NEW JERSEY MarijuAna Dispensary Laws

New Jersey Cannabis Dispensary Laws and Regulations for Retailers

Published on December 23, 2020.

In 2010, New Jersey had become the 14th US state to legalize medical marijuana when the Legislature had passed the New Jersey Compassionate Use Medical Marijuana Act (CUMMA). Although it was signed into law soon, the Medical Marijuana Program (MMP) was stalled for up to 2 years before it was finally reopened in August 2012. 
 
Recreational or adult-use cannabis will become legal in New Jersey from Jan 1, 2021, after the Marijuana Legalization Amendment was approved by voters during the general elections in November 2020 with 67% voting in favour. Subsequently, the state of New Jersey proposed the constitutional amendment to legalize cannabis for personal, non-medical use by adults aged 21 years and older, subject to regulation by the Cannabis Regulatory Commission. The bill was passed by the legislature on December 17, 2020, and is expected to be signed into law by the governor before the end of the year.
 

Related resources:

 Oklahoma Dispensary Laws / Washington Dispensary LawsColorado Dispensary Laws / California Dispensary Laws / Maine Dispensary Laws / Missouri Dispensary Laws / Michigan Dispensary LawsIllinois Dispensary Laws / Nevada Dispensary Laws / Montana Dispensary Laws / Alaska Dispensary Laws / Arizona Dispensary Laws

New Jersey Cannabis Laws

An overview of the medical and recreational marijuana laws in New Jersey.

Who can purchase cannabis in New Jersey and what are the limits?

New Jersey residents who are at least 21 years of age or older and have a valid government-issued id will be allowed to possess up to 6 ounces of cannabis.

So far, Medical patients were only allowed a purchase limit of 50 g or less and anything above that warranted harsh penalties, but changes will be enacted from Jan 2021, and now an adult can carry up to 170 g of marijuana at any time.

Are there any qualifying conditions for medical marijuana patients in New Jersey?

Patients with the following conditions can qualify for medical marijuana use:

  • Addiction substitute therapy for opioid reduction
  • Amyotrophic Lateral Sclerosis (ALS)
  • Anxiety
  • Cancer (includes associated chronic pain and/or severe nausea)
  • Chronic pain
  • Chronic visceral pain
  • Crohn’s disease
  • Dysmenorrhea (menstrual cramps)
  • Epilepsy
  • Glaucoma
  • HIV/AIDS (includes associated chronic pain and/or severe nausea)
  • Inflammatory bowel disease (IBD)
  • Migraines
  • Multiple Sclerosis
  • Muscular Dystrophy
  • Opioid dependency
  • Post-Traumatic Stress Disorder
  • Seizure and/or spasticity disorders
  • Tourette’s syndrome
  • Any terminal illness if a doctor has determined the patient will die within a year

Visit the Division of Medical Marijuana for more details.

Is home cultivation allowed in New Jersey?

No, S21 does not allow New Jersey residents to cultivate cannabis at home. The only legal cannabis in the state will be cannabis grown at a state-licensed cultivation facility, and there will remain stiff criminal penalties for home cannabis growers, as before. 

Under New Jersey’s state law, cultivation of ten or more marijuana plants is a felony crime, punishable by a $150,000 fine or up to ten years in prison.

Where can marijuana be consumed in New Jersey?

New Jersey marijuana users may only consume cannabis in the privacy of their homes.

Retail Cannabis Licensing in New Jersey

Everything you need to know about opening a retail cannabis location in New Jersey.

What state agency is in charge of cannabis licensing in New Jersey?

The Division of Medical Marijuana is in charge of awarding licenses for medical dispensaries but currently, no new applications are being accepted.

For cannabis retail licenses, licenses will be awarded by the Cannabis Regulatory Commission and more updates will be available by January 2021.

Who can apply for a Marijuana business license?

Residents of New Jersey, aged 21 and above can apply for a business license, either alone or in partnership with someone. In the first 2 years, only 37 recreational cannabis licenses will be awarded.

However, social equity considerations have been taken into account by introducing exclusive business incentives for minorities, women and veterans, and 25% of all legal cannabis licenses will be awarded to residents of disproportionately impacted communities. 

