This chapter applies to the distribution of any cannabis licenses through a lottery system, including a: Standard grower license; Standard processor license; Standard dispensary license; Micro grower license; Micro processor license; Micro dispensary license; On-site consumption establishment license; and Incubator space license. An applicant shall submit an application to the Administration for a license. A submitted application shall conform with the requirements established under Alcoholic Beverages and Cannabis Article, §36-404, Annotated Code of Maryland. An application shall be: Completed on a form designated by the Administration; and Accompanied by the application fee as specified in COMAR 14.17.21. An applicant, including any individual or entity that holds an ownership interest in or control of the applicant, may only be listed on: One application per license type per application round; and Two applications for any license type per application round. Any applicant that violates §D of this regulation may not be considered by the Administration for licensure. The Administration may not require an applicant to possess or own any property or facility to operate a cannabis business at the time of the application. The Administration may verify an applicant’s status as a social equity applicant prior to the initial application and licensure. Any information an applicant submits in support of their social equity status in §G of this regulation is considered part of the application and is subject to verification by the Administration. The Administration shall announce an application round at least 60 days prior to the acceptance of applications. The announcement shall include: Types of licenses available during the licensing round; Number of licenses available by license type; Beginning and closing day of the application period; and Any regional, jurisdictional, or other geographical considerations in the licensing round. The Administration shall accept applications for a period of 30 calendar days. The Administration shall conduct extensive outreach to small, minority, and women business owners and potential social equity applicants prior to accepting applications. Upon the closing of any application period, the Administration shall announce the number of applications submitted and the maximum number of licenses that may be awarded within each license category and pool of applications. Application Review. The burden of proving an applicant’s qualifications rests on the applicant. The Administration may: Deny an application that: Is not complete in every material detail; Contains a material misstatement, omission, misrepresentation, or untruth; Does not meet the minimum qualifications for the lottery; or Is not submitted by the established deadline; Request any additional information from any applicant, if it deems the information necessary to review or process the application; and If the applicant does not provide the additional requested information within 10 calendar days, deny the application. The Administration shall determine whether a submitted application meets the minimum qualifications for the lottery on a pass-fail basis by reviewing: A detailed operational plan for the safe, secure, and effective operation of the business; A business plan demonstrating a likelihood of success and sufficient ability and experience on the part of the applicant, and providing for appropriate employee working conditions; A detailed diversity plan; and For the first round of licensing and otherwise as required under Alcoholic Beverages and Cannabis Article, §36-404, Annotated Code of Maryland, for any subsequent round of licensing, documentation that the applicant meets the requirements of a social equity applicant. Minimum qualifications in §E(3) of this regulation shall be established by the Administration and communicated to prospective applicants prior to the application period. The Administration may award fewer licenses than authorized under law in any licensing round. The Administration may require an applicant, or any individual or entity that holds an ownership interest in or control of the applicant, to complete an attestation demonstrating the applicant meets the requirements for award established in Alcoholic Beverages and Cannabis Article, Title 36, Subtitle 4, Annotated Code of Maryland. Lottery. The Administration shall conduct a lottery that is impartial, random, and in a format selected by the Administration. Any applicant that meets the minimum qualifications for licensing shall be placed in the lottery. Subsequent to the lottery, the Administration shall notify all applicants of whether their application was selected in the lottery. The Administration may request any additional information or supporting documentation from an applicant selected in the lottery necessary to verify aspects of the application, including but not limited to additional information and supporting documentation related to the: Operational plan for the safe, secure, and effective cultivation, manufacture, or dispensing of cannabis; Business plan demonstrating a likelihood of success and sufficient business ability and experience on the part of the applicant, and providing for appropriate employee working conditions; Detailed diversity plan; and Ownership and control of the applicant. The Administration may deny issuing a conditional license to an applicant selected in the lottery if: The applicant fails to provide any additional information or supporting documentation requested pursuant to §A(4) of this regulation within 10 calendar days; Any additional information or supporting documentation submitted by the applicant demonstrates the applicant is not eligible for a license under this subtitle or Alcoholic Beverages and Cannabis Article, Title 36, Annotated Code of Maryland; or The Administration determines that the applicant violated Regulation .02D of this chapter. The Administration shall notify an applicant who has been awarded a conditional license within 5 calendar days of the award. Conditional License. A conditional licensee shall complete a