Oregon Pot Investors May Have To Be Residents

2000px-Flag_of_Oregon.svgLawmakers in Oregon are now considering a residency requirement for businesses and investors wanting to enter the state’s new legal marijuana marketplace.

A legislative committee for implementing marijuana regulations added language to a pending bill, which may require residency for participants in the medical cannabis program in the state. Some committee members also acknowledged that they are considering similar requirements for the recreational marijuana program.

Sen. Ginny Burdick (D-Portland), who co-chairs the committee, said that one of the main factors being considered is whether there is “strong legal ground with [the] residency requirement.”

Republican lawmakers who are part of the committee sought a lawyer’s opinion regarding the prohibition of out-of-state companies and investors. The lawmakers also sought opinion on whether the Oregon can prohibit local businesses from investing their own proceeds outside the state.

The lawyer, Legislative Counsel Dexter Johnson, answered that such prohibition would violate certain clauses of the US Constitution – namely, the privileges and immunities clause and the commerce clause.

But Burdick, who also sought legal opinion, received a different response from Deputy Legislative Counsel Mark Mayer. The lawyer works specifically on cannabis legal issues, and he said that Oregon would have a strong case in imposing residency requirements, if ever such requirements are challenged in court. This is because marijuana is still illegal at the federal level and there is still no large-scale interstate commerce in the marijuana industry.

Mayer added that when marijuana is federally de-scheduled and develops interstate commerce activity, that’s the time to reconsider the ideas about out-state investor and business prohibition.

Oregonian pot-growers, both in the black market and in the legal medical marijuana market, are reportedly keen on preventing out-of-state competition from entering the Oregon space.

On the other hand, at least one private equity firm has expressed interest in getting involved in the Oregon legal market.

The legislative committee continues to discuss Oregon’s policies on Measure 91, the measure that has allowed adults in the state to legally possess cannabis. The biggest point for discussion is currently Senate Bill 844, which aims to regulate the state’s medical marijuana more tightly.

Recreational marijuana shops in Oregon cannot open until 2016 because the state is yet to set up a licensing system. But because of voters’ approval of Measure 91, the state has joined Colorado, Washington, and Washington DC in allowing recreational cannabis to some extent.

Posted in: Articles

Comments are closed.