LAPEER, Mich. – Although the holidays have come and gone, with Michigan’s new laws allowing recreational use of marijuana for adults 21 and over, the spirit of giving and gifting is still alive and well. Unfortunately, unlike the gift of a nice bottle of wine or an expensive box of cigars, the laws and regulations regarding the sale of marijuana can be a bit confusing. But that’s not stopping savvy business owners from finding loopholes in the laws that allow them to “give” away their product.
As the State of Michigan and its citizens prepare for the emergence of recreational marijuana businesses, many business owners are already trying to get ahead of the game searching for different loopholes in the law. One way would be by gifting cannabis to customers through different methods. For instance, some businesses have proposed the idea of selling a rather expensive T-shirt or item that comes with a “free” bag of weed. This, however, may not be the best way to go about peddling one’s products containing THC. These businesses are operating in a grey area under state law, leaving law enforcement waiting for the Michigan Licensing and Regulatory Affairs Department to clarify the statute’s language.
“It is not unlawful to give away or otherwise transfer without remuneration, that is without compensation, up to 2.5 ounces of marijuana to a person 21 years of age or older as long as the transfer is not advertised or promoted to the public,” said Bob Hendricks, attorney with Wrigley, Hoffman and Hendricks Law, located in Grand Rapids.
The idea of gifting marijuana with the purchase of another item gained momentum after the District of Columbia legalized marijuana a few years ago without including a way for the people to buy it. It’s a perfect business model for smaller operations that want to participate in the cannabis industry without amassing a huge bankroll.
According to the verbiage in Proposal 1, the new law shall “Allow individuals to give away, but not sell, up to 2.5 ounces of marihuana to people 21 and older,” which is the basis for many business owners’ thinking behind new forms of promotion and retail.
“It’s completely legal to give away or otherwise transfer up to 2.5 ounces of marijuana without remuneration, and this is a huge grey area,” said Lapeer-based attorney and marijuana activist Bernard Jocuns. “People are testing the waters on this as we speak. The idea of giving cannabis with a piece of art, or a book or any other item really seems to stretch the aspect in the statute regarding advertising or being promoted to the public.”
When the proposal was first passed and recreational marijuana became legal as of Dec. 6, 2018, it was incumbent upon users to find ways to obtain marijuana while also staying within the confines of federal law – something that was easier said than done. The most popular method of both giving and receiving marijuana since the passing of the new legislation has been through “gifts” that come with the sale of another item.
Organized events with marijuana samples have taken place since legalization, as well. Chef Gigi Diaz, trade show High Times’ 2017 cannabis chef of the year, held an event earlier last month featuring cannabis-infused dish tastings, a cooking demonstration and a gallery from local photographer Erin Short, which shared the stories of members of the medical cannabis community and how they use their medication.
Approximately 70 people attended the event, which was made available to the public with tickets sold on Eventbrite. Diaz said she accepted “donations” starting at $35 to cover costs. In keeping with the legislation verbiage, as long as the free cannabis samples were not be advertised anywhere, including online, the marijuana was completely legal for people to give away. For that reason, events like this have a stronger legal standing than businesses selling products with gifts of marijuana, and therefore less of a chance of being prosecuted.
The Michigan Regulation and Taxation of Marihuana Act — the law that Proposal 1 became once voters approved it — allows individuals to gift up to 2.5 ounces of the smokeable marijuana flower and to gift up to 15 grams of marijuana concentrates to others, which is a considerable amount of marijuana – enough flower to roll approximately 70 one-gram-sized joints, according to the Michigan State Police.
Legally speaking, gifts are “something provided without remuneration or the expectation of reciprocity or payment,” according to officials. However, questions remain over whether medical patients can gift marijuana to non-patients, or if caregivers can gift marijuana to people who aren’t their patients, so many lawyers and activists recommend marijuana users begin growing their own plants as soon as possible. But this begs yet another question: where does one obtain or buy seeds legally? Because, as of now, the new recreational marijuana law does not provide a mechanism to purchase seeds.
In the medical marijuana system, fertile seeds can be sold by licensed medical growers to licensed medical provisioning centers, who in turn can sell them to card-carrying patients or caregivers, however, that does not mean medical provisioning centers can sell fertile seeds to just anyone. Also, many users aren’t interested or able to produce their own crop. Which takes us right back to square one – gifting.
According the legal verbiage on gifting marijuana from Proposal 1, it’s legal to give someone marijuana as long as it’s no more than 2.5 ounces the exchange is in no way advertised or promoted. So, for all those businesses planning on selling shirts with a “free” bag of weed, it would behoove you to proceed with extreme caution, especially in regards to advertising the sale. Or, at the very least, retain the services of an attorney.
According to the Prosecuting Attorneys Association of Michigan, prosecutors around the state are waiting for clarification on the law, though even without a rule, people who pursue this business model could face an investigation and criminal prosecution.
This means for the next year or so, most pot consumers (at least those without a medical marijuana card) will be forced to continue frequenting the black market. Unless they and the business they frequent are exceptionally careful to fly under the radar and maintain strict adherence to all stipulations of the legislation.
“It appears there’s going to have to be some type of legislative fix in the near future,” said Jocuns. “Again, this is something that will probably be decided by the courts, no different than with the Medical Marijuana Act of 2008, where dozens of cases have been litigated in the last decade.”
So far, law enforcement has not said how it will approach the grey market. But one thing is for sure, the weed dealers in Michigan are going to push the limits in the coming months while the state figures out how its taxed and regulated scene is going to go down.
Fortunately for all marijuana users and business owners, there’s light at the end of the tunnel. It just may take a little more time. According to officials, the Department of Licensing and Regulatory Affairs legally has up to 12 months to come up with guidelines for methods and means of selling and obtaining marijuana and expects to see recreational marijuana for sale in about a year to a year and a half from now.
The Jocuns Law Firm consults potential businesses and individuals under MRTMA and the MMMA of 2008.