supplemental license application. A supplemental license application shall require a conditional licensee to: Undergo a criminal history records check in accordance with Alcoholic Beverages and Cannabis Article, §36-505, Annotated Code of Maryland; Complete a financial background investigation conducted by the Administration; Verify any information or supporting documentation provided in the application; Disclose any adverse action taken against a professional or business license held in any jurisdiction by the applicant or any individual or entity holding an ownership interest in the applicant; Waive any contractual, statutory, or common law obligation of confidentiality and authorize any government agency in any jurisdiction to release to the Administration all information the conditional licensee has provided to any other jurisdiction while seeking a cannabis-related license in that other jurisdiction, as well as the information obtained by that other jurisdiction during any investigation it may have conducted regarding the applicant; Release all financial institutions, fiduciaries, and other parties from any contractual, statutory, or common law obligation of confidentiality to provide financial, personal and background information relevant to the conditional licensee’s capacity to manage a licensed facility; and Identify and demonstrate legal control of the proposed site, through lease, purchase, or other means, for the cannabis business. Any conditional license not awarded due to circumstances in §A of this regulation may be awarded by lottery using the same pool of applicants as the initially selected application. Conditional License Period. The conditional license period: Begins on the day that a conditional license is issued to the selected applicant; and Expires 24 months after the day that conditional license was issued or at the end of an extension granted by the Administration. A conditional licensee may apply for an extension of the conditional license. The Administration may approve a one-time extension of up to 6 months, if the Administration determines the conditional licensee has made consistent good faith efforts to establish a cannabis business. For purposes of determining consistent good faith effort in §A(3) of this regulation, the Administration: Will consider demonstrating legal control of a premises to indicate consistent good faith effort if the premises: Is suitable for the operations of the cannabis license; and Complies with local planning and zoning requirements; and May use its discretion to determine that a conditional licensee has demonstrated consistent good faith effort if the conditional licensee provides adequate documentation that a political subdivision has unduly burdened its efforts toward becoming operational, as defined in Alcoholic Beverages and Cannabis Article, §36-405, Annotated Code of Maryland. During the conditional license period, a conditional licensee shall: Complete a supplemental license application; Establish legal control of the proposed site, through lease, purchase, or other means, for the cannabis business; Notify the Administration of establishment of legal control of the proposed site; Within 6 months of being issued a conditional license, demonstrate adequate capitalization to enable the business to become operational; Gain zoning or planning approval from a political subdivision, if applicable; and Register the business with the State Department of Assessment and Taxation. During a conditional license period, a conditional licensee may not: Engage in purchasing, possessing, cultivating, manufacturing, or selling cannabis or cannabis products; Make any transfer of an ownership interest that causes a change in the individual or entity that holds the controlling ownership interest; Make any transfer of control, as defined in COMAR 14.17.01; and If the conditional licensee qualified as a social equity applicant, make any transfer of an ownership interest that causes the conditional licensee to no longer comply with the social equity applicant definition in COMAR 14.17.01. During a conditional license period, a conditional licensee may obtain additional resources by adding: Grants and loans from new or existing financial sources not listed in the initial application; and Owners and passive investors. Any additional resources obtained by a conditional licensee made under §A(7) of this regulation may not violate this subtitle or Alcoholic Beverages and Cannabis Article, Title 36, Subtitle 4, Annotated Code of Maryland. Rescission of a Conditional License. The Administration may rescind a conditional license if a conditional licensee, or any individual or entity included in the supplemental license application: Has been convicted of or pleaded nolo contendere to a crime involving moral turpitude, whether or not any appeal or other proceeding is pending to have conviction or plea set aside; Fraudulently or deceptively attempts to obtain a license; Is ineligible to hold an ownership interest in or control of a business licensed under Alcoholic Beverages and Cannabis Article, Title 36, Subtitle 4, Annotated Code of Maryland; Fails to reveal any material fact pertaining to the conditional licensee’s qualification for a license; Fails to submit a complete supplemental license application; Fails to become licensed and operational within: 24 months after the day the conditional license was issued; or If granted an extension, the day after the expiration of any extension granted by the Administration; Fails to comply with §A(5) and (6) of this regulation; Is not registered or in good standing with the State Department of Assessment and Taxation; or Has taxes in arrears in any jurisdiction. The Administration may award a license on a determination that: The conditional licensee has submitted a complete supplemental license application; The supplemental license application, including any individual or entity included in the application, does not violate §B of this regulation; The license fee specified in COMAR 14.17.21 has been paid; All inspections are passed, and all the conditional licensee’s