Is one entity allowed to apply for more than one license?

For the first 18 months, no business will be allowed to have both cultivation and retail cannabis licenses. There will be additional restrictions against vertical integration that will prevent the formation of possible monopolies.

A medical dispensary is prohibited to apply for a retail license unless special approval is given by the commission and the municipality it operates in.

What is the process for obtaining an adult-use marijuana retail license in New Jersey?

The newly formed Cannabis Regulatory Commission will have up to 180 days to come out with their regulations after the enactment of law on Jan 1, 2020. The commission would begin accepting and processing applications for licenses and conditional licenses within 30 days after the commission's initial rules and regulations have been adopted.

Permanent license: If approved, a license would be issued by the commission not later than 30 days after a notice of approval has been given, unless the applicant is found to not be in compliance with relevant regulations or local regulating ordinances applicable to their business operations. An issued license would expire after one year, but could be renewed following submission of a new application, in which the applicant would detail aspects of the cannabis licensee's operations and on-going compliance measures as part of the renewal process.

Conditional license: The applicant would not need to be in compliance with every aspect of the regulatory requirements expected for full licensure in order to obtain a conditional license, but would need to provide sufficient plans for actions to be taken to eventually achieve compliance for full licensure. During a 120-day period following issuance of the conditional license, if it is determined that the conditional licensee is in compliance with all plans to achieve full licensure, it would replace the conditional license with a full, annual license, dated to expire one year from its date of issuance, otherwise, the conditional license would expire after the 120 days period.

Watch this space in 3-6 months from now for more details on the application process.

New Jersey Cannabis Retail and Dispensary Establishment Laws

Learn how to remain compliant with New Jersey’s cannabis retail laws.

Where can a marijuana dispensary or retail establishment be located?

Each municipality has its own laws and regulations regarding this, and although the state of New Jersey has legalized recreational cannabis, municipalities are allowed to implement the law as they please. So read up more on your region-specific regulations before deciding on a location.

Whom can New Jersey marijuana retailers sell to?

Licensed adult-use marijuana retailers may sell cannabis to adults aged 21 and older, with a valid government-issued identification card, and employees are required to check purchasers’ IDs before making the sale.

What products can a New Jersey marijuana retailer sell?

Marijuana stores may sell cannabis, cannabis resin, cannabis products and cannabis extracts, but seedlings, immature marijuana plants and marijuana paraphernalia are prohibited.

Can medical marijuana and recreational cannabis be sold in the same dispensary?

Marijuana retail stores can not operate as a medical marijuana dispensary or primary caregiver at the same location as the adult-use marijuana store, and dispensaries are not allowed to sell cannabis for recreational use either.

What taxes are collected on retail cannabis in New Jersey?

New Jersey state sales tax rate of 6.625% would apply to purchases of recreational cannabis, with local municipalities only permitted to impose an additional 2% tax.

Is delivery for cannabis products allowed?

Yes, delivery of medical marijuana to patients in New Jersey is permitted, but the health department requires anyone delivering cannabis to have a GPS tracking system on their vehicles. Home delivery of recreational cannabis will be allowed as well, but retailers must seek permission from local municipalities for the same.

Businesses providing courier services to a licensed cannabis retailer must apply for an exclusive Cannabis Delivery license in order to make deliveries of cannabis items and related supplies to a consumer. 

What is required of adult-use cannabis retailers in New Jersey before conducting sales?

Retailer licensees can start sales of cannabis items on any date after the date that the Cannabis Regulatory Commission adopts its initial rules and regulations. Retailers can legally sell to persons 21 years of age or older, so long as the municipality in which it is located is engaged in retail sales.

Prior to and during this transition phase leading up to eventual retail sales of cannabis items, every municipality would have the option to authorize and regulate the times of operation, place, manner, and number of licensed cannabis businesses operating within its jurisdiction, in a manner consistent with the bill's regulation of such businesses.

More details to come.

Cannabis Tracking and Reporting in New Jersey

Every regulated cannabis market has its own tracking and reporting requirements. Find here how New Jersey monitors commercial cannabis activity.

