabis ads have dwindled, which seems counterintuitive. Wouldn’t you want to advertise your cannabis business since the herb’s legal under state law?

 

The MAUCRSA actually outlines strict rules regarding advertising and marketing. Newspaper outlets, websites, publications, and all advertising and media platforms are only allowed to provide advertising to state licensed cannabis businesses. The way in which the Bureau of Cannabis Control (BCC) plans keep tabs on who’s adhering to the rules is by requiring advertisers to incorporate an official state license identification number on the ad.

 

Over the last week, the BCC sent letters to Weedmaps—the marijuana-advertising monolith, and Sacramento publication News and Review, telling them they’re in violation of the law because they host advertisements and listings for unlicensed cannabis dispensaries, delivery services, product businesses, etc.

 

When scrolling through Weedmaps’ site, there are hundreds—if not thousands—of listings for cannabis businesses all over California; a number far greater than the amount of licenses issued by the Bureau. According to Lori Ajax, Chief of the Bureau, if Weedmaps continues to violate state law, the company will face criminal and civil penalties.

 

Ajax said the agency initiated enforcement action against Weedmaps and other advertising platforms, such as News and Review, due to complaints from licensed retailers around the state who argue unlicensed retailers have an unfair competitive advantage because they don’t the pay taxes or license fees that went into effect with the state's new cannabis regulatory system on Jan. 1. "It is prevalent across the state and it is jeopardizing the legal market," Ajax said.

 Weedmaps’ competitor, Leafly.com, recently announced that it would only allow advertisements of licensed businesses in California, starting March 1. "The California state government has made clear that only licensed retailers and delivery services may advertise via technology platforms," Leafly said in a press release last month.

 

The Bureau is knee deep in applications right now. But as soon as they’re able to come up for air, it’s safe to assume enforcement will ramp up. In the mean time, here’s a brief outline of the MAUCRSA’s cannabis advertising regulations:

·         Any advertisement must accurately and clearly identify the business and incorporate the business’ state license ID number.

·         Cannabis businesses without a state license cannot advertise.

·          No billboards featuring cannabis are allowed on a highway or interstate that crosses the border of neighboring State.

·         Ads cannot target anyone under 21 years of age.

·         Promotional materials cannot use language, music, gestures, symbols, graphics, characters, or any other content associated with people under 21 years of age.

·         No billboard or signs advertising cannabis may be placed within 1,000 feet of a youth center, daycare, or school.

·         Businesses cannot give away cannabis or cannabis accessories as a promotional tool.

·         No TV or radio ads can be placed in a slot where less than 71.6 percent of the audience are over 21 years of age, as determined by reliable and up-to-date audience composition data.

·         All advertising statements must be true and substantiated.

·         Any direct marketing campaign or materials must accurately confirm the age of its targets before entering into communication with them.