Wouldn’t you know it, just as Alabama’s medical cannabis program is set to launch, the Alabama Medical Cannabis Commission (AMCC) wants to change the rules. Mercifully, the proposed changes would not delay the launch of the program. They would, however, effect the program in a number of ways - some significant, others more modest.

We address each proposed revision in turn below. But first it is worth mentioning that the proposed regulations published on February 18 are at this point merely proposals. The AMCC will accept public comments on the proposed regulations until April 3, 2026. At that point, the AMCC will have the opportunity to vote on the regulations as drafted or in a revised form based on comments received.

Change in Ownership Rules

One of the more notable proposed changes is a tweak to the process by which a licensee can transfer ownership interests. The original rule primarily focused on prohibiting transfers or changes in ownership without the commission’s prior approval. Under the proposed new framework, ownership changes fall into three distinct categories: de minimis changes, non-controlling changes, and controlling changes.

  • De minimis changes involve less than 5% of the total ownership (as aggregated with all other acquisitions by the same acquiring entity over the last 36 months) and do not require prior AMCC approval.
  • Non-controlling changes (other than de minimis changes) involve less than 50% of the total ownership of the licensee and do not result in a change to a controlling interest. Non-controlling changes require prior AMCC approval, which may be granted upon demonstration that the change does not violate any other provision of law or the AMCC rules.
  • Controlling changes involve a change in a controlling interest and may only be approved following a public hearing where the suitability of the entity acquiring the controlling interest is determined. In addition, the public hearing must result in a finding that the controlling change does not violate any other provision of the law or the AMCC rules.

The proposed amendment further provides that any request for approval of a non-controlling or controlling change is treated as a license application and must be accompanied by a $2,500 application fee. Existing licensees also must receive notice of the request and may intervene and request a hearing before an administrative law judge. Beyond other statutory and regulatory requirements for approval, if the licensee originally qualified as a “minority group” license holder under Ala. Code 20-2A-51(b), the commission will not approve an ownership change that would result in a reduction of the number of “minority group” licenses below the statutory minimum. All changes of ownership due to death are subject to the approval procedures in the proposed rule, but such requests are presumptively approved so long as the new owner(s) demonstrate they are qualified to hold a license under Alabama law and AMCC rules.

The proposed rule contains entirely new language providing that an “ownership interest” in a licensee will be attributed to interests held indirectly through one or more intervening organizations in certain cases. Ownership interests will also be attributed where interests in voting stock are held in trust by any person who holds or shares the power to vote that stock, to any person who has the sole power to sell the stock, and to any person who has the right to revoke the trust or replace the trustee.

The commission also defines several forms of constructive ownership using new language. An individual will be considered an owner of a licensee which is owned, directly or indirectly, by or for the individual’s spouse, children, grandchildren, or parents. An entity will be considered an owner of a licensee when it has an option to acquire stock or other interest in the licensee. Additionally, an ownership interest in a licensee contained in a trust or estate will be considered as being owned by the beneficiaries of that trust or estate.

Finally, the proposed rule requires the commission’s consent for a licensee to transfer interests in its facilities via trust, mortgage, or other instruments to secure an indebtedness. Commission approval is required if the secured party’s enforcement of its interest would result in a transfer of the license, a change of ownership to a non-qualifying entity, or another violation of law.

Notice of Lost Card

The commission has proposed extending the deadline for a patient to provide notice of a lost, stolen, fraudulently used, or fraudulently accessed medical cannabis card from 72 hours to 10 days.

Material Change in Licensing Information

The current rule provides that a licensee has an ongoing duty to notify the commission or to seek its permission within 30 days of any material change in licensing information. The proposed amendment clarifies the definition of a material change and provides that licensees must seek prior approval of such changes. If prior approval is not feasible because a material change is caused by death or other circumstances beyond the licensee’s control, the commission must be notified in writing no more than 30 days after the change.

Under the proposed amendment, a material change includes a change in the licensee’s management not resulting in change of ownership, a change in the location of any facility used pursuant to the license, or any other change that would render the licensee ineligible for a license under the AMCC rules.

Fees

The commission’s proposed amendment includes a clear schedule of fees to remove ambiguity. For businesses, fees for applications, amendments, corrections, and renewals are standardized. For example, rather than calculating application amendment fees based on the original application fee, the proposed schedule sets uniform fees for such actions.

Purchase Period & Possession Limit

The commission proposes a more detailed scheme governing purchase limits for medical cannabis products. In its current form, the rule allows a patient to purchase the lesser of a 60-day supply, a number of doses equal to the number of days since the patient’s last purchase, or as recommended by the registered certifying physician. The proposed amendment establishes a 60-day “purchase period” that begins on the date a patient purchases medical cannabis. During each purchase period, a patient’s maximum allowable purchase is the difference between the number of days remaining in the purchase period and the number of daily dosages already purchased during the period. During the last 10 days of the purchase period, a patient may purchase medical cannabis products early to cover the start of the next period. The proposed amendment also establishes a possession limit of 70 daily doses for all patients.

Continuing Education

The proposed amendment simplifies and reduces continuing education requirements for licensees. Training requirements now apply to “registered agents” rather than distinguishing among owners, managers, salaried employees, and non-salaried employees. First, a medical cannabis foundations training program is now required within 60 days of an agent’s registration rather than before hiring. Second, the commission proposes reducing the annual continuing education requirement from 20 hours to six hours.

Agent Registration 

As referenced in the preceding section, the commission proposes an amendment to the rules for “registered agents.” Critically, any individual granted access to a licensee’s facility who is not a registered agent must comply with the visitor access requirements of the AMCC rules. So, licensees will want their employees to be registered agents should the proposed rule pass as written. To achieve this status, an agent must submit an electronic application to the AMCC along with the licensee’s verification of the agent’s association and must also submit to state and federal background checks. Registered agent status must be renewed annually.

Exemptions from Secure Transporter Regulations for State Testing Laboratories

The commission clarifies in its proposed rule that certain requirements for secure transporters of medical cannabis do not apply to state testing laboratories acting as transporters. Specifically, a state testing laboratory transporting samples of medical cannabis to or from state laboratories is not required to actively monitor variable route plans and GPS tracking systems, provide locks and alarm systems in vehicle storage areas, or provide remotely monitored tracking devices on sealed tamper-evident containers. State testing laboratories transporting medical cannabis for testing are also exempted from licensure requirements and associated fees, and employees are exempt from annual training requirements.

New Symbol

The proposed rule modifies the labeling requirements for medical cannabis processors and establishes a commission-approved universal state symbol. The symbol must be at least a 1/2 inch by 1/2 inch in size, printed in color, and placed on the principal display panel of the label or the package to which the label is affixed.