HB 6099 — AN ACT CONCERNING ANTITRUST ISSUES AND THE PALLIATIVE USE OF MARIJUANA AND THE SALE OF HEMP AND HEMP PRODUCTS.

102(2) 10the sHB6099acquisition Fileof No.hemp or hemp products for the sole purpose of product distribution for resale;

102 distribution for resale;

(3) No individual, including any key participant of any entity, who has been convicted of any felony, as prescribed in the federal act, shall beeligibletoobtainorholdaproducerlicense,providedsuchrestrictionLCO shall{\\PRDFS1\HCOUSERS\BARRYJN\WS\2021HB-06011 not apply to any individual who lawfully grew hemp with a license, registration or authorization under any state pilot program authorized by section 7606 of the18 AgriculturalR02-HB.docx Act} ofSubstitute 2014Bill before sHB6099 / File No.

1026099 11beeligibletoobtainorholdaproducerlicense,providedsuchrestriction sHB6099shall Filenot No.apply to any individual who lawfully grew hemp with a license, registration or authorization under any state pilot program authorized by section 7606 of the Agricultural Act of 2014 before December 20, 2018.

102 December 20, 2018.

and (3)LCO In{\\PRDFS1\HCOUSERS\BARRYJN\WS\2021HB-06012 the event that resampling by the commissioner is required due to a test result that shows a violation of any18 provisionR02-HB.docx of} thisSubstitute sectionBill orNo. any regulation adopted pursuant to this section, the licensee shall pay an inspection fee of fifty dollars.

Such6099 fee(3) shallIn bethe paidevent priorthat resampling by the commissioner is required due to a test result that shows a violation of any provision of this section or any regulation adopted pursuant to this section, the sHB6099licensee /shall Filepay No.an inspection fee of fifty dollars.

102Such 12fee sHB6099shall Filebe No.paid prior to the inspection and collection of the sample to be used for resampling.

102 inspection and collection of the sample to be used for resampling.

(l) Nothing in this section shall be construed to limit the commissioner'sLCO authority{\\PRDFS1\HCOUSERS\BARRYJN\WS\2021HB-06013 to issue a cease and desist order pursuant to section 22-4d, or an emergency order, in order to respond to a condition that may present a public health hazard, or issue orders necessary to effectuate the purposes of this18 section,R02-HB.docx including,} butSubstitute notBill limited to, sHB6099 / File No.

1026099 13commissioner's sHB6099authority Fileto No.issue a cease and desist order pursuant to section 22-4d, or an emergency order, in order to respond to a condition that may present a public health hazard, or issue orders necessary to effectuate the purposes of this section, including, but not limited to, orders for the embargo, partial destruction, destruction and release of hemp or hemp products.

102 orders for the embargo, partial destruction, destruction and release of hemp or hemp products.

(o) (1) Any negligent violation, as described in the federal act, of this sectionLCO or{\\PRDFS1\HCOUSERS\BARRYJN\WS\2021HB-06014 theof state18 planR02-HB.docx shall} beSubstitute subjectBill toNo. enforcement in accordance with the federal act, and the state plan for negligent violations.

(2)6099 Forsection anyor negligentthe violation,state aproducerplan shall be requiredsubject to correctenforcement suchin negligentaccordance violation,with bythe meansfederal ofact, aand correctivethe actionstate plan approvedfor sHB6099negligent /violations. File No.

102(2) 14For sHB6099any Filenegligent No.violation, aproducer shall be required to correct such negligent violation, by means of a corrective action plan approved by the commissioner.

102 by the commissioner.

(2) Notwithstanding the provisions of subdivision (1) of this subsection,LCO all{\\PRDFS1\HCOUSERS\BARRYJN\WS\2021HB-06015 documentsof and18 recordsR02-HB.docx submitted} orSubstitute maintainedBill pursuantNo. to this section shall be disclosed to any law enforcement agency upon request of such law enforcement agency.

(r)6099 Thesubsection, commissionerall maydocuments inspect and shallrecords havesubmitted accessor maintained pursuant to thethis buildings,section equipment,shall supplies,be vehicles,disclosed records,to realany propertylaw andenforcement sHB6099agency /upon Filerequest No.of such law enforcement agency.

102(r) 15The sHB6099commissioner Filemay No.inspect and shall have access to the buildings, equipment, supplies, vehicles, records, real property and other information that the commissioner deems necessary to carry out the commissioner's duties pursuant to this section from any person participating in producing, handling, storing marketing or researching hemp.

