New York Cannabis Board Approves Packaging, Marketing, Testing Regulations; 16 More Cultivation Licenses Issued

As New York cannabis regulators steady the ship for the launch of adult-use sales by the end of the year, the state’s Cannabis Control Board (CCB) members approved June 1 their first regulations for the broader market.

Those regulations establish specific parameters for packaging and labeling, marketing and advertising, and laboratory testing in the forthcoming industry.

The board members’ unanimous approvals on Wednesday came after nearly three months of work by Office of Cannabis Management (OCM) officials to carry out the state’s Seeding Opportunity Initiative, which aims to position individuals with prior cannabis-related criminal offenses to make the first adult-use cannabis sales with products grown by New York farmers.

Specifically, through OCM recommendations, CCB members have approved 162 existing hemp farmers for conditional adult-use cannabis cultivation licenses for the 2022 growing season, including their latest batch of 16 approved applicants on Wednesday.

While the Seeding Opportunity Initiative guides initial steps toward developing a “strong” adult-use market, CCB Chairwoman Tremaine Wright said she and her colleagues recognize that “there is so much more to do in order to establish a robust adult-use cannabis market” in New York.

“So today, we’re going to consider two sections of regulations that will be a part of the broader and much-anticipated adult-use regulations,” she said during Wednesday’s regular meeting.

“These regulations were selected as the first sections for consideration because they will help ensure products are safe and tested with appropriate consumer protection labeling,” she said. “We also recognize the need to expand our cannabis laboratory testing capacity within the state to ensure we have enough third-party labs online and ready to properly test regulated cannabis products.”

The approved packaging and labeling regulations aim to ensure adult-use cannabis products are safe for consumers and do not target youth or promote overconsumption.

Minimum standards include:

• Child-resistant, tamper-evident and nontoxic packaging that is enclosed to prevent contamination or degradation
• Label components such as warnings, serving size, potency, ingredients, and usage and storage instructions
• A universal symbol to be placed on all licensee packages
• Licensee recycling programs for cannabis packaging
  

Prohibitions include:

• Attractive to individuals under the age of 21 (e.g., cartoons, characters, celebrities, toys)
• Include false or misleading statements (e.g., “organic,” “craft,” health claims)
• Multiple brand logos or unapproved graphics
• Features emitting scent or sound
  

Packaging Environmental Sustainability Program

• All licensees are required to implement an environmental sustainability program for cannabis product packaging, which may include reuse (after sanitation), or the use of non-plastic or compostable materials.
• Licensees must report key metrics on the implementation of their program annually
  

Violations and penalties

• Violations may result in suspension, cancellation and revocation of a license
  

Those regulations were crafted based on numerous discussions with experts from other states, building off of best practices and lessons learned over many years of legalization efforts outside of New York, said Lyla Hunt, OCM’s deputy director of public health and campaign.

The packaging and labeling regulations have two primary goals, she said during Wednesday’s meeting. 

“The first goal is to maintain safety quality. To that end, all packages are required to be child-resistant, tamper-evident, non-toxic and must fully enclose each product,” Hunt said. “The second goal is to inform consumers about what it is they’re consuming. So, to that end, labels include any key public health messages, serving sizes, potency, ingredients, and usage and storage instructions. False or misleading statements, or statements that make health claims will not be allowed.”

Board Member Jen Metzger spoke on the packaging parameters for the Environmental Sustainability Program.

The Marihuana Regulation and Tax Act (MRTA), which former Gov. Andrew Cuomo signed into law in March 2021, recognizes the “critical importance” of setting New York’s cannabis industry on a sustainable path and puts environmental protection and climate resiliency up front in the intent of the law, Metzger said.

“We face a climate crisis, and we have a real opportunity to get it right from the start rather than repeating the mistakes made elsewhere,” she said during Wednesday’s meeting. “And this includes how we approach the packaging of cannabis products. The rate of plastic production worldwide is doubling every 15 years, and this has been largely driven by packaging.”

Metzger added, “The proposed regulations are intended to encourage use of materials other than single-use plastics. But if plastics are used, they would need to have a minimum post-consumer content of 25%. Licensed applicants, depending on the license type, will be required to submit an environmental sustainability program for packaging as part of their application. And this would be a program of the applicant’s own design; and the reason why it’s being included in the application is because the MRTA directs the board to consider waste and single-use plastics specifically along with other criteria in licensing decisions.”

The regulations also require annual reporting from licensees to help OCM establish a baseline of information and evaluate progress over time, she said.

Meanwhile, the approved marketing and advertising regulations also aim to ensure adult-use cannabis products do not target youth or encourage overconsumption.

General requirements include:

• Warning content and format (e.g., age restrictions, reasonable consumption, bolded text, bright yellow box)
• Reaches an audience reasonably expected to be at least 90% age 21 and older, websites or digital applications restrict access to those age 21 and older
  

Prohibitions include:

• Marketing that is attractive to individuals under age 21, including both images and audio
• Promote overconsumption, be false or misleading, or suggest products are safe or have curative/therapeutic effects
• Be in the form of a billboard, be within or visible at 500 feet of schools, recreation centers, childcare centers, playgrounds, public parks or libraries
  

Violations and penalties

• Violations may result in suspension, cancellation and revocation of a license and/or fees or fines
• Advertising, marketing or outdoor signage that is not in compliance shall be removed or discontinued
• Licensees must maintain records that advertising and marketing meets the requirements
  

In addition, the regulations include rules for content and location of outdoor retail store signage.

And the cannabis laboratory testing regulations establish an application process to permit independent cannabis testing laboratories and approval of laboratory sampling firms.

Some of the specific regulatory parameters include:

• Existing independent laboratories already certified to test medical cannabis under the Department of Health (DOH) will be authorized to test medical and adult-use cannabis under OCM.
• Labs must be ISO 17025 accredited and meet other quality assurance and staffing requirements.
• Lab ownership is prohibited from having a direct or indirect interest in any other registration or license type under the cannabis law.
• Laboratory sampling firms, independent of registered organizations or licensees, will be collecting samples from registered organizations and licensees for lab testing to ensure that there are random sample collections to help protect public health and safety.
  

The regulations include requirements for a state reference laboratory to test when needed for quality assurance matters and to assist with method development.

While establishing those regulations, OCM officials considered what Board Member Reuben McDaniel called “lab shopping” that goes on in other states, where licensees take their samples to testing facilities that are known to generate more favorable results.

Nicole Quackenbush, OCM director of health and safety, went into further detail at Wednesday’s board meeting.

“The regulations include the independent sampling firms to collect the samples so that the licensees are not selecting specific samples. They’re randomly collected,” Quackenbush said. “Additionally, there’s no ownership intermingling with the sampling firm as well as the licensees or the registered organizations to promote that third-party scenario with the sampling firm collecting.”

With 162 conditional cultivation licenses now approved, among roughly 200 applicants, Metzger urged the board to act swiftly upon further OCM license recommendations with the 2022 growing season already underway.