To become part of the relatively new and burgeoning cannabis industry in New Mexico, cannabis businesses face a high bar of entry.

The occupational licensing laws are set to enforce strict requirements on any business owner looking to enter the cannabis space.

With the recent decriminalization of recreational cannabis usage within New Mexico and the industry set for a huge boost in the coming years, it is important for entrepreneurs looking to ride the cannabis wave to understand the licensing laws before making their move.

At Legal Solutions of New Mexico, our lawyers are across the changing legal and regulatory requirements and can help you navigate the legal hurdles in place for obtaining a cannabis occupational business license.

What is occupational licensing?

Some industries and professionals are highly regulated by the government and the cannabis industry is one of them.

“Occupational licensing” is the term given to a type of licensing required by government regulation where business owners want to pursue a particular profession for a profit.

This particularly applies to professions that can have a major impact on the general public, putting people’s health, safety, finances, freedom, or wellbeing at risk. Typical examples are:

• Physicians
• Public accountants
• Lawyers

In some states, occupational licensing is also needed for some tradespeople like electricians and plumbers.

Cannabis businesses are also generally included in requirements for occupational licensing. It is seen as necessary to keep standards of safety and quality high enough to protect public safety.

Because of the high bar of entry placed on professionals by occupational licensing requirements, the additional costs incurred may be passed on to customers. On the plus side, however, it protects the public from incompetent or unscrupulous individuals.

Some states that have legalized recreational cannabis have been accused of finding ways to protect the incumbent industry from competition by placing severe limitations on who can apply for a license. For instance, only registered medical cannabis dispensaries or those who hold a wholesale dealer license for liquor may apply.

In New Mexico, the Cannabis Regulation Act, which legalized recreational cannabis from January 2021, named a Cannabis Control Division (“CCD”) to administer the licensing provisions of the law governing medical cannabis, which has been legal in New Mexico since 2007.

The CCD is still developing the rules to fall in line with industry standards on topics like:

• Qualifications for licensure
• Procedures for obtaining licensure
• Limits to consumer purchases and possession
• Advertising and marketing regulations

Cannabis industry professionals in New Mexico are subject to occupational licensing requirements and it is important to understand what this means before you consider setting your business up.

Restrictions on who can apply

As the licensing regulations in New Mexico are developed, it remains to be seen how stringent the restrictions on who can apply will be and whether applicants like licensed medical cannabis dispensaries will be given priority.

What we do know is that applying for a cannabis license is a complex and expensive process – with higher fees than for other occupational licenses. In New Mexico, the various licenses cost from $1,000 up to $125,000.

Many different licenses are available depending on which sector of the cannabis industry you intend to operate in:

• Cannabis Courier License
• Cannabis Testing Laboratory License
• Cannabis Manufacturer License
• Cannabis Producer License
• Cannabis Retailer License
• Cannabis Research Laboratory License
• Vertically Integrated Cannabis Establishment License
• Cannabis Producer Microbusiness License
• Integrated Cannabis Microbusiness License
• Cannabis Consumption Area License

Besides this, we also know that there are restrictions placed on who can apply based on criminal conviction history.

Criminal convictions

If an applicant or a “controlling person” of the applicant has been convicted of an offense that is substantially related to the qualifications, functions, or duties of the applicant’s business, the individual will be denied a license.

This restriction is a common one amongst states that have legalized cannabis usage – though some states only look at a ten-year look-back period for completed sentences.

One concern about adding overly stringent occupational licensing requirements for cannabis is that it will reduce opportunities for entrepreneurs by raising application costs and requirements.

This may prevent the growth of a legal market and encourage the black market to continue – which is part of the reason why regulations were introduced in the first place.

Apply for your New Mexico cannabis occupational license

At Legal Solutions of New Mexico in Albuquerque, our experienced cannabis business lawyers can help you navigate the substantial legal hurdles to obtaining the correct business licensing.

Call (505) 445-4444 to talk to a knowledgeable cannabis lawyer.