102 other information that the commissioner deems necessary to carry out the commissioner's duties pursuant to this section from any person participating in producing, handling, storing marketing or researching hemp.

[(w)] (v) Whenever the commissioner believes or has reasonable cause to believe that the actions of a licensee or any employee of a producerLCO licensee{\\PRDFS1\HCOUSERS\BARRYJN\WS\2021HB-06016 are inviolationofthefederalact,thestate plan, or any state law concerning the growing, cultivation, handling, transporting or possession of marijuana,18 theR02-HB.docx commissioner} shallSubstitute notifyBill theNo. Department of Emergency Services and Public Protection and the State Police.

6099 producer licensee are inviolationofthefederalact,thestate plan, or any state law concerning the growing, cultivation, handling, transporting or possession of marijuana, the commissioner shall notify the Department of Emergency Services and Public Protection and the State Police.

Subsection (g) of section 22-61m of the general statutes is sHB6099repealed /and Filethe No.following is substituted in lieu thereof (Effective July 1, 2021):

102 16 sHB6099 File No.

102 repealed and the following is substituted in lieu thereof (Effective July 1, 2021):

(NEW) (Effective July 1, 2021) (a) Marijuana producers, licensed under any provision of the general statutes, shall manufacture, market, produce or store hemp and hemp products, as such terms are defined in section 22-61l of the general statutes, as amended by this act, in accordancewiththeprovisionsofchapter424ofthegeneralstatutesand anyLCO regulations{\\PRDFS1\HCOUSERS\BARRYJN\WS\2021HB-06017 adopted under said chapter, except that marijuana producers may obtain hemp and hemp products from a person authorized under the laws of this18 stateR02-HB.docx or} anotherSubstitute state,Bill territoryNo. or possession of the United States or another sovereign entity to possess and sell such hemp and hemp products.

(b)6099 Hempany orregulations hempadopted productsunder purchasedsaid bychapter, except that marijuana producers may obtain hemp and hemp products from sHB6099a /person Fileauthorized No.under the laws of this state or another state, territory or possession of the United States or another sovereign entity to possess and sell such hemp and hemp products.

102(b) 17Hemp sHB6099or Filehemp No.products purchased by marijuana producers from third parties shall be tracked as a separate batch throughout the manufacturing process in order to document the disposition of such hemp or hemp products.

102 third parties shall be tracked as a separate batch throughout the manufacturing process in order to document the disposition of such hemp or hemp products.

Section 1 July 1, 2021 Section 1 New section Sec.

sHB6099ENV /Joint FileFavorable No.LCO {\\PRDFS1\HCOUSERS\BARRYJN\WS\2021HB-0609918 of 18 R02-HB.docx }

102 18 sHB6099 File No.

102 The following Fiscal Impact Statement and Bill Analysis are prepared for the benefit of the members of the General Assembly, solely for purposes of information, summarization and explanation and do not represent the intent of the General Assembly or either chamber thereof for any purpose.

In general, fiscal impacts are based upon a variety of informational sources, including the analyst’s professional knowledge.

Whenever applicable, agency data is consulted as part of the analysis, however final products do not necessarily reflect an assessment from any specific department.

OFA Fiscal Note State Impact:

None Municipal Impact:

None Explanation The bill requires any proposed changes in ownership of medical marijuana businesses licensed by the Department of Consumer Protection to be reviewed by the Office of the Attorney General (OAG) to determine whether such changes would violate antitrust laws.

This has no fiscal impact since OAG currently has staff with expertise for this purpose.

Additionally, the bill allows third-party medical marijuana producers to purchase hemp and hemp products from entities that are not part of the medical marijuana program.

This has no fiscal impact to the state or municipalities.

The Out Years State Impact:

None Municipal Impact:

None sHB6099 / File No.

102 19 sHB6099 File No.

102 OLR Bill Analysis sHB 6099 AN ACT CONCERNING ANTITRUST ISSUES AND THE PALLIATIVE USE OF MARIJUANA AND THE SALE OF HEMP AND HEMP PRODUCTS.

SUMMARY This bill requires anyone involved in a transaction that results in a material change to a medical marijuana business to file written notice with the attorney general.

It also establishes a waiting period for these transactions.

Under the bill, the written notice must contain information relevant to the proposed transaction as the attorney general deems necessary to enable him to determine whether thetransactionwouldviolate antitrust laws.

The attorney general may ask for supplemental information and extend the waiting period.

The bill prohibits disclosing this information under the state’s antitrust law and exempts it from disclosure under the Freedom of Information Act (FOIA).

