N.Y. Comp. Codes R. & Regs. tit. 9 § 123.5

Current through Register Vol. 46, No. 36, September 4, 2024

Section 123.5 - Processor Ownership, Interests, Business Authorizations and Prohibitions

(a) A processor may acquire, possess, process and sell cannabis from a licensed cultivator to duly licensed processors or distributors. Authorized processing activities vary by the processing license type.

(b) A processor may process cannabis grown by a cultivator without taking ownership over that cannabis.

(c) A processor may only enter into branding or white labeling agreements with its true parties of interest, or another licensee, provided that such licensee is not otherwise prohibited therefrom pursuant to this Title.

(d) A processor may hold one (1) distributor license.

(e) A processor may purchase mature cannabis from a nursery if the cannabis was grown for seed production and the seeds have been removed.

(f) A processor shall only conduct those activities specified on its application, whether on an initial or amended application, that have been approved by the Office or Board for such processor.

(g) A processor may not be a true party of interest in another processor. A true party of interest of a processor may, however, be a true party of interest in a cultivator, processor, distributor, cooperative or collective, microbusiness, ROD, or ROND license.

(h) A processor, or its true party of interest, may have a goods and services agreement with an adult-use cultivator, processor, distributor, cooperative or collective, microbusiness, ROD, or ROND license, subject to all restrictions governing such relationships, including, but not limited to, undue influence, control, and true party of interest requirements.

(i) In addition to any other restrictions or prohibitions in this Title, including, but not limited to, Part 124, no processor or its true party of interest is permitted to have any direct or indirect interest, including by being a true party of interest, passive investor, or having a goods and services agreement with, or by any other means, in an adult-use retail dispensary, on-site consumption, delivery, registered organization registered under article 3 of the Cannabis Law, or cannabis laboratory licensee or permittee.

(j) A conditional processor licensed pursuant to section 69-a of the Cannabis Law is subject to all rules and regulations in this Title applicable to a processor. A conditional processor determined to be in good standing by the Office shall, upon submitting any necessary forms required by the Office and upon payment of any applicable fees, be permitted to transition to a processor license.

(k) A conditional processor shall be given priority by the Office in review of its application for a processor, and if applicable a distributor license under this Part.

N.Y. Comp. Codes R. & Regs. Tit. 9 § 123.5

Adopted New York State Register September 27, 2023/Volume XLV, Issue 39, eff. 9/27/2023