New Jersey Legal Update

On September 25, 2023, Governor Phil Murphy signed into law A-4151/S-2766, an Act concerning cannabis. This law, P.L2023, c.162, will revise certain cannabis restrictions on cannabis establishments’ owners and expand the scope of review of cannabis establishment license applications and related materials. The signage of this bill into law will help provide additional opportunities for inclusivity in the cannabis marketplace, as the original legalization law intended.  

A4151 specifies the following:



• Allows investor groups and individual investors (including owners of a Class 5 license) to provide “significant financial or technical assistance or the significant use of intellectual property” to up to 7 retail licenses

• In exchange, the investor can receive up to a 35% interest in each of those 7 businesses

• In no situation is the investor/lender allowed to obtain more than 35% of the business. The borrower/company receiving investment must be a Class 5 retail license holder that is either a certified women-owned business enterprise (WBE), minority-owned business (MBE), or disabled veteran-owned business (DVOB)

• The terms of any agreement providing such assistance must be commercially reasonable and must be submitted to the CRC for review

• Repayment agreements:

• The recipient of the significant financial assistance must “pay back to the investor, investor group, or fund the full value of the financial or technical assistance or intellectual property provided under the agreement, plus any applicable interest and fees,” but repayment terms must comply with the following:

• In a period not less than five years after the date of the agreement, if the full value of the assistance or property is less than $100,000

• In a period not less than seven years after the date of the agreement, if the full value of the assistance or property is between $100,001 and $250,000

• In a period not less than 10 years after the date of the agreement, if the full value of the assistance or property is over $250,000

The New Jersey Regulatory Commission must now amend its regulations to implement the provisions of P.L.2023, C162, which will likely be subject to a 60-day public comment period. It's expected the regulatory process will occur this autumn.  

Please reach out to a member of your team at Vicente with any questions, or click here to set up a consult.  

© Vicente LLP 2023.

This material is intended as informational only and the content should not be construed as legal advice.

This material may be considered attorney advertising under certain rules of professional conduct.