Additionally, the bill allows licensed marijuana producers to manufacture, market, produce, or store hemp and hemp products and obtain these products from other legal sources.

It also requires these products the producer purchases to be tracked throughout the manufacturing process.

Finally, the bill (1) prohibits hemp or hemp products from being sold or distributed within a medical marijuana dispensary and (2) requires the independent testing laboratory that tests hemp to be located in Connecticut.

By law, hemp that is intended to be manufactured into a manufacturer hemp product must be tested by an independent testing laboratory.

“Manufacturer hemp products” include products intended for human consumption, including by ingestion, inhalation, or sHB6099 / File No.

102 20 sHB6099 File No.

102 absorption, that contain a THC concentration of no more than 0.3% on a dry weight basis or per volume or weight.

EFFECTIVE DATE:

July 1, 2021 MEDICAL MARIJUANA BUSINESS TRANSACTION NOTICE AND WAITING PERIOD The bill requires any person who enters into a transaction, either directly or indirectly, that results in a material change to a medical marijuana business to file a written notice with the attorney general and serve a waiting period.

A “person” means an individual, firm, partnership, corporation, company, association, trust, other business, or tribal entity and a “medical marijuana business” means a licensed medical marijuana dispensary or production facility.

Under the bill, “material change” means:

1.

the addition of a dispensary facility backer or producer backer (i.e., an owner of a greater than 5% stake);

2.

a change in the ownership interest of an existing dispensary facility backer or producer backer;

3.

themerger,consolidation,orotheraffiliationofamedicalmarijuana business with another person;

4.

the acquisition of all or part of a medical marijuana business by another person;

and 5.

the transfer of assets or security interests from a medical marijuana business to another person.

“Transfer” means to sell, transfer, lease, exchange, option, convey, give, otherwise dispose of, or transfer control over, including by way of merger or joint venture not in the ordinary course of business.

Written Notice The bill requires the written notice to be in a form and contain the documentary material and information relevant to the proposed sHB6099 / File No.

102 21 sHB6099 File No.

102 transaction as the attorney general deems necessary and appropriate to enable him to determine whether the transaction, if consummated, violates antitrust laws.

By law, the attorney general has the authority to, among other things, investigate proposed transactions and require parties to provide relevant information through subpoenas and written interrogatories (CGS § 35-42).

Waiting Period The bill requires a waiting period before the transaction is complete, which begins on the day the attorney general receives the completed notice from all parties to thetransaction (see above).

The waiting period generally ends on the 30 th day after the receipt, unless the attorney general extends the time or, in individual cases, terminates the waiting period and allows the transaction to proceed.

Under the bill, the attorney general may, before the 30-day waiting period expires, extend the waiting period by requesting additional material.

He may require parties to submit, pursuant to a subpoena or voluntarily, additionalinformation or documentary material relevant to the proposed transaction.

Upon this request, the waiting period is extended until 30 days after the parties have substantially complied with the request, as determined by the attorney general.

Disclosure Prohibited Under the bill, any information or documentary material filed with the attorney general is not disclosable under the Connecticut antitrust investigation law or FOIA.

This information or material must not be made public, except as may be relevant to an administrative or judicial action or proceeding.

The bill requires the information or documentary material to be returned to the person who provided it when the attorney general’s review is terminated or the final determination of any action or proceeding commenced as a result.

sHB6099 / File No.

102 22 sHB6099 File No.

102 HEMP The bill requires any licensed marijuana producer that manufactures, markets, produces, or stores hemp and hemp products to do so in accordance with existing hemp laws and regulations.

The bill also allows producers to obtain hemp and hemp products from a person authorized under Connecticut law or the law of another U.S.

state, territory, or possession or other sovereign entity to possess and sell these products.

Under the bill, theSeed Law Chapter and itsregulations do not apply to medical marijuana producers, broadening an existing provision generally exempting producers from laws on hemp licensure and programs.

The Seed Law Chapter generally establishes requirements for seed labeling, sale, inspection, and restrictions, among other things (CGS § 22-55 et seq.).

The bill requires the hemp or hemp products a marijuana producer purchases from a third parties to be tracked as a separate batch throughout the manufacturing process to document their disposition.

Once the producer receives these products, they are deemed marijuana and the producer must comply with the applicable marijuana laws and statutes.

Producers must retain a copy of the certificate of analysis for hemp or hemp products purchased and the invoice and transport documents that show the quantity purchased and date received.

COMMITTEE ACTION General Law Committee Joint Favorable Substitute Yea 19 Nay 0 (03/09/2021) sHB6099 / File No.

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