HT>Washington, D.C. Officials To Begin Inspections of ‘Gifting’ Shops Next Month

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Regulators in the nation’s capital announced last week that they will start inspections of unlicensed cannabis businesses to verify compliance with various laws.

The Alcoholic Beverage Regulation Administration said that a “Joint Cannabis Task Force,” which consists of “various [Washington, D.C.] government agencies,” will start visiting the businesses next month following a 30-day grace period.

Although voters in D.C. passed an initiative that legalized recreational cannabis all the way back in 2014, the sale of weed is still technically illegal due to a congressional ban.

Businesses there have found a loophole through the practice of “gifting”: a customer pays for an item like a t-shirt and is in turn “gifted” some cannabis.

The practice has upset many of the medical cannabis operators in Washington, D.C., who have said that the illicit shops are cutting into their business.

In April, the D.C. City Council rejected a proposal, which was backed by the medical marijuana industry, that would have levied harsher fines on businesses that engage in gifting.

The inspections that were announced by the Alcoholic Beverage Regulation Administration will be done to ensure that the unlicensed cannabis businesses “abide by the regulatory requirements of DC Health, the Department of Consumer and Regulatory Affairs (DCRA), the District of Columbia Fire and Emergency Medical Services Department (FEMS), and the Office of Tax and Revenue (OTR).”

The administration detailed those laws:

• “DC Health—Edibles and other manufactured products being offered by businesses to customers must be approved by DC Health; businesses also must be in compliance with DC food safety and hygiene laws.”
• “DCRA—Businesses operating in the District must be registered with DCRA; businesses also must be in compliance with the District’s general business requirements such as having the proper business license and Certificate of Occupancy.”
• “FEMS—Businesses must be in compliance with DC fire code regulations such as having a clear path of egress for customers and having properly working smoke and carbon monoxide detectors.”
• “OTR—Businesses must register with OTR and pay taxes in DC.”

“Joint agency inspections will take place unannounced after the 30-day grace period to verify the compliance of operating businesses with legal requirements. Businesses in violation may be subject to a fine or other enforcement action permitted by the statutory authority of each respective enforcement agency,” the administration said in the announcement last week.

According to The DCist, “many of the gifting businesses say that they are already in compliance with D.C. business regulations and pay taxes on the products they sell.”

Lonny Bramzon, an attorney and owner for one of the gifting shops in D.C., told the website that he doesn’t see the administration’s announcement “as necessarily targeting marijuana, though he thinks it may be an easy way for D.C. to close down operators who haven’t followed city regulations.”

“It seems that ABRA isn’t concerned with the instrumentality of the gifting. It seems like they’re concerned with business licenses and certificates of occupancy,” Bramzon said. “If somebody is going to open a coffee shop, they’re going to get their licenses and do the inspections. But because of the nature of the [marijuana] business, there’s a higher chance people will open without the proper licenses. This might be a backhanded way to shut down some of those shops. I would like to make sure everyone has their licenses and is paying their taxes like everyone else.”

Earlier this year, the D.C. City Council passed a measure that allows medical cannabis patients in the district to “self-certify,” meaning they no longer need a doctor’s recommendation for a card.

The bill, signed into law last month by D.C. Mayor Muriel Bowser, was hailed as an improvement for both patients, and medical cannabis providers who have been outpaced in sales by the gifting shops. 

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