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July 2, 2025
Welcome!
As the Minnesota cannabis industry continues to develop, we strive to provide you with the information you need to succeed and to be a partner for your business. We’ve added qualified and preliminarily approved applicants to our distribution list for this newsletter, which contains important guidance and information from OCM’s compliance and enforcement team.
If you are new to the Compliance Connector, welcome! Continue reading to learn about the hemp and medical cannabis markets transition to chapter 342, the cannabis event organizer license, the Cannabis Technical Authority, and more.
In this issue:
Product transition period for existing regulated product supply chains
Launching a new retail market for cannabis and hemp-derived products that is governed by one statute (chapter 342), while maintaining existing markets authorized under other statutes (section 151.72 and chapter 152) is complex. Prospective hemp-derived, adult-use cannabis, and medical cannabis businesses have understandably had questions about how to manage the transition between regulatory frameworks, particularly as it pertains to statutory requirements for products and packaging/labeling.
To support the launch of the adult-use cannabis market and provide continuity for existing hemp-derived businesses and medical cannabis patients, OCM has authorized a product transition period through December 31, 2025. During this transition period, license holders conducting retail sales under Minnesota Statutes, chapter 342 are authorized to sell products compliant under the existing regulated supply chains in section 151.72 and sections 152.22-152.37, including hemp-derived cannabinoid products (HDCPs) and medical cannabis.
Below we outline how this product transition period impacts hemp-derived product retailers, manufacturers, and Minnesota’s medical cannabis program.
What the transition period means for hemp-derived retailers
Through December 31, 2025, cannabis and hemp license holders authorized to sell lower-potency hemp edible products at retail are now able to:
- Purchase hemp-derived products that are compliant with section 151.72 from hemp-derived product manufacturers that are not yet licensed as hemp businesses under chapter 342.
- Sell hemp-derived products that are compliant with section 151.72 to customers.
The hemp-derived products purchased and sold by cannabis and hemp license holders during the transition period must be compliant with all packaging, labeling, and testing requirements as outlined in section 151.72.
Before and pending licensure, registered hemp-derived businesses may continue selling hemp-derived products compliant with section 151.72. Once licensed, both cannabis retail businesses and lower-potency hemp edible (LPHE) retailer license holders will now be able to continue sales of hemp-derived products compliant under section 151.72 through December 31, 2025.
After December 31, 2025, all hemp and cannabis business license holders authorized to retail must follow all product requirements under chapter 342, including packaging, labeling, and testing.
What the transition period means for hemp-derived product manufacturers
Once a hemp-derived manufacturer currently manufacturing products under section 151.72 receives a hemp or cannabis business license, they must only produce and sell products that are compliant with chapter 342. The product transition period authorizes the purchase and retail sale of hemp-derived products compliant with section 151.72; it does not authorize the manufacture of products compliant with section 151.72 that are not compliant with 342.
Hemp-derived manufacturing businesses should prepare for the transition to licensure and assess stock and sell any remaining product that is not compliant with chapter 342 before licensure. To prepare for the LPHE licensing window, opening October 1, and the regulatory transition from section 151.72 to chapter 342, including how requirements will shift after December 31, 2025, read the Hemp Registrant to License Holder Conversion Guide and Hemp Business Guide.
What the transition period means for the medical cannabis program and medical cannabis patients
Chapter 342 created a new licensing framework for the medical cannabis program. To prevent disruption in medical cannabis patients’ access to medical cannabis during the operational transition from sections 152.22-152.37 to chapter 342, the office will authorize medical cannabis combination business license holders that previously held a registration agreement with the state’s medical cannabis program to sell medical cannabis products manufactured and tested prior to licensure and compliant under Minnesota Statutes, section 152.22 and Minnesota Rules, chapter 4770, to medical cannabis registry patients. This authorization also applies to limited product designated for sale to adult-use consumers subject to registration agreements.
All products sold by a medical cannabis combination business under this authorization must comply with the packaging and labeling requirements in chapter 342 and Minnesota Rules, chapter 9810. A new marketing layer, as that term is defined in part 9810.0200, subpart 38, may be utilized.
Once a medical cannabis combination business is licensed, all new products cultivated and manufactured by the license holder must be tested according to and otherwise compliant with all of chapter 342, chapter 9810, and the office’s Cannabis Technical Authority.
Applications for cannabis event organizer licenses to open Aug. 1
On August 1, OCM will begin accepting applications for cannabis event organizer licenses. This will be an open-ended opportunity for applicants, with applications accepted on a rolling basis. The cannabis event organizer license authorizes the holder to plan and host temporary cannabis-related events in Minnesota. Pursuant to Minnesota law, cannabis events must be limited to ages 21 and older and may not include the sale or consumption of alcohol. Cannabis events may feature the on-site sale and use of adult-use cannabis products, lower-potency hemp edibles, and hemp-derived consumer products. Event organizers may host multiday events, provided that the event does not exceed four consecutive days in duration.
This license type is temporary, and a new license must be obtained for each event. All cannabis event activities require local approval, including but not limited to any permits or licenses required by the applicable local unit of government and specific approval of on-site consumption areas. Event organizers must obtain this approval before submitting an application to the OCM and provide proof of local approval as part of the application.
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Change of Business Ownership and Control
Minnesota law only allows for licenses to be transferred with OCM’s prior written approval. However, the prohibition on pre-licensure transfer does not mean that an applicant cannot make changes to their ownership structure. There are different requirements for changing ownership of a business, depending on if the changes are being made prior to obtaining a cannabis business license, or if they are being made after a license has been issued.
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Technical Authority: standards for sampling and testing cannabis products
Minnesota Statutes, chapter 342 says that all products must be evaluated for relevant contaminants and potency prior to retail sale. The Cannabis Technical Authority is where the individual analytes and the corresponding action levels are published.
All products manufactured in Minnesota will be held to the requirements listed in the Cannabis Technical Authority once the companies making them are licensed by OCM. Until January 2026, lower-potency hemp edibles (LPHEs) may be tested by ISO 17025 accredited labs that are not licensed by the office. Any questions can be directed to cannabis.info@state.mn.us.
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OCM issued the first cannabis business license in the state of Minnesota on June 18. The first licensee, Herb Quest, LLC, is a microbusiness located in Brook Park in Pine County, Minnesota, whose initial primary business activity will be outdoor cultivation of cannabis plants.
Interim Director Eric Taubel said the issuing of the license is a major milestone for the growing market and the licensee will now be able to begin growing plants to help further boost the state’s supply chain. Herb Quest, LLC joins more than 600 businesses that are within the final steps of completing their applications and securing approvals from local governments. The first pieces of Minnesota’s adult-use market fall into place.
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Important updates and reminders
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Correction from our previous issue; Q & A: On-sale alcohol establishments selling HDCPs
- Q: Is there a requirement to create separate bills for HDCPs versus other products?
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A: No, an establishment is not required to separate bills for HDCPs and other products. Please consult the Department of Revenue for any questions regarding how to implement taxation and any requirements.
- If you have not already, register your HDCP business by completing the HDCP Business Registration Form by August 31, 2025. If you have more than one location, please register each one separately. Please note, you do not need to register again if you have already registered. If you are not sure if your business is already registered, please check the public list of HDCP registrants before completing the form
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Update your existing HDCP registration by submitting a HDCP Business Registration Change Form by August 31, 2025.
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Starting October 1 and continuing through October 31, OCM will accept business license applications for three license types: lower-potency hemp edible retailers, lower-potency hemp edible manufacturers, and lower-potency hemp edible wholesalers.
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