The Department of Cannabis Control (DCC) may embargo cannabis or cannabis products to prevent their sale, distribution, disposal, or removal from the location when the DCC has probable cause to believe the cannabis or cannabis products are adulterated or mislabeled, or that the sale of the cannabis or cannabis products would otherwise be in violation of the Medicinal and Adult-Use Cannabis Regulation and Safety Act (MAUCRSA) or the DCC’s regulations contained in California Code of Regulations Title 4, Division 19.
How will the DCC notify the licensee or product owner that they have items subject to an embargo?
If the DCC suspects that cannabis or a cannabis product is adulterated or misbranded, or that the sale of the item(s) would be in violation of MAUCRSA or the DCC’s regulations, the DCC will provide an Initial Notice of Embargo to the licensee or product owner describing what items are under embargo and the reason for the embargo. The Initial Notice of Embargo may be oral or written and may be provided in person or by telephone, mail, facsimile transmission, email, or other electronic means.
After an Initial Notice of Embargo is provided, the DCC will provide an inventory list of the items under embargo and will visit the location to affix an embargo tag, or marking, to items under embargo. The DCC may also place a California Cannabis Track and Trace system hold on the items under embargo.
How must I comply with an embargo? What happens if I fail to comply?
Items subject to embargo must not be sold, distributed, removed, or otherwise disposed of. You must obtain written approval from DCC before taking other action with respect to an embargoed item.
Failure to comply with these requirements result in fines of up to $10,000 per item, as well as disciplinary action against a commercial cannabis license—including potential suspension or revocation.
How will the DCC communicate information about items under embargo?
After the Initial Notice of Embargo, the DCC will continue to communicate information about the embargo by providing additional notices. Embargo notices may include specific instructions and deadlines for addressing the items under embargo.
For example, the licensee or product owner may be issued a Supplemental Notice of Embargo which provides information about the embargo, instructs the licensee or product owner to submit a written plan for addressing the items under embargo and the issue(s) that resulted in the embargo, and communicates a deadline for submitting the written plan to the DCC.
How will an embargo be resolved?
Only the DCC or a court can lift an embargo.
The DCC will review the licensee or product owner’s written plan to determine whether the plan addresses the items under embargo and resolves the issue(s) that resulted in the embargo. Upon completing the review, the DCC will provide a written determination to the licensee or product owner that includes further instructions for addressing the items under embargo.
If the DCC does not approve the plan or does not receive a response by the deadline provided in each embargo notice, the DCC may initiate condemnation proceedings on the items under embargo in accordance with Business and Professions Code section 26039.3, subdivision (f).
How can licensees and product owners ensure they are notified about items in their inventory that are subject to an embargo?
To prevent a missed notification, please ensure that the email address and telephone number for all owners associated with the license and the Designated Responsible Party for the license are current in the DCC’s Licensing records.
To update the email address and telephone number of license owners or the Designated Responsible Party, the Designated Responsible Party should fill out the DCC-LIC-027 form and email it to email@example.com.
If you have received an embargo notification and need additional information, please contact the DCC representative identified in the notice directly or contact the DCC at firstname.lastname@example.org.