operations conform to the specifications of the application as approved pursuant to this chapter; and The proposed premises: Are under the legal control of the conditional licensee; and Comply with all zoning and planning requirements. A licensed business may not grow, process, distribute, dispense, or otherwise begin business operations without approval of written documentation under §C of this regulation by the Administration. The Administration may not award a license to a business who has registered with the State Department of Assessment and Taxation using a legal name that: Uses the terms “cannabis”, “marijuana”, or other synonym related to controlled substances; Suggests the use of cannabis as an intoxicant; or Incorporates any copyrighted material or trademark or service mark attributable to another entity. The Administration may suspend, fine, restrict, or revoke a license, including a conditional license, if: A licensee has fraudulently or deceptively submitted written documentation to the Administration; A licensee has violated Alcoholic Beverages and Cannabis Article, Title 36, Subtitle 11, Annotated Code of Maryland; A licensee began operations prior to Administration approval; or It is determined that a licensee has not complied with statements in the application, including statements about standards of operation or employment practices related to diversity, equity, and inclusion. Upon notification that an applicant was not selected by the lottery, the applicant may request the Administration retain the application for subsequent licensure application rounds. The Administration shall retain any application requested for retention by the applicant for a period of 1 year. The Administration may contact an applicant with a retained application for any additional information required for subsequent licensing rounds. Any application retained by the Administration that meets the specifications and requirements of a subsequent licensing round within the 1-year retention period shall be automatically entered into the lottery if: The applicant has properly amended the application if requested by the Administration under §C of this regulation; and Any additional information requested by the Administration has been updated. The Administration may not enter a retained application into a subsequent lottery round if: Any individual included in the application is associated with additional applications in the licensing round that exceed the restrictions in Regulation .02D of this chapter; Any individual included in the application is in violation of ownership restrictions under COMAR 14.17.16, or the awarding of a license would place the individual in violation of ownership restrictions under COMAR 14.17.16; and Any individual associated with the application has been found to be in violation of Alcoholic Beverages and Cannabis Article, Title 36, Subtitle 11, Annotated Code of Maryland. Records Review. An applicant not entered into the lottery by the Administration may request a records review of the submitted application within 10 days of notification that their application does not meet the minimum qualifications for the lottery on a pass-fail basis. A records review shall consist of an opportunity for the applicant to examine the applicant’s records received by the Administration and verify the basis on which the application was deemed ineligible for the lottery. No applicant may gain access to records submitted by any other applicant through the records review process. A selected applicant or an applicant who applies pursuant to COMAR 14.17.05.06 who subsequently has their application denied by the Administration or a conditional licensee who has their conditional license rescinded pursuant to Regulation .05B of this chapter may request a hearing under COMAR 14.17.22. An applicant who meets the minimum qualifications for the lottery, but is not selected in the lottery, may not appeal or request a hearing. The application shall be retained by the Administration in accordance with Regulation .06 of this chapter. Pigford v. Glickman Class Members. The Administration may issue up to five conditional grower licenses to recognized class members of Pigford v. Glickman, 185 32 F.R.D. 82 (D.D.C. 1999), or In Re Black Farmers Litig., 856 F. Supp. 2d 1 (D.D.C. 2011) who: Were awarded damages related to farming operations in Maryland; Have provided evidence to the Administration that they have not been fully compensated for discrimination and continue to experience challenges due to past or present discrimination; and Meet all other application criteria established by the Administration under this chapter. If there are more qualified applications than the number of licenses available, the Administration shall conduct a lottery for all applicants that meet the minimum qualifications for licensing established under §A(1) of this regulation. Notwithstanding any other provision of law, a license issued under this regulation is in addition to and not subject to the limitations on the total number of licenses that the Administration may issue under Alcoholic Beverages and Cannabis Article, Title 36, Subtitle 4, Annotated Code of Maryland. A business awarded a grower license pursuant to Ch. 598, Acts of 2018, may be awarded a standard dispensary license, if the grower: Submits an application that meets the minimum qualifications for a standard dispensary license, as determined by the Administration; and Including any individual or entity that holds an ownership interest in or control of the grower, does not own or control a dispensary license. Alcoholic Beverages and Cannabis Article, §§36-202, 36-401, 36-404, and 36-505, Annotated Code of Maryland Effective date: Regulations .01—.08 adopted as an emergency provision effective July 1, 2023 (50:14 Md. R. 559); emergency status expired June 30, 2024 Regulations .01—.08 adopted as an emergency provision effective June 7, 2024 (51:14 Md. R. 676) Regulations .01—.08 adopted effective July 22, 2024 (51:14 Md. R. 678) Regulation .05 amended effective April 14, 2025 (52:7 Md. R. 324); March 16, 2026 (53:5 Md. R. 244)