What are the tracking, reporting, and inventory control requirements for New Jersey cannabis retailers?

Most states require dispensaries and cannabis stores to track and trace all of their cannabis products for regulatory and compliance reporting requirements. Records identifying the source of each ingredient must include the date of receipt of the ingredient, vendor’s name and address, name of the ingredient, etc. The vendor’s batch number, lot number of the product and control number used to identify all components in the marijuana product(s), as well as the grade and quantity must be mentioned in inventory reports.

What is New Jersey’s official cannabis monitoring system?

New Jersey has not appointed an official cannabis monitoring system yet, and both Metrc and Bio-track are currently vying for this coveted partnership.

Is Cova compliant with New Jersey’s cannabis retail reporting requirements?

Yes, Cova's Cannabis Dispensary POS Software and inventory management system includes all the features needed to keep cannabis retailers compliant, including:

  • ID scanner for age and card verification
  • Integrated inventory and sales tracking and reporting
  • Built-in product equivalency conversions and purchase limit enforcement.

Cannabis Advertising & Marketing Laws

What restrictions are there regarding cannabis advertising?

There are specific restrictions depending on the advertising medium that we will address below, but overall there are some common restrictions across the board.
 

First, no advertisements for anything cannabis-related can be attractive to minors (no cartoon characters or public figures appealing to a younger age group) or promote underage or out-of-state consumption. Second, no product can claim any therapeutic or curative effects. Lastly, any cannabis advertisement must include the following government warnings:

  • "This product has intoxicating effects and may be habit forming.";

  • "Marijuana can impair concentration, coordination, and judgment. Do not operate a vehicle or machinery under the influence of this drug.";

  • "There may be health risks associated with consumption of this product."; and

  • "For use only by adults twenty-one and older. Keep out of the reach of children.”

What kind of signage are dispensaries allowed to have?

Each licensed retail location can have two signs at their location with their business name or trade name. These signs cannot be larger than 1,600 square feet (measured from the outer frame). No signs can be on the road pointing in the direction of the dispensary, they can only be affixed or hanging from the building or windows of the actual storefront.

What can the signs include on them?

The signs can include the business name, location and identify the nature of the business. It cannot have any photos or depictions of cannabis and it cannot be appealing to minors.

Are cannabis advertisements on billboards allowed?

A cannabis dispensary can advertise on billboards with some restrictions. First, the billboard can only contain the same information as signage on the storefront (i.e., name of business, address and nature of business). It cannot contain any photos or depictions of the cannabis plant (this includes any logo with a cannabis leaf) or appeal to minors. No matter the design, the billboard must say that cannabis can only be purchased and possessed by adults over 21 years old.

Are dispensaries allowed to host giveaways or coupons?

No, dispensaries cannot give away any product or coupons. They can, however, encourage customers to sign up for an email or text list and offer specials that way.

Can a dispensary sell branded merchandise?

No, a dispensary is only allowed to sell legal cannabis products and paraphernalia. But branded merchandise for a dispensary can be sold on their website or through a separate entity.

 

Can a dispensary advertise in print media?

Yes, a dispensary is allowed to advertise in print publications, but with a few restrictions. The publication cannot target or distribute to an audience out of state or underage. And the content of the advertisement must follow the same rules as billboards and signage (no cannabis depictions or photos, cartoon characters or anything appealing to minors and must include government warnings). Local jurisdictions are able to establish additional advertising rules, so always check for relevant local laws.

What is allowed in terms of online advertising?

A retail cannabis business can have a website, but it cannot appeal to or solicit anyone under the age of 21. You can sell branded non-cannabis merchandise on your website, but all cannabis products must be purchased in store.

Can a dispensary host, attend or sponsor events?

Yes, a dispensary can host or sponsor an event, but only if attendees are over 21 years old. They cannot have product on hand, neither as a free gift or sold.

Where can I find more information about cannabis advertising laws in Washington?

Rules and regulations regarding advertising for Washington cannabis companies are constantly changing. You can view the WSLCB’s Q&A on advertising here.

POINT OF SALE

You definitely need a cannabis-specific POS at your dispensary. Find the most frequently asked tech questions here.

