New Jersey Dispensary Laws

PUBLISHED DECEMBER 23, 2020 - UPDATED MARCH 10, 2021

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 favor. 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 was finally signed into law by Governor Murphy on February 22, 2021. Dispensaries are expected to begin recreational cannabis sales soon. This page is informational only and should not be considered legal advice.

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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 disproportionately impacted communities, and 30% of all legal cannabis licenses will be awarded to businesses owned by women, minorities, or disabled veterans.

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.

An existing medical cannabis operator could begin adult-use sales immediately after rules are issued – but only if the company can prove it has sufficient supply to meet medical marijuana demand, which must be prioritized.

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

The newly formed Cannabis Regulatory Commission has up to 180 days to come out with its regulations after the enactment of the law. 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.

The CRC would determine the maximum number of licenses for each class based on market demand. Watch this space for more details on the application process, as and when CRC updates them on its website.

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?

Yes, medical dispensaries can sell adult-use cannabis, but only if they have enough stock to meet medical marijuana demand. But, Marijuana retail stores can not operate as medical marijuana dispensaries.

What taxes are collected on retail cannabis in New Jersey?

Adult-use sales would be taxed at 7%. Municipalities could charge local sales taxes of up to 2%.

The CRC also could levy a small “social equity excise fee” on marijuana growers that would fluctuate depending on the average retail price of cannabis.

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 patient card verification
  • Integrated inventory and sales tracking and reporting
  • Built-in product equivalency conversions and purchase limit enforcement
ron-segev

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.

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