EXPLANATION: CAPITALS INDICATE MAT TER ADDED TO EXISTIN G LAW.
[Brackets] indicate matter deleted from existing law.
Underlining indicates amendments to bill.
Strike out indicates matter stricken from the bill by amendment or deleted from the law by
amendment.
*hb0272*
HOUSE BILL 272
A3 4lr0849
By: Delegate Grammer
Introduced and read first time: January 12, 2024
Assigned to: Economic Matters
Committee Report: Favorable with amendments
House action: Adopted
Read second time: March 3, 2024
CHAPTER ______
AN ACT concerning 1
Cannabis Licensing and Registration – Use of Straw Ownership – Prohibition 2
FOR the purpose of prohibiting a person from applying for or holding a cannabis license or 3
registration under certain circumstances if an ownership interest in the license or 4
registration is for the limited purpose of satisfying certain requirements of 5
registration or licensure; requiring the Maryland Cannabis Administration to deny 6
a certain application or revoke a cannabis license or registration if the applicant, 7
licensee, or registrant is determined by the Administration to be in violation of this 8
Act or convicted of a violation of this Act; and generally relating to straw ownership 9
and cannabis licensing and registration. 10
BY repealing and reenacting, without amendments, 11
Article – Alcoholic Beverages and Cannabis 12
Section 36–101(a) and (o) 13
Annotated Code of Maryland 14
(2016 Volume and 2023 Supplement) 15
BY adding to 16
Article – Alcoholic Beverages and Cannabis 17
Section 36–1103 18
Annotated Code of Maryland 19
(2016 Volume and 2023 Supplement) 20
SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND, 21
That the Laws of Maryland read as follows: 22 2 HOUSE BILL 272
Article – Alcoholic Beverages and Cannabis 1
36–101. 2
(a) In this title the following words have the meanings indicated. 3
(o) (1) “Control” means: 4
(i) the decision–making authority over the management, 5
operations, or policies that guide a business; or 6
(ii) authority over the operation of the technical aspects of a 7
business. 8
(2) “Control” includes: 9
(i) holding a right to veto significant events; 10
(ii) the right or authority to make or veto decisions regarding 11
operations and strategic planning, capital allocations, acquisitions, and divestments; 12
(iii) the right or authority to appoint or remove directors, 13
corporate–level officers, or their equivalent; 14
(iv) the right or authority to make major marketing, production, and 15
financial decisions; and 16
(v) the right or authority to execute exclusive contracts or significant 17
contracts in the aggregate of $10,000 or greater on behalf of the licensee. 18
36–1103. 19
(A) IN THIS SECTION , “GENUINE OWNERSHIP ” MEANS AN OWNERSHIP 20
INTEREST IN AN APPLI CANT, A CANNABIS LICENSEE , OR A REGISTRANT THAT IS 21
EVIDENCED BY RECORD OWNERSHIP IN WHICH T HE OWNER, REGARDLESS OF THE 22
AMOUNT OF CAPITAL OR ASSETS THAT THE OWNE R CONTRIBUTES TO THE 23
APPLICANT, LICENSEE, OR REGISTRANT , ENJOYS THE CUSTOMARY INCIDENTS OF 24
OWNERSHIP AND SHARES IN THE PROFITS AND L OSSES OF THE CANNABI S LICENSE 25
OR REGISTRATION PROP ORTIONATE TO THE PER CENTAGE OF THE OWNER ’S 26
INTEREST IN THE CANN ABIS LICENSE OR REGI STRATION. 27
(B) A PERSON MAY NOT APPLY FOR OR HOL D A CANNABIS LICENSE OR 28
REGISTRATION UNDER T HIS TITLE IF AN OWNE RSHIP INTEREST IN TH E LICENSE OR 29
REGISTRATION IS : 30
HOUSE BILL 272 3
(1) NOMINAL OR WITHOUT T HE BENEFITS AND RISK S OF GENUINE 1
OWNERSHIP OR CONTROL; AND 2
(2) FOR THE LIMITED PURP OSE OF SATISFYING THE REQUIRE MENTS 3
UNDER THIS TITLE FOR CANNABIS LICENSEES O R REGISTRANTS , INCLUDING 4
REQUIREMENTS FOR SOC IAL EQUITY LICENSEES OR REGISTRANTS . 5
(B) (C) A PERSON WHO VIOLATES SUBSECTION (A) (B) OF THIS SECTION 6
IS GUILTY OF A MISDE MEANOR AND ON CONVIC TION IS SUBJECT TO A FINE OF NOT 7
MORE THAN $2,500 OR IMPRISONMENT FOR NOT MORE THAN 1 YEAR OR BOTH. 8
(C) (D) SUBJECT TO THE HEARIN G PROVISIONS OF § 36–202 OF THIS 9
TITLE, THE ADMINISTRATION SHALL DENY AN APPLICATION FOR A CANNABIS 10
LICENSE OR REGISTRAT ION OR REVOKE A CANNABIS LICENSE OR REGISTRAT ION 11
UNDER THIS TITLE IF THE APPLICANT , CANNABIS LICENSEE , OR REGISTRANT IS : 12
(1) DETERMINED BY THE ADMINISTRATION TO BE IN VIOLATION OF 13
SUBSECTION (B) OF THIS SECTION; OR 14
(2) CONVICTED OF VIOLATI NG SUBSECTION (A) (B) OF THIS SECTION. 15
SECTION 2. AND BE IT FURTHER ENACTED, That this Act shall take effect 16
October June 1, 2024. 17
Approved:
________________________________________________________________________________
Governor.
________________________________________________________________________________
Speaker of the House of Delegates.
________________________________________________________________________________
President of the Senate.