How do I manage state compliance using my point-of-sale?

Cova POS software provides complete seed-to-sale tracking functionality and has a number of built-in features designed to help you automatically comply with the legal regulations in your state/province. For example, the Cova POS system automatically monitors:

  • Purchase Limits – The POS system automatically calculates the correct THC amounts for all products, including concentrates and edibles. By relieving your staff of this complex task, the POS prevents mistakes in calculation and allows your budtenders to focus on customer service—and not on mathematical conversions. The system also enforces purchase limits by alerting staff when a limit has been reached and preventing budtenders from executing a sale that would place you over the legal limit.
  • Hours of Operation – The system can be easily configured to comply with local laws. Once the operational hours are set up, the POS will not allow sales to be executed outside the legal hours of operation, preventing potential violations before they occur.
  • Customer Identification Requirements – Customer IDs are easily scanned and recorded, ensuring your staff double checks IDs and virtually eliminating potential sales to minors or other individuals lacking the requisite documentation.
  • Accurate Real-Time Reporting – Operational visibility is also very important for your team. Cova POS software generates management reports in real time. These reports can be easily distributed across the organization to ensure the correct data is in the hands of the correct personnel.
  • Fully Compliant Product Labelling & Receipts Cova Software enables the complete customization of all printed materials, product labels, and receipts, enabling you to comply with all local regulations related to labeling and packaging quickly and easily.



What happens if my internet connection goes down and my dispensary is slammed with customers?

To ensure that you always maintain an expedient transaction pace and keep lines moving, Cova comes with a built-in offline sales processing mode that enables continuous access to critical functions even when your Wi-Fi or internet connection is unavailable. Once connectivity is restored, all transactions performed in offline mode are synchronized with the state’s reporting system, data is backed up, and reports and inventory records are adjusted accordingly.

How do I make sure I submit timely and accurate taxes each month to the government?

By choosing a POS system with built-in tax reporting functionality, you’ll always know exactly how much tax you need to pay.



Why is it important to have a marijuana-specific POS vs. a retail or pharmacy POS?

There are several reasons why a cannabis-specific POS is ideal for your operation—but the most important one is compliance management. Because traditional retail operations and pharmacies don’t have the same government-mandated compliance requirements, their POS systems aren’t built to manage the complexities involved with track and trace reporting and the other aspects of state compliance.

What happens if the state regulations change? How does Cova stay on top of this?

With the industry still in its infancy, regulations are bound to change. At Cova, our team keeps up with industry-wide and state-specific changes so that our developers can quickly made necessary software updates—and so you never have to worry about remaining compliant with the latest regulations.

Is Cova integrated with Metrc?

Currently, Metrc is not yet live in California since the state's regulations have not yet been officially adopted. However, Cova is working closely with Metrc and has already begun the process of integration, and we plan to be ready when the system goes live.



I have a high-traffic store. Can Cova support me and handle my volume?

Absolutely! Cova software is built on technology that has the ability to dynamically scale with your needs. Microsoft’s Cloud Computing Platform, Azure, automatically detects instances of heavy traffic (such as sales on 4/20) and assigns further servers and computing power as necessary to compensate—allowing you to process sales without interruption, even during the busiest retail periods.



Do I have to follow CA compliance even if it is not in effect? Will the POS still process sales?

Although technically you are not mandated to comply with the new law and regulations until July, it’s a good idea to implement a compliant POS now so you don’t have to switch later.

How do I do the 14-day inventory reconciliation?

With Cova, you can easily stay compliant with California’s inventory reconciliation requirement by printing the Inventory-on-hand report and checking it against your physical inventory. You can make any necessary adjustments directly into the POS, which will then sync the data across your network.

Ron Segev

Cannabis Business Lawyer & Founding Partner, Segev LLP

Legally reviewed by

Ron Segev

Ron Segev is the founding partner of Segev LLP. A practical-minded business lawyer with expertise in the cannabis industry, he represents cultivators, dispensaries, CBD extractors, oil extractors, food processors, media and marketing companies, consultancies, and other businesses in the legal cannabis market. 

View Ron's full bio

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